Wouldn’t it be nice to go somewhere online and just get the greatest stock investing tips ever? And know you could trust them too? As you may have realized, it is not that easy at all. Reliable and trustworthy investment advices have never been easy to find, especially in today’s Internet world with thousands of web sites asserting they have the best guides available. In addition, you may have the disadvantage of being a beginner at stock investing. But hey, why not turn it the other way round. Does it need to be a disadvantage to be a newbie at investing? Does it need to be harder for you as a beginner than the experienced one? Not at all. Actually, you can make your non-experience into an advantage instead. But first let’s go quickly through a couple of important things.
Being a beginner (or an amateur) at investing in the stock market you face different issues you need to deal with:
- First of all, which markets and products to invest in (what countries, stocks or commodities, individual stocks or funds, stocks or ETF’s or options)? As a long term value investor my advice is to invest preferrably in individual stocks. This requires that you stay focused and that you want to dedicate some time taking care of your investments.
- Secondly, which companies to invest in?
- How many different companies/stocks to buy at the same time? Is it really necessary to diversify and have a portfolio?
- For how long is it beneficial to keep a stock?
- And when to sell it?
I have discussed several of the issues above earlier here: When you choose to buy a Stock what is your Game Plan? And in detail here: The Stock Bargain Method
It might seem challenging and overwhelming when you face the markets in the start, but there sure are some great advantages by being a beginner on the stock markets. Let me mention some of the most important ones. Compared to an experienced investor, you probably have the big advantage of investing only small amounts in the beginning. You might also have only one, two or three stocks to monitor too, compared to an investor who has to monitor a much larger portfolio of stocks, with a lot more money involved also. In other words, you don’t need to use as much time on it as the experienced one, and more importantly, if you should fail, no big deal! The small amount you eventually lose is money you can afford, and you have no big investment capital yet to make failures with. And there is great learning in making some mistakes in the start too, it’s not a big crisis. It is definitely better to make your mistakes in the beginning with small amounts than later when you have bigger amounts to take care of. And in addition:
- As a beginner, you can walk the path step by step. You have the advantage of taking only small steps in the start, meaning you can test it out, how things work, learning and trying. Remember, small mistakes in the beginning is no big deal, it’s a great way to make some precious experiences instead!
- You can learn from others failures and mistakes to prevent making the same mistakes as they did.
- You can learn from others success stories, taking advantage of their experience and investment approach.
- It is great fun! Try it out, make a buy or two, and learn the secrets of patience. Lean back, and allow the market to develop your investment into (most likely) a winner. Have fun making some new experiences while learning and developing your investment skills.
- You definitely have the advantage of not carrying any former luggage of negative experiences or bad habits. You are not stuck in “old fashion” stocks or earlier price levels in specific companies that might influence you.
- You have every stock investing tool available to help you and to guide you, which means that you have lots of opportunities to “breed” on and to succeed from.
My purpose with Stock Bargains is that it might be one of the top value investing blogs on the Internet. I would be more than happy to get your feed-back or help you with a related issue. Please don’t hesitate to write me a question or a comment to this article.