What a new investor needs to know - GovtVacancy.Net

What a new investor needs to know - GovtVacancy.Net
Posted on 24-10-2022

What a new investor needs to know

In the stock market, you can make millions and lose millions. We find out how much money you need to start investing, how to choose a broker, and if there is a guaranteed way to get rich trading in the stock market.

Why invest? Is it right for me?

Let's say you have a deposit in a bank, but you are not satisfied with the interest, it is too low and you want to earn more. But you need to understand: the greater the chance of winning, the greater the probability of losing all the money. If you know the risks and have free funds, it may be worthwhile to learn how to invest in securities that are traded on the stock exchange.

° The easiest way for a beginner is to buy securities and, after a certain time, sell at a higher price, and thus earn. The main thing to remember is that winnings are not blind luck, like in a casino, but the result of well-thought-out actions. It is not a game, but a job.

It is not worth investing the last money if you do not have savings and a bank deposit. If a bank fails, the state will return the money to depositors - within 1.4 million euros. There is no such insurance on the exchange, you can lose everything. In addition, the fall in the value of securities occurs much more frequently than bank failures.

I want to try it. Where to start?

The modern exchange is electronic, you can trade over the Internet without getting up from the couch. But this requires an intermediary: a company that has a license to trade on the stock exchange. Before looking for it, it is worth determining for yourself a few important things.

Calculate how much you are willing to invest

It is worth starting to invest if you are willing to risk several tens of thousands of euros. It is better to imagine a situation where you will lose your money in advance. If you understand that this is not a disaster for your budget, you can give it a try.

Consider how much time you are willing to spend

If you are ready to educate yourself, immerse yourself in the topic, study statistics and stock reports in the morning, follow the charts during the day, you can try trading on your own

If you do not intend to spend a lot of time and effort on investing, then it is better to consider one of the forms of trust management. In such a system, you make a minimum of decisions, entrusting the investment of your money to professionals.

Choose strategy and assets

Decide what you are going to invest in. Stick to a certain strategy.

What is a strategy?

A strategy is a set of investment parameters that determine your behavioral style on the stock market: what assets you trade, how often you sell, and what guides you when making decisions (for example, do you see news that affects the market ).

The simplest version of the strategy: you choose:

° Assets

° The period in which you want to invest

° Maximum loss

Let's say the assets are shares of pharmaceutical and chemical companies, the period is 1 year, the amount of losses is 20%. In this case, you immediately sell the assets if they are down 20% in price, even if the year has not yet passed.

If you have chosen trust management, you must also decide on a strategy. Only in this case, you will choose from the offers that are already on the market or discuss an individual strategy with your manager.

Thank You