Need a little extra cash? Maybe you’re looking for a little financial windfall in the stock market. But how to do you know what stocks to buy? CEO of MyTrade, Andy Swan sent us a list of suggestions on how to become a stock market stud.
Hi, I’m Nikki Key and you’re watching The Daily Idea.
Everybody likes money, right? I mean, even the sketchiest of characters can become at least semi-interesting with a wad of cash.
But let’s face it, not everyone can win the lottery.
So all of us regular folks looking for a little financial windfall turn to the stock market. But how to do you know what stocks to buy? Well, while our cracked team of researchers spent all week at the Circle K playing scratch-off games, alert viewer Andy Swan sent us a list of suggestions. Today’s Daily Idea is how to become a stock market stud.
Ignore your uncle.
Chances are you have an uncle or other relative who acts like they know everything about everything. Stock tips rarely work out and if you take one from a relative, you’re setting yourself up for additional family stress. And besides, if Uncle Al knew so much about the stock market, he could afford some cologne.
Listen to kids.
While this may sound a bit counter-intuitive, thing about it. Kids aged 12 to 17 are always hip to the latest in technology. If you paid attention when your younger cousin said,
“Check out this new thing they call and i-pod,” and you bought stock in Apple the next day, you sir, would be partying like a rock star.
Paying attention to teenagers would have also paid off if you overheard them talking about some new game system Nintendo was creating called the Wii.
Sure, Apple and Sony were established stocks when those gadgets came out, but the good stocks only get better when the company introduces innovative new products.
And it was teenagers who started the trend that we’re sure will one day end the world: Crocs.
Avoid cheap stocks
Most first-time investors make the same rookie mistakes and one of them is buying cheap stocks. Cheap stocks are cheap for a reason. Most novice investors thought Google was too expensive at one-hundred dollars per share when it first went public. But a $2,000 investment then is worth $14,000 just three years later.
Please tell me you didn’t spend your $2,000 on shares of Furby.
Don’t be afraid of the new highs
When a company reaches a new high in their stock price and they have a strong reputation, chances are the stock is going to continue to rise. These are companies that are doing well. If they are a small company whose stock has climbed rapidly, there’s a good chance someone big will buy them. That means the stock price is likely to go up or you get shares of the larger company and-or money for your stock to boot.
Think of it as trading up.
Take Andy’s tips to heart, research your stocks before you buy and only play within your budget and before you know it, you’ll be a stock market stud.
And that’s another Daily Idea.