New to the stock market: Where do I begin?

[disarray]

Re: Where to begin?

what do you want to do? invest your money for a few months / years in a sound company or trade shorter time frames and try and be in/out with quick profit? i found myself that this is a huge field with many different methods, timeframes and applications, any one of which can make you money.

to get involved in the market you need a broker account, and brokers charge fees when you use them - the big banks all have share broking services and you'll pay $20 - $40 per trade. $1000 is really not enough capital to start out because the fees you pay will take up a decent percentage of your money.

if you are serious about getting involved then read a few books (stan weinstein secrets for profiting in bull and bear markets is a good beginners book that will introduce you to the basic concepts) and decide how you want to play the game, all the while saving more money so you can start from a decent position. if you jump into the market with $1000 not knowing what you are doing (especially with the market as it is now) you'll just piss your money up against the wall.

 

[Infest]

Re: Where to begin?

what do you want to do?

Without researching, I would like to have both "quick" and "long term" investments.

 

[Julia]

Re: Where to begin?

Congratulations on having a $30K term deposit and $1000 left over at age 18.

Great that you're taking responsibility for your financial good health. I reckon you'll be able to retire at 40!

For basic understanding of how the stockmarket works go to the ASX website
www.asx.com.au and read through their Education section. That will describe the various approaches and give you an idea of whether you want to be a fundamental investor or take a technical approach.
I agree with Disarray about Stan Weinstein's "Secrets for Profiting in Bull and Bear markets".

Buying lots of books (and several will no doubt be recommended in response to your question) can chew up a chunk of your available money so I'd suggest the ASX website first of all.

Good luck.

 

[Infest]

Re: Where to begin?

I reckon you'll be able to retire at 40!

Haha, I have along way to go before there. But thanks for the vote in confidence. I actually have $3000 left over, but $2000 of that has gone to a friend as he needed it. He should be able to pay me back soon.

 

[im_daniel]

Absolute beginner: Where do I begin?

hi guys Im completely unfamiliar with the sharemarket and stocks, im 16 years old and have saved up around A$2000, i was looking into investing so i thought i would look to this site for some help, only to realise how much i didnt know ie T/A ? F/A ? etc.
Does any1 have suggestions as to sites/books to start my journey into the sharemarkets, and gain knowledge about T/A and stock selection, also who to trade with ie commsec, etrade etc which would be best for a novice trader with around A$2000-A$5000 to invest.

thanks for your help I would really apreciate it

 

[$20shoes]

Re: absolute beginner

hi guys Im completely unfamiliar with the sharemarket and stocks, im 16 years old and have saved up around A$2000, i was looking into investing so i thought i would look to this site for some help, only to realise how much i didnt know ie T/A ? F/A ? etc.
Does any1 have suggestions as to sites/books to start my journey into the sharemarkets, and gain knowledge about T/A and stock selection, also who to trade with ie commsec, etrade etc which would be best for a novice trader with around A$2000-A$5000 to invest.

thanks for your help I would really apreciate it

Welcome to the forum Daniel. There is a lot of information to absorb and there are an almost inifinite number of opinions on how to trade and when ( hence, we have a market, right?) How actively involved you want to be with your investments may determine the best investment method for you.
Most people will tell you that you are substantially undercapitalised, because you cannot spread your risk/adequately protect your capital. They would be right. And then Daniel, how do you plan to protect yourself in a market?? Will you be able to tolerate a 5% loss of your capital?? A 10% loss, a 50% loss??? Are you happy for your equity to decrease by 80% so long as it recovers in 5 years time??

Are you seeking value?? Value is an arbitrary term - is good value investing in a share that moves sideways for 3 years?? Is it value if it moves sideways for 3 years but pays dividends?? Is it good value if your stock moves 15%, but other indices 40%??

When I was a younger tacker, I put all my 21st money into Woolies and it paid off handsomely. But I knew nothing about a trading strategy, risk, probability or PRESERVING YOUR CAPITAL AT ALL COSTS. IT was just a punt that paid off....Years later, after knowing a fair bit more, I lost heavily on BDG...There's nothing like a bit of pain to focus your attention Daniel, and you simply cannot afford to lose your hard earned dollars. Sometimes though, mistakes are the best teachers.

I know a lot of investors are on the sidelines now - money in cash...Nothing wrong with that. Have you looked at managed funds which might be a worthwhile option that you can keep adding in to...??

Stick around here if you have an avid interest...read as much as you can about different strategies...some people will use Fundamental data, others will use charts (Technical Analysis) others will use both.

Don't rush in unprepared. There will always be opportunities. Trying to catch a bottom while your undercapitalised is fraught with danger. If you get burnt now, you may not come back.

 

[Julia]

Re: Absolute beginner: Where do I begin?

Daniel, that's just a great effort to have saved that much at 16. Good for you.

I'd suggest a good place to start would be the ASX website - go to their education section.
www.asx.com.au.
This will explain how the market works and allow you to work your way through the sections which give an outline of how FA (fundamental analysis) and TA (technical analysis) work as tools for selection and timing of buying and selling.

By the time you've done that, there might be a more clear idea of where everything is going. Might be best not to rush in with your hard saved money right now.

All the best.

Julia

 

[So_Cynical]

Re: Absolute beginner: Where do I begin?

As Julia said...the ASX site is a great place to start.

Education & Resources > Education > Online classes > Online classes
http://www.asx.com.au/resources/education/classes/online.htm#getting_started_in_shares

Make an account and get some watchlists going too.

 

[fimmwolf]

Re: Absolute beginner: Where do I begin?

As far as suggestions for books goes, have a look in this thread: https://www.aussiestockforums.com/forums/showthread.php?t=11507&highlight=books

I particularly enjoyed the book by Nicholas Darvas "how I made 2 million in the stock market"
it's a quick read, only 160 pages or so, but well worth your time.

I'm currently reading "The business of share trading" by Leon Wilson. Based on what I've read thus far, I would also recommend it.

 

[Sean K]

Re: Absolute beginner: Where do I begin?

And, once you're sick of reading, there's nothing better than actually making a trade to really begin....

 

[awg]

Re: Absolute beginner: Where do I begin?

Hi Daniel,

searching ASF posts is a good way to start.(free)

your local library has a range of books on the topics (free)

having said that, you would probably want to own at least one or two good texts as reference

dont get sucked in too easily to anything at first,take your time!!.

register on Incredible Charts (free)...mindblowing amount of info.

also "Big Charts"

Search the net for various other blogs and info sites.

by the time u absorb all that u will be 18!

It is not very practical to be a share investor until you are 18, due to various impediments (unless you already have a tfn)..others may disagree

 

[im_daniel]

Re: Absolute beginner: Where do I begin?

hey thanks everyone for your replies,
I guess i have allot to learn when it comes to shares, its time well spent in the end if i end up a succesfull share trader
anywayz does any1 have sugestions for good trade simulators that would be good practice, i cant seem to find ones that are australian and others are usually already started

thanks

 

[prawn_86]

Re: Absolute beginner: Where do I begin?

You can just paper trade, you dont need a specific program.

Just keep a spreadsheet of what price you would buy and sell different stocks at.

 

[im_daniel]

Re: Absolute beginner: Where do I begin?

You can just paper trade, you dont need a specific program.

Just keep a spreadsheet of what price you would buy and sell different stocks at.

yer thanks i could do that , but isnt there an easyier way which simulates actually buying and selling stock ? (without using you own money)

 

[MRC & Co]

Re: Absolute beginner: Where do I begin?

lol, the overwhelming start hey!

You found a good site, plenty of info here, read read read this site and you will get a basic idea about the various types of traders there are out there and the analysis used.

Don't even know where to tell you to begin, except what I said above.

You have to work out what suits your personality (scalping, swing trading, position trading, momentum trading, or longer-term investing), T/A or F/A? And even once you are done with that, you have to work out which methods you wish to use within that. There are different forms of fundamental analysis and technical analysis (Volume spread analysis, elliot wave, breakouts of traditional patterns etc). And then comes the actual important part, how are you going to take that method, apply it, find your own way of using it and realise your edge. Then comes the never ending psychological and discipline issues a trader goes through.

I would recommend once you have read read read, sign up to The Chartist for at least a few months if that is all you can afford, and watch the nightly videos and power set-ups and how they unfold on that site. You will learn a STACK about what works and about application.

Enjoy that journey, long, fun and thoroughly rewarding if it's your true passion.

Cheers

P.S Most of that was probably WAY over your head, but that is natural, just keep your head down and learn (and then the most important part, apply).

 

[im_daniel]

Re: Absolute beginner: Where do I begin?

lol, the overwhelming start hey!

You found a good site, plenty of info here, read read read this site and you will get a basic idea about the various types of traders there are out there and the analysis used.

Don't even know where to tell you to begin, except what I said above.

You have to work out what suits your personality (scalping, swing trading, position trading, momentum trading, or longer-term investing), T/A or F/A? And even once you are done with that, you have to work out which methods you wish to use within that. There are different forms of fundamental analysis and technical analysis (Volume spread analysis, elliot wave, breakouts of traditional patterns etc). And then comes the actual important part, how are you going to take that method, apply it, find your own way of using it and realise your edge. Then comes the never ending psychological and discipline issues a trader goes through.

I would recommend once you have read read read, sign up to The Chartist for at least a few months if that is all you can afford, and watch the nightly videos and power set-ups and how they unfold on that site. You will learn a STACK about what works and about application.

Enjoy that journey, long, fun and thoroughly rewarding if it's your true passion.

Cheers

P.S Most of that was probably WAY over your head, but that is natural, just keep your head down and learn (and then the most important part, apply).

thanks for your advice i have already started on the "read read read" part

 

[kam75]

Re: Absolute beginner: Where do I begin?

thanks for your advice i have already started on the "read read read" part

Books to study:

1. Reminiscences of a Stock Operator - Edwin le Fevre
2. How I made 2 million in the Stockmarket - Nicolas Darvas
3. Secrets for Profiting in Bull & Bear Markets - Stan Weinstein

Read and study the above books and try to save up more funds before you play the market. 2k is simply not enough, regardless of the type of trading you'll choose to do. At least 10k is needed in my opinion to set up your risk and money management rules. Oh and stay away from all spruikers and seminar sellers flogging off courses!!! They all suck.
All the best.

 

[prawn_86]

Re: Absolute beginner: Where do I begin?

Read and study the above books and try to save up more funds before you play the market. 2k is simply not enough, regardless of the type of trading you'll choose to do. At least 10k is needed in my opinion to set up your risk and money management rules. Oh and stay away from all spruikers and seminar sellers flogging off courses!!! They all suck.
All the best.

2k is fine if you just want to buy 1 or 2 stocks for a long term hold. A lot will get eaten up in purchase costs, but providing your not 'trading' then its enough to start with. Have to start somewhere...

 

[beamstas]

Re: Absolute beginner: Where do I begin?

Hey daniel.

Im 19, so still sort of young, here is my advice.
I read alot and found some things to buy, i too started with 2k. Find something that suits you. Do you want to hold for a long time or buy and sell alot? Are you prepared to wait for returns? Do you want capital growth or dividends?

The thing that made me learn the most is just jumping in the deep end

But don't be afraid to loose or more though at the current situation. By the time your 18 the bear may be gone and you can learn on a bull!

And prepare yourself for alot of this if you jump in right now

The best experience and lessons learned are often the most expensive.. so be careful

2k is fine if you just want to buy 1 or 2 stocks for a long term hold. A lot will get eaten up in purchase costs, but providing your not 'trading' then its enough to start with. Have to start somewhere...

Very True. The brokerage on commsec is 20.00, so you are basically loosing 1% of your capital every time you trade. 5 buys and 5 sells and you are saying goodbye to 10% of your capital in brokerage alone.

 

[Medici]

Green Beginner

Hi every one.
recently i have inherited some money and have to admit that looking at them sitting in bank account is like watching the grass grow.
I would love to invest (trading) in shares, but i have to say i am at the same question you all have at the beginning.
Where do i start ?
I did have webinar with elite traders, but the starting cost (over $4500) is pretty much to high. They do have learning curve of 21 days to get you trading and SMS alert advice on margin stock.
Is there any book (first steps) any one could recommend for a beginner ?

Appreciate your help.

Regards

Medici