Want to get started investing in the stock market, but aren't sure how to do so?
What are stocks?
What determines their market prices?
Why do they go up and down?
How can I beat the stock market?
What are mutual funds?
What are index funds?
What are Exchanged Traded Funds?
Even though the stock market is the heart of a country's wealth, and even though it enables everybody to be a part owner in the largest, most successful countries in the world, it's not taught in public schools.
But be warned: the mainstream press often misrepresents the stock market. They focus on making the news exciting and dramatic to sell copies.
Frankly, the best investing is boring investing. It's putting as much money as you can afford into many companies, and reinvesting dividends. And continuing to do so until you reach retirement age.
The best investing is not about trying to figure out what's going to happen in the economy or the markets tomorrow, next week, next month or next year.
Many financial writers try to make you think you have to work hard at investing. You must study stock charts every night. Read annual reports. Thoroughly analyze a company's financial statements. Read THE WALL STREET JOURNAL, BARRON'S, and MONEY MAGAZINE. Buy special software. Hang out in online investing forums.
Not so!
Don't waste your time. This book takes modern financial theory to its logical conclusion. You can get the maximum long term benefit by following its simple plan. No tedious math or economics theory needed.
It's simple to set up. Then you forget about it. Pay no attention to the financial news. Just focus on making the most money you can in your career or business, that's all.
And if you're starting small, we've got you covered too.
You'll learn the various kinds of stocks and the various ways to invest in them, including tax-deferred retirement accounts such as an IRA.
This work is shorter than Stock Investing for Dummies.
Warning: the investment world is full of people who think your money belongs to them.
From out and out scammer brokers, financial advisors, newsletter editors, and to the managers of actively traded mutual funds, if you're not careful you'll help everybody get rich except yourself.
Uncle Sam also wants your money, so this includes a chapter on the tax consequences of investing -- and how to minimize them.
Genre: BUSINESS & ECONOMICS / Personal Finance / InvestingAs well as a Kindle edition, it has a paper CreateSpace edition, and an Audible version is in the works.
What is Stock?
A share of stock is a unit of ownership of a corporation.
This may seem a little odd or too simple, but at root that's all it is.
Example:
As of February 2011, Microsoft had about 8.4 billion shares outstanding.
Bill Gates owns about 591 million shares, making him a 7% owner.
He is the largest single owner. I'm sure other important Microsoft executives also own big chunks. The rest is owned by the general public -- that's you and me.
If you buy 100 shares of Microsoft stock, you are a 100/8,400,000,000th (or 1/84,000,000th) owner of one of the largest companies on Earth.
You're not going to catch up with Gates, at least not with Microsoft stock :)
You may not feel like much of an "owner" of thee company because you have no practical control over what Microsoft does (you don't even qualify for a discount on Microsoft Office), but legally that's exactly what you are, and it has some potentially important legal and financial implications for you.
This Book is About Common Stock
Shares of stock ownership in a company are known as "common" stock, and that's the subject of this book.
There is such a thing as "preferred" stock, but it's different, and not the subject of this book.
Whenever you hear people bragging about selling stock for a profit, or the New York Stock Exchange, or their stockbroker, or the Dow Jones Industrial Average, they're referring to common stock.
Common Stock Ownership Means:
1. You become a part owner in the company, in proportion to how many shares you own.
2. If the company's Board of Directors declares a payment of dividends, you will receive the same per-share payment as every other common stock owner.
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French
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German
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Italian
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Portuguese
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