So I’m 18 years old, have no money, no job, but going to my community college and might transfer next year to a four-year, also majoring in Mechanical Engineering. But more to the point, I am really interested in the stock market and trying to learn more about it, ‘because I am definitely going to start investing in the future, but it seems every time I start reading a tutorial in stock picking or something else, there are a WHOLE bunch of new terms that I have no idea what they mean and when I go to check out the meaning, I get a formula and a paragraph on what it means, but as I’m reading 10 other new terms will come up and it never seems to end. I am getting frustrated and I don’t know where to start, it seems like I’m always starting from the middle, not the start, because my knowledge is very limited. And my source of information is Investopedia.com.
Thank You!
Thank You!
Home | Investing | Blog article: Too many in terms in trying to understand/learn about the stock market/investing?
k a 3:00 pm on August 14, 2010
Okay I was in your same exact boat about 15 years ago. Here is what I did and my friends still come to me for financial advice and two company owners praise my financial knowledge.
First off the media and websites don’t cater to you since so few people under 30 or 35 take investing seriously. Secondly, the "financial planners" will just try to sell you life insurance so they can make a commission.
I have read maybe 50 or so books on investing and only one comes to mind as being great for novice investors. It was called "The wealthy barber" and from start to finish an excellent book to learn about investing. You could probably get it at your local library as it’s at least ten years old and very easy to understand. But back to the point here is what I did when I got started….
1) read anything you can get your hands on. I subscribed to Money magazine and it was a great source of learning and understanding finance and investing. It cost about $20 a year. I also got any investing books I saw at the library and struggled through them only understanding about 20% of what I read.
2) The finance channel (what is is MSNBC or something like that). Check it out maybe 20 minutes or so a day, you might not get everything but just watch and learn. They have many interesting stories, articles, and interview that will teach you.
3) I started out investing with a company called T Rowe Price. I learned so much from them I am still amazed. I still remember the first $300 I saved with them…then $1,000…then $5,000…then $25,000…then $50,000….then $100,000. Seriously they were wonderful. You can check their website for investment info on mutual funds, other stocks, or call and their employees are top notch. I started with one mutual fund and now have 22 with them I think. Great company, great people, very helpful.
4) I bought a drip (dividend reinvestment plan) and also opened a brokerage account. Hey this is when I was starting out and it was great to have a finance professional I could call. He makes money buying and selling stocks I tell him I want to buy and I deposit money in a money market account. He was a good broker and just open the yellow pages and find one. I used a local guy and didn’t care if it was $20 to do trades instead of $9 online. For the extra $11 a trade I had someone I could call for input, advice, and learn from so it was well worth it. Do note if you’re not buying or selling he isn’t making money and some brokers suck. Call around and find a guy/girl you click with and open an account with as little as $100 or $200.
I will mention between Money Magazine, doing business with T Rowe Price, and opening a broker account you start to get on some mailing lists with more financial stuff and info.
Hey I was there once and it’s not really easy or there isn’t a single source…just keep reading and asking questions and you will learn a lot eventually. Don’t feel bad you don’t understand everything. I know people in their 40’s who still don’t know what a stock or mutual fund or bond is AND they are company owners, company vice presidents and they make great money!
MVD34 3:00 pm on August 14, 2010
Try this little gem to start:
The Lazy Person’s Guide to Investing: A Book for Procrastinators, the Financially Challenged, and Everyone Who Worries About Dealing with Their Money by Paul B. Farrell
If you like that one, bump it up a notch or two with these:
Your Money and Your Brain by Jason Zweig
A Random Walk Down Wall Street by Burton G. Malkiel **
You Can Be a Stock Market Genius by Joel Greenblatt
The Interpretation of Financial Statements by Benjamin Graham **
Against the Gods: The Remarkable Story of Risk by Peter L. Bernstein
The Black Swan by Nassim Nicholas Taleb **
Innumeracy: Mathematical Illiteracy and Its Consequences by John Allen Paulos **
exactduke 3:00 pm on August 14, 2010
I like investopedia.com, they do a good job of explaining investing terms.
Two great books – Investing for Dummies by Eric Tyson, and Wall Street Words by David L Scott. I have both of these.
zuma 3:00 pm on August 14, 2010
If you don’t have it already, get Mozilla, Firefox, webrowser, then download the Add-on for Dictionaries.
You’ll read on the Web and when a word that you don’t know, or word or words that you’d like to search, you’ll High-lite it and Right Click and then click on Dictionary or Google Search, and in different tab your results will be ready when you choose to read it.