I’m no professional when it comes to trading, but I do love talking about the art of investing. I became motivated to re-amp my trading portfolio after reading a well known book called Trading For A Living. I’d highly recommended this read to anyone interested in becoming more financially literate.
Stock trading is a bit of a gamble, but it’s not quite the stigma that many people set it out to be. Yes, it’s difficult to catch trends and sell at a decline, however, it’s far from actual gambling. Trading For A Living emphasizes this point quite nicely.
The concept of investing is quite simple: you buy into companies that are growing at a low price, then sell your shares of that company at a high price to make profit off of the margin. There are many variables that can alter a company’s portfolio, such as new product releases, lawsuits, and even government affairs.
Professional traders monitor the market as well as relational politics to see possible dips and spikes. These can help indicate when stocks should be purchase, held, or sold. This takes quite a bit of time and experience which is why brokers fill most of their time with analysis rather than making actual purchases.
I personally started investing a couple years ago. I had no knowledge of what I was actually doing but I put my money into companies that I knew would grow. These companies include Apple, Alibaba, and Microsoft which turned out to be great investments. I took the long term approach where I left my assets in the companies for the entirety of the past 2 years.
I look at investing as a passive income source that doesn’t require much of my attention. If done correctly, your money can make money for you! If you want a safe investment route, there are mutual funds which are managed by stock brokers. Mutual funds are almost guaranteed to increase over time, but they grow slowly and come with a commission payment.
I’d love to expand on the import concepts of stock trading in a future post, but for now, here is a quick introduction into the beautiful world of Wall Street.