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Investing in stocks for beginners

By: Anders Johansen

Investing in stocks is a great way to build a portfolio and earn cash over a period of time, but there are numerous stocks, bonds and mutual funds available, which one do you select and how do you decide? The best way to set off investing in stocks is to do the research. Begin with companies you have faith in and get all of the information on those companies.

Guide to Beginner Investing

The first place to begin is with company research, extract the 10K or the 10Q reports, these are the annual filings that companies do for the Security Exchange Committee. Then find and read the proxy financial statement which tells you about the board of directors, management pay and shareholder proposals. Next the annual report should be read and info on the company going back 5 to ten years. Another matter to check is the income statements, balance sheet and the cash flow statement of the companies you are interested in; this will give you an idea of how the companies stocks have been doing and the well being of the company.

Once the research is done and the investor has contracted down the companies to invest in, its time to get a broker by going online or in person to start your investments. Stocks can be purchased online and most brokerage houses have virtual dealing for novices where you can go online and exercise trading and buying stocks with virtual dollars. This is a crucial way to make mistakes and learn about the process without using real money. Finding a respected brokerage house is done the same way by doing the research and making sure they have your best interest in mine and that there are no invisible fees for servicing.

Stocks

May beginners can start with penny stocks if they don’t want to spend a bunch of cash, many of the penny stocks are under five dollars. This can be a little less profitable but it can be a fun way to start. Once a beginner makes the virtual trading, he or she can begin small and invest in stocks that have been doing well and start to build their portfolio of investments. The best thing for beginners to remember is that you don’t have to start big, practice, go online and buy one or two stocks and watch those. There is a lot of helpful info online for novices so start small and research everything and trading stocks can be paying and fun.

Article Source: http://www.onlinearticlessite.com

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