Stocks Investing basic knowledge

Whenever you think of investing it might sometimes sounds scary to you. the intial question
popping out of your mind is how do I invest? where to invest? or who will teach me to
properly handle my investment? what if I lose all my money? this is some of the common
question that a person without any knowledge in investing thinks of.

What is the 'Stock Market'
The stock market is the market in which shares of publicly held companies are issued and traded either through exchanges or over-the-counter markets. Also known as the equity market, the stock market is one of the most vital components of a free-market economy, as it provides companies with access to capital in exchange for giving investors a slice of ownership in the company. The stock market makes it possible to grow small initial sums of money into large ones, and to become wealthy without taking the risk of starting a business or making the sacrifices that often accompany a high-paying career.


Investing is actually is very simple it means that your making your money works for you. Yes you read it right your money works for you! It will maximize your earning potential whether you work or not. when you invest in a big shot company like for example Ayala Corporation you put your money to their company. Then they will use the money they got from all their stock holders (including yours of-course) to build malls or make a product that they will sell. To simply put it whenever that company earns a profit so do you!

Take note that investing in the stock market does not make you rich in a short period of time
think of it this way for example, your money is a seed, you plant it in the ground it will take years to grow to a fully big tree that bears a fruit that's the same as investing.

But there are some methods that you can learn to earn a lot of money in the stock market in a short period of time but it will always comes with a big risk!

Now What are the DO's and DON'Ts in Investing?

 DO's

1. DO a lot of research before you invest when I say a lot what I really mean is a ton of research, why? because without knowledge on the basic DO's and DON'Ts in investing you will end up questioning everything you did and might end up regretting the decision you made, make sure you understand what stocks you buy.
Now what are the basic knowledge that you should know about?
Here are some Stock Market Trading Terms.
 *Averaging Down: This is when an investor buys more of a stock as the price goes down. This makes it so your average purchase price decreases.

*Bear Market: This is trading talk for the stock market being in a down trend, or a period of falling stock prices. This is the opposite of a bull market.

*Bull Market: This is when the stock market as a whole is in a prolonged period of increasing stock prices. Opposite of a bear market.

*Blue Chip Stocks: These are the large, industry leading companies. They offer a stable record of significant dividend payments and have a reputation of sound fiscal management. The expression is thought to have been derived from blue gambling chips, which is the highest denomination of chips used in casinos.

 *Broker: A person who buys or sells an investment for you in exchange for a fee (a commission)

 *Beta: A measurement of the relationship between the price of a stock and the movement of the whole market. If stock XYZ has a beta of 1.5, that means that for every 1 point move in the market, stock XYZ moves 1.5 points and vice versa.

 *Exchange: An exchange is a place in which different investments are traded. The most well-known in the United States are the New York Stock Exchange or in the Philippines just visit the PSE website

 *Dividend: this is a portion of a company’s earnings that is paid to shareholders, or people that own hat company’s stock, on a quarterly or annual basis. Not all company’s do this.

*Day Trading: The practice of buying and selling within the same trading day, before the close of the markets on that day. This is what Tim typically does, although he does have a long-term portfolio as well. Traders that participate in day trading are often called “active traders” or “day traders.”

 *Moving Average: A stock’s average price-per-share during a specific period of time. Some time frames are 50 and 200 day moving averages.
You can search or might learn some term in the stock market when you plunge into this venture and learn it along the way.

2. Attend free Seminars! in today's world almost everything can be done in the internet so does stock market there are a lot of company that offers free seminars and low investment scheme that may fit an average earning person a chance to invest, just search for some credible company in the internet that offers a free seminars. For some that might ask me what is the best broker company here in the Philippines you can send me an email.

3. Diversify your investment. Don't invest to only one company try and do some research and what to buy like they always say don't put all your eggs in one basket. There are a lot of forums/guide that you can find in the internet that might help you or just easily ask your broker on what is best stocks to buy or find someone who can mentor/guide you in the stock market.

4. Always have Emergency funds saving. Make sure you separate the money you invest from your savings. Why? Market investments are for the long-term – money you won't need for at least 10 years, ideally longer. Retirement is a perfect example it's always a must to have a savings account for emergency purposes.

5. Choose your broker wisely, spend time researching about the broker's company you choose to handle your investment check their background and performance before signing up to any form make sure you read all their terms and regulations and always ask the percentage of their commission and other fee's that they charge for their service.

6. Invest for the long term. The inevitable fluctuations of share and bond values, and of the funds that invest in them, matter less and less the longer you hold them, because the ups and downs even out over time.

7. Commitment in investing! Investing regularly is the best way for you to earn more think of it as planting a seed the more you plant a seed in the future you'll have plenty of tree that bears fruit for you to harvest.

DON'Ts

1. Don't be in a rush to invest! learn all the basic knowledge you need before you invest. Remember you'll be investing your hard earned money.

2. Don't invest based on your emotion. some people tend to invest to a certain company where they earned in the past always remember that market goes up and down some company grow and some are not.

3. Don't Panic whenever you see a news that says that the stock market is crashing it's very common thing to happen in the stock market, stocks goes up and down. There are a lot of factors that affects the performance of stock market like your country's economy.

4. Don't be afraid to ask for help from the people that have a lot of experience and knowledge in the stock market.

These are some basic knowledge in investing I hope you learn a little about investing if you have any suggestion or corrections just comment down below.






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