Tag: Investing In Stocks (Page 1 of 4)

How to Invest In The Stock Market For Beginners

There comes a point when you realize that in order to build wealth it will require you to build multiple streams of income.

The average millionaire has seven.

The stock market is one way you can invest your earned income in order to start earning passive income and multiply your money.

Here’s how to invest in the stock market step by step for beginners.

franknez.com

Welcome to Franknez.com – the blog where you can digest content on personal finance, entrepreneurship, market news, and trending investing topics.

Lets get started!

I’ve been investing in the stock market since 2019.

When I learned how to open a brokerage account and buy company stock, I knew I had to show people how to do it too.

Everything I found online was outdated so I wanted to make it easy for people to start.

Benefits of investing in the stock market

One of the greatest benefits of investing in the stock market is that you get to hedge against inflation.

Inflation is at an all-time high right now and simply letting your money lose its value isn’t going to create wealth.

The stock market also provides an average return of 7%-8% annually which means those CDs and high yielding savings accounts are a thing of the past.

Even so, you can always create a portfolio bringing in 20%+ annual returns!

In June of 2021, AMC shareholders saw a whopping 3000% return on their investment at its high.

GameStop shareholders saw about half!

Although these trades are much different anomalies then traditional long-term investing, it paints a picture of the power of the market.

Let’s get you started!

#1. Set a Budget When Planning to Invest

set a budget when investing

Before you begin to invest you will need to set a budget on your first investment(s).

The great thing about the stock market is that you can invest with as little as $50 or so depending on the cost of a share.

A share is a fraction of a company you can own and earn money from as the company grows and profits over a period of time.

Example

If you set a budget of $200 and the share of a company you want to invest in costs $50 then you can purchase (4) four shares of said company.

If a month later the shares you purchased are worth $60 each then your shares would now be worth $240, resulting in a $40 gain.

This is how investing in the stock market works.

Note: I highly recommend having your emergency fund built prior to proceeding with investing in the stock market.

It is important to highlight that the money you invest in the stock market will need to be money you can tolerate losing.

The stock market is volatile meaning the value of your assets is constantly going up and down.

Something to keep in mind is that the value of your investments can go down just as fast if not faster than they went up.

Now, this is not addressed to scare you. The stock on average has an annual return of 6-8% per year.

Why should you invest in stocks?

Investing in stocks is a great way to diversify your portfolio.

You don’t want to keep all your eggs in one basket.

For this reason, the wealthy invest in companies they believe have long-term potential to thrive and to multiply their investment.

#2. Know What to Invest In

Now that you’ve set a budget you’ll need to know what you want to invest in.

Once you do, find the stock market symbol of the company on Google search engine.

If you wanted to invest in Coca-Cola for example, you’d search ‘stock market symbol for Coca-Cola’ on Google.

You’ll see that the NYSE (New York Stock Exchange) symbol for Coca-Cola is KO.

This is how you will identify and search for companies to invest in when you’re in the market to buy stocks.

Here are some different type of investments you can invest in within the NYSE.

Stocks

A stock is a share of a company just like Coca-Cola.

Buying a share from one specific company is a stock.

Stocks are good to purchase if you strongly believe in the continued success of your choice of company.

Invest in companies that have room to grow and are constantly innovating.

Stocks I personally favor are Tesla, Apple, and Amazon.

These tech companies are always innovating therefore I have strong conviction towards their continued growth and success.

Index Funds

An index fund is a fund that tracks and follows the index (growth) of a group of companies.

When you own a share of an index fund, you own a percentage of a pool of companies oppose to just one company.

What makes an index fund great is that if a company within an index fund isn’t performing very well there are other companies that may balance the overall performance of the fund resulting in a fair return.

A popular choice is the S&P500.

This index fund tracks the performance of the top 500 companies in the United States.

This type of investment tends to be a less risky and yield great profits over the long run.

It’s an investors favorite and I personally hold shares in the S&P500.

Bookmark: Retire a millionaire with the S&P500: is it possible?

REITS

A REIT (Real Estate Investment Trust Fund) is very similar to an index fund.

The only exception is that it invests exclusively in real estate companies oppose to other businesses.

If you want to invest in real estate without the hassle of learning the game, using cash up front, or getting into debt, REITs are a great way to diversify your portfolio into the real estate sector.

A great REIT I’m invested in is VNQ with Vanguard.

Which investment is right for you?

Each of these investments has their own benefits.

My suggestion is to research them individually as all of our needs are very unique.

As your skills develop as a retail investor, you’ll find yourself having a diversified portfolio consisting of all three.

Invest in the stock market and learn to identify which investment is best for you.

Price is what you pay. Value is what you get.

Warren buffett

#3. Choose a Brokerage Firm to Begin Investing in The Stock Market

This is the fun part.

Choose a reputable online brokerage firm.

A brokerage firm is a platform where you will be doing all of your investing through the NYSE.

Here you’ll be able to purchase stocks and sell them.

Each brokerage firm has their own customer advantages but are very similar to use.

Here is a list of brokerage firms you can open an account with and sign up for free.

Check out each brokerage firm’s website and see which feels more comfortable for you to navigate.

Do some research on each of them to see which has the strongest potential for your needs. I personally use Vanguard.

Vanguard investment - brokerage for investing
How to invest in the stock market for beginners

Note: When you purchase investments, there are small commission fees your investments will pay out to the firm.

They are very small in most cases and don’t hinder your earnings like you’d think. Vanguard has the lowest fees.

Each brokerage firm will have different commission fees and the percentage will vary in each firm.

For example: Coke (KO) will have a slightly different commission fee in every firm despite having the same share cost.

#4. Open your account

For this step-by-step on how to invest in the stock market I’m going to use Vanguard.

Vanguard is one of the most reliable brokerage accounts you can use.

how to invest with Vanguard
Franknez.com
How to invest in stocks for beginners

Head over to Vanguard and select ‘Open an account’.

how to open an account with vanguard
How to invest in stocks with Vanguard

Select ‘Start your new account’ to get started.

Vanguard Account

Choose the method you will be funding your new account. You can choose between:

  • Electronic bank transfer or another Vanguard account
  • Rollover from an employer plan (e.g., 401(k) plan)
  • Transfer investments from another financial firm

Most new retail investors will be choosing the first option, using an electronic bank transfer to fund your account.

Before you open your account to begin investing in the stock market you’ll need your bank account and routing number as well as other personal information.

Once you’re in it’s time to transfer funds into your account.

#5. Transfer Funds into Your Brokerage Account

Congratulations! Now that you’ve chosen a brokerage account to invest with, you’ll have the tools at your disposal to begin investing.

Navigate throughout your brokerage website. Get comfortable with where things are.

Things might seem very new at first, intimidating even.

Don’t worry, now that you’ve begun something new, you’ll begin to take the first steps toward self-education.

First, you’ll want to learn how to transfer funds into your brokerage account.

I will be demonstrating step by step how to do this using Vanguard.

Toggle the settings to connect your bank account with your brokerage account so you can start to invest in the stock market.

This direct line will allow you to transfer funds into your account so you may begin to purchase shares.

Once you have this set up you may transfer the money from your budget to invest in.

#6. Make Your Very First Investment in The Stock Market

Now that you’ve transferred your funds over to your brokerage account, navigate through the site to make your very first purchase.

Search the symbol of the stock, index, or REIT you will be investing in.

Note: Before purchasing, make sure you thoroughly navigate the website to get comfortable using it.

This will make the purchase experience a lot easier.

Once you pull up the investment, go through the details provided on the page.

You should be able to see its history, it’s projected return, its risk level, and so much more information about the investment.

Invest Vanguard

Purchase the investment!

Purchase the investment with the option set to ‘Market’.

This option will allow you to purchase the investment instantly at the price it’s worth.

We suggest doing a test purchase since this is your first time investing in the stock market.

This will help you get a feel for it. Purchase one share so you understand the process.

It will serve as good practice and experience.

Congrats on buying your first share!

Follow up on your investment the following day and see whether your investment had gains or losses.

You’ll see for the very first time how your investment grew in value or decreased in value.

You now have a taste of what it’s like to invest in the stock market.

Bookmark: My top picks of stocks to invest in right now

Final thoughts

franknez.com

I have personally invested in stocks since 2019 and have learned a lot about the stock market.

In fact, I’m still learning today.

I published an article on the best tips and advice for beginners investing in stocks to further help you on your journey.

Stock investing is all about strategy.

When you make money in the stock market you may let it sit and accumulate over time, or you may cash in your profits and allocate those gains towards other opportunities.

This is why I believe investing in stocks is extremely important to someone who wants to build wealth.

The stock market allows you to multiply your hard-earned money so you may further invest it in other assets.

If you received value from this post please be sure to share it with someone who’s working towards becoming financially independent and who is also building their financial future.

My mission is to help people all around the world attain financial stability in order to live their best lives possible.

Here’s how you make money trading the S&P 500.

Need a financial advisor? Click here.

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How to Build Your Investment Portfolio as a Beginner

how to build your investment portfolio as a beginner
Educational: How to build your stock investment portfolio as a beginner.

If you want to succeed in the business world, you’re going to need a good portfolio.

With 2023 finally in full effect, now’s the perfect time to get started.

Granted, this is easier said than done as the investment world isn’t for the faint of heart.

Beginners often find themselves stumped on how to go about things. When starting out, you need to be certain about what you want to do as an investor.

In this article, we’ll be going over how you can build your investment portfolio as a beginner.

Look for Something That’s Low Risk

It cannot be recommended enough; every investor needs to start off with something east and low risk.

Risk is an investment term used to describe the potential issues that could arise while partaking in said investment.

We need to make one thing clear: there’s no such thing as a risk-free investment.

Even the safest of investments have their own risks. Below is a quick list of some of the more low-risk investments for beginners:

  • High-yield savings accounts
  • Treasury bonds
  • Corporate bonds
  • Dividend stocks
  • Certificates of deposit

One type of investment that’s seen a massive influx of popularity is real estate. Real estate has been proven by many professionals to be one of the safest investments to date.

So much so, it’s often chosen over the stock market. Real estate is a welcome addition to any investment portfolio for a variety of reasons.

Those who go with real estate can expect a predictable cash flow and an amazing ROI.

Furthermore, you can see a large profit without having to devote most of your time and money to it.

This is known as fractional real estate investment. Regardless of what you choose to start with, make sure to do thorough research on it.

You need to be sure that it’s the right investment for you. Otherwise, you could feel like you’re wasting your resources.

Beware of Volatility

stock investment portfolio
Educational: How to build a stock investment portfolio.

Volatility is another term used in the investment world and is used to describe how likely an investment is to change or spike in price.

One of the worst things that can happen to a new investor is having their hard work deconstructed by a price gouge.

You need to identify your risk tolerance right from the start. A key example of volatility would be the stock market.

The stock market is a good start for all investors, but at times, it can be very difficult to maintain your ground.

The stock market works like this: you pick a company that offers shares. These shares are basically small sections of the company that you own upon purchasing.

Some shares are more expensive than others, which is why beginners should always buy one or two to get a better understanding of how they work.

But making the initial sale isn’t the issue; it’s trying your best to keep it. The stock market can be very unforgiving at times because of the rates.

If the rates increase too much, it can be difficult to pay for it and even resell it. In fact, there’s a variation of buying and selling stocks known as day trading.

Be Patient

A key trait that every successful investor should have is patience.

Because of how common investing has become over the years, you’d be amazed at how many people rush into it without much forethought.

However, therefore almost every one of them failed.

Rushing into an investment, regardless of how safe it is, is a big mistake.

You need to be patient and protect yourself from online scams, and take your time, this applies to every aspect of investing.

If you don’t know what you’re getting into, it’s very common for something to go wrong.

Just remember to do your research, gauge the pros and cons, and invest what you can afford.

Related: How to Invest in The Stock Market for Beginners

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How to Read Stonk-O-Tracker For Beginners

how to read stonk-o-tracker for beginners

I want to guide new retail investors in every way I can. I’ve received questions regarding what the information on Stonk-O-Tracker means.

I’m going to break down what all the data is presenting.

franknez.com

Welcome to Franknez.com – the blog where you can digest content on personal finance, side hustle ideas, entrepreneurship, and trending investing topics.

Lets get started!

Stonk-O-Tracker AMC

Stonk o'Tracker AMC

The information at the very beginning of Stonk-O-Tracker is pretty self-explanatory starting out with NYSE.

This is the price closed from the New York Stock Exchange.

This is the stock’s price.

SSR stands for short sale restriction.

The SSR prevents from short sellers from continuously shorting a stock.

The SSR shows the price in which this regulation was triggered.

When SSR triggers it’s usually due to an insane amount of shorting driving the share price of a stock down.

The SSR protects retail investors and activates once a stocks share price falls below 10% from the previous trading day.

FRA is the Frankfurt Stock Exchange.

The FRA is German’s largest stock exchange.

The price here is translated in euro.

Related: Are Institutions Preparing to Close Short Positions in AMC?

Stonk-O-Tracker Calls ITM & Shares Available to Borrow

calls ITM & Shares available to borrow AMC
Stonk o’tracker

What are call options in stocks?

People in on AMC stock either buy the stock or buy call options. Call options are contracts that you can bet on to execute by a specific date.

What makes these contracts attractive is that premiums are cheaper to purchase as they’re usually sold in ‘bundles’.

Investors who buy call options are usually speculating the price of a stock will be significantly higher in the future.

Calls ITM expiring: This is the number of calls expiring on the specific date detailed.

If an investor placed a strike price of $49 dollars by the end of Friday and Friday’s price action is $55 then that call option expires in the money, otherwise known as ITM.

Calls ITM expiring on Stonk-O-Tracker is the number of these contracts expiring on the date detailed.

Calls ITM: Calls ITM refers to the number of call options expiring at a specific dollar amount.

In the reference above it details 21,823 calls are expiring in the money at $50.

Borrowed Shares Available

Borrowed shares available stonk-o-tracker
Borrowed shares available Stonk-O-Tracker – Stonk o’tracker AMC

The borrowed shares refer to the number of shares short sellers have available to short a stock.

This number decreases when a stock is being shorted, or the price is being driven down.

Short sellers can continue to borrow more shares even after they’ve used some or all. However, this comes at a price.

Shorts must pay the fee detailed in the chart.

ETF available Stonk-O-Tracker

An ETF is known as an exchange trade fund. Like an index fund, these types of stocks pool a variety of stock in a bundle.

AMC Entertainment stock is pooled a few ETFs that short sellers can also short.

The ETF available is the number of ETFs hedgies can short.

Related: Will This Market Meltdown Trigger AMC to Squeeze?

Option data: Calls vs puts

what does option data mean on stonk-o-tracker
Stonk-O-Tracker Option Data: Calls vs puts – stonk o’tracker AMC –

The option data chart shows a stocks call vs puts. I went over what calls were above.

Puts are the exact opposite. Puts bet on the stock going down instead of up. When puts are executed, the stock is further laddered down.

This chart shows you how many options are in the money and out of the money.

Out of the money are simply contracts made that have yet to be anywhere near the current price range of a stock.

Trading data Stonk-O-Tracker

AMC dark pools
Trading data – AMC dark pools – AMC stonk o tracker – stonk o’ tracker AMC

The short percentage in the trading data is simply the percentage of the volume that is being shorted.

The dark pool percentage shows the percentage of trading that’s done behind closed doors.

This unknown platform is known as dark pools.

This is where short sellers can get away with additional shorting tactics.

The SEC must look into this as it’s a manipulative way to further short a stock. In this case, AMC and other meme stocks.

Fails-to-Deliver

Fail to deliver AMC stock
Fails to deliver AMC – AMC stonk o tracker – stonk o’tracker AMC –

Fails-to-deliver are contracts that did not execute in the pocket.

These are reported by the SEC (securities exchange commission) and are updated once they release that information.

This chart details how many contracts failed to execute and at what closing price they failed.

The SSR trigger info at the very bottom of Stonk-O-Tracker simply reveals the close price at which it stopped going into effect as well as the price SSR was triggered.

Read: Here’s why people are buying AMC stock: Investors guide

Community

If you found this article to be of value, be sure to share it with the community.

I feel it’s extremely important for us to share information and knowledge with new retail investors buying AMC stock and other short squeeze plays.

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Stocks Are Trading Sideways: Is Now Time to Buy?

Market News: Stocks are trading sideways, should you buy?
Market News: Stocks are trading sideways, should you buy?

Stocks are trading sideways, indicating there is indecision in the market.

Despite its macro downtrend this year, the S&P 500 (SPY stock) is retesting its $400 levels after coming down significantly to $350.

As the market sees some bounce, we’re also experiencing major barcoding, or sideways trading.

Market makers are capitalizing on supply and demand zones along with support and resistance levels.

And while day traders are also capitalizing on these swings, it’s retail investors who are stuck in the middle.

Is now the time to buy stocks?

Let’s discuss it below.

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Will SPY Break Through?

Spy Stock Chart - Franknez.com.
SPY Stock Chart – Franknez.com.

The SPY is currently in a downtrend channel.

Breaking above the $400 level could mean a strong breakout for the market.

Rejection on the channel’s trendline will result in further market decline where SPY may touch $330.

Buying the market now will play a big role in the momentum needed to break the market’s downtrend.

Our weekly MACD shows us buyers are coming in while our TTM indicator shows us decaying selling momentum, for now.

Spy Stock Technical Analysis - Franknez.com.
Spy Stock Technical Analysis – Franknez.com.

Market makers and big whales still have the final say of course.

A break above the downtrend signals a great buying opportunity.

Rejection at $400 levels will signify more downtrend for the market lies ahead.

At this point, retail investors may hold off from buying until price hit the next support trendline.

Related: How to Invest in the Stock Market for Beginners

Is There Another Stock You’d Like Technical Analysis On?

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Leave a comment below if there’s another stock you’d like me to cover technical analysis on.

Related: How Soon Will AMC Break the Next Level of Resistance?

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