Can someone help me with the Stock Market?

[goofyjumper 0]

My Dad, who is very internet challenged (does not even have a computer) asked me to try and get him into the internet trading market.

I am fucking clueless, but of course want to help him out.

My question is:
How much should he invest?
Is it better to have a broker, or do this all over the internet?
Is it better to do this stuff over the internet?

HELP!

-----------------
I love and Miss you so much Honey!
Orfun #3 ~ Darla

[anthonyfellows 0]

There is absolutely no reason for a person who is not a professional to be investing in individual stocks.

Give Vanguard a call. My suggestion would be to spread the investments out over several mutual funds using the cost dollar averaging method. Don't dump all of your money in at once. Figure out the amount you want to put in on a monthly basis and continue contributing to it.

Serious relationships turn into work after a few weeks and I already got a fucking job :)
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
H.A.F. = Hard As Fuck ... Goddamn Amateurs

[wmw999 2,136]

Quote

There is absolutely no reason for a person who is not a professional to be investing in individual stocks.

My father did it for years. It was his hobby. He researched, got a Yahoo Finance setup and tailored it so that he could monitor what his stocks were doing, and as his vision got worse and worse, took to calling the stockbroker or his secretary for updates. It kept him in touch with another piece of the world. And this was beginning in his late 70's. He only quit when a head injury deteriorated his health to where he didn't care any more.

It cost him money, but a lot less than I spend skydiving.

Wendy W.

There is nothing more dangerous than breaking a basic safety rule and getting away with it. It removes fear of the consequences and builds false confidence. (tbrown)

[Misternatural 0]

hi

I have been a long time on line investor I'll start out by saying that it is a very high risk game. I used the word game because stock prices are based on large group psychology and so it is very difficult to predict.

$ Amount; my view don't play with any more money than you are willing to loose because unless you follow the market closely in real time or set what are called stops which trade for you automatically you can miss big moves and not sell in time.

Broker or self; broker will charge a fee, they may give you advice but it is not necessarily good. I think you are better managing the game yourself.

Online brokers; I like E trade but there are many, Ameritrade,Scottrade, Marsco....most have the word trade in it.


Most traders suggest starting out with an index fund then work toward individual stocks but whatever you do prepared to be immersed in it as a life long education- there's a lot to learn but in my view it is the most challenging and exciting game there is...that's why I play.

The word on the street right now; invest in large companies with low debt,and a dividend between 3 and 6 percent. so called recession defensive stocks ;if you can smoke it, eat it, clean with it,medicate yourself,or drink it.Those are recession proof companies
Most important- understand what the company does.

cheers.

Beware of the collateralizing and monetization of your desires.
D S #3.1415

[anthonyfellows 0]

Quote

Quote

There is absolutely no reason for a person who is not a professional to be investing in individual stocks.

My father did it for years. It was his hobby. He researched, got a Yahoo Finance setup and tailored it so that he could monitor what his stocks were doing, and as his vision got worse and worse, took to calling the stockbroker or his secretary for updates. It kept him in touch with another piece of the world. And this was beginning in his late 70's. He only quit when a head injury deteriorated his health to where he didn't care any more.

It cost him money, but a lot less than I spend skydiving.

Wendy W.

Are we talking about a hobby or a serious investment? If the guy can afford to lose every penny he puts in and just wants something to fill up his free time, that is one thing ... But if you're talking about investing for the future, I personally would not be putting my money in individual stocks.

Serious relationships turn into work after a few weeks and I already got a fucking job :)
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
H.A.F. = Hard As Fuck ... Goddamn Amateurs

[BIGUN 1,065]

You may want to provide a little information on the pros and cons of "margin/call."
2002 was a very bad year for margin call.

Nobody has time to listen; because they're desperately chasing the need of being heard.

[Remster 24]

Quote

I am fucking clueless, but of course want to help him out.

Well, at least you are asking for help... Too bad you're asking a bunch of skydivers! If neither you or your father know much about investing, you should ask for help from people around you who can help you more. There is no one size fits all investment strategy, and anyone who gives you specific advice should know your situation well.

Quote

My question is:
How much should he invest?

That depends what your father is expecting from this money. Is it a long term investment, will he need money in the short term, how is his risk tolerance, etc.... The older we get, the more risk adverse we become since our time horizon on using those funds gets shorter.

There are roughly 3 investment vehicules you have at your disposition:
1- Risk free investment (aka money market)
2- Bonds
3- Stocks

The 1st thing you need to decide is how much of your money you want to invest in risky investments (bonds and stocks). This is pretty much driven by how risk adverse you are. It could be 100%, it could be 0%, it could be anywhere in between.

Then you need to figure out your split between stocks and bonds. Again, your risk aversion and time line will drive that.

Once your are there, for most investors, the hard job is actually done. Without going into the details behind why, a portfolio consisting of all the shares available to you is the portfolio that has the better risk/reward ratio. So in theory, a low or no fee SP500 or the Russell 3000 tracker fund, or a SPIDER are one of the better investment you can make. In practice, you'll see stocks really outperform the overall market and make you feel you are missing out. So you shouldnt use this approach if you expect to soar above the market.

Quote

Is it better to have a broker, or do this all over the internet?
Is it better to do this stuff over the internet?

If you dont know anything about investing, get help, in person.

Remster

[Remster 24]

Quote

You may want to provide a little information on the pros and cons of "margin/call."
2002 was a very bad year for margin call.

Who the fuck talked about margins?????

We are talking about investment 101... Unless you are a very savy, well funded investor, you should _never_ use shorts and margins.

Remster

[BikerBabe 0]

right now? seriously?

I'd say stick the money in a short term money market fund or CD until the stock market settles down. Or look at bonds.

I would say his money might be safer under his mattress right now than in the stock market.

Never meddle in the affairs of dragons, for you are crunchy and taste good with ketchup!

[Misternatural 0]

>.margin call

ouch, I take it you got burned on that...so sorry

Margin calls are like borrowing from a bookie with a bent nose and a baseball bat. when the trade is done you pay win or loose.

DON"T DO IT!

Beware of the collateralizing and monetization of your desires.
D S #3.1415

[Remster 24]

Quote

right now? seriously?

If you time horizon is short, then I 'd agree.

But long term, right now is probably the best buying opportunity we've seen in a few decades. Short term, you have to be willing to roll with the punches, and the punches may be hard.

Remster

[ryoder 1,393]

Quote

There is absolutely no reason for a person who is not a professional to be investing in individual stocks.

Give Vanguard a call. My suggestion would be to spread the investments out over several mutual funds using the cost dollar averaging method. Don't dump all of your money in at once. Figure out the amount you want to put in on a monthly basis and continue contributing to it.

+1
Outside of my 401K, I also have money in the Vanguard VFINX index fund based on the index of the S&P500. Over the past year they have helped me lose...well...you don't wanna know about it, believe me.

"There are only three things of value: younger women, faster airplanes, and bigger crocodiles" - Arthur Jones.

[riddler 0]

Quote

right now is probably the best buying opportunity we've seen in a few decades.

Truer words have never been spoken. The year after the great crash saw three of the largest gains ever in the stock market. If you have extra $$$ that you can keep in the market for the next year, and you invest in good opportunities, you can make some money.

If you're unemployed and can't make the rent for the next few months, keep it in the bank.

Trapped on the surface of a sphere. XKCD

[Sletzer 3]

I agree 100%. I've got a Finance Degree and everything I was taught said to go for the mutual funds spread out in different sectors of the market. You can pick different funds based on your risk tolerance and time horizons to give yourself a feel of control. Individual stock picking is a craps shoot.

Vanguard is a great choice with very low fees compared to the other companies. (and no I don't work for them).

I will be kissing hands and shaking babies all afternoon. Thanks for all your support! *bows*

SCS #8251

[Misternatural 0]

>Over the past year they have helped me lose.

don't feel bad man, even the best of us lost on paper, The ones that say they converted to all cash in '07 and walk around like they're geniuses who say they saw it coming...just got lucky.

The important thing is you held on and didn't panic and sell all your shwag at one of the many bottoms we see now.

Beware of the collateralizing and monetization of your desires.
D S #3.1415

[goofyjumper 0]

See that is my big question. They always say invest when everything is low. And then it will eventually pick up.

He really just wants to buy some shares and just wants to do it the cheapest way possible.

I always see commercials saying $8 trades. So I was not sure if there were any fine lines between that.

-----------------
I love and Miss you so much Honey!
Orfun #3 ~ Darla

[Remster 24]

Quote

And then it will eventually pick up.

They most probably will. The bigger question for your father is when. if he wants that money in the next year, he shoudnt invest it.

If he'll lose sleep if his investment lose 20%, then gain 15, then loose another 5 in the next few months, he shouldnt invest either. It will be a pretty volatile few months and perhaps years.

The real low fees for trades are really attractive for wannnabe day traders and very active investors. Check with your bank, they may have a investment branch that is even better than 8$ per trade (I'm with Wells Trade, and with my type of account, there are no fees on the first 20 trades in the year. If you decide to invest $x per month, that may be a good deal).

Remster

[skittles_of_SDC 0]

Quote

There is absolutely no reason for a person who is not a professional to be investing in individual stocks.

Give Vanguard a call. My suggestion would be to spread the investments out over several mutual funds using the cost dollar averaging method. Don't dump all of your money in at once. Figure out the amount you want to put in on a monthly basis and continue contributing to it.

Pussy.

[TrophyHusband 0]

buying individual stocks are prettyy risky.but whether or not he should do it depends on what he has going on investment-wise. if your talking about a large percentage of if a portfolio, he should go with mutual funds, and definately more than one. if its just a small percentage, have fun, but treat it like a trip to the casino.

"Your scrotum is quite nice" - Skymama
www.kjandmegan.com

[headoverheels 291]

If he is skilled at picking his own stocks, the internet is just another way to make trades, at a somewhat lower cost. Sort of like booking airfare online is now cheaper than actually talking to someone at the airline. I have brokerage accounts which I always trade online, but I could also talk to them if I wanted/needed to.

Despite the large drops in the last year, there is no assurance that the market will recover any time soon. In the 30's, there were 6 or 7 rallies of more than 20%, but it kept going down to less than 1/8th of the peak value. The market as a whole can drop a lot from where it is today, and individual stocks can fare much worse (or better).

If he thinks the market is cheap and doesn't want to pick stocks, buying either mutual funds (professional picks stocks) or an index fund might make sense. You can buy/sell those online, or talk to a broker. I watch the market closely, but am pretty uninspired regarding investing just now. GF is going to get laid off, I need to do a major house remodel, etc., so I don't want to tie up more cash for years.

[JackC 0]

Quote

But long term, right now is probably the best buying opportunity we've seen in a few decades. Short term, you have to be willing to roll with the punches, and the punches may be hard.

I reckon that's about right. I dabble as a hobby with a long term view. Day trading is the short route to bankruptcy unless you're gifted.

The best thing to do is buy a good book on investing in stock market and read it several times before you shell out another dollar. Then, play fantasy shares for a while and see just how good (or bad) you are at picking a decent share. Remember to factor in all the commision, tax and spread as you work out you fantasy profit/loss. Then you'll have a much more informed view of the gamble you are about to take. This is a game that can bite you in the ass hard if you don't know the rules.

[anthonyfellows 0]

Quote

See that is my big question. They always say invest when everything is low. And then it will eventually pick up.

Well not everything will eventually pick up. Let's see .. Here are a few that will never pick back up ... Circuit City, Linens and Things, Skybus.

Serious relationships turn into work after a few weeks and I already got a fucking job :)
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
H.A.F. = Hard As Fuck ... Goddamn Amateurs

[anthonyfellows 0]

Quote

have fun, but treat it like a trip to the casino.

That is about the best advice you can give the average person who wants to learn how to day trade.

Serious relationships turn into work after a few weeks and I already got a fucking job :)
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
H.A.F. = Hard As Fuck ... Goddamn Amateurs

[BIGUN 1,065]

I the fuck talked about margins...
As you know if you get into day trading, they're pretty good about pushing margins on you.
And, that my friend is why I suggested he bring it up.

Not to mention my own margin misery... looks pretty good on a market upswing, but when a sector (technology) nosedives on ya... And, all you're getting is margin on top of margin call every day for almost a year until your entire day-trading portfolio has vanished...

Nobody has time to listen; because they're desperately chasing the need of being heard.

[Thanatos340 1]

I set up an Ameritrade account several years ago. Started out putting $5K in it. I have withdrawn $5k twice now and still have a current value of $2k+/- depending on the latest ticks.

Definitely just a hobby for me. Ameritrade is very easy to use. I don’t claim to know anything about the market at all other than I like to buy when a Stock takes a Huge hit and then sell once it goes back up.

One stock I have made most of my money on over that past 6 years is NOOF. This stock had some good swings. I first got in under $1 per share, Sold off when it hit $4, Sold more when it hit $6 and still regret holding what I had left when it hit $10. It is now back under $2 once again looking like a good Buy. (They say invest in what you know. NOOF is a Porn Company. They own most of the Porn Pay per view Channels.)

Another stock I like right now is OME. They were trading at around $14 per share before the crash. Now they are around $3. Forbes named this company one the Americas 10 best small companies back in August. Looks like a great time to buy them right now and double or triple your money with in the next few months if things turn around.

Finally the last Stock I like in the Penny range is PTN. They were working on a Viagra for women product that showed great promise but they ran into alot of political problems from religious nutcases that convinced the FDA there was too much potential for abuse with this new drug. With the new administration, They have may a chance at restarting the trials. This sock is trading around $.09 per share right now and in danger of being delisted. It is a HUGE Gamble but if they can get through this the returns would be astronomical.

All of it 100% pure gamble. Don’t invest a penny more that you would be willing to toss out the window because you may be doing just that.

I think there are some fantastic buys out there right but figuring out which ones those are is the hard part.


Just my 1.032746 cents worth - according to the latest Ticks.