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Stock Market Tips for the Beginning Investor

Aug 2, 2008
If you want to get into investing in the stick market with the goal of making serious money and have very little experience in this area, then you can benefit from stock market tips to help you get started. With the convenience of being able to trade stocks online, more and more people are becoming interested. The main thing to remember is that before you start trading on the stock market, you should become familiar with it. Understanding the stock market is absolutely essential.

Stock market transactions require the services of a stockbroker. However, you don't need to find a broker as soon as you get started. First there are three main methods of trading stocks that you need to learn about. These are:

- Fundamental analysis. This is the stock valuation method that analyses financial and economic conditions to predict how stock prices will move for a certain area of the market. It includes analyzing a company's records, such as their financial and non-financial reports to determine how well they are doing. These records are available for anyone to view if they are interested in investing in the company stocks.

- Technical analysis. This refers to the study of prices and volume to help you make forecasts of the future prices of stocks or to predict price movements. Knowledge of this method will help you be able to anticipate what is likely to happen to prices over a specific period of time. This is not exact and it does take a bit of experience before you can have a good handle on doing this type of analysis.

- Risk and Money Management. Investing in the stock market carries the risk that you will lose your money very quickly. This method involves being able to assess the risks and know which stocks to invest in. It also involves managing your investments so that you don't put all of your eggs in the same basket.

Once you have analyzed the market and the prices, you are ready to start looking for a stockbroker to help you start trading stocks. There are three main types of stockbrokers: discount brokers, full service brokers and money manager brokers. Discount brokers will take your order both online and by telephone. These brokers will not give you nay help in deciding which stocks are the best ones to invest in and if you trade online, you won't actually get to speak with anyone. Full service brokers will make recommendations for stocks that you should invest in, but the final decision is up to you. These brokers will provide you will an investment plan for which you will receive periodic updates. You can make adjustments to the plan, but you will have to pay a fee for doing so. Money manager brokers will take over the responsibility for investing your money in a portfolio. However, you should have a lot of money available to invest to avail of the services of these brokers.

Discount brokers are the ones most people used when investing online. Some are available only during the day and others are available 24 hours. Some focus only on certain segments of the stock market, which means that you may have to search to find one that deals in the types of stocks that interest you. In choosing a stockbroker, a helpful tip is to compare the commissions of all so that you find the one with the lowest rates.
About the Author
For more information stock market tips,common stock investing mistakes and information on understanding cash flow statement visit http://www.TradingSphere.com
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