Im 13 and want to invest money!?

Question

hi...im 13 yrs old and would like to invest some money in stock and shares....can someone please tell me wat this is all about as i have no clue. thankyou

Answer 1

Simply put, a stock is ownership in a company. When you buy a stock, you own part of the company and in many cases, you get voting rights too (excluding preferred stock, which I will state later on in this answer). Stocks are traded on a thing called a 'stock exchange', you may have heard it on the news e.g. 'The Nasdaq is currently up 5 points' or 'The FTSE is down 20 points' etc etc. The Nasdaq and the FTSE are exchanges. When the company you have invested in has gone up in terms of profit, you get what is called a dividend, which in simple terms is a company's way of reimbursing the shareholder. This isn't always the case however, and you'll learn more about that when you invest in stocks. Conversely, when the company you invested in goes down, you lose some of the money you have invested in as well.

You may ask why a company would want to give out ownership rights to millions of people. That's because shares is a great way for a company to finance itself, unlike bank loans which require interest paid on the principal too.

Stocks can be broken up into two parts: Common stock and Preferred stock. Common stock is what many people refer to when they say 'stock'. Preferred stock is like a half-bond, half-stock, but you do not get voting rights in the company. However, you are guaranteed a certain dividend each year, unlike Common stock which changes easily.

Stocks are arguably the most known type of investment, but it isn't the only type. Other type of investments include Commodities, Futures, Options, Bonds, Savings Accounts, Real Estate and many more. It is recommended that you diversify your money across these, as stocks (in the short-term) are very risky and fluctuate within a short amount of time.

I'm 15 and I learned stocks at 13 through several books and websites which offer clear-cut advice on what stocks are, what tactics professional investors use, and of course the mindset of professional investors (I recommend reading about Warren Buffett, the richest man according to Forbes 2008).

Useful Books:

- The Intelligent Investor

- Five Tips for successful stock investing

- Rich Dad Poor Dad

- The Cashflow Quadrant

- Pick stocks like Warren Buffet

Instead of jumping into the market, as that is like walking blindfolded in a motorway, I recommend practicing with Investopedia's stock simulator. They give you 'Cyber-money' ($100,000 from what I remember) and through that, you can learn stocks. It also offers a vast amount of articles to read, exempt from nuisance jargon:

http://www.investopedia.com

Other useful links include:

Howstuffworks: http://money.howstuffworks.com/stock.htm

Yahoo Finance: http://www.yahoo.com/finance

Thisismoney: http://www.thisismoney.co.uk/

My Investopedia profile can be found here: http://community.investopedia.com/Marvin...

Good Luck~

Answer 2

This "INVESTMENT GUIDE" is more helpful for you to make your money to make money for you,without taking any risk.

To gain more information about stocks & shares,just gothrough the site http://www.savings4future.com