invest
Lunch Breaking Investing Rulebook
After careful consideration, I have decided to try a new investing strategy. I’ve found that I do not have time to use the traditional rules. My rules will have to fit my time constraints. In other words, it has be easy and simple enough to do during my lunch hour.
Here are my Lunch Break Investing Rules:
1. Only buys stocks on the watch list.
2. Must be trending upward.
3. Must have a trending sweep of at least 10%.
4. Buy only at the bottom trend line.
5. Set a loss limit (2-3%).
5. Set a trailing stop loss to 8% below the bought price (dollar amount on the stop loss, not percent)
6. Set a profit limit (5-10%).
6. Allow the stock to trend upward until trailing stop loss is activated.
7. Never break any of these rules.
8. Adapt my strategy as needed.
Over the next several weeks I will be expanding on each of these items. I will also concentrate on the automation and mobile techniques.
Comment and share!
Passion and the Stock Market
Picking individual stocks for a portfolio is not for everyone. If you are interested in investing, it’s worth the experience. Give it a try and if you love it, keep doing it. If you don’t love it, get out and find a different investment strategy like money markets or mutual funds. For an investor to really make money in the stock market they must have a passion for it. The stock market is a roller coaster with ups and downs. When you go up it’s the greatest feeling, elation with just a tingle of fear that it’s all going to crash. When it does crash, and it always does, it’s a sickening feeling that ties your stomach into knots and makes you doubt what you are doing. The doubt is the killer and passion is the defense. If you have the passion and excitement, then you too can make money in the stock market.
6 Excuses Not To Invest
1. I don’t have enough money.
Most accounts can be started for $500 or less. Use your tax return or start a saving account to save the money to start investing. Also see my post about getting started even if you make minimum wage.
2. It’s the wrong time.
The worst time to invest in the stock market is tomorrow. Tomorrow is too late. Today is always the best time. Your money can’t grow until you invest it.
3. Recession!
Remember the often used “Buy low and sell high.” Guess what a recession does to stocks; it pushes them down to the “low” point of the last statement.
4. It’s too complicated.
It can be. Depending on your investing goals and strategy. Of course, it can be so simple you can do it on your lunch break. Like me!
5. I don’t have enough time.
Like step 4, most investing can be done in under an hour. I do most, if not all of my investing homework at lunch.
6. I’ll lose ALL my money.
Diversify! Unless you have a string of bad luck and all the companies go out of business, you won’t loss all your money. Keep in mind one of the goals of investing is to persevere your capital. It’s ok to take a loss if it minimizes the damage one or two bad stocks can do to your portfolio. And remember, always have a loss limit.
Got other excuses you have heard and want to share, COMMENT!
4 Tips For Buying a Certificate of Deposit
Certificate of Deposit (CD) is one of the easiest and safest ways to earn interest. With a little work on your part, small amount of time, and a little cash you can be earning interest with your hard earned money.
1. How much and how long?
These are your first decisions. Depending on how much and how long will determine your APR (annual return of premium). Maturity time can range from 6 months to 60 months. Remember, you will be penalize if you cash in before the maturity date. Only deposit money that you don’t need during your allotted time period.
2. Compare rates
Check your local banks web sites. Most list the current rates and a few have helpful calculators to show how much you can earn. Some have a minimum amount to open an account. You can also use web sites like Bankrate.com or a brokerage service like Scottrade.com.
3. Check the bank for FDIC deposit insurance
The FDIC insures your CD up to $250,000. If the bank is not FDIC insured, DO NOT buy a CD from them. You can LOSE all your money. Check FDIC.gov for more information.
4. Buy and enjoy earning interest.
Got other tips to share on CD’s, leave a comment!
Best Christmas Present – Stocks
Every Christmas and birthday my kids get many presents. A few weeks later the presents are mostly forgotten or broken. Such a waste! I started brainstorming ideas that could cut down on the clutter and be a long term benefit for them. I considered savings accounts, bonds, cds and the cookie jar. Stocks was the winner!
Here are my reasons for picking stocks:
1. High dividend stocks make money for them.
2. Stocks splits give them more stocks.
3. My teen thinks its cool to have a stock portfolio (my youngest,8, doesn’t care right now).
4. I pick stocks of products that they like. In our case, they get 4 McDonald’s stock a year.
5. If you aren’t into picking stocks, go with an index fund.
Four a year? That’s not much!
True, but take the case of my 8 year old. He will have 40 shares when he turns 18, plus the dividend that gets paid. It doesn’t take long for the stocks to accumulate enough dividend to start buying more stocks. Keep reinvesting the dividend, it adds up!
Risk
I know that the market will go up and down. This is a long term investment for them. I’m not taking too much risk
What about fees?
I use Sharebuilder for my kid’s portfolio. Their service is a bit odd in that you get a $4 fee when you buy on Tuesday (and only on Tuesday), other days it’s $12. Since my kids only buy twice a year and aren’t gaming the market it works out best for them. They also allow custodian accounts which is what you will need.
Action time:
1. Decid how much to buy.
2. Sign up for a service like Sharebuilder.
3. Open a custodian account in your child’s name.
4. Deposit the money.
5. Buy!
If your kids keep the investment going, they could potentially have a million when they retire. Like I said earlier, this is a long term benefit for them!
Making Goals & Making Money – Stock Market Tip
I have found that by creating an end goal keeps investing interesting and fun. Your goal could be a vacation, new big TV, pay off or buy a car, or some new expensive item. Having a purpose as to why you invest will help you stay focused. I have found without the end goal I start to lose interest in my portfolio. I would recommend leaving “filthy rich”* off the list, it’s too generic. Make your goal specific and give yourself a reasonable deadline. This tip works best for short term investing, for long term investing make your goal a specific number.
My goal is to pay off my family’s van with my short term stock portfolio.
* I have met a rich person and I have met a filthy person, but I have yet to meet a filthy rich person.
Investing Tip – Start!
The only way to make money investing is to start investing. If you know nothing about investing then you can begin by learning. Read a book about investing, magazine, website, or listen to an investing podcast.
Subscribe to the RSS feed or check back to my website for reviews on all of these options.
The Purpose of the Website
I am not a professional investor, I am an amateur investor. I have been investing since early 2008. I was unfortunate enough to start investing at the beginning of the recession. I had to learn some lessons the hard way. I hope to share with everyone what I have learned and I hope to help everyone not make the same mistakes I made.
What to expect from this website:
- Articles written for the beginning investor
- Book reviews
- Terminology clarification
- Product reviews: websites, applications, iPhone applications and other blogs
- Helpful quick tips
- Examples of my successes and my failures. I hope this will help everyone to profit and avoid my previous mistakes.
Please subscribe to the RSS feed or check back to this site for future posts.
Disclaimer:
Periodically I will use stocks to emphasize a certain key point in a post. This is not an endorsement of that stock. Any stocks owned by me that are mentioned or products that I am affiliated with or use will be noted within the post. I am not a professional investor or financial advisor. This website’s intention is for educational purposes only and does not take the place of professional advice. Keep in mind any investments come with risks, please research your investments to better understand your risks.
