The Ultimate Guide for the Young Investor

Rayne Fisher-Quann
Jul 24, 2017 · 3 min read

I recently had the pleasure of speaking to one of the most intelligent investors I’ve ever met — he has a constant eye on the stock prices and an incredible gut for when to buy and sell. He just recently went in huge on Apple stocks when they were at their recent low — and he bought them lower than anyone else I know. His stocks have gone up $6 a share in the past week alone, and anyone will tell you that Apple stock is set to go way higher.

He’s not an investment banker or a stockbroker — he’s never even taken a finance course. He’s an 11 year old I met at my job as a camp counsellor at a volleyball day camp.

I share this anecdote because it’s proof that anyone can invest in the stock market. Many people I know want to invest, but feel like it’s near-impossible to be successful as a teen. This is completely untrue! All you need to invest in the stock market is a little background knowledge and a little luck. I can’t provide the luck for you, but here’s all the knowledge you need — the ultimate guide for the teenage investor.

Lesson One: Invest, don’t Speculate.

When it comes to stock trading, there are two “types”. The first is investing — essentially putting money into companies that you believe will grow for reasons that you understand or support. You could be investing in a business idea with a strong market; a company you think needs growth to succeed; or a research lab with science you understand. Basically, investing is analyzed and researched.

Speculation, on the other hand, is the exact opposite. It’s an investment based on a gut feeling or random guess — similar to gambling. Speculating can make you quick money, but you can lose money twice as fast. For a novice investor, it should be avoided like the plague.

Lesson Two: Never Invest More than You’re Willing to Lose

This is the golden rule of stock trading. You never know when stock prices will rise or drop — sometimes, you may win big, but you can fall just as hard. That’s why the most important rule to follow is to never, EVER invest more money than you can stand to lose.

Lesson Three: Start With Penny Stocks

Penny Stocks, aka micro-cap stock, are a kind of stock with a low pps (price per share). They can even trade for under a dollar! For this reason, penny stocks are a great place to start investing as a beginner. In addition, most penny stock trading is done without a broker, so it’s a great place to dip your feet into the world of stock trading without much commitment.

Lesson Four: Find a Good Broker

If you decide to graduate from penny stocks into the big leagues, a broker is an important tool. While it is possible to trade without a broker, it requires a lot more work and having a professional on your side is always good for the novice investor. Do your research and find a well-recommended broker either online or in person.

Lesson Five: Invest in What YOU Want

Trading stocks isn’t just a way to make money — it’s a way to put yourself behind companies you want to see grow. Don’t just invest in companies purely for the payout: invest in places where you want your money to go. This way, even if the stock drops and you can’t trade for higher, you’ll (hopefully) still be satisfied.

In conclusion: stock trading is an exciting and lucrative world, but like anything, it comes with risks. Make sure to keep your investments smart and safe, and you’ll be trading like a pro before you know it.

The Global Voice

The Global Voice provides a voice to today’s youth in the wake of today’s fascinating political and economic climate. We employ a diverse team of writers to show a variety of perspectives on the pressing issues of today.

Rayne Fisher-Quann

Written by

The Global Voice

The Global Voice provides a voice to today’s youth in the wake of today’s fascinating political and economic climate. We employ a diverse team of writers to show a variety of perspectives on the pressing issues of today.

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