These days, the best way to store your money is by investing it. If you’re a milenial and it’s your first time investing your money, there are few things you must never do. Here are the first three of 6 moves a first time investor like you should most definetly avoid.
1. Jumping in Head First
In theory, the fundamentals of investing are quite simple — buy low and sell high. But, in reality you need to learn what “low” and “high” really mean.
In any deal what is “high” for the seller is called “low” (enough) for the buyer and you can see how different assumptions can be made from the same facts. It is necessary to learn before diving in, because of the relative complexity of the market.
2. Playing Penny Stocks and Fads
Penny stocks at first sight seem like a great idea. You will get a lot more shares in a penny stock for as little as $100 than a blue-chip that could pay $50 a share.
Unfortunately, many penny stocks have to weigh against the uncertainty they face in place size and future profitability. Overall, remember to think in percentage terms of stocks and not entire amounts of dollars.
3. Going All in With One Investment
In opting to chuck diversification into the storm, investors have a lot of potential but that also brings a lot of harm. It’s especially good to buy at least a handful of stocks as a first-time investor.
The lessons learned along the way are less expensive but still useful. Exchange traded funds (ETFs) are a great way of getting widespread exposure.
Continue to read the rest three of 6 moves first-time investor should never do in the second part of this article tomorrow!
