This is a story about how my mentor sold his stocks to buy a sports car, and this stock market tips for beginners post can help any beginner find success.
Like my mentor has always said, anyone can do this. One day you can have enough extra money to buy a sports car with your investments. But you have to start soon, as soon as you can. These stock market tips for beginners will show you how.
And it’s good to be. If you didn’t have a healthy dose of skepticism, you’d fall victim to a lot of things. Like Nigerian scams. Penny stock pump and dumps. Pyramid and ponzi schemes.
I know that it’s hard to believe people who talk about the stock market. I don’t blame you. In fact, I once felt the exact same way.
You know how it goes, right? Everyone has their two cents about money, and many feel inclined to tell you. No matter where you go, you hear the same tune. Save money, stay away from credit cards, invest as much as you can, keep your credit score high, pay on time, go to work, etc.
All the same money advice is so tired and so overdone. I bet you’re as sick of it as I am. I mean who really expects to stop buying daily lattes in the hopes of being a millionaire “one day”. Sure, the math works out, but I want to see the results in action, don’t you? Theories are nice, but results are better.
Stock Market Story for Beginners
As I’ve been running this website, it’s been easy to forget the steps I took to get here. I consider myself a successful investor now (I also have the results to prove it).
But I’ve failed in sharing everything I experienced to get to this point. That’s no one’s fault but my own. You see, I had to see the results for myself, before I could “buy in” to this concept.
Let me take you back to the day when I really started believing in the stock market.
I have a friend who I’m lucky to also consider one of my mentors. He used to tell me all of the same things that I tell you now, like buy assets, get into the market, save even just a little, invest conservatively. Those things were all nice and good, but I didn’t really see a big reason for it.
You can know all the benefits of something, but until you have a why you probably won’t do it. Most people know that flossing is good, but until you have motivation (like your impending gum surgery), you probably aren’t taking it all too seriously. On that note, I should probably start flossing again.
Anyways, I was listening to all of my friend’s advice. It was good, it was wise… I could agree with that. I liked listening to it, but I never took it that seriously, because I didn’t see much implication in my life.
Until the day he drove up in a new Corvette.
I love me a good sports car, and so of course I love the Corvette. He had just got a nice red Z06, with a clean black leather interior and a roaring exhaust.
Yeah it’s pretty cool, but he’s an older guy so at first it wasn’t a big deal. I asked him, “What’d you do with your (brand-new) Lexus?”
He replied, “I still have it. I bought this one with some stocks I had.”
Wow, I was floored. I could tell that my friend was good with money, but man… to just buy a sports car with some stocks like it’s no big deal??? Sign me up!
It was after that day that I began to take the stock market more seriously. My mentor was in his 50’s living the dream, but he first starting buying stocks at 23. He took deliberate steps with his wealth when he was young, to be able to buy fancy toys all willy-nilly today.
That’s where I want to be, and that’s where I want you to be too. It’s all possible for any of us. If my mentor could do it, he said anyone could. He’s got over 500 horses to back him up.
So with this post, I want to make it possible for you.
Here I will share exactly the things he told me. I hope somewhere along all this you will feel inspired, motivated, and ready to take on the market.
4 Stock Market Tips for Beginners
1. My mentor encouraged me to buy just 1 share. The learning starts here. Until you have “skin in the game”, you won’t understand how the market works. You’ll get bored, you’ll get overwhelmed by all the information, and the you’ll never get wealthy.
Avoid all these things by opening an account and getting started TODAY. Each excuse only delays your new Corvette.
[Of course, I’ve written a post geared specifically for you if you are at this step. It’s called the Practical Guide for Absolute Beginners]
Stock Market Tips for Beginners #2
2. My mentor stressed the importance of the trailing stop. Out of all the things you can learn, this may be the most important. A trailing stop lets your winners run and cuts your losses short.
You think you will know when to sell, but once you start investing you’ll realize it’s impossible. The stock market will become a nightmare to you. You’ll be torn whether to sell or hold on, and regretful when it goes down or regretful when it goes up.
The trailing stop helps you avoid all of this emotional heartbreak. It protects you from stock market crashes, bear markets, and depressions and recessions. It leaves you in stocks during bull markets, so you get a piece of all the profits. Do yourself a favor and learn about the trailing stop.
[Again, I’ve written a post fully explaining the trailing stop, including how to use it and why it’s so important. All the top traders swear by trailing stop. Don’t ignore this.]
Stock Market Tips for Beginners #3
3. My mentor taught about consistency. This is just as crucial as the trailing stop. By using a method called dollar cost averaging, you can automatically set yourself up with a successful system for investing.
The truth is, market timing is impossible. Nobody can accurately and reliably predict when a market will go up, or when it will go down. Just buy a stock and see for yourself.
That’s why it’s important to invest consistently. If you only invest when you feel good about the market, you will inevitably throw money in at the top of a bull market and watch yourself lose it all as it comes crashing down.
An automated system like dollar cost averaging will force you to invest the same amount every month, automatically buying more when the market is down and buying less when the market is up. This is classic buy low, sell high, and it’s done automatically with dollar cost averaging.
[Guess what, I’ve written about this too. Dollar cost averaging is so crucial, and you must understand it. It’s so simple, yet so effective.]
Stock Market Tips for Beginners #4
4. Finally, my mentor believed success comes from buying low and selling high. Dollar cost averaging helps a lot with this, but you will compound your returns even higher when you learn to select the right stocks. Little percentage over performance, like 1% here and 1% there, will compound into thousands and hundreds of thousands of dollars down the road. Once you can master stock selection, you will have power like never before.
Now the first 3 tips are highly implementable and attainable immediately. Just those 3 will better your results substantially.
This last one takes a little time. But for those with the patience and the willingness, it can be done. Buy low and sell high isn’t as obvious as it sounds, but there are simple ways to make them happen.
Companies are required by law to submit their financial statements and balance sheets to the government, for free access to all. It’s by looking at these statements that we can interpret the data and find the best deals in the stock market.
I can show you exactly how to do this. I’ll even show you the exact parameters I use to select a stock, which you can duplicate for your own success. But it will take your patience and your willingness to learn. I can deliver you this information the best way I know possible, over time through an email coaching program. You see, this information is too overwhelming to learn even in one day.
But I’ve helped coach friends and readers, to get this information absorbed. And now I’ve developed a system that teaches you all of this, over a span of weeks. All you need is access to an email account. So sign up to my email newsletter today, where you’ll see all the best resources I’ve created. In addition to that, you’ll start to receive automated emails from myself, which will start you on the process to picking the best stocks.
It’s the best I have to offer, and it’s free for now. Take advantage of this and subscribe today.
**Wisdom Wednesday #57**
**All Rights Reserved. Investing for Beginners 2014**
**Photo shown above can be found: Photo Attribution**
**Stock Market Tips for Beginners – from my Successful Mentor**