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 Stocks for Dummies is a natural follow up to our article on Investing for Dummies because it shares a lot of the same ideas and concepts. The sheer number of tasks each of us takes on everyday is astounding. Our lives are busy and complex, so when something can be broken down and simplified it gives us back the time we find so scarce and valuable.
Stock Research for Dummies
The first place many people have trouble is getting started. They know, or think, they want to start investing in stocks but they simply do not know where to begin. Fortunately, we've already put together a series on stock research that should help the novice investor get a good feel for how to go about picking stocks.
In Stock Research Part I we cover the basics of how to identify an excellent business or industry. The number of publicly-traded companies is large, so you need a way to quickly eliminate a lot of companies from consideration. In this publication we explain how to avoid companies that are in commodity-like industries or an industry that has so much competition that prices are too low for the manufacturers to make any money.
In Stock Research Part II we explain how to calculate the intrinsic value of a company and give an example calculation so that you know how to apply this lesson in the real world. We also talk about return on equity, something that everyone investor should be sensitive to when evaluating stocks. That's why in Stock Research Part III we take a deeper look at earnings and use it to help project a future stock price for the company we are evaluating.
In our last publication in this series - Stock Research Part IV - we review everything that was learned in the first three lessons and run through an example from start to finish. So by the time the reader is finished they know how to research stocks - even dummies!
Dictionary for Dummies
There is no doubt that the world of stocks is full of descriptions and jargon. The more you read the more questions that you might have about certain phrases or words used in an article. We have worked hard to put together what we think is one of the best investment dictionaries available on the Internet.
There is no doubt that you will find websites with more definitions than ours - most of them single-sentence descriptions for seldom-used terms. But we doubt you will find better explanations than ours anywhere else. So take a look at our investing dictionary and decide for yourself.
Stockbrokers for Dummies
Now that you've picked your stocks and are ready to start investing in the market you are faced with a final question - How are you going to purchase those stocks? We'll we've got that one covered too. In our article Investing Money we explain both the difference between investing versus saving and we also run through some of the things you need to think about before engaging the services of a stockbroker.
Now this might sound like a trivial matter, but the fact is that choosing the right broker is an important part of the process. If you wind up with a less than honorable broker, you can quickly go through your investment money and have nothing to show for all your hard work.
We Were all Dummies at One Time
We've joked around in this article by using the term "dummies" to describe the novice investor in stocks. Keep in mind that everyone starts out with very little knowledge about stocks and investing. It is not something that is instinctual or taught to everyone at birth.
Those that are truly successful have worked hard to get where they are today - and they've made lots of mistakes in the process. Learn all you can and you will minimize your failure and maximize your chance at successfully picking stocks. Keep reading and make that investment in your knowledge too.
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