Little lessons for newcomers?

Discussion in 'Stock Market Education' started by WaveWage, Sep 11, 2015.

  1. WaveWage

    WaveWage Well-Known Member

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    In order to help newcomers and new investors to learn a bit about the market, because after all, there was a time where we was all new about markets, it would be helpful to gives some paths or resources or clues about it.


    If I would have to give clues to a newcomer, it would be to learn math first, and to be really used to it. Not the complicated maths, but rather the statistics, probabilities, randomness, and theories around human behavior that's often expressed in maths. I think it should be helpful.
    Then, I would say them to try simulation, because this is a playground but often with real world data, so while it is not fully comparable, it is certainly helpful. Finally, it would be to look up all unknown names the person meets, and learn about the debt of states, currencies, basic economy and the basic of the market.


    And you, what would be your advises?
     
  2. JR Ewing

    JR Ewing Super Moderator Staff Member

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    I would say read several good books on the subject - Ben Graham, William O'Neil, Peter Lynch, et al.

    You can watch the financial news - CNBC, Bloomberg, etc - to get a good feel for things. But DON'T go out and try to do everything you hear people talk about. Take things with a grain of salt. Much of it is just chatter with some speculation thrown in.

    When a bigtime whale like Buffett, Icahn, Dalio, or Tepper speaks or puts out a letter or whatever, listen and read much more closely and take notes if you need to.
     
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  3. JessieJ

    JessieJ Guest

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    Newcomers should be careful when dealing with money. Know what you're investing in.
     
  4. Value Prophet

    Value Prophet Member

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    Good "little lesson" ideas so far. One idea I would recommend is to have a plan (financial plan, of which investing will be one component) and then use an investment criteria checklist. If an investment doesn't tick the right boxes then don't get emotional - just go an find a new investment.

    Apologies for self-promotion :), but there are also several other tips for new investors on the "Getting Started' page our web site valueprophet.com.
     
  5. baudwalk

    baudwalk Senior Investor

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    I have no knowledge of your business on the ring of fire in New Zealand, but you have a clean-looking desktop web site. From a webbie point of view, today''s society is shifting/has shifted to the mobile platform. Strict HTML5/CSS3 standards makes pages scalable across Android and iOS smartphones and tablets, plus desktops. And Google search now gives preference to searches to such scalable web sites. (For reasons not worth going into here, k2eoc.org is a bit out of date, but it is my design of a scalable site working on every device out there.) Just an idea... HTH. YMMV.
     
  6. atanasster

    atanasster Active Member

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    Do not start trading with real money - there are many virtual/simulation trading sites that are great to learn and experiment. While learning, keep the money in an index fund/etf.
     
  7. richc3

    richc3 Senior Investor

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    When I first started I used a simulator and quickly had a lot of success with that. While there was some optimism and confidence that came with that, it also made me regret the fact that I didn't use real money and thus wasn't getting any of the return on what was a successful portfolio -- then again, at least I didn't lose either. That said, I sometimes find the more personal appeal of using real money does make you take things more seriously, but if you have the discipline then play money should work too.

    Personally, I find it helps to frequent stock investing forums like this and with generally casual investors. I know some follow the experts a bit too closely and typically when a stock gets their endorsement it means you're already too late or at least it's not an optimal entry point. It's great to get little tidbits of wisdom here and there from all sources though, not to mention you eventually start to see the dirty world of investing when it comes to pumpers and dumpers.
     
  8. 111kg

    111kg Guest

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  9. WaveWage

    WaveWage Well-Known Member

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    Nice tips, being informed is important when you are making decisions, doesn't matter the decision you have to make, you would want to have as much information as possible to have investing ideas and check what's happening.


    As well, that's a nice tip. I think having a financial plan or at least some budgetting and keeping things fixed in number helps to do investment without going to do something too much outside of the bounds you defined. As well, a checklist is nice, but a note, sometimes, the checklist is something you would not consider when you really have the feeling it may be a good investment because the best investment are usually surprising.


    The thing is that with simulation vs. real money, the worst problem is to act differently because you don't feel like it's the same as the simulation but you're instead using real money with real losses. Otherwise, if you got it right in simulation, that means you will get it right in the reality as well. Just check if the simulation is realist enough, especially regarding to taxes and transactions "limits".
     
  10. Steve Dawson

    Steve Dawson Active Member

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    Knowledge is power to me, the more information I can obtain and obsorb, the more confident I am in any decisions I have to make. Simulators are a useful tool to familiarise yourself with market trading but I found them to be of limited usefullness before I had actually started trading. A good strategy, and reasonable, acheivable short-term goals are good things to plan in order to keep your investment at the level you initially plan for, and any plan can be amended or changed completely at a later date if the situation demands it.
     

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