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Important Stuff That Beginners Need to Know About Stocks

A lot of people are looking into buying stocks and playing the stock market. However, there is more to it than just buying stocks and selling them. People are generally looking to increase their income or improve their investments. If you are a beginner looking for a starting point when it comes to stocks, you need to keep reading. If you already have a good understanding and control of your stocks, you may still need to refresh a few of these tips.

Buy low and sell high. The slightest drop in the market can cause chaos. Investing is probably the one place where things getting cheaper is a bad thing.

Learn what filings are and use them. Filings is a good starting point for beginners. Filings contain a lot of valuable information on companies. These filings include everything from risk factors to financial numbers and even the changes in senior management.

Nothing specific can separate the good stocks from the bad stocks. There is no perfect metric or single number that will tell you what is good or bad. Stocks can change in a second.

A sure thing doesn’t exist. People have found themselves in disaster for investing in companies that ‘are a sure thing’. Anything can happen in the markets to make that supposed sure thing a nothing.

Don’t go for short-term. Long-term trading will almost always bring you better earnings than short-term ones based on quarterly reports. It is better to look at stocks that can possibly offer a long stream of profits.

Beware the taxes. The taxman can take a big part of your profits if you don’t play it right. If you sell stocks that you have had less than 12 months, your gains are taxed as normal income. If you hang on to those stocks for 12 months or longer, you will pay much less in tax.

Before you get started with buying and selling stocks, make sure you know as much as you can about the process, odds, and how to keep yourself out of trouble.