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Newbie with a small amount to invest

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zam

Joined
23 August 2006
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Hi Guys n gals,

I am very new to the stock market and would like to get myself into it.
I initially thought that $500 would be a good start until i saw many recommendations of around 2k - 3k. would it be worth buyin $500 in a stable company or put it in a term account and add to it weekly.

any ideas would be great.

Regards
Sam
 
When i first started to get interested in trading/investing i spent the money on education. Probably the best return you will ever get for $500.

Whether its books, courses, or seminars there is lots of advice on here regarding that topic.

Good luck.

Save, Save, Save....invest, invest, invest
 
To be honest ZAM, $500 is not really enough.

On commsec I think the bare minimum purchase is $500. So you can buy 1 share.

You've gotta pay $20 brokerage to buy, $20 to sell, and tax on any profits.

If you buy a company that goes up 20% in 6 months (which is a truly great buy). You make $100 less $40 brokerage less $30 tax, you make $30 which is 6%.

Hardly worth it!!

Up to you though, it may be a good learning experience at least.
 

I second that

Education is key

Peter Lynch's One Up On Wall St (1990) would be a good start
 

Good point, for this case, you might as well put in the bank, risk free



thx

MS
 
Thanks for the quick replies to my question,

I thought that this would be the case time to start saving hard.
What would be the minimum starting money. I have been reseaching and $3k has a few reports of being effective would $1500 do the trick or should i wait till the 3 - 4K mark.

Regards
Zam
 
My vote is to give it a go Zam.

You won't make your fortune on that amount but you won't lose your shirt either. Buy something like 300 shares in BPT and see how things go.

If your inspired save up another $500 and buy some more.

Plenty of good reading available for free on the net even some of the acclaimed books if you look hard enough.
 
There is some merrit in the idea of buying $500 worth of a cheaper share. That way you are keen to follow them, and any mistakes you make cost real money, so you learn from them in a hurry.

I started with $5000, and lost nearly half of it before i started to learn more, control risk, and choose more carefully.

Remember, only invest it if you can afford to lose it.
 

Good point

actually i think u should go for a speccy, potential 10 bagger, most u can lose is 500 but very very unlikely, but quite possible u can lose 200 maybe

Uranium Stocks maybe eg AEX? EXT?

any other good ones?

thx

MS
 
michael_selway said:
Good point

actually i think u should go for a speccy, potential 10 bagger, most u can lose is 500 but very very unlikely, but quite possible u can lose 200 maybe

Uranium Stocks maybe eg AEX? EXT?

any other good ones?

thx

MS
Click to expand...

I second that, research a good specky that might (?) have some real prospects, check their announcements (all) and see if they are making real progress to achieving their goals. If you only have $500 its worth taking a punt and if it comes off you can wack your profits into a good mid cap company.
All the best and enjoy your ride.
 
I hold AEX, at least its cheap and in an up trend channel. I'm not even going to bother commenting on the other one, there are plenty of views available on that one, LOL!

You could pick up 10,000 shares of AEX for $420. At least you'll see some movement.
 
wow cant believe how quick you people answer, keep it up lol.

I think my best option would be to go with the bank and build it up.

I looked into AEX shares and can buy 12500 for 500 if around 0.04 a share
If this raised to 0.06 and after broker and tax fees would not make me much $100 for example. would it be worth having a stab at this and reinvesting the 100 and slowly (very slowly) build my way up.

I know i am talking petty cash here but i am lookin at it as a start.

Thanks again for the answers

Regards
Zam
 
Not qualified at anything but having tried a lot of things (property, trading and such) and losing I just place my money with those who keep on delivering. Many will give my thought the flick as they are more able to make money but if I had my time over again, especially if I was starting out again - which I am in one way - I would simply give the funds to companies like Argo Investments, Australian Investment Foundation and others such as them and reinvest the divedends. You will need to research if they are suitable for you.

The stress of everything else took its toll on me and my family so with all else being equal we decided it was better to go that way. As one person suggested outsource your incompantance. AFI paid a divvy today so that made it a nice day today.
 
Work your up to 5k you can happily trade with that but if your really serious about trading you need about 20k before you can see any real profits. Trading is a long a rewarding journey and i wish you luck. But keep one thing clear in your mind that your primary goal in trading is preserving your capital profits are just bonuses that come along.
 


Zam

the best thing for you to do is read some books if your new, after reading a few books start paper trading, work out a system for your trading.

by that time you could have saved some more funds to start trading.

take it slowly and all ways remember that if you miss a opertunity today don't worry cuz there will be another one soon!

Also losing small amounts of money is fine never be afraid to lose in the market the seceret is to take out more then you leave in!

best of luck to you!

some great books to read:

Secrets for Profiting in Bull and Bear Markets

Charting Secrets.
 
michael_selway said:
Uranium Stocks maybe eg AEX? EXT?

any other good ones?
Click to expand...

Zam, just btw me and u, have a look at CBH, if it closes above 40c today and the volume is there also, the potential is massive; and its not based on ifs, buts and maybes, they will be earning big money from endeavour very soon

Dont be in a hurry to jump into the market though; there will always be opportunites if people tell u "once in a lifetime opportunity" or "its a no brainer" dont listen always do ur own research and rememeber these words below a wise man once said them to me:

The trend is your friend, your enemy is your fear, your greed will cost you and your lack of a stop loss is idiotic.
 
Thanks again,

I have learned so much from these forums in the last few days what you have here is a great resource.

I think i will sit n save and continue my paper trading might even throw around 500 to get a feel for it.

Regards
Zam
 
zam said:
Thanks again,

I have learned so much from these forums in the last few days what you have here is a great resource.

I think i will sit n save and continue my paper trading might even throw around 500 to get a feel for it.

Regards
Zam
Click to expand...

good thinking Zam

the markets are totally different to this time last year its a lot more tricky!

paper trade and develop a system!
 
HI Zam,

From one newbie to another, my question to you is. What do you know about trading? education mate is the key.

I have been lurking around here now for quite some months and educating myself and following the market for some time and i have not put a cent in yet. This is about to change but my point is these forums are excellent and alot of the guys and girls give great advice and are very helpful. You cannot be successful until you can make the right decisions yourself, for a long time i would look at some of the posts made here on trades made etc and say to myself "why did he do that? what made him buy that stock?" until you can see and understand the basics of trading and apply it to your own system my opinion is leave it alone.

I am happy to start making some trades myself because my trading strategy is showing promise, i am picking entry signals and following trades through on my own which gives me heaps more confidence. I can then come back here and comment on what i think about a certain trade and its a good sanity check.

Anyway i hope it all goes well!

Stink
 

Very Well Said :bowser:
 
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