Investment For Beginners

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By

Alan Oscroft

Published in Investing on 19 April 2012

Our new series on investment for beginners takes you through the steps of getting started.

So, you think you might like to invest in shares, you've seen lots of waffle about earnings and dividends and ratios and all that, but you're stuck at the first hurdle thinking: "Yes, but what do I actually do?" Well, you're not alone, and this new series on investment for beginners is for you.

Over the coming weeks, we'll take a look at what shares are and how stock markets work, with the emphasis on what you actually do and how you go about setting up the necessary accounts, transferring money around, and actually buying and selling shares.

And we'll even set up a sample portfolio, containing shares in five or six well-known companies, with the aim of keeping track of what news becomes available and what you should do about it when you get it. The focus will be on the practical operation of the portfolio, not on tracking its performance (though we hope that will be reasonable, too).

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If you want to know more about this new series of articles, or have any suggestions as to what you'd like to see, feel free to add your comments in the box below.

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Comments

The opinions expressed here are those of the individual writers and are not representative of The Motley Fool. If you spot any comments that are unsuitable hit the flag to alert our moderators.

AleisterCrowley 19 Apr 2012 , 4:15pm

I find it vaguely annoying that, when I click on 'series' absent-mindedly expecting it to be a link to the articles, I end up at a FedEx advert

apprenticeDRL 19 Apr 2012 , 4:29pm

I look forward to reading this series of articles

TMFSamR 19 Apr 2012 , 4:47pm

Keep an eye out for an article tomorrow morning, apprenticeDRL! :-)

Stevokenevo 19 Apr 2012 , 10:53pm

Looking forward to this series. Im pretty new to this stocks and shares stuff and always willing to learn.

Gazzamm 20 Apr 2012 , 1:59pm

Have been thinking a lot about investing lately and have been using google finance to create a fantasy portfolio in the last week. At the moment, I'm up, but I expect it to fluctuate wildly. I really need more guidance to understand the fundamentals of trading.

guykguard 20 Apr 2012 , 6:08pm

@Gazzam
Far be it from me to put you off your "thinking a lot about investment", nor Alan Oscroft his forthcoming series of articles. However, if he sticks to his plan, he will, I trust, draw a sharp distinction between investment and trading. For many people but not all investment is a wise choice -- in property, cash, stocks and shares, and anything that is rare or scarce. Trading is a fancy word for gambling. A few traders strike lucky but we seldom hear about all those who try it and lose their shirt.
As a self-confessed beginner, you cannot do yourelf a bigger favour than read "Where are All the Customers' Yachts...?" by Fred Schwed. Nor can all we hardened pros!
If you mean by trading simply buying and selling a share, there's not a lot to it The hard part is to know when to buy and sell. Alas, not even Mr Oscroft can help us much with that! Good luck!

JohnnyCyclops 20 Apr 2012 , 8:09pm

"Where are All the Customers' Yachts...?" by Fred Schwed.

That can't be a real name. I'm almost tempted NOT to look it up on Amazon so I don't break the spell.

MF is very good at distinguishing investing from speculating from trading, so I think you have no fears there.

WallStreetRaider 20 Apr 2012 , 11:17pm

Let's hope that it's not all about "dividend-paying shares" as The Motley Fool likes to concentrate on.

Not all of us are into dividend-paying share selection.

Let's see more on Growth Shares and GARP share selection on this site too please.

jaizan 21 Apr 2012 , 1:13pm

For many of us I suggest the most important thing is to INVEST, not TRADE.

RobinnBanks 22 Apr 2012 , 5:54pm

Fred Schwed's excellent advice was to buy low and sell high; do this all your investment life, and he says you will die rich! I heartily recommend his book, and wish I could emulate him more!

TMFBoing 24 Apr 2012 , 10:24am

"Where are All the Customers' Yachts...?" by Fred Schwed.

That can't be a real name. I'm almost tempted NOT to look it up on Amazon so I don't break the spell.

Oh, it's real all right - and it's a great book.

Alan
TMFBoing

elopesi 24 Apr 2012 , 11:59am

Can we have a list of all the stock market synonyms, such as p/e and others,what they tell us AND especially how they are calculated.
Many thanks
David Ross

AleisterCrowley 25 Apr 2012 , 2:05pm

"Where are All the Customers' Yachts...?" by Fred Schwed.

His middle name is "The" , right ?

BadlyDrawnBoy 26 Apr 2012 , 12:47pm

I think the mechanics are pretty well covered in lots of places. Where I struggle as a beginning investor is:

1) Valuing a business (and it's shares) - a guide on how to read balance sheets and annual reports, and a glossary of all those accounting terms would be great.

2) Finding out what systems other investors use for staying organised and tracking their performance - I half-heartedly update a spreadsheet when I remember, but I feel like I'm missing something!

fifiqq 28 Apr 2012 , 9:54am

It says above that if I would like to know more, please put my comment here so here it is.
I'd like to know more.

It seems a strange way to register one's interest but perhaps there is something [yet again!] that I don't understand.

TMFBoing 30 Apr 2012 , 10:56am

Hi fifiqq,

What we really meant is that if there are any specific issues you'd like to learn about, please let us know of them.

So as the series progresses, please do raise anything you want to know more about - and in the meantime, just keep following, twice a week.

Foolish regards,
Alan
TMFBoing

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