If that's what you want to do, then go for it. But my bet is you will end up like kelby who thinks he got a decent return. While he's patting himself on the back for the less thsn 3 percent annual return on INTC, the major indexes have returned over 30 percent over the same period.
I just watch business channels on tv, read magazines like Money or Kiplingers for "interesting" stock tips. You can collect as many as you want. Then I go to online research sites like YaHoo, or MSN or Fidelity mainly to see the analysts ratings and maybe the charts for the last few years. When I decide on a stock I buy it and the forget about it for a year. After the year is up I watch it for a few months to understand how it moves. At some point in time, perhaps after years, it will become clear that it is time to sell.
For example, I bought INTEL about two and a half years ago at 24.40. I waited a year and then watched it for a year and a half. Itwnet as low as 20 and bounce around the low 20's. A couple weeks ago it reached 26.68 and I sold it. Counting dividends I made about 5% or so, which is rather low, but the point is even though it was lower than I paid for most of the time I owned it, by using buy and hold methods, I came out with a reasonable profit where I could have easily lost.
Hopefully when you do your homework you will be able to answer some of your own questions.
A $10 stock isn't necessarily cheaper than a $20 stock. It depends on the valuation of the company.
My suggestion would be to try to diversify. Don't plop everything down on one stock. Try for two to four stocks.
Sounds like you're off to a great start with your saving and being 20 years old is a great time to take an educated risk with your money because you still have time to earn back any losses.
Decide whether you will be an investor or trader. If you will be an investor, go to www.investopedia.com and look up and read their "Investing 101" it is a good primer. The one basic rule or two is, your job is to buy a dollar for fifty cents. Pay attention to the cost of doing business just as you, I hope, pay attention to the fees on your mutual funds. You may want to pay more attention to so-called "growth" stocks which are at the opposite end of the spectrum from "dividend" stocks as you are probably paying income taxes. You will likely do better buying companies whose products you know.
I am new to the concept of investing in individual stocks, though I have been a long time user of several mutual funds in which I have 70% of my money. I am in my early 20s, single, no debt, and am looking to purchase some individual stocks - mainly for my own interest and the pride that can come with being responsible for my financial performance.
I am looking to invest about $2k-$3k in individual stocks this summer, after I have done a good bit of homework on strategy and narrowing down my options on what I would like to invest in. My question is, having already established index funds for myself, what would be good strategies on putting the 2-3k to its best use in individual stocks?
Note: not asking for stock picks, but rather things like small quantities of multiple companies v large orders, more expensive stocks v cheaper stocks, ect....
Thank you in advance :)
