Is investing easy, if so why aren't more people investors?
Investing sounds easy, but I might be very wrong. I have to admit I may know a little about investing. Isn't it just buying a stock from a company, and when the value of the company increases the value of the stock increases? Is investing time-consuming? Do I have to learn a lot before I can start? How risky is investing? And in the end, is it rewarding? Im thinking of getting into it if its not too time-consuming. I can buy and sell stocks online, right? Thank you for taking the time and answering my many questions. I really appreciate it :).
I know it takes time and won't make me cash overnight.
- AmyLv 72 months ago
Many people are investors through a 401(k) or similar, even if they don't realize it. Those who don't invest might not have enough money to set some aside long-term, or might distrust the banking institutions, or might just never have been taught how. Schools don't teach even the basics of personal finance.
Investing can be as simple as "just buying a stock," but there are also some very complicated options. And there's no guarantee that any particular company will increase in value. Another type of investment is a loan at a fixed interest rate.
Some investments are riskier than others. Airline stocks are currently trading at less than half of their January price. Hotel chains cancelled their dividends. But the riskier investments tend to give higher returns when they do succeed. On average, stocks double in value every decade.
Investing is not time-consuming; in fact you should rarely make changes to your investments. But you do need to put in some time up front to understand what you're spending your money on. If you buy stocks of individual companies, you'd better be very confident that they're financially stable companies. If you buy a mutual fund, know how much you'll pay in management fees.
- SteveLv 62 months ago
You have the basics of it down. Theres more to it than just thinking it may be a good buy because everyone else is buying it. You have to look at the data that is available to you. Yahoo finance provides enough to where you can make a solid decision about the stock. There other places online. Some you pay for the service to know more. Investing should take some of your time. Not all of it. An hour or 2 a day would work. Theres news to be followed, articles to read and data to look over. You shouldnt stop learning about what may next be a good buy. You should know at least basics before you invest a dime. Much of the rest you will learn as you go along. Experience is the best teacher. You will have ups and downs, but in the long run you will learn from mistakes that will make you a better investor. You have to stick with it, not be afraid and dont give up easily. Investing can be very risky if you go into it not knowing what you are doing. It can be very rewarding and lucrative. There are few better ways to build your income. Yes, you can buy and sell stocks online on your pc or your phone. Once you see that your account is getting larger, it will become addictive and you will want more. Good luck to you.
- zman492Lv 72 months ago
<<<Is investing easy, if so why aren't more people investors?>>>
You can make investing as easy or as complicated as you want.
More people are not investors for different reasons. One big reason is that a lot of people do not have enough money to make investments. A person who makes little more than minimum wage and has a family needs all their money simply to live a decent life in most parts of the country. Other people simply have not been taught the value of investing. Managing money money is not an inherent property of human beings. A surprising number of people who win multi-million lotteries go broke remarkable quickly.
<<<Investing sounds easy, but I might be very wrong.>>>It can be easy if, for example, you simply buy broad based mutual funds or exchange traded funds. It can also be very complex if you get into day trading or derivatives.<<<I have to admit I may know a little about investing. Isn't it just buying a stock from a company, and when the value of the company increases the value of the stock increases?>>>You rarely buy stock from a company. That only happens when the company has a public offering. At other times you usually buy a stock on an exchange from another investor. It is normally true that when the value of a company increases the value of the stock increases, but not always. Also, not all companies increase in value. Some go bankrupt.<<<Is investing time-consuming?>>>Usually not, but you can spend as much time as you want investing.<<<Do I have to learn a lot before I can start?>>>No, but the more you learn the more you are likely to make.<<<How risky is investing? And in the end, is it rewarding?>>>You can control how risky your investments are. The more diverse your investments are the lower the risk. Over the long term, diverse stock portfolios are almost always rewarding. Over the short term you will sometimes have losses. I recommend you avoid buying stocks with any money you think you are likely to need within the next five years.<<<I'm thinking of getting into it if its not too time-consuming. I can buy and sell stocks online, right?>>>Once you have established and funded a brokerage account you can buy and sell stocks online at most brokerages.
- How do you think about the answers? You can sign in to vote the answer.
- StephenWeinsteinLv 72 months ago
It's not easy and you are very wrong.
It is not rewarding for anyone who thinks it is easy.
The value of the stock does not always increase when the value of the company does. The value of the stock is simply whatever others are willing to pay for it, and may have little or nothing to do with the real value of the company.