North Texas Daily

An introduction to the world of investing

An introduction to the world of investing

An introduction to the world of investing
January 19
11:22 2020

Allow me to preface this piece with a simple statement: I am not an expert investor and I am not responsible for any money you lose from following my advice. 

With that out of the way, let’s get started. It’s 2020 and responsible financial actions are as accessible as ever. Budgeting apps collect directly to bank accounts to track and limit spending, and the stock market is at the tip of our fingers. The emergence of “free” investing platforms such as Robinhood has introduced a whole new demographic to the stockmarket. People are starting to invest at a younger age and it’s not only helping the health of the stock market, but it’s helping individuals. It’s common knowledge in the financial sector that the sooner you get into investing, the more money you’ll possess by the time you retire. 

In 2020, we’re beyond the days of needing financial advisors and stockbrokers — we can accomplish everything on our phones. Here are some quick steps to getting into investing in 2020.

Decide what your goals are

As with everything in life, the first step is to assess your goals. The two main methods of investing are short- and long-term trading. Long-term investments can include anything from personally investing in bluechip stocks to investing in an Individual Retirement Account. Regardless of what you want to do, there’s a method to do it.

Find a free investing software

There’s no such thing as a free lunch, but some websites offer “free” trading, regardless. Personally, I started using Robinhood about a year ago. They do take a commission off the top of traded shares, but it’s almost unnoticeable at the end of the day. An extra bonus of apps like this is that some throw in a free stock whenever you join. I received a share of Groupon (worth $3.25 when I received it and is now worth $2.95), for example. 

Utilize study tools

Not only do these investing software offer newsfeeds that give hints at the market, but there are several tools online that can help you learn the best ways to trade. Media outlets, such as the Wall Street Journal, have business sections that report on policies affecting the economy. Websites, such as Nerd Wallet and Investor Junkie, are devoted to giving tips, including any form of investment. No one is expected to know how to navigate the world of investing from the get-go, but there are plenty of resources available.

Start small

The worst thing any beginner can do is throw their entire savings into the market. With how volatile the American stock market can be (especially now with the threat of a recession looming), it’s important to start small, invest in a few smaller stocks and work your way. Set a certain percentage of your biweekly paycheck and make yourself invest in that after utilizing research tools. 

Once established, diversify your portfolio

I won’t tell anyone they should get into cryptocurrency, but dipping your toes in the water of any investment is a good idea. If Bitcoin blows up as it did halfway through the last decade, a $10 investment now could turn into $20,000 down the road. But if you wanna stay in the realm of firmer investments, look into different sections of the economy. Aim to be a jack-of-all-trades, rather than sticking in one realm such as technology or construction. Sections like real estate have investment groups that spread among a plethora of different public corporations and tend to be safer than investing in individual companies.

Regardless of how you choose to handle investments, investing in college — assuming you have the extra funds — is a safeguard to the economy hitting the wall later on. However, establish your goals and tread carefully in the beginning.

Allow me to stress this again: I’m not a certified personal financial advisor, so don’t flood my email with hate letters if you lose money. The stock market is an ever-fluctuating beast and should be treated with respect.

Featured Illustration: Miranda Thomas

About Author

Zachary Cottam

Zachary Cottam

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