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Username Post: Stock Questions/Help Please        (Topic#535840)
dirty
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04-11-12 06:36 PM - Post#1426979    



First off- I'm a complete rookie with this. If you give me advice and speak to me like I'm slow here I won't be offended. I keep myself on a fairly tight budget. A small portion of my check goes to a 401K, a small portion goes straight into a savings account that I don't touch and the rest goes into my checking account.

I don't really invest much myself. I recently bought $1,500 worth of silver but I'm just keeping that aside and hoping for the best long term. I might pick up more in the near future.

I'd like to try my hand with small stock investments but the little bit of research I did today just confused me more about the process. Some places I checked called for me to go through middlemen. Some had a $2,000 minimum. Some claimed they were free for each "trade" but there seemed to be stipulations.

I don't want to invest a lot. Basically I'll have $100 to $200 a month I'll invest for a while and if it seems I'm doing poorly I'll stop. I don't want to put in $2,000 right away. I just want to slowly buy stocks at my own pace. Is there a site where I can do something like this and just keep my investments/portfolio stuffed away? Do I have to have a certain amount of transactions? Are there any sites that don't charge for each little purchase?

If somebody would be willing to PM me or give me easy answers here I'd really appreciate it.
Many black people have gone around saying cracker -chaser
I have never had a guff with Stortini -McKenna
most people have a deep fryer and a turkey fryer -Huard
My favourite actor Nigolas Cage-Juha


 
Kanrok
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04-11-12 06:43 PM - Post#1426984    


    In response to dirty

What color is your check?

Somebody had to ask it.

With your level of contributions I would suggest DRIP stocks (DRIP stands for "dividend reinvestment).

Pick out 4-5 good, solid companies that offer DRIP (meaning periodic stock investments directly to the company with dividends- cutting out the middle man) like Walgreens (WAG), Johnson & Johnson (JNJ), Clorox (CLX), and build up a position. Once you reach 100 shares find other companies to invest in.

The dividends then pay for more stock. The more shares you hold, the bigger your dividend, and the dividend makes your position automatically larger with time.

Google "DRIP stocks" and you'll get plenty of hits.

One word of warning though, keep good records of your transactions so you can calculate your tax basis when it's time to sell.

I did this when I was young, and you would be surprised how quickly you build up holdings.

Just be disciplined - pay yourself first.

Good luck.
Blessed are those who hunger and thirst for justice, for they shall be satisfied.


 
dirty
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04-11-12 06:47 PM - Post#1426986    


    In response to Kanrok

Thank you. I will look into it.
Many black people have gone around saying cracker -chaser
I have never had a guff with Stortini -McKenna
most people have a deep fryer and a turkey fryer -Huard
My favourite actor Nigolas Cage-Juha


 
mtnbiker
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04-11-12 07:25 PM - Post#1427003    


    In response to dirty

Companies like Computershare offer you the ability to buy shares of many different companies that offer dividend reinvestment plans.

https://www-us.computershare.com/Investor/default.asp

They allow monthly contributions (like $100/mo) and dividend reinvestment.

Remember that even if you are reinvesting dividends you will still be accountable for the taxes on the dividends (and not just the tax on potential gains when you sell).
"This ends tonight!"
"It's daytime you douche."



 
NYR_Nutz
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04-11-12 07:35 PM - Post#1427009    


    In response to mtnbiker

I recommend checking out Vanguard.com and looking into mutual funds. They have Target retirement funds or just general mutual fund accounts with minimums of $1k for most accounts.

Obviously different than stocks, but a good way to invest $100-200 per month and watch it hopefully grow. No transaction fees


 
dirty
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04-11-12 07:50 PM - Post#1427014    


    In response to NYR_Nutz

Thanks guys.
Many black people have gone around saying cracker -chaser
I have never had a guff with Stortini -McKenna
most people have a deep fryer and a turkey fryer -Huard
My favourite actor Nigolas Cage-Juha


 
mtnbiker
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04-11-12 07:50 PM - Post#1427016    


    In response to NYR_Nutz

The big knock against mutual funds (whether active or index) are the inherent internal costs. Granted they offer diversification and simplification, but sooner or later there will portfolio drag due to the fees. Owning an individual stock is cheaper, and the stock DRP is the more cost effective way to go but with potential higher risk since you are own a single company versus a fund of 80 companies. On the other hand, Vanguard has an excellent website and tons of info on various investments, but will typically charge $7 or $25 (depending on how many trades you do) per stock trade. Vanguard does not charge fees for buying their mutual funds.
"This ends tonight!"
"It's daytime you douche."



 
Johnny_Upton
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04-11-12 07:52 PM - Post#1427017    


    In response to Kanrok

  • Kanrok Said:
What color is your check?

Somebody had to ask it.

With your level of contributions I would suggest DRIP stocks (DRIP stands for "dividend reinvestment).

Pick out 4-5 good, solid companies that offer DRIP (meaning periodic stock investments directly to the company with dividends- cutting out the middle man) like Walgreens (WAG), Johnson & Johnson (JNJ), Clorox (CLX), and build up a position. Once you reach 100 shares find other companies to invest in.

The dividends then pay for more stock. The more shares you hold, the bigger your dividend, and the dividend makes your position automatically larger with time.

Google "DRIP stocks" and you'll get plenty of hits.

One word of warning though, keep good records of your transactions so you can calculate your tax basis when it's time to sell.

I did this when I was young, and you would be surprised how quickly you build up holdings.

Just be disciplined - pay yourself first.

Good luck.



+1

I'd highly recommend ING/Sharebuilder for the convenience factor.

But you can do the same direct with many companies direct, although they often have minimums ($1k) or make you own 1 share

http://www.dividendgrowthinvestor.com/ - Pretty good site for info.

It was down in Louisiana,
Just about a mile from Texarkana,
In them old cotton fields back home.


 
rangfan
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04-11-12 07:56 PM - Post#1427018    


    In response to NYR_Nutz

Index funds. Unless you think you know more than the masses, or are very lucky.

From a risk-return perspective they beat most managed funds.

Individual stock picking? I'd be careful, though having an income component is not a bad idea. If you're investing for the long term, I'd look for companies that will benefit from long term trends, e.g. the aging demographic mix (think medical supplies), global warming and climate change (think generators), etc...
"He is NOT Yankees material. He wouldn't look good in their uniform and doesn't fit the class or work ethic level. I see him as a lazy non pressure environment pitcher."

Huard, on CC


 
rangfan
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04-11-12 07:59 PM - Post#1427019    


    In response to mtnbiker

  • mtnbiker Said:
The big knock against mutual funds (whether active or index) are the inherent internal costs.



There are plenty of passive/index funds with very low costs.

History and statistics say you're better in index funds than individual stocks, unless you're a savant.
"He is NOT Yankees material. He wouldn't look good in their uniform and doesn't fit the class or work ethic level. I see him as a lazy non pressure environment pitcher."

Huard, on CC


 
Johnny_Upton
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04-11-12 07:59 PM - Post#1427020    


    In response to mtnbiker

  • mtnbiker Said:
The big knock against mutual funds (whether active or index) are the inherent internal costs. Granted they offer diversification and simplification, but sooner or later there will portfolio drag due to the fees. Owning an individual stock is cheaper, and the stock DRP is the more cost effective way to go but with potential higher risk since you are own a single company versus a fund of 80 companies. On the other hand, Vanguard has an excellent website and tons of info on various investments, but will typically charge $7 or $25 (depending on how many trades you do) per stock trade. Vanguard does not charge fees for buying their mutual funds.



Sharebuilder will do $4 trades (Reoccurring)

Disagree that the 0.3% +/- is much of a drag Vs the costs of buying and selling

YMMV
It was down in Louisiana,
Just about a mile from Texarkana,
In them old cotton fields back home.


 
mtnbiker
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04-11-12 08:09 PM - Post#1427025    


    In response to Johnny_Upton

Do you really want to get into this?

The SEC requires all mutual funds to have a prospectus that discloses the fees of the mutual fund. But the fund company only discloses the fees that the SEC requires. There is typically another .5%-1.5% of hidden cost that the fund companies are not required to discuss.

Add the fact the the investor is subjected to potential annual capital gain distributions from portfolio holdings being bought and sold by the manager it can add additional cost and tax issues. If there are years where a bunch of investors dump their mutual fund shares, the fund manager is oftentimes forced to sell positions to cover those redemptions creating more cost and potentially more taxable distributions. There were plenty of stock funds in 2000 and 2001 that had bad losses, and yet investors were given a nice little surprise in the form of a big cap gain distribution. Those shareholders had to pay taxes on gains although they were actually were down substantially.
"This ends tonight!"
"It's daytime you douche."



 
Johnny_Upton
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04-11-12 08:12 PM - Post#1427026    


    In response to mtnbiker

Not to get nit-picky but cap gains/losses aren't fees (Though I agree that the tax consequences can be troubling)
It was down in Louisiana,
Just about a mile from Texarkana,
In them old cotton fields back home.


 
cashman rulz
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04-11-12 08:21 PM - Post#1427030    


    In response to Kanrok

  • Kanrok Said:
What color is your check?

Somebody had to ask it.

With your level of contributions I would suggest DRIP stocks (DRIP stands for "dividend reinvestment).

Pick out 4-5 good, solid companies that offer DRIP (meaning periodic stock investments directly to the company with dividends- cutting out the middle man) like Walgreens (WAG), Johnson & Johnson (JNJ), Clorox (CLX), and build up a position. Once you reach 100 shares find other companies to invest in.

The dividends then pay for more stock. The more shares you hold, the bigger your dividend, and the dividend makes your position automatically larger with time.

Google "DRIP stocks" and you'll get plenty of hits.

One word of warning though, keep good records of your transactions so you can calculate your tax basis when it's time to sell.

I did this when I was young, and you would be surprised how quickly you build up holdings.

Just be disciplined - pay yourself first.

Good luck.

Very good revue Kanrok,I was fortunate enough in my younger days buying canadian banks(a little at a time)that paid dividends and i reinvested the dividend in more shares for many of years and the stock split 4 times since then and now i still have my initial investment and i live very comfortable off the dividend payments 4 times a year.The only thing i can add dirty is keep an eye on mining(junior companies)that you can buy for cheap when the ipo is released and ride the pine with them,if you can mutiply your money quickly then sell it.


 
PuckRogue
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04-11-12 08:35 PM - Post#1427033    


    In response to rangfan

Put some money in OREX. Slam dunk for next year.

-PR
Bee-dee Bee-dee Bee-dee


 
mtnbiker
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04-11-12 08:40 PM - Post#1427036    


    In response to Johnny_Upton

  • Johnny_Upton Said:
Not to get nit-picky but cap gains/losses aren't fees (Though I agree that the tax consequences can be troubling)



That's why my third paragraph starts with "add the fact".
"This ends tonight!"
"It's daytime you douche."



 
Cotton
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04-11-12 08:40 PM - Post#1427037    


    In response to PuckRogue

Great thread!

I've been a gold bug for years and I've done well with it. It originally started because of my political/social views, but I've done quite well with gold and silver over the years.

The wife handles other investments as she went to school for it and has worked in a bank for 10 years. That was the agreement. I get my gold/silver money allocation and she gets the other investment funds allocation portion. Both of us have done well in those regards IMO.
"No man in the wrong can stand up against a fellow that's in the right an keeps on a-comin."
-creed of Texas Ranger Captain W. J. McDonald




 
foolish
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04-11-12 08:40 PM - Post#1427038    


    In response to cashman rulz

I'd suggest seeing if your bank offers a brokerage service (I think most do). then you can hopefully be waived on the minimums and just "pay per trade". I would be really leary of a site/service that didn't charge a fee.

You should also spend a little time gauging your risk tolerance.

I also very strongly suggest avoiding the lure of penny stocks - if you have the time to keep an eye on them, they can pay huge... but most don't.

DRIPs are a great idea - if you are ok with slow gains.

I trade fairly aggressively, and for my "long-term" stuff I tend to look for small biotechs who've had recent bad news.....FDA rulings tend to drive prices down disproportionately, and pending studies seem to inflate prices equally disproportionately... which can equal nice profits

but its all about how much time you want to spend, and how much risk you are willing to take

I can suggest an awesome book if you get into day/swing/pattern trading at all:

"stock patterns for day trading" by barry rudd

Good luck!
 
Johnny_Upton
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04-11-12 09:01 PM - Post#1427048    


    In response to mtnbiker

  • mtnbiker Said:
  • Johnny_Upton Said:
Not to get nit-picky but cap gains/losses aren't fees (Though I agree that the tax consequences can be troubling)



That's why my third paragraph starts with "add the fact".



You did, Missed it
It was down in Louisiana,
Just about a mile from Texarkana,
In them old cotton fields back home.


 
cashman rulz
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04-11-12 09:42 PM - Post#1427067    


    In response to Cotton

  • Cotton Said:
Great thread!

I've been a gold bug for years and I've done well with it. It originally started because of my political/social views, but I've done quite well with gold and silver over the years.

The wife handles other investments as she went to school for it and has worked in a bank for 10 years. That was the agreement. I get my gold/silver money allocation and she gets the other investment funds allocation portion. Both of us have done well in those regards IMO.

You have any visible or is it paper?


 
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