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Investing for beginners

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https://www.moneysavingexpert.com/savings/investment-beginners/

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Investing for beginners
Many savers fed up with risible rates of return on their cash are being tempted to invest in stock markets instead. Our beginners' guide explains what taking a punt on shares really means for your money, what and where to buy, and how much risk to take.

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Investment explained

Investment explained

An investment is a gamble: instead of the security of guaranteed returns, you're taking a risk with your money. 

You can invest in Shares, Bonds, Funds, Government bonds (gilts), ...

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How stock markets work

How stock markets work
  • A stock market is simply a place where buyers and sellers meet to sell shares.
  • A share is a divided-up unit of the value of a company.
  • Shares exist to boos...

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Share price of a company can rise and fall

  • The price is initially set by the firm offering shares.
  • Its price on any given day can be determined by poor financial results, the economic health and so-called 'sentiment', ie, if Ci...

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5 golden rules of investing

5 golden rules of investing
  1. The greater return you want, the more risk you'll usually have to accept.
  2. Diversify as much as you can to lower your risk exposure, ie, invest in different companies, industries...

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Investment as a good fit

  • Ask yourself WHY you're looking to invest.
  • It is better to try and sort out your personal debts first before you take the risk of making them worse.
  • You don't ...

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How to invest

  • You can buy shares or funds from different providers.
  • The cheapest offers you'll want to do it through is a website, often called a platform.
  • It's a two-stage process...

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2 ways you make money from investing

2 ways you make money from investing

One is when the shares increase in value (and you profit when you sell), the other is when they pay dividends.

Dividends are a bit like interest on a savings account. If a company...

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A fund explained

A fund explained
  • A fund is simply another way to buy shares. 
  • Instead of you buying a slice of a company directly, you give your cash to a specialist manager who pools it with money from ot...

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SIMILAR ARTICLES & IDEAS:

Investing defined

Investing is about laying out cash or assets now, in the hope of more cash or assets returning to you tomorrow, or next year, or next decade.

Most of the time, this is best achieved th...

Productive assets explained

  • Productive assets are investments that internally throw off surplus money from some sort of activity. 
  • Each type of productive asset has its own pros and cons, unique quirks, legal traditions, tax rules, and other relevant details.
  • The three most common kinds of investments from productive assets are stocks, bonds, and real estate.

Investing in Stocks

  • It means investing in common stock, which is another way to describe business ownership or business equity.
  • When you own equity (the value of the shares issued by a company) in a business, you are entitled to a share of the profit or losses generated by that company's operating activity.
  • Equities are the most rewarding asset class for investors seeking to build wealth over time without using large amounts of leverage.

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Investing

... is the trading of your money today for a lot more money in the future. It is a high yield over the long term.

What happens to your money

Banks don’t like to give away their money. That mindset is reflected in the interest rates of checking and savings accounts of 0,5% and 0.9% avg. annual interest respectively.

When you deposit your money in the bank, the bank turns around and invests that money at 7% a year or more. After they collect their profit, they give a tiny shaving of it to you.

Portfolio and Diversification

  • Your portfolio reflects your long-term wealth building investment strategy – not the short term. It includes everything you own. Your retirement accounts, your investment accounts, even your home are types of investments.
  • Diversification is a way to describe owning multiple types of investment assets. Diversification is smart because you both protect yourself from failure and position yourself to take advantage of multiple robust methods for building wealth.

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6 ideal investments for beginners

6 ideal investments for beginners
  1. If you have a 401(k) or another retirement plan at work, it’s very likely the first place you should put your money— especially if your company matches a portion of your contributions.