How do I start investing in the stock market and not lose my money ??

I have this questioned asked a lot by people who are looking to improve the returns on there money .

Lets face facts . Banks are safer, but they pay very little in returns now .

I give them two suggestions .

1. If they live near a Junior College , take a night course in private investing . These are usually mini courses that give no college credit units and are great for learning about investing in the stock market . They usually are taught by a Stock Broker.

2. If there are no JC's close by , Talk with your friends,ask if they are investors and see if they are happy with their broker . Then set up a appointment and go ask some question ? Many brokers can and will set you up on a personalized small scale investment plan to start you out that fits your particular needs . It should be explained to you in detail and NEVER be afraid to ask questions . Its your money . Know your Fees he or his company will charge up front . That way there will be no surprizes later .Ask him the different risk of investing .

If you are ever solicited by a outside sales person over the phone . Hang up quick !

You will want to know your broker well , Take the time to review your portfolio at least twice a year with him , if not more .Thats part of his service to you . There are no charges for appointments .
There's nothing wrong with asking him "what's his track record" been over the last couple years .

Which ever way you choose to learn , do yourself a favor and start with a good brokerage firm to get you started on the right foot . There may come a day that you are ready to "Fly Solo" and do all your your investing through a Day trader type of brokerage firm ,but I would suggest starting out with a little help of a good Broker .

Good info Al.
How much does a good broker charge per trade?
Do you pay a transaction fee for both buying and selling?
Are their other charges to be aware of?
I know the initial meeting is free, but they have to make their money somehow.
How do you know they have your best interest at heart?

Years ago, I did a little bit of trading through a broker and I asked him if he had any good tips and all that I got was a lecture about insider trading.

There is a fee for both buying and selling stock, also when you sell there is a small fee which does not amount to a lot.

I do not know what full service brokers are currently charging, but when I used to trade through them, I thought it was quite a bit, about $50 per trade, I now use Etrade and my fee is $7.99 per trade.

The broker only has one person's best interest at heart and that is their own. If one ever tries to get you to buy a stock that they are a market maker in, stay away from it.

Doc said:

How much does a good broker charge per trade?
Do you pay a transaction fee for both buying and selling?
Are their other charges to be aware of?
I know the initial meeting is free, but they have to make their money somehow.
How do you know they have your best interest at heart?

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The charge per trade or transaction fee is basically one in the same . It may very on the amount or type of stock . The brokerage houses set their own fee on this ,much like banks do. There is usually a yearly Overhead fee charged to your account that is the same for all customers .It is very mimimal and around a $100 yearly. This may be waved depending on how much business you do through them .

Most brokers do not keep their clients if they are losing them money .

For Example: My broker is my advisor and I do use his services to make stock transactions . But I also use his services for sending me propectus on new stocks , discussing "tax saving moves" that are in my best interest, providing me with monthly profit and loss statements , tracking my dividends as they are declared and reinvested properly ,a free "Notary" and "Wire Transfer" service , and much more .

A good broker should also be well versed and up to date on IRS Tax Laws and Retirment Plans .

I also do something that many investors may or may not do . I never keep all "My eggs" in one place .

REDDOGTWO said:

Years ago, I did a little bit of trading through a broker and I asked him if he had any good tips and all that I got was a lecture about insider trading.

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I would have walked out "On the spot" ! There is nothing wrong or illegal in providing public information on any stock . My broker often calls me with IPO's and other stock offerings that may be of interest to me .
I live by one rule :

If its too good to be true ,it probably is !

insider trading is when the person works for the firm and has knowledge of something big coming, and uses this to his advantage. A stock broker SHOULD have this knowledge and call each of his clients and let them know what is up, and this information should be public knowledge by then, or at least be published in some way as advertising. If someone comes to a broker with knowledge of something that is considered private information at the time, the broker can not use this in his sales approach.

Say XYZ has a product not in public knowledge yet, but person ABC leaks it to his broker, and buys shares......that is a form of insider trading, and the employee could be in trouble, if the broker sells shares on this knowledge to the employee, he is in the barrell. If he sells using this knowledge to others, he is in the barrell.

at least I believe that is the way I remember if from when I had my license to sell

ddrane2115 said:

at least I believe that is the way I remember if from when I had my license to sell

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So how long were you a broker ? Did you retire from that business ? Thanks for explaining "Insider Trading" to us .
Maybe you could help on other answers as they are asked ????