investing in stocks online

[Tommy]

do any of you know anything about online trading

I have been following the stock market and would like to start buying some stocks
but am reluctant to open an account at these online brokers
I got a feeling i am just gonna get burried in fees and that would negate any profits I made

do any of you have a finanical consultant
whats that like

maybe I should just walk in to one of these finiancil place and buy what stock I want

I really would like to set up a monthly buy budget
maybe every month buy 500 bucks worth of stock and as I learn and make money increase the budget

[cd34]

I have a Simple IRA set up through my company through Etrade and have a taxable account with them as well. They aren't the cheapest, but, at the time I set up the Simple IRA, not many online brokers would deal with it. In terms of research available, I prefer Etrade over the others.

I had an account with Datek, who was purchased later by Ameritrade. In terms of trading costs, I prefer Ameritrade. Ameritrade's interface is a little different than etrade, and their research lacks a bit. Either one gives real time quotes, so, if you're not doing your research through your broker, pick the cheapest one that guarantees trade executions, etc.

I know that buyandhold.com is pretty well regarded if you aren't trading frequently. I don't believe you can do limit orders, and they buy at market prices once or twice a day and charge minimal fees.

I know someone that uses scottrade.com that likes their services. At $7/trade (including limit & stop orders), they are pretty darn competitive. I've been told that their online research tools are pretty good.

I know a person that has a Merrill Lynch Cash Management Account (ml.com) which allows them to do a number of things online.

If you are doing the research yourself, I don't think you need a full service brokerage. If you wanted to dump a chunk of cash somewhere and wanted someone to invest that for you, a full service brokerage -- and possibly the CMA would be the right account for you.

If you want to play with stocks, I would take a look at scottrade.com. I haven't seen the inside of their account management system, but, from what I have been told, their online research rivals what I can get with etrade.

If you are looking for bottom line cost and are reading the newspaper and aren't trying to time the market, buyandhold.com is probably the one.

Any of them can do periodic withdrawls from a checking account and will put the money into a money-market interest bearing account until you make a decision where to invest it. Keep in mind, they pay paltry interest rates.

If you were looking to do something that you didn't want to manage, fidelity.com and their mutual funds are a decent hands-off method of investing. They have some of the lowest fees around for mutual funds as far as no-load and management, and, will easily set up a monthly withdrawl from your account. In this case, you would not be able to buy individual stocks, but, you could invest in an S&P tracker that over its 'lifetime' (not recent years) has returned an average annualized 12.2%.

With that said, if you don't have a Simple IRA or SEP IRA set up for your company, you might want to talk with your accountant about a company sponsored retirement program. I don't recall the limits for last year's Simple IRA contributions, but, I believe it was $10000 in 2005 and is $10000 in 2006. This is tax deferred money that you are putting away -- and if you set up with one of the online brokerages, you can then invest that money where you choose -- including many mutual funds.

I don't think any of the accounts are prone to security issues, and you are pretty well protected against that anyhow. Its no different than online banking.

With that said, and with this being the new year, everyone should really earmark a % of their income and bank it in a savings account until you have 90 days worth of living expenses stored away. At that point, you should start investing it in higher yield products. You don't need to add a ton of risk and can stick with investments that won't lose cash like laddering CDs, i.e. buy 1 CD that matures in 12 months every month. When you hit that 1 year point, you start investing in 2 year CDs and let your existing 1 year CD rollover.

And if you don't have an accountant or company structure set up where you can defer taxable income, you should speak with an accountant.

Compound interest over time is actually quite impresive. Taking larger risks with stocks can really inflate (or deflate) your $$. Make sure you know the risk you can afford to take.

[Tommy]

Thanks Cd

when you sell a stock
it always sells ??
and for the going market price ??

[Bill]

I buy mutual funds for my IRAs online, but thats not the same. Tax deferred accounts, the accounting and reporting for them is pretty easy, it's just buy and forget.

I'd like to start buying stocks in taxable accounts, but, like you, I'm worried about how much of a hassle it will be.

I'd go to something like Money magazine and read a few issues of it to get a better sense of the pros and cons.

[Surfn]

Originally Posted by Tommy

Thanks Cd

when you sell a stock
it always sells ??
and for the going market price ??

When you tell them to sell they do at THAT price. Make sure you want to sell at the price at that moment. You can also setup a sell point. What that means is if a particular stock hits a target price up or down it sells.

[bluemoney]

I've had an Ameritrade account for quite a few years now. Fees are not bad if you can keep in a minimum balance (like a bank).

First good money I made was in a "porn company", New Frontier Media Inc. (NOOF) Bought at around $1.12 in early 1999 sold at somewhere around $9.50 in mid 2000.

I've also had losers too, like Sonic Blue. They made the Rio player and Replay TV. Fucktard management did them in.

Do your "Due Diligance"before you buy any stock and you will have more winners than losers.

Dollar cost averaging over the long haul in small solid growth companies is my general strategy. Although in the case of NOOF I just felt I needed to “take my profit and smile” Still may buy back into them sometime.

PS. Speaking of “Fucktards” how about Interactive Brand Development Inc (IBDI.OB) They bought IBill |shocking|Sucka's!

[cosmiccat]

Buying stocks online is something I've thought about doing for years but frankly, it scares the shit out of me! Perhaps if I took the time to learn something about it, it wouldn't be so scary!

[cd34]

When you place a sell order, you can place it at market (which means that it will sell at whatever the price is at the moment the sell order is issued) Of course, if the price is dropping rapidly, there's no guarantee it'll sell at a particular price. On a normal day where the stock isn't being dumped, you'll generally get a price pretty close to the time of execution of the order. It used to be that when you would place a market order, they would delay it for a few seconds to hedge themselves in there and they would clump your order in with a bunch of others and move a large block -- and possibly nail a few extra cents per share in there from the hedge for themselves. That behavior seems to be almost gone due to many of the 8 second trade guarantees, etc.

You can place a Stop Loss order which will sell when a stock falls to a certain price. You can place a Limit which will sell a stock as it rises beyond a certain price.

My uncle works with leaps and derivatives - which are far beyond by knowledge of stocks. While I was busy making 20% on certain stocks, he was making 1200% on those same stocks -- with quite a bit more risk. (Yes, 1200%)

Researching the company you are buying into will save you untold hundreds or thousands of dollars. So many people buy a company based on a tip from a friend -- only to find out that the company they invested in was not quite where they should be, not quite where they wanted to be, didn't quite get that approval they were looking for, missed getting that favorable ruling, etc.

My methods are pretty simple for picking stocks. If the company isn't making money or isn't close to profitability, they are immediately erased from the list. If they aren't widely traded, I will generally pass it by -- no headaches when I decide to liquidate a position if there aren't enough daily transactions to buy it. I look for positive indicators, generally looking for companies that appear to be undervalued. I also have another off-the-wall theory that I use for investing, and one day when I get the time, I'll have to dredge up my old analysis program that I wrote.

Zacks.com has a quick weekly 'hotlist' of stocks to buy/sell. Validea.com used to have some interesting stuff. fool.com is aptly named -- their 'gorilla' portfolio lagged the broader market considerably, yet, they are still looked upon as investing gurus. There is some validity to their methods, they just didn't do enough homework -- or expected that they had enough sway to push the market.

A lot of their thoughts are pretty general and fall along the same lines as mine. I rarely will buy the #1 company in an industry. If they are #1, they might lack some energy to keep growing at a fast clip. The #2 and #3 companies are often times more aggressive and more profitable so that they can become #1 one day.

I have missed opportunities that I wish I had taken... Google at $84 was one. Overall, I spend less than two hours per quarter doing hard analysis and casually glance over the financials once in a while to make sure my current picks are still going in the right direction. I'm in it for the long haul, so, time is on my side there. I'm certainly not a day trader, and hold some stock that I should have sold long ago, but, I feel that the company will recover in 3-5 years to regain my investment back. A stop loss order here would have probably saved a bit of hair.

Investing in stock isn't really difficult -- and dollar cost averaging is the way to go. Timing the market rarely works and day trading requires time and nerves of steel. Again, if you aren't looking to pick your individual stocks, and are looking to just diversify your holdings beyond CDs and passbook savings, and you want to do automatic deposits, then, a mutual fund might be a better vehicle.

If you want to spend the time researching companies and finding the ones that appear to be good values that have growth capability and like to read balance sheets and news articles and mull through all the junk to make a decision, then, try one of the online brokers. If you're really looking to just play with it, buyandhold.com is pretty inexpensive for 2 trades a month ($6/month I think) and you can get the feel of it pretty inexpensively.

There used to be a company -- and I don't recall it offhand -- but, they allowed you to create your own mutual fund from stocks that you chose. You would invest and it would buy shares on your behalf in those stocks based on the allocation that you gave it.

So, you could say, MCD 15%, BAC 35%, CVX 25%, KO 25%, and when you did your monthly deposit of say $500, it would buy shares and fractional shares of your picks based on the allocation %. An easy way to diversify your holdings.

Another reason for mutual funds is that they usually lump a bunch of stocks together, so, you lose some of the volatility that you get on a single stock purchase. If you invest in MCD and it drops 4% in one day, that's a bit harder to stomach than if MCD dropped 4% and BAC rose 3% and negated each other.

[Surfn]

I was a day trader in the middle 90's before it became popular. I spent hour upon hour each day researching everything about the stocks I invested in. I was with Merrill Lynch at the time and unfortunately the "Tech" stocks I were choosing were not on their radar so I was making a killing. And they didn't have an online trade site so I moved to Etrade and never looked back. Then in 1999 I sold all my stocks when the new day traders ruined the market.

[Tommy]

Originally Posted by Surfn

I was a day trader in the middle 90's before it became popular. I spent hour upon hour each day researching everything about the stocks I invested in. I was with Merrill Lynch at the time and unfortunately the "Tech" stocks I were choosing were not on their radar so I was making a killing. And they didn't have an online trade site so I moved to Etrade and never looked back. Then in 1999 I sold all my stocks when the new day traders ruined the market.

so..... you must be a rich man then

[Surfn]

Originally Posted by Tommy

so..... you must be a rich man then

Rich is a relative term. I have a couple of bucks. My heath and family and friends are priceless.

[Tommy]

ahhhhh......... your to modest

if you were making a killing at Merrill Lynch with tech stocks that werent on the radar back in 99

then you must be rolling in the money

[Kinky]

hey Tommy if you haven't already opened an account check out sharebuilder.com... you can get trades for $4 fees on tuesdays and they don't have a minimum investment so you can buy small amounts to start off