Where to learn investing basics?

Re: Where to learn investing basics?

• AprilZ81 member

  

  June 2015

  I don't have any information on where to get investing advice, but I know that it is usually recommended that you start with a mutual fund type of investment until you really know your stuff.  It is hard to win when you are doing individual stocks.

  
  

  You also may want to look into getting a financial advisor to guide you.  It might be less stressful than trying to do it yourself.

  Formerly AprilH81

  

  
  

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• hoffse member

  

  June 2015

  Start with an investment bank - Fidelity, Schwab, Vanguard, etc.  They are all great.  We use Fidelity because they have a local branch in our city (rarely need to go in person, but it does happen), and they have a rewards cc that links to one of our brokerage accounts.  We' really like them, but the others are great too.  One great thing about investment banks is their customer service.  When I call Fidelity I can easily get an informed human being on the phone.  While they can't give me specific investment advice over the phone (like invest in this fund vs. another), they can answer most any other question, including questions about timing, taxes, etc.  It's refreshing.

  
  

  You can also do regular banking with them.  I have a checking account with them, and it's great.  Free checks whenever I want, my debit card works at all ATMs with NO fee, ever... in fact, if the ATM itself charges my account, then Fidelity reimburses me.  Same deal overseas - no fees.  If they were open on Saturdays, I would do all of our banking with them.
  

  
  

  When you're just starting out, I would look at mutual funds or ETFs.  The differences between them are very small - in both instances you are investing in a particular blend of stocks, bonds, etc.  Your money is automatically diversified.  You aren't likely to have any crazy runs in mutual funds/ETFs, but you also aren't as likely to lose everything at the drop of a hat like you might if you invest in stocks individually. Unless you actively trade, I wouldn't invest in individual stocks.  They are just way too volatile for the average investor, and you have to keep up with the market on a daily basis at minimum.

  
  

  To start out, I would invest in an index fund.  Index funds track the big markets you hear about on the news - the S&P 500, NASDAQ, Dow Jones, etc.  When people talk about what "the market" is doing, they are usually referring to these indexes.  So index funds track that.  You will never "beat the market" by investing in them, but you also won't do worse than the market by investing in them.  There's a lot to be said for that.  It's kind of like that wisdom in gambling where the house always wins.

  
  

  As you get used to it you might want to consider other funds as well.  Morningstar.com is a great resource, though you have to pay for some of their information.  I know Fidelity publishes the entire Morninstar report for each of their funds on the Fidelity website for free (you would normally have to pay to get the entire report from Morningstar directly).  Not sure about the other major investment banks, but seems like they might as well.

  
  

  Personally, H and I do a blend of index funds and funds that we think will beat the market in the short-term.  I do watch the market every day because I find it interesting, so we stay on top of the non-indexed funds.  I'm also a lot less risk-adverse than many on this board, so I'm willing to have at least a bit of our money tied up in more volatile investments.  

  

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• FutureMrsMerati member

  

  June 2015 edited June 2015

  I work in finance for a living (trading foreign exchange) so I know a bit about investing both personally and professionally. 

  
  

  I would agree with @hoffse, but I would caution you that the type of firms she's referring to are not investment banks, they are financial services institutions. Investment banks are market makers that are involved in, among other things: facilitating initial public offerings (IPOs); issuing securities for public clients, institutions or governments; interacting on the financial markets (think stock, fixed income, foreign exchange and commodities) but primarily in a speculative or market making manner; and providing research and markets to corporate or institutional clients. 

  
  

  Unless the investment banks have a wealth management division (some do but they are for High Net Worth Individuals (HNWI) with minimum requirements of cash equivalent assets of >$10MM+), you will need to seek out a financial services firm (like Fidelity, Vanguard, etc.) for your needs. Some of these firms still have minimum investment requirements, but typically are much less than wealth management firms for HNWI. FYI, investment banks that you may be familiar with include Goldman Sachs, JP Morgan, HSBC, Citi and Bank of America (last 4 also have commercial banks where you have checking and savings accounts).

  
  

  I would set up a preliminary meeting with a few financial services institutions and let them know you're interested about learning about their investment products and structure, then go from there to choose which is right for you. They should share their yields with you at different levels of risk, and you can have a discussion on where your comfort level is. I assume you would probably want to start with a more passive investment strategy (think: not a lot of back and forth involving specific investments, positions, buying/selling) so I would share that with them as well. Once you get more accustomed to investing and if you begin researching market trends, you can always dial it back with your firm and let them know you'd like to become a bit more active in the investment strategy. Best of luck! Let me know if you have any questions!

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• hoffse member

  

  June 2015

  FutureMrsMerati said:

  I work in finance for a living (trading foreign exchange) so I know a bit about investing both personally and professionally. 

  
  

  I would agree with @hoffse, but I would caution you that the type of firms she's referring to are not investment banks, they are financial services institutions. Investment banks are market makers that are involved in, among other things: facilitating initial public offerings (IPOs); issuing securities for public clients, institutions or governments; interacting on the financial markets (think stock, fixed income, foreign exchange and commodities) but primarily in a speculative or market making manner; and providing research and markets to corporate or institutional clients. 

  
  

  Unless the investment banks have a wealth management division (some do but they are for High Net Worth Individuals (HNWI) with minimum requirements of cash equivalent assets of >$10MM+), you will need to seek out a financial services firm (like Fidelity, Vanguard, etc.) for your needs. Some of these firms still have minimum investment requirements, but typically are much less than wealth management firms for HNWI. FYI, investment banks that you may be familiar with include Goldman Sachs, JP Morgan, HSBC, Citi and Bank of America (last 4 also have commercial banks where you have checking and savings accounts).

  
  

  I would set up a preliminary meeting with a few financial services institutions and let them know you're interested about learning about their investment products and structure, then go from there to choose which is right for you. They should share their yields with you at different levels of risk, and you can have a discussion on where your comfort level is. I assume you would probably want to start with a more passive investment strategy (think: not a lot of back and forth involving specific investments, positions, buying/selling) so I would share that with them as well. Once you get more accustomed to investing and if you begin researching market trends, you can always dial it back with your firm and let them know you'd like to become a bit more active in the investment strategy. Best of luck! Let me know if you have any questions!

  Thanks for the correction - I always call them the wrong thing

  

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• short+sassy member

  

  June 2015

  Although I can't help you with your original question, I was just curious if you had thought about REI in other areas with lower house prices and better cash flow.

  Obviously, one of the cons is you will need to visit areas you are interested in and probably hire a Property Manager if you buy property too far away from you, but it's something to consider especially since I'm assuming you are already knowledgeable and very comfortable analyzing potential real estate investments.

  If you've never been there, Bigger Pockets is a fantastic free website with a huge forum all about REI.  There are tons of investors on there who live in HCOL areas, but own rental homes in LCOL areas...sometimes just a couple hours away from them, but often out-of-state.

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• bparkhur member

  

  June 2015

  Have you looked at the bogleheads site?

  http://www.bogleheads.org/wiki/Main_Page

  See my swapping feedback: http://bumpfeedback.proboards.com/index.cgi?board=ac&action=display&thread=13

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• vlagrl29 member

  

  June 2015

  I've gotten most of my knowledge from the people at Fidelity and DH.  I have a combination of individual stocks, mutual funds, and a bond.  I seriously need to get more money out there that I have sitting in cash.  The last time I talked to fidelity , they told me what things I was low in that would make my portfolio more balance.  I then researched it on their website.  They even have a hypothetical IRA calculator to see how a purchase can affect your $$ profits.

  
  

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• FutureMrsMerati member

  

  June 2015

  @hoffse Of course! I Just didn't want her to go in saying that she is looking at a few "investment banks" to invest her money!

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