Stock Market for Beginners

Beginner stock market investing.

There are several important things you should consider before you begin investing in the stock market.

• Get your financial house in order:

  Pay off any credit card balances and other short term loans before even considering an investment in the stock market. Also, get in the habit of paying off your entire credit card balances every month. Paying credit card companies large interest on your balances is a sure way to prevent you from building long term wealth.

• Carefully inventory your current investments:

  What do you currently own? Do you have any fixed income investments in your portfolio? What stocks, mutual funds, or exchange traded funds, do you currently own? Should or could some of these be sold to free up funds for a more systematic approach to your stock market investment strategy? Everyone should have some money allocated to the fixed income market such as Corporate Bonds, U.S. Treasury Bonds or Notes, or CD (Certificates of Deposit). If you are in a high tax bracket, Municipal Bonds are a good alternative because the interest paid is not subject to federal income tax. Depending on you age, the percentage of your total investments allocated to fixed income should range between 20 and 40%.

• Maximize your contributions to your company sponsored 401K or 403B plan as well as your individual IRA:

  You will maximize your long term wealth by investing in tax deferred plans as opposed to taxable accounts. Some companies even match a portion of their employees’ investments. This is a “no-brainer” way to invest. Your money will compound tax free until you have to begin taking mandatory distributions which start at age 70 ½ under the current tax code. Albert Einstein once said that the power of compound interest is the most powerful mathematical phenomena he ever experienced. Compounding your money tax tree is the best way to invest in the stock market.

• Decide on your stock market investment horizon:

  Once you have completed the above three steps, it is time to consider your stock market investing time horizon. Scalpers try to “scalp” small profits by buying or selling frequently throughout of the day. Day Traders are similar to scalpers since they might buy and sell the same stock as many as 50 times in one day. They try to exploit the volatility in the market. Swing Traders buy and hold their positions for several weeks or several months before selling. Long Term Traders buy and hold their investments for many years. For beginners, it would not be wise to try to invest in the stock market by scalping or day trading. Rebound Trading Systems are “swing trading” systems which enable the investor to invest in the best performing segments of the stock market and then continually upgrade their holdings as market conditions change.

• How to get started:

  Investors can invest in a mutual fund directly with the Mutual Fund Family. However, it is far better to purchase mutual funds from a discount brokerage firm that handles many different families of mutual funds. (T.D. Ameritrade, Charles Schwab, and Scottrade, are three good alternatives.) This enables the investor to trade or upgrade their mutual fund holdings between various mutual fund families by placing the order with their discount broker. Mutual Fund or ETF Trading can be done online with a very user friendly trading platform.

• Rebound Mutual Fund Trader:

  This is a robust trading system that consistently outperforms the S&P 500. In fact, subscribers to this mutual fund trading system recently doubled their money in just 32 months. When fully invested, the Rebound Mutual Fund Trader holds 7 No-Load Mutual Funds or Exchange Traded Funds. The average holding time is currently running about 97 days. This system only trades about twice per month and takes less than 30 minutes per month to perform the mutual funds trading. This mutual fund trading system is currently generating an annualized rate of return nearly triple that of the broader market indices.

Mutual Funds Trading System

Exchange Traded Funds ETF

Rebound High Five

Rebound Stocks