Investing is one of those things that we all know we should be doing. Unfortunately, a third of Americans don’t even have a retirement account. One big reason for this is a fear of loss. After all, as human beings, we are very emotional creatures, and fear is one of the most driving of these emotions.
While there’s no way to guarantee your success in the market, there are a few things that you can do to give you a leg up on the competition when you get started.
Start With Research
Investing, when done properly, can be very lucrative. However, investing without research is more like throwing darts at a dartboard, not knowing where it’s going to hit. At the end of the day, successful investors know what causes fluctuations in the value of assets on the market. By knowing what causes these movements, they are able to look for signals that essentially tell them what to do next. The good news is, it’s not all that hard to get to know the market. All it takes is a little research.
There are various investing guides online that are designed to give the beginner investor an idea of how to invest and why assets move in value. Before you get started, it’s a good idea to do an online search for investing related keywords like “what causes movement in the market”, or “free beginner’s guide to investing”. Taking a little bit of time to get to know the playing field now will help ensure that you don’t strike out when you actually start to play.
Practice With Monopoly Money Before Using Your Own
You work hard for your money, and until you are confident that you’ll generate gains by putting it into the market, doing so is a big gamble. The good news is that you can test your knowledge, strategies, and market know how without actually risking a dime.
The truth is that brokers will do just about anything they can to get new investors to use their platforms. As a result, many of them have come up with a marketing tactic that just so happens to be a great tool for beginner investors. That tactic is called demonstration accounts.
Essentially, these demonstration accounts allow would-be investors to use the broker’s online platform in a virtual sense. Instead of using real money, virtual money is provided and the would-be investor has the opportunity to use the platform and see how his or her money would do in the market.
The goal from the broker’s standpoint is to get you to sign up once you see how great their platform is. However, this opens the door for you to get into the market without risking a dime.
All you need to do is sign up for a demonstration account with a broker and use it to test what you’ve learned through your research. Once your demonstration account is generating a consistent profit, it’s time to give real money a try.
Become The Ben Stein Of The Market
Ben Stein is the famous figure that was featured in clear eyes commercials years ago. The commercials caught the attention due to Stein’s odd monotone nature. He spoke as if he felt no emotion, he was simply reading a script. While being emotionless is not a good thing in a social sense, in the market, it could mean the difference between profit and loss.
At the end of the day, human beings are emotional creatures. While we may not want to admit it, we are driven by emotions like fear, greed, love, and hate. In the market, allowing fear or greed to lead the way could become a devastating mistake. Instead of allowing your emotions to take control, stay calm and allow your data, signals, and strategy to do the work for you.
The Bottom Line
The bottom line here is that investing really isn’t all that difficult of a process. While it does take some market knowledge and practice to become successful, taking the time to learn and practice can lead to great rewards. Just remember, do your research, practice makes perfect, and a Ben Stein personality is best when investing. If you do so, you should be just fine!