Your Questions About Investing

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George asks…

At what age did you start investing your money in stock market?

How many years have been investing, and would you say over the years you’ve made or lost more? Also, would you consider yourself an income investor or a growth investor?

Justin answers:

Started at age 29, I am now 71.
Made more than lost. I grade myself B, good but not the best.
I have always invested primarily for growth.

Steven asks…

How do you make money by investing in precious metals?

I am new to investing of any kind. Please explain to me how this is done, thanks!

Justin answers:

precious metal have value and this value varies so you want to invest in something that has a low value but has a high chance of going up in it’s value. So let say you have $1000 to invest. And you buy 50 share of a precious metal that cost let say $20 per share. And the following day it value goes from $20 per share to $30 per share . In this scenario you would increase you initial $1000 by $500. Now keep in mind value can go down.

Daniel asks…

How does investing in certificates of deposit help the economy, if at all?

Does investing in CD’s help? Does it not help? If so or if not, how does it affect the economy? Thanks, in advance, for all your responses.

Justin answers:

It doesnt help the economy. How it effects the economy depends on where and when the funds originated. Example if you use the stimulis money created in the last couple of months then that money will cause the money supply (inflation) to increase. On the other hand if you pay off debt with that same stimulis money then that causes a retraction in the money supply. If the money to go into the CD is comming from other savings not invested in the market then it has no effect. But pulling money out of the market gives business less capitol to work with. To understand what Im saying about how money is created and retracted you must google and learn about “fractional reserve banking” then you will understand.

Richard asks…

how to start investing,like what is the basic level for a starting investor?

i want to learn the safe game of investing.i want to know the abcd”s of investing.
please tell me where to start and i am really interested to know.

Justin answers:

If you are 25 today and you retire at 67 with a million dollar investment portfolio, that will safely generate $60K/year. But when you are 67, that 60K will only have the buying power of a little over $16K/year. It gets worse though, because at 67, you will still probably have 30 more years to live and that 16K will shrink each year until it’s only worth $8K/year at age 90.

A million dollars isn’t what it used to be… and it will be even less in the future.

So…. We must all become educated investors much more so then our parents were and start sooner. These are some basic steps to get you started. You’ve got to jump in now.

Step 1.
First decide what kind of brokerage you want to work with. You can open a brokerage account in your bank, with a large full service brokerage or an internet brokerage. I find when I get help, most people want to sell me things that are better for them…. So I use because it’s cheap and easy with low frills. I like their streaming quotes and I do my own research and make my own investments. But any low cost internet brokerage service is fine.

Step 2. Get a subscription to Barrons or Investors Business Daily… Do this for 6 months or a year. At first, It seems a bit mysterious, but pretty soon you start to understand the terms and things that investors are looking for and what they are afraid of

Step 3. If you have some money to invest, put it in 3 month CD’s right now. First the market is unstable and second you have some homework in Step 4 to do before you do any investing.

Step 4. Go out to the internet and search on the following subjects. Become very familiar with the concepts.
Asset allocation
Long term investing
Roth ira vs ira
Large med small cap
Value vs growth
Indexed mutual funds
No load mutual funds
Sector funds
Bonds CD preferred stock
International funds
Market cycles
Fundamental analysis
Technical analysis
In most cases, I think it is wise to use indexed mutual funds and ETF to build the base of your portfolio.

Step 5 go to and sign up for a free account. Play around there by looking at graphs and fundamentals. If you click on the graph names, you will get clear information about what the graph is based on and how to interpret it. I think it’s also a good idea to pretend you have $10,000 and start buying and selling on paper. Keep track of where you are each day for a month… It’s a lot easier to lose play money then real money….
WARNING: don’t rely on technical analysis alone. These graphs are good at telling you WHEN to buy and sell, but now WHAT to buy.

Step 6. It’s always a good Idea to see a CFP (certified financial planner). Their job is to work for your benefit, not to sell you investments. They can cover subjects like employee benefits, insurance, budgeting, living trusts, 401k, taxes and real estate as well as investment types and investment types to keep away from.

Always strive to do your own research… you’ll find everyone sounds like an expert so take everything people tell you with a grain of salt. It’s not easy in the beginning but soon you will be the expert.

Don’t get involved with futures, currency, options (unless you get stock options at work), commodities, annuities or other derivative type investments at this time.

Good Luck

Robert asks…

Whats the difference between savings and investing?

What are the differences between savings and investing; also I hear there are different types..what are they?

Justin answers:

The difference between saving and investing. “Savings” are usually put into the safest places or products that allow you access to your money at any time. Examples include savings accounts, checking accounts, and certificates of deposit. At some banks and savings and loan associations your deposits may be insured by the Federal Deposit Insurance Corporation (FDIC). But there’s a tradeoff for the security and ready availability of these savings methods: your money is paid a low wage as it works for you.

When you “invest,” you have a greater chance of losing your money than when you “save.” Unlike FDIC-insured deposits, the money you invest in securities, mutual funds, and other similar investments is not federally insured. You could lose your “principal,” which is the amount you’ve invested. That’s true even if you purchase your investments through a bank. But when you invest, you also have the opportunity to earn more money than when you save. There is a tradeoff between the higher risk of investing and the potential for greater rewards
The key is in two words: risk and liquidity.

Savings are low risk funds that must be liquid (available) when you need them. The purpose of saving money is so you can have it for a specific purpose within a short time frame.

Investments, on the other hand, are for wealth building, and will not be needed for many years. Yes, investments do involve greater risk, but, investments also yield much greater returns when left alone long enough to ride out the turbulence of the stock market.

Hope you understand the difference between savings and investing. Take Care

Charles asks…

When it comes to Investing, what is the smallest amount you can invest?

I am someone who knows absolutely nothing about investing and would like to know the very very basics, and would like to start out tiny if possible. Any tips?

Justin answers:

Congratulations on getting started. It’ll help you more than you know!

Your first dollars should be spent on getting educated on investing. You don’t have to train to trade them professionally, but we are talking about your future here. So the more you learn, the more it’ll help you! So let’s start there.

You ask a very broad question, so be prepared for a pretty long answer. Just take it in chunks!

How to invest depends on what you already know. We’ll assume that you’re beginning since you say you’ve got no clue!

A good primer is How to Make Money in Stocks by William O’Neil. You can get it cheap just about anywhere. It’s widely available new or used.

Another good one is one of Jim Cramer’s books.

But books will only get you so far. At some point, you’ll also want to get at least a little training. There are some great education companies if you want to make the investment. or are both very good companies as is

For free, you can start by visiting and That’ll get you a pretty good primer so at least you’ll understand what the markets are and what a stock is, etc.

If you get a chance, watch Mad Money on CNBC. Don’t trade any of his picks until you track many of them over time. Just use the show to get you to understand some basics and get a feel for the market itself.

Next, subscribe to something like investorsbusiness daily or something like that that can help you identify good stocks.

Once you understand stocks, go to It’s a website that’ll help you understand options (what they do, how they work, etc). You don’t need to trade them, but the more you know, the more you’ll see how options can really be the safest way to invest (once you’re educated).

For discipline (which is crucial to successful trading), probably Trading in the Zone by Mark Douglas or Mastering the Trade by John Carter

I know that’s a LOT to absorb. Just take it one step at a time for now. Start with a book or two to give you an idea of where to begin. Take your time, and let it seep in.

As you get up to speed, you should papertrade to practice (highly recommended). This should help reduce your losses in the beginning as you get used to buying/selling.

You can practice for free on almost any reputable broker site (optionsxpress, scottrade, thinkorswim, etc).

Save up until you get a few hundred dollars (since you don’t want commissions to eat up your investment. Start slow, then as you figure things out, you can buy more shares.

Congrats again on getting started. If you have any questions, please let me know.

Hope this helps!

David asks…

What are Key factors to consider when investing in stock market?

What are Key factors to consider when investing in stock market. I am looking to invest in smaller companies with smaller stock prices. I am also looking to invest short term and long term. What are key factors to consider when investing short term and long term. Such as, P/E ratio, dividend yield %, profit etc…

Justin answers:

Investing is about investing in businesses, yes the various ratios tells you something about the business but as an average of say temperature over a week is less indicative of overall average then one of the entire year, these “key factors” are less accurate and less indicative of the business as the businesses gets smaller. Smaller businesses are difficult enough to research and the data is of course less reliable as the business are smaller. Many brokers will deal with fractional shares, a small price on the share is not an advantage. Knowing the business is an advantage so you’re looking in the wrong places for an investment.

Being a penny stock isn’t a detractor from making a business a good investment but penny stocks are not where you go to find good investments, there are fewer there and it’s harder to determine who they are. Small stocks at small prices are not for beginners and experts find easier pickings else wheres.

Chris asks…

I want to start investing in the stock narket?

So I just turned 18 and I want to start investing into some stocks. I know there’s places like scotttrade but my dad said they might make you have a couple thousand dollars to start an account. But I was just looking to invest a couple hundred. Does scotttrade make you put in a couple thousand to open an account? If so is there another company that would open one for less?

Justin answers:

First: Go to the library and read every issue of financial magazines on the shelf.
Two: pick out your favorite magazine
three: find the last year of issues and read them
four; open a simulated account on Yahoo finance
five; simulate trading rather than waste your hard earned money
six: track your investments and figure out why the winners won and the losers lost
seven: after you know the answer to number 6 start investing money

Thomas asks…

I am a college student and I want to start investing but where do i start?

Hi everyone,
I want to start investing but have no idea where to start.
Do I need to be paying taxes in order to start investing?
I only have part time jobs and I get paid in cash.
Any advice on how I can start investing will be greatly appreciated.

Justin answers:

Before you enter into any transaction, you should first know what you’re doing, why you are doing it and how to do it and the rules relating to what you are doing.

Before you invest in any security, the first investment you should make is in yourself, and the best investment you can make is by educating yourself.

Start your education by learning why you should invest and the importance of being able to make your own decisions or how the pro’s make theirs.

Here is some reading material that can get you started in the right direction,
What Works on Wall Street by James O’Shaunessey
Beating the Street by Peter Lynch
One Up on Wall Street by Peter Lynch
The Warren Buffett Way by Robert Hagstrom
How to Make Money in Stocks” by William O’Neil
24 Essential Lessons for Investment Success by William O’Neil
Your Money and Your Brain by Jason Zweig
The Interpretation of Financial Statements by Benjamin Graham
You Can Be a Stock Market Genius by Joel Greenblatt
The Intelligent Investor, by Benjamin Graham
Common Stocks, Uncommon Profits, by Philip A. Fisher
Stocks for the Long Run, by Jeremy Siegel
Bulls Make Money, Bears Make Money, Pigs Get Slaughtered, by Gallea
Trading for a Living, by Alexander Elder
From Riches to Rags, by I.C. Freeley
Millionaire Traders, Lein & Schlosberg

Get into the habit of making daily visits to some websites like MSN Money and Yahoo Finance. ( , . While at MSN following the strategy lab analysts to get a feel for what the pros are doing and why. This site has some basic information for beginners. If any site offers free information, take it.

Other website that can provide instructions and help with procedures and terminology are Investopedia – Stock Charts –,…

Visit some of the more professional websites like Zacks –
Smart Money – Schaeffer’s Some of these web sites will have advertisers who are worth looking into also. And remember, if they offer free information, get it.

Attend all the free seminars you can, just be careful and don’t get pressured into anything you really don’t want or need. Most schools offer courses in finance and economics, but very few will have courses on the mechanics of the investment markets, if they do try taking the course. You may want to consider on-line courses, the New York Institute of Finance use to have such courses. Try to get some fee information from the stocks exchanges they all have (had) free booklets, SIAC and some of the regulators (FINRA SEC MSRB CBOE) may provide some free literature.

You at least have made the right decision to start investing, this is the first big step and it won’t be your last. Keep taking those steps forward and along the way never take the advice from people that are not in the market or try to tell you not to invest.

And No you do not need to be paying taxes to start investing, but when you make money you will be required to pay, but so what.
No one cares if you have a part time job, just keep working and study hard so you can make it

Good luck on your journey

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