Before I really understood the stock market, I always assumed investing was reserved for highly intelligent finance geeks, who read textbooks on the in’s and out’s of trading. As if they specialized in a secret science, an opportunity only available for the privileged that had the wealth needed to invest and grow. Like my unrealistic, childhood dream of becoming a celebrity, the thought of trading stocks was always desirable, but always seemed unattainable. However, after attending Bentley University and living amongst many other finance majors for the first time, I started to understand what it actually meant to trade different securities in the marketplace.
One of the biggest game changers was when I realized that I didn’t have to be a chic trader on Wall Street, finance professional or an economics professor to trade stocks. Really anyone can do it, and I mean everyone. Even you! All you really need is a computer, access to the Internet and about $200 dollars to invest. I was very unaware of just how accessible the stock market was. My classmates were pouring money into these brokerage accounts, buying and selling stocks in the dorms, during class and even on their smart phones walking around campus. My intrigue spiked one day, when my friend told me he had been paying off his college tuition by trading securities. He was very successful in his endeavors and had even bought a car with some of his yearly proceeds (not everyone is this successful). After that I knew I had to start putting money aside so I could finally take a chance of my own, and invest myself in the market. I told myself that even if I completely failed and lost everything, it would be a great learning experience. The decision proved to be worthwhile.
My first step, which was a very important one, was to choose the right brokerage online. Obviously I had seen various commercials and advertisements for brokerages of these types, but I wanted to do some comparison before I settled. It is important to choose a company that caters to your exact personal investment needs. This is especially important because every time you trade, you have to pay a percent fee known as commission. Commission is a rate fee that is tacked on to the cost of purchasing or selling stock, and every company has a different commission rate. This rate also tends to vary depending on stock type and/or amount invested. Investors also have to pay for the options in addition to the account, such as consultations, personal attention, branch locations, etc. These additional costs can add up, so it is important to keep all of this in mind when figuring out a brokerage to use. there are many sites that can give you a breakdown of pros and cons for each site.
As a millennial we aren’t the most trusting people when it comes to other people handling our money so I skipped out on a brokerage house that offered expensive advice. I wanted to learn about the market myself. We have an endless heap of knowledge known as the internet at our fingertips. I just figured I would research all the stocks myself and this would help me understand the market better and further my knowledge. Also with such low commission rates it makes sense for us millennials because we don’t have all this extra money to just toss around, the fees do tend to add up if you trade a lot.
What I learned after my first few weeks of trading was that once you put some skin in the game, you are more motivated to learn and understand where your money is going and how the system works. It was definitely one of the big motivating factors. You tend to watch the news more and pay attention to worldly events and the market. I always wanted to know what the market was doing. You will quickly learn that stock prices are more heavily influenced by the news rather than how the company may actually be doing according to numbers. So if you pay attention you can make predictions on when you may want to buy a certain security or sell, sell, sell.
The first $200 I ACH’d into the platform bought me a learning experience that I really don’t think I could’ve gotten anywhere else. It was worth every penny. This blurb of an article is just a little piece of insight to get anyone who is thinking about trading stocks or learning more about the process to consider the benefits and the knowledge that you can gain from learning to invest and what I wish someone told me before I knew anything about investing. Good Luck!