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I Am New to Investing: Help!!!

As a newbie investor, I have asked many questions of those who have had much more experience with investment. I also believe that each one must teach one, therefore, as I learn I teach. Since I have started investing, I have had many conversations with people about the same topic. As I have had those conversations I keep saying the same things over and over. Disclaimer! I am not a licensed financial advisor…but, this information is brought to you in partnership with the Stock Sage himself Mr. Devrhoid Davis. I wanted to ensure that whatever information I brought to you my beloved readers is factual. So let us all get comfortable and settle in for another massage session.

  1. Decide whether or not you want to do investing or trading or both. Investment is long term and trading is short term. Your financial goals will help you determine which one is right for you. If you decide to engage in trading, know the difference between swing trading and day trading.

  2. Select an investment strategy. Mine is value investing. Value investors look at specific criteria when selecting a particular stock. As a value investor himself, Mr. Davis has written an excellent article that summarises same. Also, select the type of analysis you would like to employ. Would you prefer fundamental analysis or technical analysis?

  3. Next select the brokerage house that best suits your needs. Some brokerage houses offer an online service where you can buy and sell stocks directly from their platforms (JMMB and NCBCM). Others allow you to do fund in requests to the Jamaica Stock Exchange’s Jtraderpro website; and Proven allows you to trade globally in addition to locally. Most brokerage houses have brokers who can, for a percentage of the buy or sell, execute your order. This is especially useful for those who are very new and unsure of how to purchase or sell a particular stock.

  4. So you’ve selected investment vs trading or both, along with your investment strategy, analysis, and brokerage house, what next? You need to make that appointment with the brokerage house and open up your account. The type of account you open will be determined by your goals, strategies, appetite for risk and the portfolio you want to create. You can work along with the broker until you are a bit more comfortable to start making your own choices.

Now I did briefly mention risk. Some persons are very risk averse and others have a healthy appetite. Your appetite for risk will determine which products you buy. Another way to get started in investing is to buy into a mutual or unit fund where your money is pooled with other funds. Most brokerage houses have such a fund that you can buy into for starters. Another way to enter the market is through an Initial Public Offering (IPO) when the company will first be listed on the market. Or, one can purchase shares when the company is making an Additional Public Offer (APO).

Well, that about ends our session for today. But before we go, please check out Devrhoid’s YouTube channel and his website Caribbean Value Investor. Investment is only one part of your financial plan. So don’t forget to get a financial advisor. I highly recommend my own, Mr. Shamar Clarke.

Is there anything that I didn’t tell you about? What else would you like to know to get started?


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