Please Help A Kid
Q: I am 17 years old and I want to invest my money. I was wondering if you could help me pick out some stocks or mutual funds to invest in, I don't know where to start to look. I have friends that buy eighty some dollar stocks but I only have about 1500 to invest with right now.
A:
Having been trading stocks since I was myself 17 years old, I can empathize
with your situation. Let me start with the first rule that I wish I had
known about when I was your chronological age:
(1) DON'T TRADE FOUR LETTER WORD STOCKS. There is no fair and orderly
publicly accessible continuous auction market for any of them. I a
morning, going to have to resume a squabble with a wrongdoing NASD
member/scammer who got hold of an order of mine on Friday, participated
with his cronies of the NASD to sell THOUSANDS of shares above my offer
price on the American Stock Exchange LISTED security involved, more than
twelve and a half times as many shares as I was offering at a lower price,
then refused to acknowledge execution of my public participant order AT
ALL, despite there being a print on the TIME & SALES RECORD FOR THE STOCK
showing exactly the unusual number of shares of my order at exactly my
offer price. The reason the NASD member felt it permissible to defraud a
member of the public in that manner was that the stock started dropping
rapidly a few minutes later and, by the time I discovered the fraudulent
failure to acknowledge execution of my order, the NASD member and his
cronies had already forced the price of the stock down by more than three
percent. Frauds in execution of public orders are the least of the wrongs
which have been perpetrated by NASD members against me personally and
against millions of other public traders and investors during the 39+ years
that I have been trading stocks (since starting at age 17).
So let's start with that RULE 1, see what other participants in this
newsgroup have to say about that rule and, if you decide that it makes
sense to you I can say some more things which I believe might be helpful
for a person the same age I was when I started, which I've managed to pick
up during the subsequent 39+ years of trading.
Start at the beginning....you can earn free stuff at morningstar.com by
signing up for a trial and going to the "university".
There are many free sites with stock info, charts and quotes. Sign up and
get spammed, but don't necessarily bite , just read the freebees and start
learning the talk. Eventually by watching the markets, cnbc, visiting
websites you'll learn what kind of investor you are or want to be and you'll
pick stocks accordingly.
It really is fun. I self studied for a year before I started. Then in
November I started buying (and selling and buying and selling) a few stocks.
Ive done pretty darn well. ( at least impressed myself. ) Not
gangbusters, but enough to brag to my friends. Listen to the analysts...but
don't run out and do what they say. Some of them have really shaky track
records and don't feel too guilty when they give bad advice.
If you start learning now a bit at a time you will really be doing well
by the time you are in your mid twenties. So stick that sucker in a short
cd or money market and start lookin around...Don't be pressured till you are
ready. Nobody has as much interest in your financial wellbeing as you
do...so you are the best person to be in charge of your baby fortune.