How often have you heard someone say "It takes money to make money." If you think that's true, then let me remind you of the Aesop's fable: The Fox and the Grapes. In this story, the fox couldn't reach the grapes he wanted so he consoled himself by telling himself that they were probably sour anyway. It doesn't take money to make money. It takes discipline, hard work, and perseverance.
I've started a mock portfolio at http://www.marketwatch.com/game/little-steps-to-wealth to demonstrate how anyone can earn money through investing wisely, even if they don't have much to start with. For the mock portfolio, I've set the initial investment at $500 and the term of the game to one year, running from February 18, 2015 until February 18, 2016.
I know, you may not have $500, and you may not know much about investing. Perhaps you have more than that lying around. Either way, learning about investments is part of the hard work required to reach your goals. In the mock portfolio, I'll make trades based on the real market prices of stocks. In other words, trades that anyone could make with real money.
Furthermore, I'll discuss the trades here in this blog. I'll give my rationale for every buy order and every sell order. My investment strategy is probably substantially different from that of most financial advisers. It's not for everybody. When it comes to investing, there is no single strategy that is the "best" strategy. There are many very good strategies and many very bad strategies. Furthermore, a good strategy for someone trying to build wealth might be a bad strategy for someone trying to preserve wealth.
Investment strategies should be built to reflect very specific goals. If you have enough money and need to simply preserve it and draw a regular income, for example, you want to take a very conservative approach to minimize or eliminate the risk of substantial loss. Generally, that means you are limiting your growth opportunities in exchange for that low risk.
Strategies might differ based on your time horizon, your anxiety level, your financial situation, economic conditions, and many other factors. When will you need the money? Do you lose sleep if your portfolio goes down five days in a row? Is the market generally heading upward or downward? What are the consequences of losing some or all of your investment?
While investment strategies may vary, there are some hard and fast rules that make sense for almost everyone.
That's it for today. Use the link in the second paragraph to follow along with my fictional $500 investment account. It's free to follow and you can even join in with your own fictional portfolio and compete against me if you like. If I see interesting investment choices in your fake portfolios, I may comment on them as well, but I'm not going to give yay or nay advice on any stock. I'll tell you what I chose, why I chose it, why I think some investments are bad or good, and offer my opinions. None of that should be construed as me telling you what to do or advising you on specific stocks to buy or sell.
If I comment on a stock that I own in real life, I'll tell you so you know if I have an vested interest in its performance.
Fair warning, though, Dow Jones, Inc. and affiliates may send ads to your email if you join the game; use a throw-away email account to sign up. You can look at the game accounts without signing up, but to play along with your own account they require your email address...
I've started a mock portfolio at http://www.marketwatch.com/game/little-steps-to-wealth to demonstrate how anyone can earn money through investing wisely, even if they don't have much to start with. For the mock portfolio, I've set the initial investment at $500 and the term of the game to one year, running from February 18, 2015 until February 18, 2016.
I know, you may not have $500, and you may not know much about investing. Perhaps you have more than that lying around. Either way, learning about investments is part of the hard work required to reach your goals. In the mock portfolio, I'll make trades based on the real market prices of stocks. In other words, trades that anyone could make with real money.
Furthermore, I'll discuss the trades here in this blog. I'll give my rationale for every buy order and every sell order. My investment strategy is probably substantially different from that of most financial advisers. It's not for everybody. When it comes to investing, there is no single strategy that is the "best" strategy. There are many very good strategies and many very bad strategies. Furthermore, a good strategy for someone trying to build wealth might be a bad strategy for someone trying to preserve wealth.
Investment strategies should be built to reflect very specific goals. If you have enough money and need to simply preserve it and draw a regular income, for example, you want to take a very conservative approach to minimize or eliminate the risk of substantial loss. Generally, that means you are limiting your growth opportunities in exchange for that low risk.
Strategies might differ based on your time horizon, your anxiety level, your financial situation, economic conditions, and many other factors. When will you need the money? Do you lose sleep if your portfolio goes down five days in a row? Is the market generally heading upward or downward? What are the consequences of losing some or all of your investment?
While investment strategies may vary, there are some hard and fast rules that make sense for almost everyone.
That's it for today. Use the link in the second paragraph to follow along with my fictional $500 investment account. It's free to follow and you can even join in with your own fictional portfolio and compete against me if you like. If I see interesting investment choices in your fake portfolios, I may comment on them as well, but I'm not going to give yay or nay advice on any stock. I'll tell you what I chose, why I chose it, why I think some investments are bad or good, and offer my opinions. None of that should be construed as me telling you what to do or advising you on specific stocks to buy or sell.
If I comment on a stock that I own in real life, I'll tell you so you know if I have an vested interest in its performance.
Fair warning, though, Dow Jones, Inc. and affiliates may send ads to your email if you join the game; use a throw-away email account to sign up. You can look at the game accounts without signing up, but to play along with your own account they require your email address...
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