The Best Stock Inves

The Best Stock Investment Strategy For Beginners

The best stock investment strategy for beginners focuses on stock funds as the best stock investment to keep it simple, and emphasizes investment strategy over stock picking. You don`t need to pick the best stock or even the best stock funds to do well if you have an investment strategy that keeps you out of trouble. Here`s how to keep it simple and make money, with less risk. Funds that invest in stocks are often called equity funds and they come in two popular varieties: mutual funds and exchange traded funds (ETFs). You can best get started on your own in one of two different ways: by opening a mutual fund account with a major no-load fund company, or by opening a brokerage account with a discount broker. Either way, you can put the best stock investment strategy for beginners that I know of to work for you.Earmark this account as your stock investment account. All of your money will be either in stocks (equity funds) or in cash in the form of a money market fund that is safe and pays interest in the form of dividends. The key to our best investment strategy is that you are never 100% invested in equity funds or stocks, and never 100% invested on the safe side. Instead, you pick your target allocation and stick with it. I`ll give you an example. You don`t want to be too aggressive, so you pick 50% as your target allocation to stocks. This means that no matter what happens in the market, you will keep half of your money in equity funds and half in the safety of a money market fund earning interest. This is your stock investment strategies, and it takes the need to make micro decisions out of the picture. You have a plan and you intend to stick with it to avoid major mistakes and the major losses that can result from emotional decisions.Now let`s take a look at how this simple investment strategy works to keep you out of trouble. Bad news hits the market and stocks go into a nose dive. What do you do? Since your equity funds will fall as well, if you fall below your 50% target you move money from your safe money market fund into equity funds. In other words, you buy stocks when they are getting cheaper. On the other hand, if stocks go to extremes on the up side, what do you do?