What is best investing strategy – best as determined by the amount of time involved vs. profitability?
I am wondering if there is an investment strategy that balances time managing the investments with profitability for the most “efficicient/optimized” gains.
I am interested in a broad range of levels of risk, except for the ultra high/speculative and the very very low.
Also, any suggestions covering a broad range of investment types is welcome a.k.a. not just limited to securities and debt.
Thanks in advance!
If you start a business of your own, you will likely be investing more time than money, although depending on the business, you could be investing quite a bit of that as well. Your chances of success depend entirely on your skill set, persistence, and capital. You will need to develop a plan, and follow it.
Regarding stocks, there are so many different investing/trading strategies, I would have no way to go over them all. I can give you some ideas, though.
1. Short term trading:
a. High compoundability
b. Low exposure to long term market trends
c. High liquidity
d. Small gains add up
a. Limited or nonexistent tax advantages (unless trading within an IRA)
b. Relatively high expenses (commissions)
c. Somewhat time intensive
d. Market hours 9:30am-4:00pm (Eastern Time) make it difficult to trade if you have a day job
e. It’s a job — if you stop trading, you stop making money
2. Long Term Trading (A.K.A. Long term investing):
a. Minimal time required during market hours
b. Relatively low expenses (commissions)
c. You’re in good company — most people with capital committed to the market are long term traders
d. If you get lucky, or pick exceedingly well, you could retire very rich
e. Favorable tax treatment on long term gains
a. Beating the returns of an index is difficult, even by professionals
b. Liquidity is somewhat compromised (you don’t want to be in a position where you need the money during a bear market, or when your account is down)
c. Making money at all in a bear market is problematic
d. If you get unlucky, or pick exceedingly poorly, you could retire broke
Okay, all of this being said, if you know what you are doing, and have the time to devote to it, short term trading has a bigger “bang for the buck” than long term trading. If you don’t have the time to devote, or the knowledge/discipline, you would probably be served better as a long term investor with an index mutual fund (or ETF). Disciplined investing combined with a reliable annual return can serve you well without giving you the headaches speculation can give.
Do you listen to investing advice given on CNBC?
Just want to take a bit of a survey, how often (if ever) do you base your investing/trading strategies off of what you see on CNBC. This could come from some analyst that Maria Bartiromo interviews or it could be from one of the evening shows such as Fast Money or Mad Money.
Personally the only show that I’ve ever used to base my strategy off of has come from the “Fast Money” traders.
Anyway, how about you?
Thanks in advance!
I am a professional trader. Most of it is painful to watch, but I do get “some” good info from Fast Money (both the lunch and late one) and Bob Pisani’s Trader Talk. Sometimes there may be a guest on who really knows what they are talking about, but most of them are just there to hear themselves talk.
I really listen to the Najarians. They know their stuff. If I am thinking of making a trade and it goes against what they say, it makes me wonder. They aren’t always right (no one is) but they are right more often than they are wrong.
And I can’t stand Rick Santelli.
What are YOUR strategies for investing in the stock market?
I look at the economy see what is selling, what people have to have like food energy etc. Then I invest in those. Done pretty good so far. You have to think whats in demand.
What is the best way to learn Dividend investing strategies?
My goal is to stop working in 3 more years at age 40. I will receive about a $32K/year pension at that time and I want to put my money to work earning interest/dividends to supplement my pension. I should have about $250K to use toward a dividend strategy, and if I can make 10% year average I can add $25K to my $32K pension. I want preservation of capital but of course I’ll need enough capital appreciation to stay ahead of inflation. Appreciate any advice on where to look to persue this plan…books, websites, etc. Thanks!
The Ultimate Dividend Playbook
Is this a smart investing strategy for stocks?
If i look up the day’s biggest decliners and then choose from those the ones that are at least 5% under their yearly average, and then set them to sell automatically once they gain 5% (essentially only having going back to the average) is this a good strategy? I know that no stock investment is safe but does this sound fairly conservative or not?
If you’re a rookie in investing or stocks, go to
Open up a portfolio without using real money. You can give yourself as much or as little money to try out the market. The stocks you want to focus on is consumer staples, consumer discretionary, and healthcare. These are DEFENSIVE stocks that will survive through good and bad times. Most of my positions are in these stocks. Some names include 3M, Procter & Gamble, Kimberly Clark, Exxon Mobil, Walmart, Costco. Everybody’s got to eat and wipe their butts regardless of the state of economy. Many of these companies survived through the Great Depression.
That’s the benefits. You can sleep at night knowing your money is doing well. There are NO guarantees that you won’t lose money. It’s just that these stocks are the best. They pay good dividends too.
Then once you’re comfortable and test the waters of the market, you can finally put some real money in. Go to Scottrade.com. They’re excellent for beginners.
What is your suggestion for the most qualified “investing 101″ book?
Hi everyone. I’m looking to get some suggestion on where to start on learning about the intricacies of the US financial system specifically intelligent investing. I have taken micro and macro econ in college and have some knowledge about what different types of investments are but I’d like to learn strategies for investing in the securities market. Anyone have any suggestions?
First of all, you will quickly learn that there was nothing you learned in college that will prepare you for trading or investing.
Next, I have some 2,500 posts full of info you might want to look at. Here is 19 years of market experience for ya – free.
As for the book, I am still working on mine.
Best investing strategy for little money?
What is the best investing strategy for someone who has a little money? The reason I’m asking is because I would like to invest a little bit of my tax check and I do not know what the best thing to invest in is. I’m looking at investing approximately $500. Any help would be greatly appreciated.
Please don’t spam about scams or anything of this nature. I’m truly looking for investment strategies that are legal and not scams.
First, I would not listen to the person suggesting to invest in the Chinese stock market – it is a bubble still deflating. They haven’t yet hit capitulation.
For $500, and little to no savings, I would recommend looking into QQQ – which is an ETF that follows the S&P 500. Here you can invest in the biggest and best companies in the US – essentially it’s like betting on the US economy.
Furthermore, keep you money in there – don’t take it out for 10 years. If you’re going to be in less than 10 years, I wouldn’t touch the stock market. Get a CD.
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