PostHeaderIcon Advice to new stock market investors

If someone told you that you could make tons of money by investing in the stock market, would you run out to take out a cash advance and start investing without first learning the ropes?

The stock market can be a tricky thing, especially for a new investor looking to get started. One must research and form a solid foundation of the market system before jumping in with both feet. Learning the language, history, and mechanics of trading will ultimately help any new investor. Stocks are always changing and can sometimes be seen as random patterns. Throughout history, the “stock” has been ever changing and continues to progress into different bodies and states.

Since the climb of out the Great Depression, stocks and trades have evolved into various entities and commodities. No longer are companies trading in single stock ideas, but have progressed exponentially with multiple options such as; Mutual funds, Stock Options, IPO’s, Common Stocks, Preferred Stocks and many others.

The everyday man is now more intent on approaching the stock market with the ability to day trade and access multiple accounts with the stroke of a few simple computer keys. Trading has been brought to the masses, to there very own home, and the possibilities are endless.

Many start up investors get caught up in the nomenclature and sub-culture of the market. Taking time to set up trading strategies are essential for the long term goals of any investor. Knowing Fundamental and Value investing is vital to the successful growth of your portfolio.

To find the stock value of a particular company, new investors must realize that stocks are valued by cash flow, earnings analysis and sales. Most “blue chip stocks” (or established firms) seem the likely beginning for first time investors.

Stock Brokers can be used to facilitate investments for those wary of the market system. Most reputable brokers will have the knowledge and training to invest your money in profit turning companies. Although be wary, there services can be costly and no one person is a psychic.

New investors should be warned to invest money that is in excess and not from a cash advance or borrowed money. Markets rise and fall in a single day or hour. Be informed and educated in the system that you are intending to conquer. With all endeavors, learn and listen and above all, learn to master and stick to value investing and always invest from a business perspective. This you will avoid taking out Off Set Mortgages to pay for your over leveraged portfolio.

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13 Responses to “Advice to new stock market investors”

  • Joel says:

    Do you know of advance stockmarket seminar somewhere in ortigas or makati for 2011?

  • Edwin Verdejo says:

    For few months since I started to venture into stock market, I’d say that I’m still a newcomer with so much to learn. This site of yours is one my sources of info and knowledge about the stock market and it helps a lot. Thanks. For some people, like me who earns a little over the minimum wage, investing in the stock market is really of greater risk, especially if it involves your hard-earned wages. To tell you honestly, I was very afraid when I first put my money into this. Now, I am learning to feel relax but still wary on things I do and to where I will be putting my small amount of money next to.

  • Beth says:

    Hi. Thanks for sharing this to us who are interested investing into stock market. I’m newbie when it come to this. I really appreciate any help you could give us.
    Question as follow.
    1. If I want to invest in a company, for example SMC ( San Miguel Corporation) what should i check first? financial statement of the company, like the Current Assest and Current Liabilities???
    2. Should I check the current news regarding that company.
    3. What is INDEX FUND??? where and how can I find that?
    4. How to pick a good company to invest in? what should I be checking first if I want to invest on that company?

    I hope to hear from you soon.
    Thank you.

  • zigfred says:

    Beth: Thanks for your question, If you don’t mind, I’d like to answer your queries in a blogpost for the benefit of others as well. I’ll inform you once it is up.

  • zigfred says:

    Edwin: Wow ! Thanks. Comments like this encourages me to do better in my blog. More power to you and welcome to the stock market investing club !

  • zigfred says:

    Joel: You can check out the Philippine Stock Exchange website. ( They constantly place stock market investing seminar schedules.

  • Vic says:

    Hi Zigfred, thanks for this guide to newbies. I know financial statement analysis but I have never tried to invest in stocks. I hope have enough money to invest on that. 🙂

  • Beth says:

    zigfred: Yes, thank you. looking forward to it.

  • Beth says:

    zigfred: Hi, how is it going? It seems your very busy these days.
    I have suggestion, if it’s not too much to ask.
    Would you do a review on some stocks for example MPI.. like showing us the P/E ratio, book value, price earning with 5 years, debt etc.
    Just a thought about it.
    In this way you could help your readers and those beginners to have a good judgement on that particular stocks and its up to us if we are going to buy and get involve with the company.
    Thank you..hoping you would consider this suggestion.

  • zigfred says:

    Vic: You are in the best position to invest in stocks considering that you already know financial statement analysis. 🙂

  • Beth says:

    Zigfred: Whew! hirap ng newbie sa stocks daming question.
    I’d like to buy shares,for example URC.. let say the current price today is 43.20 ..
    i made some list of prices that i should buy,URC if down 30.00 i will buy, but it seems impossible for the price to go down.
    I read your post about when to buy stocks:
    1. stock panic 2. industry recession 3. structural changes 4. war
    what if none of these happen? what is the best entry point?
    i felt,im already procrastinating…stock dipped last may 24th but not at the price that i set i should buy.
    DMC 25.00
    EDC 5.50
    PCOR 12.50
    etc… would these stock will go down at that price..
    i know you’ve been into this business for quite sometime.
    i want to hear you opinion.
    I really hope you’ll find a time to answer all of my question.

  • Fil says:

    Do you know what is the target price of the following stocks


    Any information is appreciated.


  • zigfred says:

    Fil: Fil, I usually don’t give out a target price for stocks. This is something you have to figure out yourself. You will have to learn to do some fundamental analysis in order to determine your exit price.

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D’ Intelligent investor is one of the first few updated value investing blogs in Asia and probably the only updated value investing blog in the Philippines where you can learn stock market investing through intelligent investing that makes business sense. The stock market investing strategies are very different from what most stock market players advocate. The strategies featured here are mainly value investing principles more specifically inclined with what are perceived to be Warren Buffett’s style of investing. Other value investing strategies by great value investors such as Benjamin Graham, Peter Lynch, John Boggle among others are also featured.