Get Ready To Play The Stock Market Game?

 

Do you quiver with fear at the mention of the stock market? Do your eyes glaze over as you listen to the lingo? Do you get lost between buy and sell with everything else being a big blur? It really isn’t quite as difficult as you might think. Get ready to play the stock market game.

For many of the extent of our venture into the stock market is buying mutual funds with the assistance of an investment manager. And there’s nothing wrong with that! The important thing is you are bright enough to be investing in your future.

But every now and then don’t you just get a feeling that you are missing out on some great opportunities by staying such a straight and narrow course? Once in a while the news will capture a new and exciting investment opportunity and you think if I only had the skills and knew what I was doing, I’d invest in that stock.

Good News! By the end of this article you’ll at least have a better understanding of the stock market lingo. Although we can’t teach you investment and stock market strategies in such a limited space, if you take some time to search the internet you’ll be amazed at how much information is available free for the taking. In no time at all you could be a savvy stock market investor!

For now we’ll start with improving your stock market vocabulary. Let’s start with the term stock. A stock is the ownership of a portion of a company. Stocks are broke down into individual shares which allow you to purchase as many or as few of the shares for any one company. Depending how many shares you buy will depend on how much of a company you own.

Stockholders are the people, like yourself that buy the shares. The entire number of shares sold equals the stocks that are owned. Stockholders are generally able to vote on corporate decisions including who will sit on the board of directors.

As a stockholder you are entitled to a percentage of the profits that are often paid as dividends or the issuing of more shares to you. The amount owed to you depends on the portion of the company you own and what the rate of return is.

The value of the stock rises and falls depending on how the market perceives the corporation at any given time. World events, currency, and several other factors are reflected in the current price of a stock. Stock prices fluctuate on a daily bases.

What you need to remember is that panicking will not do you any good. Quite often this does occur. Your shares were worth $20 each and suddenly they are worth $15 and the panic button goes off and you want to sell. If you sell you will loose money. $5.00 per share to be exact and depending on how many shares you own your loss could be substantial.

Its way smarter to ride out the bumps after all they are what make the market what it is. Don’t panic when you see your shares dropping, not unless there is a serious issue that has come to light. Then it may be wiser to cut your losses and run. Otherwise consider the stock market a very volatile environment and like a volcano it can erupt at any given moment, then settling back down just as quick.

It’s a good idea to track your stocks in what’s called a shareholders track. It may seem confusing in the beginning but you’ll get the hang of it in no time.

When you are looking at stocks the ticker symbol is what you see first. This is the abbreviated symbol that identifies the stock on the stock market. It can be all letters, all numbers, or a combination of both. For example Walmart trades as WMT. You’ll need to know this abbreviated name so you can track your stock.

The next thing you’ll see is the companies name although sometimes this is eliminated to save space. Then you’ll see the number of sales that occurred in the last day of trading. It’s based on 100,000 so if you see the number 325 it would mean 325,000 shares were bought and sold the last trading day.

Next you will see the high and low price. The high price shows you the highest price the share sold for the previous trading day, and the low price will show you the lowest price the share sold for the previous trading day. It’s very helpful for tracking how much a share varies in any given day.

Next comes the closing price which is the last price the stock traded for just before the market closed. This becomes the opening price for the next trading day. After the closing price you’ll see a number indicating how much the stock has changed. A + shows an increase while a – shows a decrease. So a +20 would tell you the stock sold for 20 points more today than yesterday, while a -25 would tell you it sold for 25 points less than yesterday.

One of the best tips to get ready to play the stock market game is to spend a month or so getting very familiar with the market. You can even make imaginary bets to see how you do. A little practice and you’ll be ready to play the stock market game like a pro!