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INVESTING IN STOCKS AND SHARES

Updated on May 6, 2011

HOW I GOT STARTED

 It was more years ago than I care to remember when my then Boss, told me to give him £100 but not until a fortnight away. Naturally I asked why and he told me he was buying some shares for me. I knew that his family had a stock dealing Agency so it was not a complete shock to receive such a request from him. He explained that payment was not due immediately but I made sure I had a cheque available.Around 2 weeks later he came into my office with paperwork which I signed and then proffered my £100 cheque only to be told that I need not bother as he had already sold my shares AT 60% profit. Thus, eventually, I received £60 having outlaid nothing in hard cash. That was my introduction and since then I have learned quite a bit about dealing in stocks and shares.

Personally, I have never been a gambler, so my investments have remained modest and I have always understood that stocks can fall as well as rise and have seen some of mine do just that. Nobody legal gets it correct 100% of the time. The key is to keep clear records, set figures to sell if stock drops and be aware of whether you are in front or behind at all times. I never chase good money after bad and I ,never, ever listen to those cold calls from Boiler Rooms that I receive on a regular basis. Go to my hub on Boiler Rooms if you want to avoid these scams.

PORTFOLIOS.

I was advised early to build up gradually a mixed portfolio that was basically divided into 3 sections.

1. BLUE CHIP STOCK. These are solid, low risk companies ,many being Household names. They pay you a dividend on the profits they make for holding their stock and thus, investing in them. Solid, reliable and DULL ,is what some say as they are not subject to switches in price of high levels in normal circumstances.Others say Dependable investments.

2. MEDIUM STOCKS. These are often developing companies, that are not yet established in the top echelon, but at least part of the way there. They,too .will pay a dividend usually, and sometimes the share price rises nicely, either because they have made further progress, or attract the attention of a would be buyer.

3. HIGH RISK STOCKS. These quite often are seedbed companies looking to advance. Remember Marks and Spenser started as a market stall! I look at these as my eggs! Some of them turn out to be Swans and make a beautiful profit, whilst inevitably some will be the ugly Ducklings and lose out.

BALANCE AT ALL TIMES.

The key is to Balance your holdings and keep the equilibrium. Most new investors do not do that, but it is vital. New investors tend to be drawn to the High Risk Sector. Here you find"PENNY SHARES", so called because you get lots for your cash and even a small rise in price on paper makes a real profit. Remember though that in real terms it is all the same ,to make 100% profit your shares needs to double in price whatever you paid for them.

 I always recommend that good advice is sort in all areas but in High Risk it is vital. My link below shows how you can get advice and check out the quality of that advice in real life without hazarding any of your cash. You can test the advice, on paper and judge the value for yourself and I think that is a good rule to follow throughout if you wish to succeed in your chosen investment plans. Check out my link below and also source your own information, invest carefully, and like me you will keep involved for years. Many will have made much more than I have and many gone the other way. My aim has always been to take the middle route and remember a profit is always a profit and if the next chap makes more then me, then so be it. I am happy with what I have. 

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