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Old 08-15-2007, 02:38 PM #1
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Talking I have $6000 and want it to grow lots by the time I get out of college.

Right now it's stuck in a 9 month CD at 5.25%, which I sort of regret now. It gets released in March. I've heard I should invest it in the S&P 500. I don't want it to be locked somewhere for a period of time, and basically want a maximum gain in 4-5 years. I'm willing to be a little risky with it.

I plan on getting a job in college and continuously throwing money at whatever I'll be investing it in, so that I won't spend it on useless crap, and to make it grow faster. I realize that college will be a perfect time to make money, because even though I'll be busy, I won't have to pay for rent, food, etc.
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Old 08-15-2007, 03:41 PM #2
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Right now it's stuck in a 9 month CD at 5.25%, which I sort of regret now. It gets released in March. I've heard I should invest it in the S&P 500. I don't want it to be locked somewhere for a period of time, and basically want a maximum gain in 4-5 years. I'm willing to be a little risky with it.

I plan on getting a job in college and continuously throwing money at whatever I'll be investing it in, so that I won't spend it on useless crap, and to make it grow faster. I realize that college will be a perfect time to make money, because even though I'll be busy, I won't have to pay for rent, food, etc.
Well I dont recommend investing a lot now with all this market stability but once it stables out you should invest in a lot of different mutual funds to create the most possible diversity.
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Old 08-15-2007, 05:44 PM #3
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You need to speak with an investment professional near you. All you're going to get here is individual investor's opinions, which doesn't fit for every single person.

Start at your local bank.
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Old 08-16-2007, 03:43 AM #4
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First off 6K isn't much. If you left it in the S&P 500 for 10 years and the S&P grew by 10% annually you would have 15,562.45 if you didn't touch it at all. That would be a very good return. 10 years is a long time though, and given inflation it would probably be more like 12K.

Normally I do research on companies I know and trust, then invest my money in them. This gives me two advantages.
  1. I understand that company and how they do business from a personal perspective.
  2. I have the market research that tells me how the stock is valued.

After all I've invested however, nothing compares to investing in myself. Start your own business. If you're savvy and have an awesome work ethic then you can make a far greater return on your money than in the stock market. The only reason I would invest in stocks if A)I had money I couldn't spend improving business profitability or 2)I didn't have business sense. If you can't invest in yourself then I would invest in the NASDAQ, not the S&P 500. The S&P is a slow mover and the NASDAQ has whipped it consistently. Just be sure you diversify. Get at least 10 different stocks. Shoot for stocks that have room for growth ($10-$20) and that you know about. Most of all READ and do RESEARCH. There are no shortcuts!

As for market instability, who cares. Get in it for the long haul or don't do it at all...short term instability is no barrier to entry. After all the instability this month you hear about in the news the market closed up over last month (I think).
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Old 08-16-2007, 09:55 AM #5
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Shoot for stocks that have room for growth ($10-$20) and that you know about.
Just out of curiousity how do you know when a stock fits this criteria?
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Old 08-16-2007, 11:48 AM #6
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The $10-$20 range is the price per share. The room for growth depends on the stock and it's fundamentals and history. You are looking for stocks with a track record of growing. The general principle is that companies who have done good things in the past tend to keep doing them. Companies with a stock price that has 'fallen' into low territory are out for me because that signals that something is wrong with either management or that industry...both bad. I never buy stocks that have 'fallen' into affordable territory.

As an analogy I will use sports teams. The Houston Texans are a good example. A few years ago everybody thought that the Texans were going to become a powerhouse because they had one of the best draft options ever. Not me. The Texans were sucking because of bad management. True to form they did not draft Reggie Bush when they had the chance. Instead they drafted Mario Williams?!? WTF? Stocks are the same way. When share price drops it signals that something is wrong. Short of a major turnaround it is hard to recover and I don't bet on that. The Texans will most undoubtedly continue to suck as they have for years.

My advice is this. Register an etrade account and do lots and lots of research...this is the only way you will know whether growth potential exists. Maybe get a good book on stock fundamentals. It's important to remember that a lot of people do this proffessionally and still lose money. That's the nature of the beast and nothing is for sure.
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Old 08-16-2007, 12:34 PM #7
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The $10-$20 range is the price per share. The room for growth depends on the stock and it's fundamentals and history. You are looking for stocks with a track record of growing. The general principle is that companies who have done good things in the past tend to keep doing them. Companies with a stock price that has 'fallen' into low territory are out for me because that signals that something is wrong with either management or that industry...both bad. I never buy stocks that have 'fallen' into affordable territory.

As an analogy I will use sports teams. The Houston Texans are a good example. A few years ago everybody thought that the Texans were going to become a powerhouse because they had one of the best draft options ever. Not me. The Texans were sucking because of bad management. True to form they did not draft Reggie Bush when they had the chance. Instead they drafted Mario Williams?!? WTF? Stocks are the same way. When share price drops it signals that something is wrong. Short of a major turnaround it is hard to recover and I don't bet on that. The Texans will most undoubtedly continue to suck as they have for years.

My advice is this. Register an etrade account and do lots and lots of research...this is the only way you will know whether growth potential exists. Maybe get a good book on stock fundamentals. It's important to remember that a lot of people do this proffessionally and still lose money. That's the nature of the beast and nothing is for sure.
I strongly disagree with you. I don't have time right now to point out the flaws in your stock picking system. But I will point out that making future projections, strongly based of off past price performance is terrible. Also that because a stock loses ground in the market does not make it a bad stock to own. That is like saying when a store runs a sale on an item it means it is automatically bad and you should buy the similar item at full price. Or if you went shopping at one store. Compared the price of a similar item at another store and decided on the more expensive one solely because there must be something wrong with the cheaper on?
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Old 08-16-2007, 12:45 PM #8
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I'm sure there are flaws, I'm not a professional. However, I wasn't speaking of stocks that were undervalued, rather stocks that have lost value because of management's bad decisions or problems with structure. And while it is wrong to extrapolate price will rise because it has in the past, it isn't wrong to extrapolate that companies who make good decisions will continue to do so. I would never bet on black at a roulette table just because the ball landed on red 10 times in a row...that would be stupid. But I would bet on a company that was doing the right things and had a track record to prove it. That was my point, which I suppose I didn't make clear enough.

To reiterate, never base future price on past price, but you can base future judgment on past judgment. Don't you agree?
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Old 08-16-2007, 03:46 PM #9
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The room for growth depends on the stock and it's fundamentals and history. You are looking for stocks with a track record of growing.

To reiterate, never base future price on past price, but you can base future judgment on past judgment. Don't you agree?
You should a little bit confused I think you need to turn cnbc off and develop a plan that suits you.

Who cares about track record. Growth on the street is like meth to low lifes. I know everyone here hates cramer but his book really sheds like what goes on, on the trading floor in his book real money. But im a trader before im an investor so what do I know.

If you really need that 6000 in the future dont trade it chances are you will lose it. I lost $7000 of my dads own money when I was 16....he was mad. I got it back for him and now he drives a 5 series bmw(true story)
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Old 08-16-2007, 05:41 PM #10
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I'm sure there are flaws, I'm not a professional.
Not to be harsh but uh....t_mo is. He may not recommend stocks to people but there are quite a few people who work in the finance industry that post here.

It's good to see you are trying to learn the market and are taking your own course of action in doing that, but I wouldn't quite recommend giving out advice just yet.
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Old 08-16-2007, 06:44 PM #11
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I had no idea there were guys of that caliber posting here. I'll defer to them. Like I said, I don't do it for a living, I work for myself - which is the best investment I ever made. I beat the street by a country mile every single week and have fun doing it. Good luck with your 6K!
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Old 08-16-2007, 09:02 PM #12
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ya go to the bank and they will assist you on what to do - good idea though
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Old 08-17-2007, 01:37 AM #13
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Whoa, whoa. Guys, I haven't got my CFA yet.
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Old 08-17-2007, 08:51 PM #14
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Whoa, whoa. Guys, I haven't got my CFA yet.
You're not giving yourself enough credit. You may not be a CFA but you work for a financial company that deals in investments, that's what I was trying to say. I guess I never really asked if you were licensed to sell anything. Ha.

I don't recommend individual stocks either, but I still consider myself a professional.
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Old 08-18-2007, 12:29 AM #15
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The $10-$20 range is the price per share.
Just out of curiosity what does the 10-20 dollar price range have to do with anything? I would rather buy one share of a constant winner, like Berkshire Hathaway than 100 shares of some shady stock, just because it is trading for 10 dollars a share.
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Old 08-18-2007, 05:14 AM #16
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I'll news trade it for you in the foreign exchange market.. I take 35% of the profits I make for you . You'll be happy with the return .

But really I could do it, but I only like to trade my money/families. But if you're serious, I can point you in the right direction. A briliant trader, the best I've ever came encounter with and my mentor. I'd say you'll do about 100% a year (most likely more) with him. Minimum investment is 10K though if you're interested. PM me and i'll send you a link to his site. I trade the same way he trades and I've taken 2K to almost 10K in 8 months. Even after I decided I'd try and technical trade and lost like $500.
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Old 08-18-2007, 10:15 AM #17
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You're not giving yourself enough credit. You may not be a CFA but you work for a financial company that deals in investments, that's what I was trying to say. I guess I never really asked if you were licensed to sell anything. Ha.

I don't recommend individual stocks either, but I still consider myself a professional.
I do work for a company that has over 14 trillion dollars in custody. I'm responsible for a coupe billion dollars day to day.

I am not in the sell side, maybe one day I haven't really decided what route I'm going to go CFA, or CFP?
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Old 08-18-2007, 09:32 PM #18
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4 years isn't a long time. I'd go with CD's
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Old 08-18-2007, 10:04 PM #19
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For non-financial geniuses (and near-geniuses), it's best to put money into an index fund to maximize return divided by risk. You can put it into a NASDAQ index fund (every NASDAQ company), as far as I know, although I'm not sure which companies offer NASDAQ index funds..
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Old 08-19-2007, 10:11 AM #20
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it's best to put money into an index fund to maximize return divided by risk.
That is an untrue statement.

There are so many other variables that go into the "right" investment for each individual that you cannot make a blanket statement like that.
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Old 08-19-2007, 11:10 PM #21
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YOu could also go with the penny stock options, but thats risky as hell.
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