From buying and selling options to tax strategies, we at FlyTraders cover the full spectrum of the stock market to instill you with the confidence you need to make wise investments. But first off, what is a stock?
A stock is an ownership share in a corporation. In other words, when you own stock, you own a part of the company, and are granted the right to vote for or against proposed company policies, as well as participate in the election of the board of directors. Stocks are traded on exchanges worldwide and the largest is the New York Stock Exchange (NYSE).
Why Own Stock?
The most practical reason to own stock is to make money. That entails selling stock for more than you paid for it, and as owner of the stock, you have the sole right to sell it. In the stock market, you can even sell stock before you purchase it, which is what people often do when they believe a company’s value is on the decline.
For example, let us suppose FLYT is trading at $90.00. There are two things you can do:
- 1. If you think it is going up, then buy the stock at $90.00 in the hopes of selling it at a higher price later on.
- 2. If you think it is going down, then sell the stock at $90.00 in the hopes of buying it back at a lower price later on.
To sum it up: buy low, and sell high. Or, sell high, and buy it back low later on. At FlyTraders, our manual will discuss a number of methods and strategies that can be used to effectively make money by buying and selling stock.
Getting Started With the Stock Market
Many people probably feel like investing in stock is a total gamble, but this is not true. You never purchase a stock willy-nilly. Rather, you buy and sell stock based on the buying and selling habits of people and institutions. In essence, the price of the stock directly reflects the investment community’s opinion of the stock. As a stock investor, your objective is to buy shares of a company that are likely to increase in value over time.
Everything we do in our lives inevitably involves risks. At FlyTraders, we are dedicated to educating our trainees on practical trading methods to minimize risk and maximize profit. People invest in the stock market for a multitude of reasons—saving for retirement through a 401K, college funds, upcoming vacations, long-term growth, and even short term profits. “Investing” entails long-term strategies, while “Trading” aims to reap short-term profits. We advise against “Day-Trading”, which is needlessly time-consuming.
Traditional Rates of Return
Let us compare the rate of return investing in the stock market to the rate of return on traditional investments. In order to effectively project future returns, we have to use “compound interest”, which is calculated by what is called “The Rule of 72”.
For example, you invest $10,000 in a certificate of deposit, yielding 4% annually. To determine how long it takes for your investment to double, simply divide your interest rate of 4% into 72 (hence, our “Rule of 72”). 72 / 4 = 18. That means it will take 18 years for your investment to double. If you invest $10,000 at the age of 29, it will double at the age of 47, and quadruple at the age of 65.
The oldest and most traditional type of brokerage house is a Full Service Brokerage company, which utilizes a research department, offering recommendations to its clients. Typically, clients do not conduct research of their own, but rely on the their brokers’ guidance for long-term investment advice. Full service brokers charge very high commissions for their services they render, but do not always result in successful returns on their clients’ investments.
Discount Brokers, on the other hand, do not offer investment advice, but usually provide material for their clients, allowing can make their own investment decisions. These companies charge significantly less than full service companies, and orders can be placed over the phone or online.
Finally, Deep Discount Brokers are designed to assist independent investors who place their own orders, and want fast, reliable executions online. Generally, these companies offer the least expensive commission fees of any brokerage house.
Sign Up Today
At FlyTraders, we recognize that no two trainees are the same, which is why we provide courses that give you a look at every angle of the Stock Market. Whether you have a job and want to play the market and trade, or learn how to trade in the market on a full-time basis, our stock market classes will provide you with the tools you need to simplify the job of investing and maximize the time needed to invest.
As the premier online stock market training company, each course is reasonably priced and guaranteed to instill you with the confidence you need to make the most informed investments. After all, it is your money. Sign up for our courses at FlyTraders today!