This means that over half of the American people missed out on the rally and gained nothing out of a period of incredible economic prosperity and growth. Media outlets often report on the rich getting richer. What they do not often report on is how they do it or that a lot of opportunities are similarly available to every American citizen.
I read the news and saw the results of the survey when the data was released. The primary reasons for people saying they did not invest were lack of funds and lack of financial knowledge. Lack of funds is no longer a valid excuse with apps like Acorns allowing anyone with a smartphone to invest as little as $20 a month in a diversified portfolio.
With that being said, lack of knowledge becomes the best excuse, though with online courses taking off this year and ebooks already a huge market, this excuse no longer holds any sway.
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This poll inspired me to learn how to invest. Knowing someone with no knowledge of the stock market could have doubled their money by simply investing in the most well-known index made me realize what I had been missing out on. It was then that I decided I was going to take the necessary steps to begin investing. Here was my process:
Step One: Read About Investing
I started with books. A lot of people hate to read. Unfortunately, data shows that successful people tend to read more than others. Here is a list of all the technical analysis books that I read in the first few months of investing. I found that I actually loved learning in-depth analysis techniques on charts and it made sense to me that there would be patterns in a stock’s price action. After reading the books, I felt like I had a lot of knowledge about the stock market and price action, but had no idea how to apply it.
Step Two: Take Online Investing Courses
Next I looked into stock market courses. There was tons of courses online, making it incredibly hard to choose. I ended up using Udemy, a discount courses website where you can learn and screen share with people in any industry. I am glad that I read books before I started doing the courses. They teach a lot of the know-how and how to use platforms, but most of them that I took do not offer in-depth study and analysis of price patterns, an integral part of trading stocks.
At this point I felt that I understood price action, I understood how to go about buying and sell stocks, and had a few strategies under my belt.
Step Three: Research the Companies
Next I started looking into companies that were in my area and were publicly traded. A lot of investors recommended investing in companies that were close to you, that you knew of, and believed in.
I ended up choosing Vivint Solar, a local company that had recently had an IPO and had seen dramatic price decreases after the IPO. I knew the company, and many employees that worked in their sales department. They were killing it in sales I knew. I also had recently completed a project on the solar market and felt I understood it well enough to understand business models and growth potential.
I ended up making a good amount of money on my first trade. I don’t believe this is the case on a lot of beginning trades. I believe it came down to being very careful and spending a long time researching.
Since then I have learned a lot. I learned to diversify and not put all my eggs in one basket. I learned to hedge my investments and stop myself from ever losing excessive amounts of money.
Everything I learned was on the side, 30 minutes here, an hour there, a podcast on the way to work, reading a book on a Sunday afternoon. The point is that anyone can do this. The stock market is not an impossible money machine for the rich and successful, it is a way for every American to take part in times of economic prosperity. Don’t let fear of the unknown keep you from taking part in America’s successes and growth.
Do you have an investment success story? Share it with us.
Photo: Flickr: Chris Potter
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