Stocks & Share Investing: How to Get Started

The aim of StockWatch is to teach beginners with no previous experience about investing. These articles will teach you why investing is important, the magic of compound interest, how to invest in shares, how to choose your own broker and how to buy your first parcel of shares.

Owning stocks is not rocket science, in fact, 46% of Australians own shares directly or indirectly*. All you need is a basic understanding of how the sharemarket works, the share language, patience and discipline.

These articles will familiarize you with the fundamentals of the sharemarket, so make sure you join the StockWatch share market game to put what you learn into practice. Other than the prizes on offer, the StockWatch share trading game will allow you to test out your own trading strategies without the stress of losing any money.

*ASX 2006 Australian Share Ownership Study

Articles

Derivatives

NEWLearn all About Trading Options 10 articles
This options trading series will teach you very important aspects of options. The part series 'Introduction to Options' will teach you tips and strategies for trading options

NEWLearn how to trade CFDs (Contract for Difference) 9 articles
Is it possible to turn $13,000 into $30,000 in 3 months or pull in $65,000 in one week trading CFDs? Find out how CFD trading (Contract for Difference) is taking the financial world by storm

Learn How To Trade CFDs: Developing a system that should make us money
Trading CFDs profitably require a careful risk management plan. Learn how to systematically look at CFD’s in bite-sized portions to develop system that should make us money.

Fundamental Analysis

NEWFundamental Analysis: Introduction to Fundamental Analysis 10 articles
Fundamental analysis is the study of economic and company related factors that will influence share price. For most long term investors, fundamental analysis is the cornerstone of good stock selection.

Funds

Managed Funds or Direct Shares
Before you can know how to best invest your money you need to first make a plan. Choose an investment vehicle/s that will best reach your invest goals.

Managed Funds - Choosing the best fund for you
Managed funds, also known as unit trust or mutual funds, allow investors to pool their money together and buy different companies.

ETFs (Exchange Traded Funds)
An exchange traded fund (ETF) is a cross between an index fund and a stock. It combines the low fees and diversification of an index fund and the liquidity of stocks.

Introduction to Index Funds
An index fund works by buying all the securities that make up a specific index, for example the S&P/ASX 200 index. Find out if you should invest in a Index Funds VS Managed Funds.

Investing

NEWCan I Retire on 1 Million Dollars? Is it Enough?
One million dollars has been the benchmark for individuals saving for retirement. But is one million dollars enough to live comfortably on? You might be surprised by the answer.

Asset Classes
The 3 main type of asset classes includes shares, property, fixed interest. Which asset class should you invest in? Each of the asset classes above have their own risk/return profile.

Dollar Cost Averaging with Example Calculations
Dollar cost averaging involves buying assets at different prices by making regular deposits. As a result, you purchase more units when prices are low and fewer when prices are high.

Choosing a Finance Advisor
Unfortunately, finding a good financial advisor is not as simple as it should be. Where to look and questions to ask.

Investment Vehicles – Best way to invest your money?
Before you can know how to best invest your money you need to first make a plan. Choose an investment vehicle/s that will best reach your invest goals.

Planning Your Investments
Before you go straight ahead and invest your hard earned money, make sure you have an investment plan. What is your time frame? What is your risk appetite?

Magic of Compound Interest
Albert Einstein called it the 8th Wonder of the World. Compound interest is one of the most basic and powerful concepts that can enhance the outcome of your investments.

Shares

NEWHow To Pick Growth Stocks?
Want to find stocks that will rocket in value? Learn how to pick growth stock by identying criterias such as EPS, P/E, Revenue & Book Value.

NEWWhat are Income Stocks? Best Income Stocks for 2010
What are income stocks and which ones are ripe for the picking for 2010? An income stock is a quality blue chip stock that will maintain its value while paying dividends. Here is out top 10 best income stocks for 2010

NEWBuilding a Investment Portfolio Strategy
Portfolios do not come with a cookie cutter suitable for every investor. We need to analyze the investor and then select stocks that match the profile. To do so we need to consider three main areas: time, risk, reward. Learn how to build a customised portfolio.

NEWCan I Make Money Day Trading? How to Become a Day Trader?
What is the reality behind day trading? Can people make a living at it? What skills and training is necessary to be successful? Is it for you?

NEWStock Market Investing and Share Market Tips
If I had to pass on a few tips that would help investors most, what would they be? The following stock market and share market tips should help keep you on the profitable side of the market

NEWWhat Is Ethical Investing?
Ethical Investments are also sometimes referred to as Socially Responsible Investments, SRI. Some reports suggest that these types of funds will reach the value of 3 trillion dollars by 2011 in the USA and $15.73 billion in Australia. What are they and should we invest in ethical investments?

NEWGuard Your Portfolio With Defensive Stocks
When the market is choppy, trendless, or hard to define, what sort of stocks should you own as an investor? For many the answer is defensive stocks. What are defensive stocks, Why Invest in Defensive Stocks? What are examples of Defensive Stocks?

NEWShort Selling Explained: What is Short Selling
What is short selling? Why do we care? Short selling allows an investor to make money on both sides of the market action. Learn how shorting selling works and why you would short a stock. The rules and risks are also explained.

NEWHow Much Do I Need to Invest in Shares
The minimum required to invest in a parcel of share in Australia is $500 however this is not advised as brokerage costs and transaction fees can eat into your capital.

NEWHigh Dividend Stocks
The process of picking high yielding dividend stocks is not nearly as simple as grabbing the one with the highest yield. Certain stocks have higher dividends than others. What types of stocks would these be? Here are example of quality stocks with high dividends.

Dividend Imputation System & Franking Credits Explained
The dividend imputation system allows investors who have been paid a dividend to take a personal tax credit (franking credit) since the company has already paid tax (30%) on this dividend.

Understanding the Share Language & Jargon
It is important that you understand the language & jargon of shares, as your evaluation of a company may be dependent on one vital piece of information.

Learn how to diversify your portfolio
One of the most effective strategies to reduce risk is through diversification. Learn how to diversify your portfolio.

What are Shares Dividends?
Dividends are the distributions that are paid using profits companies made during the year - it is like a reward to investors who have chosen correctly.

What does ex-dividend mean? How to ensure you receive your dividends
What does it means when a share goes ex-dividend? Learn the important dates of a dividend, ex-divided, record date, payable date and ensure you receive your dividends.

What is 'The Market'
Whether you've read about it in the finance section of the newspaper or heard it on the news, have you ever wondered what they mean by "The Market"? Why is it so important?

Benefits of Investing in Shares
There are many benefits to investing in shares and we will investigate how this common form of investment can be an effective way to make money and dilute the risk.

Choosing A Broker
There are 2 main types of brokerage firms, full service brokerage firms and discount brokerage firms (Online Brokers). Deciding which brokerage firm to use will depend on your trading style.

How to Buy Shares
Step by step instructions on how to buy your first parcel of shares. Learn what 'Bid', 'Offer' and 'Last' prices mean and how you can take advantage of them with your trades.

How to Make Money In Shares
The aim of StockWatch is to help beginner's learn about investing. These articles will teach you why investing is important, how to invest in shares, finding a broker & how to buy shares.

Technial Analysis

Technical Analysis Charts: Charting Range, Chart Types & Patterns 7 articles
Learn about Technical Analysis and Charting. Find out which Chart Type you should be using and learn about the most common Chart Patterns

Technical Analysis Indicators: Leading versus Lagging Indicators
Technical analysis indicators come in two basic varieties: leading and lagging. A trending market works well with lagging indicators, while a trading market more profitable with leading indicators.

Trend Following Indicators - Part 1: What Is a Trend?
Learn about trend following indicators, ADX, Wilders DMI, Aroon and MACDs. Being able to determine a trend is one of the most important concepts in technical analysis.

Trend Following Indicators - Part 2: Trading The Average Directional Index (ADX)
The ADX is an oscillator type indicator that is used to determine the strength of the trend. Learn how to trade the Average Directional Index ADX.

Trend Following Indicators - Part 3: The Directional Movement Index (DMI)
The most common way to trade the DMI indicator, is to enter a trade at the crossover point. When the red crosses above the green, go short. If the green crosses above the red, go long.

MACD Indicator Explained
The Moving Average Convergence Divergence (MACD) is a combination of moving averages designed to signal a change in trend. Learn the 3 three common approaches when trading the MACD.

Technical Analysis - Momentum Indicators: ROC, Stochastic & RSI
Momentum in stocks usually refers to a rate of change, an increase or decrease in pressure. The most popular momentum indicators are Momentum, ROC, Stochastic and RSI.

The Relative Strength Index RSI Indicator Explained
Trading the Relative Strength Index profitably is what separates the good traders from the bad. We will now discuss a few common methods of trading the RSI.

Stochastic Indicator Explained
The goal of the Stochastic Oscillator (Fast, Slow, and Full) is to determine if the stock price is in the upper or lower trading range over a set amount of time. Learn the three basic ways to trade the Stochastic Oscillator.

Momentum Following Indicators: The TRIX Indicator
The TRIX indicator has become a well used method for momentum traders to determine buy and sell signals. The goal is to super smooth the data security to reduce the volatility and whipsaws.

Volume Following Indicators In Technical Analysis
Many volume trading indicators exist such as the Money Flow Index, On Balanced Volume, Accumulation and Distribution. Whatever methods are employed to track volume, a careful study into how volume works will greatly improve your trading.

Volume Indicators: On Balanced Volume (OBV) Indicator
There are a few ways to profitably trade the OBV: divergence and crossovers. Whether you use OBV to spot divergences in prices, or to play smaller volume breakouts, this tool is best used in conjunction with other tools.

Volume Indicators: Money Flow Index (MFI) Indicator Explained
There are three key signals to use to trade profitably with the Money Flow Index Indicator: divergences, overbought / oversold signals, and crossing of the 50.

Volume Following Indicators: Percentage Volume Oscillator (PVO) Indicator
Just like the MACD, the Percentage Volume Oscillator starts with the 12 day moving average and subtracts the 26 day moving average. Here three main signals are generated with the PVO.

Technical Analysis: The Secret of Moving Averages Explained
Moving Averages are powerful indicators. They can tell you about trends and buy and sell signals generated. Continue reading to learn the secret of Moving Averages.

Learn How To Trade Support and Resistance Levels
Perhaps one of the strongest concepts in technical analysis is support and resistance. Support and resistance are great clues as to profitable entries and exits, and particularly powerful when combined with other indicators in a complete trading strategy.

Technical Analysis: Parabolic Stop and Reversal (PSAR) Indicator
Developed by technical analyst Welles Wilder who also made the RSI and ADX indicators, the Parabolic Stop and Reversal system has proved a worthy indicator for expert traders. The goal of the PSAR is to determine a trend, and then establish buy and sell signals on that trend.

Technical Analysis: Stop Loss & Trailing Stop Loss Orders
Having an exit strategy is vital to the success of any trader. While a variety of methods exist, a stop-loss order is a simple and proven method to capture gains and limit loss.