In case you didn't know by now, a stock is an equity investment that gives you part ownership of a company. That means that when you own stocks, you own a small part of that company and are entitled to part of the company's earnings. If the company you invest in is doing really well, then your stock will go up. If the company is losing money, then your stock will go down, and you might lose a little too. So if you want to be successful in the stock market, you’ll want to invest in companies that are known to be doing well or have great potential. One of the best investments for stock market beginners is to buy stocks in large companies that have been around for a while. Stick with names that you know and understand. A few of these are:
1. International Business Machines Corp. (IBM)
IBM is a pretty safe investment. They have been in the business for over 100 years, and are still moving forward with their technology. Software is their biggest product, but they are growing and moving more towards cloud technology now. They are based out of New York State but operate in many countries.
Verizon is another good share for beginners. They make products for communication and entertainment all over the world and are the biggest wireless service provider in the USA. Their stock is reasonably priced compared to other wireless providers at the moment.
3. Procter & Gamble (P&G)
P&G owns several products that you've probably heard of. Some of their health and beauty products include Olay, Oral-B, and Charmin. They also own several cleaning products that you may have used in your house at sometime. With all of these products driving their income, you can feel safe that they will be doing well for a long time.
One of the most famous companies in the world, Wal-Mart is only expected to keep on growing in the next few years. They have increased their cash dividend every year since 1974 (Story here). They are doing better in the stock market than any of their competitors.
Index funds are one of the best investments for stock market beginners since there is little risk involved. An index fund has its own rules that it has to stick to. They include mutual funds and exchange-traded funds. Index funds will group together money from a group of investors. For more on index funds, read this article. Some of the broad-market ones to invest in are:
· S&P 500
If you're still unsure or need a little help, you can always take a course to learn about the stock market. There are plenty of courses online, or you can speak to a stock broker. Investing in the stock market is exciting and can have a great return on investment.