It is surprising how many people want to learn to invest, but for various reasons do not dare to do so. It is also very common to meet people who are encouraged to take the first step but end up leaving it without achieving their goal. It is a path that takes time, it can be tough, but it is profitable and it is worth it. With these 5 tips for learning to invest in the stock market, I want to help newbies to start this path successfully without just trying.
Tip # 1: Learn to invest from the best
It is important to know how to separate the grain from the chaff. The media, especially the internet, are full of fake investment gurus who sell foolproof ways to invest in the stock market and make big money in a short time. Most, if not all of them, are charlatans who earn their living by selling useless books and courses at exorbitant prices.
To know who the best are, we must turn to the historical profitability of their investments. Warren Buffett, Peter Lynch, David Einhorn, Phillip Fisher, the managers of Bestinver… All of them have obtained a great return on their investments, making rich many shareholders and participants in their funds who have trusted them in the long term. You can earn a lot in a year if you are lucky, but the worth of an investor is proven in the long run.
What do most of the best investors have in common? Who invest in long-term stocks following the philosophy of the value investing. They do not trade intraday, analyze charts, or invest in highly leveraged derivatives. Do not sell the motorcycle with false promises, if you want to learn to invest like the best you must focus on value investing.
Tip # 2: Read a lot and of quality
Once we are clear that we are going to learn from the best, that is, that we are going to learn to invest according to the fundamentals of value investing, we must get down to work. To do this, the best way is to read a lot. But that is not enough, we must look for quality content. There are three main sources of content that we should not rule out:
- Books: The Basic Source of Wisdom. I always recommend starting with "Benjamin Graham, where the fundamentals of value investing are established, teaching us to think as a enterprising investor. As the number of investment books is enormous, I recommend that you go through my section of "Recommended books to learn to invest in the stock market“, Which will surely be very useful for you.
- Blogs: Today we are lucky to have this great free resource at our disposal. In my section of links You can see some investment blogs in Castilian more than recommended.
- Social networks for investors: This is a source of information that we cannot rule out either. To find out which social networks to use, I recommend you take a look at my article on 3 social networks for investors worth being on.
Tip # 3: Be patient
Before starting you have to know that learning to invest takes time, a long time. What's more, investing is an art that requires continuous learning that lasts a lifetime.
The art of inversion has a learning curve very similar to that of a martial art. You can learn the basics in a short time, but it takes a lifetime to be a true teacher and the learning process never ends.
Tip # 4: Apply the theory
Having a solid theoretical base is essential to learn to invest. However, practice cannot be set aside. It is necessary to compensate the theoretical learning with the practical one. For example, you can start by looking at the presentations of results and annual accounts of some listed companies to get used to it over time and that it is not difficult to analyze the companies in depth in the future.
Tip # 5: Be consistent
In learning to invest in the stock market, as with diets, physical exercise or studies, perseverance is essential. As the roman poet said Value Investing FM, in which Adrián and Paco share 10 tips to invest in the stock market for beginners (and not so beginners).
You can listen to it: