Investing in Shares Online

When you have finally decided to go online and purchase shares, you will want to keep the following information in mind. There is a myth about online share trading that; the more money you put in the greater your return will be. This is not necessarily true. You decide how much you want to put in. However if you do put in large amounts of money and manage a diverse portfolio you might see returns more quickly.

Remember; never use your bread and butter money. When you invest money, you will want to make sure that it is money that you are willing to lose. If it is money that you really need you will not want to invest it, as you might lose some of it or you won’t be able to retrieve that money as quick as you would want to. Always make informed decisions about the shares you want to purchase by identifying which are good and which are bad investments. As you keep learning how to trade shares, you will start to obtain more knowledge.

Diversify, diversify and diversify. Don’t put all your eggs in one basket. When the basket falls, you lose all your eggs. If you invest a large amount, try to by shares in as many, well established, companies as you can. E.g. you want to invest R50,000.00. Split the investment amount 5 ways, thus investing R10,000.00 in 5 different companies. By doing this you are spreading your risk.

Trade shares in companies that are financially strong and have a good past and future. There are a lot of different companies listed at the JSE; the well established ones are usually on the

Main Board. Visit the JSE website to find out more about the companies listed on the Main Board. An alternative is to visit the AltX, here you will find the smaller companies. These companies’s shares are usually very cheap and you can by a lot for just a little money.

Remember there are no short cuts to becoming a well established share trader. Sometimes you will lose some money. What makes you a good trader is how well you can pick yourself up and carry on.

 

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