How do I Invest


 

How do I Invest

How do I invest? How do I invest correctly?

So, you have some extra cash. And you want to learn where to invest cash. Let’s say you’re looking for the best way to invest 10k Maybe you’re torn whether to learn to invest in real estate or simply want to know the best place to invest money now. We can help you.

First off for those of you that got here and wanted to learn to invest in real estate . I enter exhibit A and you’ll basically see that for most of the time investing in real estate has just yielded an above average inflationary hedge. Can you make money in real estate? Yes. The returns in real estate tend to be targeted towards leveraging your returns with debt. The danger is that when you leverage things can go very wrong very fast.

S&P 500 Track Record

Just to prove my point here is the S&P 500 over the long haul.

S&P 500 return inflation adjusted

Inflation adjusted S&P 500 return

Investing can seem like a complicated subject, something that only bankers and investment brokers truly understand. But the truth is, just about anyone can grasp the basics of investing and use the knowledge they gain to grow a substantial nest egg over time. Investing is more a game of temperament then advanced mathematics.

“If calculus or algebra were required to be a great investor, I’d have to go back to delivering newspapers”

“You don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ.”

-Warren Buffett

While it is true that most get-rich-quick schemes are doomed to failure, the get-rich-slowly approach to investing and saving for retirement has been working well for hundreds of years. This web site will teach you how to conduct your proper investing education. This includes answering what to invest in, best place to invest money now , where to invest , invest tools to use. We answer how do I invest and best way to invest 10k , and how to advance your investment education .

Investing in individual companies can be very complex but rewarding. For those first entering their investing education process, it can be daunting to learn the process of what to invest in, what the proper invest tools , and where to get started. The stock market can look like a crazy place. The good news is that you can beat most money managers with a very very very simple strategy and we can teach you what to invest in to begin compounding and teach you how to further your investment education .

“Rule No. 1: never lose money; rule No. 2: don’t forget rule No. 1”
-Warren Buffett

You’re probably saying don’t lose money? This is some genius advice this guy is giving me but often the simplest advice is the best advice and the key to the stock market is to avoid big losses. Charlie Munger has always said that people would do better if they could only buy a limited amount of stocks in their life and had to make sure that the stocks they purchased were excellent.The stock market is a no strike game . It’s like a home run derby in baseball you can sit there and wait for your pitch to crush it!

First we remind you that stocks are not just wildly swinging prices on a computer screen. They represent interests in businesses. The further you disconnect from this element the more your acts become speculation and less investment. Each stock is a piece of a business, that owns hard assets like cash and real estate, soft assets like brands and patents, and has earnings power. Each one of these components determines the value of the stock. If you were to believe the efficient market theory then we would stop right here because then you would believe that the market reflects all known information about a stock and that securities are perfectly priced. In other words if it were true the best place to invest money would merely be in index funds with the lowest fees. Index funds mirror indexes like the NASDAQ, Dow Jones, or S&P 500. In Index funds the key is you want the lowest of fees. If you go down this route then Vanguard is the best place to purchase funds.
You can never do that wrong investing in one of the targeting retirement funds from Vanguard and continually dollar cost averaging. What is dollar cost averaging it’s spreading your purchase out over an infinite period of time. If the market goes down it behooves you to purchase more shares if it doesn’t you just keep going along your process. We believe that if Graham were alive today he would suggest that the defensive investor would make use of index funds such as these at a low cost and then to remember: For most professionals with full time jobs this is by far the best way to go.

“Be fearful when others are greedy and greedy only when others are fearful.”
-Warren Buffett

This method is best for 90% of people. As most people don’t have the time to dedicate to commit themselves to learning how to return out-sized returns in the stock market

Otherwise continue to our Invest Correctly article.