Investing for Beginners

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Investing in the stock market can be both intimidating and foreign, fulfilling and lucrative. Both extremes are part of the experience for beginners, but learning more about the process of investing can ensure you meet your investment goals. 

Ready to ride the waves of the market? Learn how to start investing in stocks now.

Step 1: Identify your goals.

The first step in investing is to identify your long-term goals and which approach to take. There are limitless choices, and everyone has different goals and risk tolerance. 

Here are a few basic questions to guide your plan of action:

  1. Do I want to invest myself or utilize services offered by licensed professionals?
  2. Do I invest in stocks for the long-term (years) or do I prefer a shorter-term approach?
  3. Am I comfortable picking stocks myself (active investing) or does the passive approach suit me better?
  4. What is my financial situation and how much money should I allocate for investments?
  5. What are my long-term goals and how will I handle risks associated with investing?

There is no one correct answer to any of those questions. But contemplating your investing style will help you create a plan before moving forward to the next steps. 

Historically, the stock market has provided an annualized return of just under 10% per year over the last 100 years. This is generally better than other asset classes like real estate and fixed income. 

But the stock market can be volatile and go through periods of negative returns anywhere from short-term pullbacks to long-term bear markets when prices decline significantly. 

If you just want to participate but don’t have time or desire to do the work yourself, there are thousands of professional investment companies to create and manage your stock portfolio for a fee. In this case, your next step is to research those companies and find the one that fits your investment style.

Some examples are:

Mutual funds are a professionally-managed investment fund that pools money from many investors to purchase and manage securities (you can start with a small amount).

A registered investment advisor is a firm that provides advice and manages securities (usually for higher net worth clients).

Robo-advisors are digital platforms that provide automated, algorithm-driven financial planning services with little human involvement.

On the other hand, if you want to do stock investing yourself, you need to open a brokerage account.

Step 2: Open your investment account.

In order to buy and sell stocks, you need to open an investment account with a broker. This is an easy online process, and there are countless reputable brokerage firms you can choose from. 

Walk through the following questions to help you narrow your search for the right firm:

  • What are the commissions (how much do they charge you for a stock transaction)? Commissions have been declining over the last decade, and several brokerage firms in the United States do not charge commissions.
  • What kind of online trading platform is offered? Is it easy and intuitive to place a buy or sell order? Is there a mobile app for trading?
  • Does the broker provide research, education, stock news and insights? Are those features free?
  • Is charting software available and how user friendly is it? Is it free?
  • Are there charges if you aren’t trading actively?
  • Does the platform provide friendly and patient customer service (important for beginners)? Can you talk to someone over the phone?
  • What kind of security does the broker use to keep your account safe?
  • How long has the service been in business?
  • Does it allow retirement accounts and what are the options?
  • What is the minimum account size?
  • Can you expect user-friendly account management features where you can see your transactions, balances, history and cost?
  • Does the firm offer advisory services, and how much is the charge?

Most brokers have answers to these questions right on their websites, but it’s always good to call directly and have a conversation with their representative. Explain your goals and objectives to learn more about the best options for your needs. 

It’s common for brokers to offer a simulated account (no real money needed to be deposited in your account). It’s worth it to go through the opening process just to test drive services and get comfortable before investing real capital. simulated trade can also help you practice the process of specifying types of orders, number of shares and other features. 

Every professional stock trader has clicked “buy” instead of “sell” or typed 1,000 shares instead of 100 at least once in their lives by accident. Don’t be in a hurry. Make sure the order you are placing is exactly what you want it to do.

Here are some of the types of orders:

Market order is an order to buy or sell a stock immediately. This type of order guarantees that the order will be executed (filled) but does not guarantee the execution price.

Limit order is an order to buy or sell a stock at a specific price or better. A buy limit order can only be executed at the limit price or lower, and a sell limit order can only be executed at the limit price or higher.

Stop order is an order to buy or sell a stock once the price of the stock reaches the specified price, known as the stop price. When the stop price is reached, a stop order becomes a market order.

Day order is an order which will expire at the end of the day (daily trading hours) if not executed.

Good Til’ Canceled order is an order that will remain active until executed or canceled by you.

Here is an example of a typical stock order:

Limit (type of order) Day (duration) order to Buy (action) 100 Shares (number of shares) of MSFT (ticker symbol for Microsoft Corporation) at $210.50 (price).

In plain English, the above order means that you want to buy 100 shares of Microsoft Corporation if it trades at the price of $210.50 today. It will either be filled if MSFT trades below $210.50 or it will expire at the end of the day.

Step 3: Identify your investment strategy.

After you determine whether the do-it-yourself or professionally assisted approach is better for you, the next step is to learn some of the most common investment strategies to identify what will work well for your goals and personality.

While there are millions of different stock strategies on Wall Street, the most important issue on the road to successful investing is psychology. You must be honest with yourself and understand your strengths and weaknesses when it comes to investing your money. Your stock investing must fit your personality. Trying to blindly replicate what someone else is doing in the stock market rarely works. Learn different techniques and apply the ones that suit you.

For example, if you want to adopt a passive approach, investing in ETFs may be a good start. An ETF (exchange traded fund) is a basket of stocks that usually tracks a particular index, but trades like a stock. If you would like to be invested in the S&P 500 index, buying SPY (SPDR S&P 500 ETF) will give you a nearly identical return to the index.

There are hundreds of ETFs out there. You can choose which index or sector or industry or region you want to be invested in by selecting an appropriate ETF. 

If you prefer researching and picking individual stocks, consider learning the following concepts:

Growth or Value

Growth stocks tend to increase in value rather than provide dividend income.

Value stocks tend to have solid fundamentals, higher dividends and are considered underpriced.

Fundamental or Technical

The fundamental approach is analyzing stocks based on their financial statements and valuations.

The technical approach is analyzing stocks based on chart patterns and sentiment.

It’s always a good idea to be diversified (invest in multiple stocks from different industries and sectors). And try not to forget about volatility. Most investors have a hard time handling big swings in their investments, so try to invest in stocks or ETFs that you are comfortable with.

How Much Do I Need to Start Investing?

While there is no exact formula for how much money is needed to start investing in stocks, treat your account as a serious investment, regardless of whether you start with a few hundred dollars or hundreds of thousands.

Does it Cost Money to Invest in Stocks?

Investors need to be cognizant of the cost associated with buying and selling securities. Every time you make a transaction, your broker charges you commissions. Over the last several years, however, commissions cost have been trending down. 

There are some brokers who don’t charge commissions at all, but investors have to be aware of potential hidden costs when it comes to buying and selling stocks. Unless you are an active trader, the overall commissions cost is minimal.

Best Online Stock Brokers

There are numerous online brokers that can accommodate all your investment and trading needs. Here is the list of some of the most prominent and reputable brokers:

Best For
Intermediate Traders and Investors
Overall Rating
Get started securely through Webull’s website
Best For
Intermediate Traders and Investors
1 Minute Review

Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.

Webull is widely considered one of the best Robinhood alternatives.

Best For
  • Active traders
  • Intermediate traders
  • Advanced traders
  • Commission-free trading in over 5,000 different stocks and ETFs
  • No account maintenance fees or software platform fees
  • No charges to open and maintain an account
  • Leverage of 4:1 on margin trades made the same day and leverage of 2:1 on trades held overnight
  • Intuitive trading platform with technical and fundamental analysis tools
  • Does not support trading in mutual funds, bonds or OTC stocks
Best For
Overall Rating
get started securely through Robinhood’s website
Best For
1 Minute Review

Robinhood is the broker for traders who want a simple, easy-to-understand layout without all the bells and whistles other brokers offer. Though its trading options and account types are limited, even an absolute beginner can quickly master Robinhood’s intuitive and streamlined platform. On the other hand, more advanced traders might be frustrated by Robinhood’s lack of technical analysis tools, a feature that’s now nearly universal across other platforms.

Best For
  • Beginner traders
  • Mobile traders
  • Streamlined, easy-to-understand interface
  • Mobile app with full capabilities
  • Can buy and sell cryptocurrency
  • Almost no trading analysis tools available
  • Only taxable brokerage accounts available
  • No option to open a retirement account
  • No access to mutual funds, forex or futures trading
  • Limited customer service
Best For
IPO Investing
Overall Rating
get started securely through SoFi’s website

Current Stock Movers

There are thousands right now. Benzinga keeps our list up-to-date, so you’re always in-the-know.

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Session: Jun 10, 2021 4:00 pm – Jun 11, 2021 3:59 pm
Symbol Open Close Change Change % Volume
Buy HBANM Stock – Buy Now HBANM
11.30 26.63 15.33 135.67% 20.89K
Buy NOVN Stock – Buy Now NOVN
9.04 14.79 5.75 63.56% 125.82M
Buy BAOS Stock – Buy Now BAOS
Baosheng Media Group Hldg
3.16 4.48 1.32 41.77% 30.93K
Buy UONE Stock – Buy Now UONE
Urban One
15.45 20.47 5.02 32.49% 36.10M
Buy PROG Stock – Buy Now PROG
2.49 3.19 0.70 28.17% 18.91M
Buy EQOS Stock – Buy Now EQOS
6.51 8.34 1.83 28.11% 3.10M
Buy ICON Stock – Buy Now ICON
Iconix Brand Group
2.45 3.12 0.67 27.34% 3.54M
Buy CARV Stock – Buy Now CARV
Carver Bancorp
12.43 15.34 2.91 23.37% 1.93M
Buy XIN Stock – Buy Now XIN
Xinyuan Real Estate
2.93 3.61 0.68 23.20% 18.61M
Buy VXRT Stock – Buy Now VXRT
7.17 8.75 1.58 22.01% 103.04M
Buy NCTY Stock – Buy Now NCTY
16.05 19.38 3.33 20.74% 6.48M
Buy BIVI Stock – Buy Now BIVI
14.87 17.90 3.03 20.37% 13.75K
Buy AMEH Stock – Buy Now AMEH
Apollo Medical Hlgs
40.21 48.34 8.13 20.21% 1.80M
Buy BYFC Stock – Buy Now BYFC
Broadway Financial
2.56 3.07 0.51 19.92% 9.30M
Buy GBS Stock – Buy Now GBS
3.63 4.33 0.70 19.14% 11.04M
Buy CMMB Stock – Buy Now CMMB
Chemomab Therapeutics
20.00 23.62 3.62 18.10% 2.94M
Buy EVFM Stock – Buy Now EVFM
Evofem Biosciences
1.05 1.24 0.19 18.09% 86.19M
Buy CLSN Stock – Buy Now CLSN
1.30 1.53 0.23 17.69% 7.68M
Buy PTGX Stock – Buy Now PTGX
Protagonist Therapeutics
33.84 39.57 5.73 16.91% 81.03K
Buy MDLA Stock – Buy Now MDLA
28.38 33.16 4.78 16.84% 9.33M


Session: Jun 10, 2021 4:00 pm – Jun 11, 2021 3:59 pm
Symbol Open Close Change Change % Volume
Buy ORPH Stock – Buy Now ORPH
21.00 9.40 -11.60 -55.24% 41.82M
Buy RCON Stock – Buy Now RCON
Recon Technology
12.74 6.19 -6.55 -51.42% 121.51M
Buy CRIS Stock – Buy Now CRIS
12.68 8.00 -4.68 -36.91% 20.98M
Buy APTO Stock – Buy Now APTO
Aptose Biosciences
5.53 3.72 -1.81 -32.74% 12.48M
Buy GLTO Stock – Buy Now GLTO
8.00 5.58 -2.42 -30.25% 8.72M
Buy AEHL Stock – Buy Now AEHL
Antelope Enterprise Hldgs
4.10 3.22 -0.88 -21.47% 1.43M
Buy HTBX Stock – Buy Now HTBX
Heat Biologics
9.60 7.61 -1.99 -20.73% 5.18M
Buy MEDS Stock – Buy Now MEDS
Trxade Health
6.67 5.31 -1.36 -20.39% 4.21M
Buy FMTX Stock – Buy Now FMTX
Forma Therapeutics Hldgs
28.05 22.76 -5.29 -18.86% 1.32M
Buy CVI Stock – Buy Now CVI
CVR Energy
23.44 19.05 -4.39 -18.72% 1.47M
Buy ANY Stock – Buy Now ANY
Sphere 3D
3.21 2.63 -0.58 -18.07% 18.95M
Buy LOOP Stock – Buy Now LOOP
Loop Industries
13.75 11.28 -2.48 -18.00% 41.43K
Buy QUMU Stock – Buy Now QUMU
4.62 3.79 -0.83 -17.97% 63.45K
Buy LXEH Stock – Buy Now LXEH
Lixiang Education Holding
10.22 8.50 -1.72 -16.83% 4.95K
Buy POAI Stock – Buy Now POAI
Predictive Oncology
1.51 1.26 -0.25 -16.56% 4.36M
Buy MDLY Stock – Buy Now MDLY
Medley Management
7.98 6.68 -1.30 -16.29% 90.22K
Buy PHCF Stock – Buy Now PHCF
Puhui Wealth Investment
5.27 4.42 -0.85 -16.13% 93.46K
Buy CMCM Stock – Buy Now CMCM
Cheetah Mobile
2.76 2.36 -0.40 -14.50% 1.92M
Buy DIBS Stock – Buy Now DIBS
28.50 24.46 -4.04 -14.18% 75.55K
Buy UPST Stock – Buy Now UPST
Upstart Holdings
146.42 125.74 -20.68 -14.13% 9.91M

Invest in Stocks Today

The stock market is an excellent wealth builder and a never-ending chess match. Learn the basics, read as much as you can, learn the strategies and techniques and avoid being a gambler. 

Do your research, run from “hot tips” and know how to handle risk. Learn first, invest later.

Related content: Swell Investing Promotion

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