How to Buy Stocks 101
Buying stocks as an investment, rather than speculation, involves having a stock-selection process. Anyone with a brokerage account can buy stocks. Deciding which stock to purchase requires a buying strategy.
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The Broker
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Comfortably buying stocks involves owning investments that are sound. Use a full service brokerage if you want a broker to make recommendations. Use a discount broker if you want to make your own decisions and want low commissions.
Your Objectives
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A full service broker must ask about your investment objective. Ask yourself about your objective if you make your own decisions by using a discount brokerage. Buy large, well-known companies if you seek the security of preserving capital. If you seek income, buy companies with long histories of stable or rising dividends.
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Selecting Purchases
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Buying stocks that you are most comfortable owning involves investing in industries familiar to you. Select stocks in an industry that provides you with special knowledge for finding bargains. The array of quality stock choices includes large companies with stable future expectations and small companies with higher growth potential than competitors. Stock purchases can involve information you have about the technology of a certain company. Or your stock buying decision might rest upon knowing a lot about an area of the world where a particular company has a strong sales presence.
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References
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