How to Earn Money in the Stock Market

The stock market is the center of the economy, but it's a wild roller coaster. Someone who invests in the right company at the right time can look at an early retirement, but the wrong investment can cause you to lose everything. Trying to earn money in the stock market is not for the cowardly or weak of heart.

Difficulty: Challenging

Instructions

1. Choose a company you wish to invest in. The newspaper's business section will list every company on the stock exchange, and what its price per share is.

2. Determine how many shares of your company you can or want to buy. Remember that you will have to include a stockbroker's commission to the total price.

3. Call a broker and tell him how many shares in what company you wish to buy. The broker will relay the purchase to a floor broker on Wall Street who will buy the share from the company for you.

4. Check your stock's price each day through the newspaper business section or online. By seeing how much the shares have gone up or down, you can determine if you want to keep the shares or sell them off.

Tips & Warnings

• Buy stocks when the price is low and sell when high. This is the golden rule of the stock market.
• Don't panic and sell if the stock starts dropping. If you stay long-term with a proven company, the good days will often outnumber the bad and you'll make money in the long run.
• Sell if your stock's price is skyrocketing. It will eventually come down, and hard.
• Buying into a new or expanding company can pay off, but there's great risk. The guy who invested in Starbucks early on made a fortune. Someone who invested in the first laser discs didn't do so well.
• Always remember: the stock market is the biggest game of toss-up. Nothing is guaranteed and getting in at any time is always a risk.