I want to invest but i am a teen?
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Answer:
By law, you must be 18 years of age to be able to invest. For now, your parents can set up a minor or child account and they can invest for you.
If you have knowledge of the stock market and done lots of research on the companies you wish to invest in, then you should consider a career of being a portfolio manager when you get older. Otherwise, invest in mutual funds. Why? They are professionally managed, inexpensive to invest in, and are considered to be diversified investments because a mutual fund invests anywhere between 25 to over 100 different companies.
Average rate of return on mutual funds in the past 25 years has been anywhere between 10-14%. However, investor's rate of return has been around 2-4$. Why? When a sudden worldwide event such as war or economic slowdown happens, price of stocks starts to fall. Then people get worry and start selling all their shares or move it to a less risky investment. When the stock market rebounds, people start putting their money back in. This is a bad way to invest. A smart investor will always continue to invest no matter how the market performs. Its all about accumulating lots of shares by retirement.
Go to scottrade.com and open an trading account.
It really depends on what you want to invest the money in, and how soon (if at all) you'll need the money.
Opening up an online trading account (like scottrade or ameritrade) is one idea. The thing I don't like about investing in one of those is the commissions you pay when you open up an online account. They usually have a fee of around $7 a trade. If you only have $200 to start with, then you have an uphill battle in front of you. First, you have to earn back the $7 you spent on trading, then you have to manage your investment and sell it at the right time to maximize your profit, and who knows how well one individual stock can do.
Another thing you can do is open up a mutual fund account with an investment company. A mutual fund takes money from all investors with similar investment strategy. The money is then given to a professional money manager who buys and sells a diversified portfolio of stocks. The idea is, that way, if one stock tanks, then hopefully you'll be invested in other companies that are doing better, so it all balances out. You can pick a mutual fund usually based on a particular investment strategy (for example, one that invests only in Japanese business, or one that only invests in the largest companies in the US Market). Usually a mutual fund will allow you to open an account with a small balance, as long as you agree to an automatic purchase plan of $50 or so a month.
You could start off with an individual account, or you could even look into a traditional or roth ira. An IRA has tax advantages and can be used later for a 1st time home purchase, or retirement expenses. A Roth IRA can be used for qualified education expenses.
One thing I would caution you on, is if you do go with a mutual fund, really grill them on expenses. The type of fund you will probably want will come from a "direct" or "no-load" mutual fund company. Some companies that come to mind are vanguard, fidelity, usaa and tiaa-cref. You want to be careful, because some broker/dealers charge a commission to you for buying the mutual fund (this is usually 5% upon purchase or sale of the shares). Call the company and ask them to mail you a prospectus, because it will discuss annual fees. If you see annual expenses around 1% or less, that is usually pretty fair, although I have seen funds charge over 2% which is rarely justified by performance. Also ask for an annual report, that way you know what stocks and bonds the portfolio manager is buying.
Just start small, and put away what you can, you'll be surprised at the results over time.
You'll have to open an investment account through a brokerage house. There are a lot of online brokerages out there you can go through. A lot have account minimums (I believe TDAmeritrade is $2000, Scottrade is $500). Sharebuilder.com might be a good option for you because it does not have an account minimum, has very low commissions (the cost per trade) and does not require you to make certain amount of trades per quarter. Good luck and congratulations for starting young. My advice is to be patient and do your research on companies before you invest.
I have some ideas that may be able too help you out...
Before you start investing inthings since you already have a checking or savings account set up...go too http://www.ingdirect.com . Open up an account there with $250.00 *I know you only have $200.00 in there by what it says* opening up an account there with the $250.00 will then give you a $25.00 bonus... fund the account till you have about 6 months worth of pay in it . use that as an emergency account, only using it when you truely need it.
Second if you have a 401k at work fund it with as much as you can afford too, especialy if you they happen too match you any in contributions...
Then you might want too set up a Roth IRA maybe at http://edwardjones.com . Chose American Funds for it only takes $250.00 too fund them...
And last check out http://www.sharebuilder.com Opening an account there and making your first purchase after a month you will recieve a bonus of $25.00. use this account too buy stocks and etf's
eventualy you can also buy bonds at http://www.savingsbonds.gov
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