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Originally Posted by sundulhyip
I have $10k LR ,i want invest in safe investment program.
where to invest ?
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Ok, now into your question. Actually, investing is what I do for my living. FXHOY had some good advice:
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First, get your money into hard currency.
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Agreed.
And this is actually a question I get a lot of when I teach folks. Sometimes one's come into a bit of money. They want to invest some spare money?
Sounds like you want something that's lower risk. Much of risk, depends on what some call your "financial IQ". If you know your way around various markets? Your risk is lessened, because you understand the nature of what you're dealing with.
The lowest risk - is usually guaranteed returns. Something like a bank CD. Where the returns are guaranteed? They are generally lower. So you could easily turn that $10,000 into $10,300 to $10,450 with a
CD of some type. That's the safest bet.
First thing I always tell folks? Become educated as to investing. Learn the difference between investing, and trading. There is a large, large difference.
Then, you have investing. Which doesn't guarantee your returns. Therefore, your risk has increased. Investing
is not trading. It amazes me how many people say: "I'm going to invest with FRO for the next two weeks", or "I'm going to invest in Commodities". YOU CANNOT INVEST IN GOLD. You can TRADE gold for profits. But it is economically incorrect to say that you're going to INVEST in gold. And I would know, I'm a commodity speculator.
You CANNOT invest in commodities. You CANNOT invest in a company, for only three days. If you're doing that? You're trading commodities. You're trading stocks.
Investments are longer term, and the profits do not come from a difference in the price of the stock as much, as they come from earnings, dividends, and DRIP programs.
For example, a stock trader buys 200 shares of Bank of America (BAC) at $25. So he laid out $5000.00, plus about $7.00 in comission so the broker. He then sells those 200 shares of Bank of America (BAC) at $32, or $6400, minus the commissions. He made approximately $1400.00; by trading. Trading is much more risky than investing. It usually takes place with a shorter time frame.
Investing on the other hand? Lasts for years. You buy, say 200 shares of Bank of America (BAC) at $25.00, for $2,500.00. Every quarter for the last 100 years, BAC has paid out dividends. Right now, those dividends are .64 cents a share. So as long Bank of America (BAC) is making money at their business? They pay their dividends. You make money from the earnings, and share in the wealth that they create.
A fantastic way to compound those returns? Is something called: DRIP. It stands for
Dividend
Re
Investment
Program.
Now pm me for details ...
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Just kidding. Couldn't resist.
What the DRIP does? Is it takes the cash you would receive for dividends? Say you have 200 shares? At .64 a share, you'd receive what? $128 right? Just for owning 200 shares. But with DRIP - you don't receive $128. What you recieve, is the equivalent of $128 - in more shares of Bank of America (BAC). So if Bank of America (BAC) was trading at $30? You'd receive 4.266 more shares of Bank of America (BAC). So instead of having 200 shares? You'd then have 204.266 shares. Over the years? This is how Warren Buffett created his wealth. It takes time. But eventually, the DRIP begins to
compound your returns.
I know someone who bought $300 worth of GIS in the 1960's. Very stable company. The DRIP program was turned on. Through stock splits? Without ever adding another dime? That $300 is worth about $180,000 today. The guy probably kicks himself, because he didn't add more money. If he had added more money? He'd be sitting on millions. With only one stock.
The risk, is the company may get involved in something stupid, and go out of business. They key, with investing? Is earnings. Making sure those earnings keep coming.
But look to arm yourself with good, quality knowledge about the markets. Know the risks. Be wary of the spammers and advertisers willing to trade your money away. There's a lot more to investing that what I mentioned above. You'd want to be diversified adequately, but not
too diversified.
Learn about real estate, and other businesses. There's plenty of ways to make money. Problem is, most people are not patient enough to make the money that's out there for the asking ...