How to invest your money?

Best Growth Stock – How should you invest your money? There is not fast way to answer this question, nor shortage of advice when it comes to make money in the stock market. Most of the time, however, such opinions and advice are based on a selective presentation of the facts by investment firms and derived by secondary gains from the adviser which is affected by the day to day news and analysis. You will encounter in your stock trading career one trader telling you to invest your money in stocks. Another will insist that mutual funds give you the most for your money. A third will tell you to bet on bonds. Others will go for ETFs, options, or futures.

Growing your money and investing it is not just a theoretical exercise. You have, or will have, money that you want to invest. As a matter of fact, you need to invest the money that you have earned, saved, and/or inherited so that you can meet with your retirement goals, buying a new home, paying for college, etc. Before you start investing your money you need to understand as much as possible about how the stock market works, how to do proper stock market research and analysis.

So, how should you invest your money? Before you answer that question, you need to understand and have a clear picture of what constitute an investment and what investment choices you have available in the stock market today.

Stock

Welcome to the holy grail of the stock market. Investing your money in stocks is different from investing your money in good stocks. So, What is a good stock? Some stock brokers will say larger companies. At Best Growth Stock LLC, we argue that the best stocks to invest your money are fast growing companies, Growth Stocks.

Mutual Funds

Wall street pundits will argue that mutual funds offer great value to the average investor. When you invest your money in a mutual fund, the mutual fund company is investing it in stock, bonds and other investment vehicles to growth its value. The bad about investing in mutual funds is that instead of YOU being your own portfolio manager and investor, you relay on other people to growth your own money and sometimes it comes back with high management fees.

Bonds

During the bear market of 2001 investing in bonds became very famous. Keeping part of your money in bonds is a good way to diversify a stock portfolio. Another advantage of bond investment are the tax advantages of bonds, especially municipal bonds. But keep in consideration that bonds do not offer a good return relative to stocks and that they have their own risk, including default risk, sensitivity to interest rates, currency exchange rates, and the business cycle.

Options

Investing in options remain one of the less well understood trading to new investors and we encourage new investors to stay out of options until they can understand the level of speculation that it carries. Most options are short-term investments and must be monitored closely. Options carry the big potential for spectacular returns through financial leverage, though sometimes they are marketed as a way of “insuring” your portfolio against a market downturn. The cost of trading options is frequently very high for individual investors and that most individuals who use options to speculate lose money.

Futures

The last investment vehicle we will discuss are futures. Like the options, futures trading have many of the same uses as options. The degree of return compare to its leverage is very high for the individual investor but with added risk of margin calls. New investor should stay away from futures at all cost since you have to monitor those investments very closely.