Nuts and Bolts
Decided to invest in shares? Read on…
1) Educate yourself
- Go to the Australian Securities Exchange (ASX) website and take some of the online courses.
- Pick an easy-to-read book about investing in shares like Tracey Edwards’ Shopping for Shares (2006, Wrightbooks) – it’ll help you decide if share investing could be for you.
- Talk to other women you know who invest in shares.
2) Put together a plan
- Decide if investing in shares fits in with your financial goals – this will determine how much you invest and whether you regularly buy more parcels of shares. Seek financial advice from an accountant or a financial adviser if you need help.
- Save up for your first parcel of shares. You can start from as little as $500, however the Australian Securities Exchange recommends starting with at least $2,000.
3) Find a broker
- Work out what sort of broker you need (full service or online) and look around for best value. The Australian Securities Exchange has an up-to-date list of online brokers.
4) Which companies do you want to invest in?
- Start by reading Tracey Edwards’ Shopping for Shares – it has a good list of things to look for. Also get your hands on a copy of Top Stocks by Martin Roth. Published annually, he lists his top 100 companies on the ASX. Even better, he summarises all the facts and figures onto one page per company. Very helpful and very easy to read.
- Once you’ve shortlisted potential companies, work out what price you’re willing to pay for your shares. Most finance books give advice on evaluating a good price.
5) Buy your shares and track them
- Here comes the easy part: buy your shares through your broker and track them. You’ll probably be surprised at how simple it is once you get going.
Go to the First-time investor section of the Australian Securities Exchange website. Also download the Getting started in shares booklet.
Explore this section of the Australian Securities and Investment consumer website MoneySmart – it’s a great way to learn more.
Shopping for Shares by Tracey Edwards (2006, Wrightbooks)
A good, basic book about shares. It’s easy to read and written by an Australian woman who has successfully invested herself.
Top Stocks by Martin Roth (published annually, Wrightbooks)
An excellent book if you’ve decided investing in shares is for you. Summarises the most important criteria for his top 100 Australian listed companies.
The New Buffetology by Mary Buffett and David Clark (2002, Scribner)
If you’re going to follow anyone why not let it be the man widely considered the greatest investor of our time – Warren Buffett. His company Berkshire Hathaway has returned more than 360,000% for shareholders over the past 40 years.
Motivated Money by Peter Thornhill
A book about shares written by an Australian financial expert who has strong opinions about shares vs property. Not in bookstores – order online here.
The Intelligent Investor by Benjamin Graham (1973 Harper Collins – note: revised editions available)
An oldie, but still considered a classic and a ‘stock market bible.’ Fairly hard going – not for the faint-hearted.
Find a financial adviser
Check out the Australian Securities and Investments Commission’s website MoneySmart – it has loads of great information about obtaining personal financial advice and finding a qualified financial adviser. Experts often suggest you find an adviser who charges by the hour instead of receiving a commission.
>> Next section – Responsible Investment
<< Previously in Shares – How to Invest Directly in SharesYou can leave a response, or trackback from your own site.