How to invest in stocks
STOCK trading has undergone a resurgence thanks to low-cost apps and rising company values.
Stockmarkets have been rising in recent months off the back of successful vaccine rollouts signalling a return to normality and President Joe Biden's Covid relief bill getting passed.
This is pricey but covers everything from research to buying and selling stocks for you.
A rival has emerged in recent years through discount brokers such as Robinhood and eToro who will let you buy and sell stocks online through an website or app with zero commission.
They will also let you purchase fractional shares rather than a whole share.
Diversify
Films such as the Wolf of Wall Street may glamorise investing and suggest you can get rich quick.
But investing is risky and you could lose all your money.
Experts suggest building a diversified portfolio with companies from different sectors and different sizes.
That way, if some parts of your portfolio are doing badly, others can take up the slack.
Investors should also avoid knee-jerk reactions when investing as you can smooth out losses over the long-term but if you cash out because of a temporary drop, you may never make the money back.
That said, there are some companies that may collapse or decline in value permanently so it is important to understand what you are investing in.
Check company company reports, Securities and Exchange Commission filings as well as press articles and broker notes so you can see where your money is going.
Don't forget about tax
You may need to pay tax on profits you make when selling a stock.
The rate you pay depends how long you invested for.
Investors pay tax at their federal rate on any profits from stocks sold in under a year.
The rates on profits from shares held for more than a year than a year tend to be lower at 0%, 15% or 20% depending on your income and filing status.
You also need to pay tax on dividends.
If you want to reduce your tax bill, you could instead invest in shares through an individual retirement account with your broker or bank or a 401(k) from your employer.
Any gains in these accounts aren't taxable while invested.
Crypto prices have also surged as a growing number of institutional investors and major companies such as
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