The first and most important thing that a new investor can do is soak up as much research and knowledge as possible. Learning as much as you can about the market, and the commodities traded within it, will help you grow your confidence, financial assets, and history of successful trades.
As with any other pursuit, understanding the rules of the game and developing strategies for creating success is crucial. Some of the most successful investors in history spend an incredible amount of time studying markets, browsing through financial data, and trying to learn more about current trends and new developments in the world of business. When trading stocks, what you’re really doing is buying and selling tiny pieces of real-world companies. A share of Microsoft, Tesla, or 3M is a small fraction of those real businesses; what this means is that the company’s success is your success.
More pressing is the reality that investing in these companies means that you have to continuously maintain a knowledge base about how consumers are using brands, and how an individual brand sits within the greater marketplace. For example, Microsoft and Apple compete directly with one another in PC technology, and so movements in their stock prices can directly impact one another — yet each of these companies also compete in unique spaces that don’t overlap with one another, making evaluation a slightly more difficult challenge.