This is from my peers:
Discussion Board 2
American Intercontinental University
My new article has sparked some interest on the firm's approach to the investing market for small investors. There were many emails from potential clients asking me to address some to address some of the topics. Some of these emails have responded to my article saying that the stock market is a no-win situation. Here are some answers to these questions that where emailed to me. Ihope that this will better clarify our position.
Some of the disadvantages when it comes to small investors investing in the stock market is that the investor would have to spend a lot of time researching and studying the market. Being able to stay on top of your business and investments takes time and investor could become stressed or overwhelmed with the research. Many investors also seem to not invest for long periods of time. Getting rich fast schemes which do not work most of the time. Investments need time to mature and grow. However, small investors might also hold onto their stocks at the wrong times assuming the price will continue to grow. Small investors do not have the stock knowledge and do things like this often.
Some of the advantages small investors have are purchasing stocks that have less issues than the larger stock. Being a small investor means that it is easier to buy and sell stock. Although small investors may not have diversity in their portfolios, they would be able to concentrate and perform well in a specific market they feel comfortable with and able to accumulate more funds orstocks.
In conclusion small investors may not have enough money to purchase several different stocks, build and diversify their portfolios like large investors they can still get into a market niche that is comfortable for them and their skill set. They can also attend investment classes at local community colleges or large investment firms to help them with their portfolio. There are alsocompanies that specialize in diversifying portfolios.
XXXXXX, XXXXXXX M. (2010). Financial Management: Core Concepts (2nd edition). Upper Saddle River, NJ: Prentice-Hall.
From my peers:
Unit 3 Assignment 2 (Discussion Board)
FINA310-1203A-09 (Risk & Capital)
By: Teresa Evans
American InterContinental University June 20, 2012
Our Investment Firm would like to thank you the readers for the many e-mail responses to a recently posted article titled "Investing Is for the Little Guy" also known as the small investor. Your comments and questions are very important to us and therefore the following are answers to some of the questions we received concerning the advantages as well as the disadvantages that the small investor faces when investing in the stock market (MUSE, 2012).
Let's start off by defining the small investor, basically it is an individual who occasionally buys or sells small amounts of stocks or bonds for him/herself using their own funds and like many their primary concern is to minimize risk while maximizing the return (InvestorWords.com, 2012). Now that we have clear that up lets go over some of the answers as it relates to the advantages as well as the disadvantages of investing in the stock market.
Some might look at investing in the stock market as a no-win situation, while others may look at it as a place where hopes and dreams can come true with a little luck. The fact is that investing in the stock market is a risky business for anyone whether you are a first timer or seasoned investor the market does not owe you a profit no matter how much you think it does. Therefore you must educate yourself as much as you can and learned the tricks of the trade.
One advantage that the small investor has is periodically putting small amounts of money into a pool of funds such as an IRA or a 401K account, while you keep a close eye on the market and when you notice activity occurring that makes sense to you then make your move (Winder, 2012). Another advantage that small investors have is (Speed) he or she can quickly move funds when they notice negative activity occurring with his or her investment. In this market being able to pull out at a minute notice is crucial, unlike the big investors who invested tons of money thus making it harder for them to move it can only watch in agony as their numbers go from green to red and their money is lost (Winder, 2012).
One disadvantage of being a small investor is not having enough money or capital to invest so therefore it is extremely important to know your limitations; too many investors put their eggs in one basket and end up losing everything. Remember it if sounds too good to be true it usually is. Another disadvantage is as a small investor you most likely do not have access to in-house technical experts, research analyst or sophisticated automated trading programs that provide trading suggestions, but there are financial based website that can help you as the small investor (Investopedia, 2010).
Here is a basic recommendation: Educate yourself by setting aside an hour a week to review business news and trends also make an effort to read research reports and profiles on sites such as Yahoo! Finance and CBS Market watch (Investopedia, 2010).
Investopedia (2010), Is the Stock Market Rigged? Retrieved 6/20/2012 from
InvestorWords.com (2012), what is Small Investor: definition and meaning, Retrieved
6/20/2012 from (http://www.investorwords.com/4608/small_investor.html)
Winder, Ray (2012), Small Investor Advantages in Today's Market, Retrieved 6/20/2012 from(http://ezinearticles.com/?Small-Investor-Advantages-in-Todays-Markets&id=4008291)
MUSE (2012) Unit 3 Course Material, Retrieved 6/20/2012 from AIU Online Virtual Campus
are you going to help me.THANKS