Yes even you can invest with any amount of money. Many people usually think of investing as taking a huge chunk of money and potentially risking away their future on the tiny string of hope of that their money will one day increase in value. Well, I am here to tell you that couldn’t be further away from the truth. Investing can be done with any amount of money and with little to no risk.
There are many forms of investing with a small amount of money. Some include: saving accounts, stocks, and bonds. Saving accounts and bonds are really safe bets, and you could probably get a couple of cents a month. I love the stock market and logging onto my account to see what the change in my balance is for the day…
On most occasions, I advise people to save up at least three to five thousand dollars before they really throw their money into the market because they have more options in stocks and amount of shares they can choose. However, not everybody feels comfortable putting that amount of money aside or they just don’t have that much to use.
A quick aside: In the summer, after my first year of college, I interned with a consulting company and made $4,500 for the summer. This is a good idea for college students to raise some money and build their resume (always good to have a back up).
The problem with investing a small amount of money is that it can be hard to make huge returns in the time frame you might like, and it is always good to have patience if you are going to invest under $1000. BUT IT CAN BE DONE.
One question you should ask yourself is do you want to buy more shares or more value? There is no secret that the stock prices range from all sizes and some stocks are more stable then others. Before investing you want to decide how much of a risk are you willing to take? Most stable stocks are usually higher in price and don’t fluctuate as much (that is why they are stable) which will allow you to only get so many shares, but you might have to wait longer to make a good gain. An example could be Microsoft (MSFT). If you have the patience it can turn out to be a real good investment after one year. On the other hand there are lower price stocks that are usually speculative stocks and fluctuates much more, which is enhanced because you buy more shares. So if you get $500 and decide to put all your money in Microsoft then you may only be able to get 16 – 17 shares, and if the price goes up or down .60 on a day then your change would be around $10; however, if you invested in Sirius (SIRI) you could get about 160 shares then that .60 cents change equals $160, which is good if it went up .60 cents. For speculative stocks, you should check in with your investment more often because, unless there is news around the company, the stock won’t move or will sink fast.
Just for the record if you put $500 in SIRI (like I did) about two weeks ago, then you would have made around $80 (like I did), which is a really good 16% return in 2 weeks. Obviously investing in speculative stocks is more of a risk because it can change at any moment, but, with such a small amount of money invested, it hopefully won’t be that bad of a problem if you lose a little of it.
If you still don’t want to take a chance, then there is no problem with investing in a stable stock or even an ETF (acts like a mutual fund but trades like a stock). Still need a little bit more convincing? I am going to set up a $500 personal account to take the risk (hopefully along with you).
I don’t recommend that you buy the same stock that I do unless you do your own research. I have no license and everything I choose to buy is only on my knowledge and educational guessing. You are welcome to buy it if you want, but don’t blame me if you lose money. I am going to buy 80 shares of Sun Microsystems (JAVA) at $5.67 each. Let’s see how I do and, if you are investing some money yourself, let me know how it goes.
Also if you need an online stock brokerage I recommend using Zecco (click on banner to the right of site >>>) because it is commission free and for a small investment that is always the best to have. If you want a more established company, then I recommend TDAmeritrade.<!–kw=venture investment stock–>