When it comes to the stock market, there is an abundance of advice for those looking to get into investing and those trying to improve their strategy. For this reason, it can be hard to know where to look.
Of course, the most obvious place to turn to is Google and the treasure trove of information it provides with a simple click of a button. And if you’ve turned to the search engine to help you on your investment journey, you’re certainly not alone—thousands of people every month look for advice about the stock market.
In fact, according to new research by personal finance experts Snoop Dow the most asked query is “how to invest in stocks”, which received an average of 6,600 searches each month. Furthermore, the research by Snoop Dow has revealed the most googled queries about stocks.
So to make your life easier, we’re going to cover each one and provide the answers. You’ll be ready to invest in no time!
What are the most googled questions about stocks?
Thanks to Snoop Dow, we’ve got the list of the top 10 stocks-related queries the public wants the answers to. Let’s run through them!
1. How to invest in stocks.
Investing in the stock market as a beginner can be a little daunting. To simplify the process, here aresix steps to follow to start investing:
- Decide your investing approach: There are multiple ways to invest in the stock market, such as investing in individual stocks or index funds. Depending on how much time you have to focus on your investments, you can tailor your strategy.
- Decide how much you want to invest in stocks: before you get stuck into buying stocks, you need to decide how much money you can afford to put into investing. As a rule, don’t invest more than you can afford to lose or money you will need within the next five years.
- Open an investment account: to buy stocks, you’ll need an investment account—this usually means a brokerage account or a robo-advisor. Brokerage accounts are a good option if you’re happy to be hands-on with your investing journey, whereas a robo-advisor is usually a better option for those looking for some advice and guidance.
- Choose suitable stocks: the best approach to investing is to diversify your portfolio and only invest in stocks you understand.
- Focus on long-term investment: as tempting as a short-term result is, one of the most effective ways to invest is to plan for the long-term.
- Manage your portfolio: to see the best results, you’ll want to keep managing your portfolio and hold on to shares for as long as possible.
2. What stocks to buy now
Identifying which stocks to buy is a complicated process, and there is never a clear-cut answer as it will depend on your personal circumstances. This said, according to Investor’s Business Daily, these are the best five stocks to buy and watch at the moment:
- Eli Lili
- Enphase Energy
- Neurocrine Biosciences
- Cardinal Health
- Arista Networks
It is worth remembering, however, that it is important to do your research before you commit to buying stocks to ensure it’s the right choice for you.
3. How to buy stocks
To buy stocks, you’ll need to use a stockbroker in the form of a person or online platform. They will buy, sell and manage stocks on your behalf and are able to assist you in building up your portfolio.
4. Which stocks increase in a few months?
As the stock markets fluctuate consistently, there is no straightforward answer. This said, if you’re looking to invest in stocks that are likely to experience fast growth, it’s best to identify high-growth sectors and market trends.
This will give you an idea of which types of stocks will provide a good return in a short period of time.
5. What is a Stocks and Shares ISA?
Also known as an investment ISA, a Stocks and Shares ISA is a special type of savings account. It allows traders to invest in their portfolio without having to pay Income Tax or Capital Gains Tax onincome from investments—up to a certain limit.
6. How do stocks work?
Stocks work by allowing investors to buy a share of a company. They are usually sold by companies that want to generate capital so they can grow their business.
The value of stocks will rise and fall depending on the company’s performance, which means that if a company grows, the price of stocks will also likely increase. This means investors are able to make a profit if they have bought shares in a company that grows successfully.
7. Can you have more than one Stocks and Shares ISA?
Yes, you can hold multiple Stocks and Shares ISAs. However, you can only pay into one Stocks and shares ISA within a tax year (April to April), and you cannot open more than one within a single taxyear.
8. What are penny stocks?
Penny stocks are shares of small companies that typically trade for less than $5 per share in the US(or £1 in the UK). While some are listed on the New York Stock Exchange, they are mostly traded via over-the-counter (OTC) transactions or on the electronic over-the-counter Bulletin Board (OTCBB).
Penny stocks are generally considered low-price but high-risk and, for that reason, are usually not recommended for most traders.
9. What are dividends in stocks?
A dividend is the distribution of a company’s earnings to its eligible shareholders. They are usually distributed quarterly in the form of cash or more company stocks. Not all companies pay out dividends, but a lot of larger ones do as they can afford it. Smaller businesses, such as start-ups need to use their earnings for growth and, therefore, will be less likely to offer dividends.
10. Is investing in stocks haram?
The overall act of investing in stocks is not necessarily haram. Muslims can invest in the stock market. However, there are some things to be mindful of.
There are certain industries and companies that are considered haram, such as:
- Alcohol
- Tourism
- Nightclubs and hotels
- Illicit content
- Banks involved in ‘riba’ (unjustified lending)
- Insurance companies
This said, there are plenty of halal industries that align with Islamic law, such as:
- Clothing and shoes
- Medical equipment
- Real estate
- Furniture
- Manufacturing
- Shipping and transportation
Another thing to be mindful of is that Muslim investors should avoid investing in companies that make the majority of their profits from interest, as this would be considered riba.