Joseph A Leonard - Wealth Management & Consulting

There are many ways to go about financial investing. A number of well-known companies sell stock directly to individuals. If you’re making a direct stock purchase yourself, you’ll find that most companies will not charge you a commission or if they do, the commission charges will be much lower than if you’re buying through a broker. If you’re interested in financial investing in only a small number of shares and want to keep your costs as low as possible, this is a good way to go.

There are many things to know about a particular stock. Remember that in financial investing, when you buy a share, you are buying a share of ownership in this company.

Types of Stocks to Purchase

These are the oldest companies that have been continuously profitable. They usually pay a dividend. Many of the thirty Dow stocks are blue chips. For financial investing, many of the lowest-risk stocks are in this group.
These are expected to have the greatest yields for financial investing. They typically don’t pay dividends because they tend to reinvest their earnings. When they’re growing, they tend to be pricey. However, if they’ve had a setback, the price can go down—a lot. If you choose to buy these, be prepared for the roller-coaster.

No-Load Stocks

If you go to a company’s website, you can usually find out if it participates in no-load stocks. These are inexpensive for purposes financial investing; in fact, sometimes you can invest for no cost at all. On the company’s website you can learn how to invest directly.
These are risky for financial investing. The likelihood that you might lose a lot of money is very high here and the likelihood that you’ll make a lot of money is low. Some of these are priced under $5 per share.

What to Look for When Evaluating Stock for Financial Investing

• Price-to-earnings ratio
• Earnings-per-share increase over the past year
• Earnings of the company
• Yearly increase in revenues and profits
• History of stock splits
• Dividends
• Debts
• Relative strength
• Business model
• Management
• Plans for the future
• News—past and present
• Price of share
• Price fluctuations
• Price over time
• Projections for five years (estimates, of course)
• Ranking in industry
• Number of broker recommendations

• MsFinancialSavvy’s interactive charts, bookstore, and news.
• Online web portals; i.e., Yahoo, Google
• Hoover’s Online
• http://www.sec.gov/ (Edgar Online)
• Website for the company
• Annual Report for the company
• Financial newspapers

For purposes of financial investing, you will want to make a chart in order to keep track of the information you collect. It’s the diligent researcher who is most likely to make profitable investments in stocks. You will need to pay either short-term capital gains taxes or long-term capital gains taxes. However, the experts say your focus should be on profits and earnings, not taxes.

Ask Joseph Leonard and Coastal Investment Advisors for additional personal finance advice or learn money management tips on financial management by downloading this free financial management guide.