How to Invest in Stocks

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Investing in stocks has proven to be many’s most effective investment tactic. But when and how do you start investing in stocks? In this beginner’s guide, we’ll tell you everything you need to know about how to invest in stocks in 2024. Of course, as with any other guide, it’s important to do your own research before making any investment. DYOR (Do Your Own Research) must be your mantra.

Beginnings are never easy at first glance. Rent, bills, maybe debt, and increasingly expensive groceries may seem like all you can afford. This is especially true for those of you who are just starting to work during inflation when your salary buys less bread, gasoline, or an apartment than your parents. But once you’ve got a handle on budgeting for those monthly expenses and putting at least some money in an emergency fund, it’s time to start investing. The rule here is that the best time to invest is yesterday, and the second best time is today. But how much to invest and where? Today, we will show you how to invest in stocks.

Start Early

Early investments are the best. Investing at a relatively young age is the surest way to get a good return on your money. The reason for this is compounded profits, which means your investments begin to generate their own return. This accumulation allows your account balance to grow over time. This strategy is very similar to sports betting, where you cannot be successful unless you are prepared to invest early.

And there arises the eternal question for many people: Can I start investing with small amounts of money? The answer is YES, OF COURSE. There is practically no minimum limit for investing in shares. You can start with 10, 100, or 1,000 EUR. Don’t worry about whether your contribution is enough; instead, focus on the amount you think is acceptable based on your financial situation and goals. Also, it is important to have the right money management. It doesn’t matter whether you invest 10,000 or 50 EUR per month, as long as you regularly contribute to your investments.

For example, suppose you invest EUR 200 in shares every month for 10 years and achieve an average annual return of 6%. At the end of the ten-year period, you will have EUR 33,300. Of this amount, EUR 24,200 is your contribution (from monthly contributions), and EUR 9,100 is the interest you earned on the investment.

How to Invest in Stocks for Beginners – Step by Step

You need to educate yourself to make quality investments in shares. That’s why we offer several steps that we consider crucial when starting. Of course, this is not mandatory, but it gives you more chances to make a profit.

1. Define Your Investment Approach

Let’s start from the beginning. The first thing to consider is how to invest in stocks. Some investors choose to buy individual stocks, while others opt for a less active approach. To help you decide on the most suitable investment strategy, you can see which of the following statements apply to you:

  • I am an analytical person and enjoy numbers and research.
  • I don’t like math, and I don’t want to do a lot of “homework.”
  • I have a few hours each week that I can devote to investing in stocks.
  • I like to read about different companies that I can invest in, but I have no desire to get into anything related to math.
  • I’m busy and don’t have time to learn how to analyze the stock market.
  • The good news is that you are, regardless of which of these statements.

Different ways of investing in shares:

  • Individual Stocks: You can invest in individual stocks if – and only if – you have the time and desire to do thorough research and ongoing stock analysis. In this case, Joker recommends this strategy. An intelligent and patient investor can beat the market over time. On the other hand, if you don’t like things like quarterly earnings reports and moderate math, you’re probably better off taking a more passive approach.
  • Index Funds: Besides buying individual stocks, you can invest in index funds that track a stock index. When discussing actively and passively managed funds, we generally prefer the latter. Index funds typically have significantly lower costs and are almost guaranteed to match the performance of their underlying indexes over the long term. Over time, the S&P 500 has achieved total returns of around 10% per year, and that kind of performance can create significant wealth.
  • Robot Advisor: Another option that has become very popular in recent years is robo-trading. A robo-advisor is a brokerage firm that invests your money on your behalf in a portfolio of index funds that matches your age, risk tolerance, and investment goals. A robo-advisor can choose your investments, optimize your tax efficiency, and automatically make changes over time.

2. Decide How Much to Invest in Stocks

Okay, first, we need to clear up the money you shouldn’t invest in stocks. Knowing that the stock market is not a place for money you may need for at least the next 5 years is important. While the stock market is almost certain to rise in the long term, there is simply too much uncertainty in stock prices in the short term. A 25% drop in one year is nothing unusual. During the COVID-19 pandemic, the market fell by more than 40%, and within a few months, it reached a record level again. Stocks are very similar to cryptocurrencies such as Bitcoin and Ethereum. This volatility is also what makes it attractive, but it is a big risk in the short term. Therefore, do not invest money intended for:

  • For your money in an emergency.
  • For the money, you will have to pay your child’s next school fees.
  • For vacation money.
  • For money for the possible purchase of an apartment.

Money Distribution

Well, now let’s focus on the money you probably won’t need in the next five years. This is called asset allocation, where several factors are important. Your age is an important factor, as is your specific risk tolerance and investment goals.

As a general rule, stocks gradually become a less desirable place to keep money as it ages. If you’re young, you have decades ahead of you to weather all the ups and downs of the market, which is not the case for retirees who depend on investment income. A short rule for allocating funds can help you here:

Take your age and subtract it from 110. This is the approximate percentage of your investment money that should be in stocks (this includes mutual funds and stock-based ETFs). The rest should be in fixed-income investments such as bonds or high-yield CDs. You can then increase or decrease this ratio based on your risk tolerance.

Example: Let’s say you are 40 years old. According to this rule, 70% of your investment money should be in stocks and the remaining 30% in fixed-income investments.

3. Open an Investor Account

Of course, all of Joker’s stock investing tips for beginners are useless if you don’t have the ability to buy stocks. Stocks are bought and sold on stock exchanges, but you can’t buy them directly. To access the stock exchange, you must open a trading or brokerage account. In general, everything works just like crypto exchanges.

Opening a brokerage account is usually a quick and easy process that only takes a few minutes. Brokerage accounts function similarly to bank accounts, except they are used to buy and sell securities. You choose a provider, open an online account, transfer money to it, and with a few clicks, you are ready to buy shares.

There are many licensed brokers to choose from, and the decision depends on your individual needs and priorities. There are 3 main options when choosing a broker:

  • Full-Service Brokers: These are traditional brokers with a full range of services. They offer multi-level services, including specialist research and advice, retirement planning, tax assistance, wealth planning, and access to IPO. For this reason, they are aimed at wealthier clients who can pay high account management fees.
  • Discount Brokers: This type is related to making your own decisions. Discount brokers usually trade only on behalf of clients and do not offer specialist investment advice. While they were once the exception, they are now the norm, and investors prefer them because they are more affordable and do not charge fees. They usually make up for what they lack in expert advice with a wide range of tools and educational resources.
  • Robo-advisors: Robo-advisors are automated investment platforms that select and manage investments on your behalf based on your specific goals and time frame. They typically follow a passive investment strategy by investing your money in affordable ETFs or index funds. They are mainly sought after by investors who swear by greater independence.

Joker tip: When you decide to open a trading account, check the fees between the individual platforms. For example, some brokers offer clients various educational tools, access to investment research, as well as the ability to trade on foreign exchanges.

4. Choose Your Stocks

We have now covered almost everything you need to know about stock trading. Only the most obvious thing remains – how to choose stocks for yourself. Of course, it is possible to write multi-page analyses on this topic, but Joker has prepared a few basic guidelines to get you started:

  • Keep your portfolio diverse.
  • Only invest in stocks of companies you know.
  • Avoid stocks with high volatility until you learn how to invest.
  • Always avoid cash stocks.
  • Learn basic metrics and concepts for stock valuation.
  • Buying flashy, high-growth stocks may seem like a great way to build wealth (and many historical examples back this up), but waiting until you have more experience is better. It is wiser to build your portfolio base with solid, established companies.

Once you’ve narrowed your options to a few companies in an industry you like, it’s time to think like an analyst and do some research. The best place to start is the company’s annual report, which contains a comprehensive financial data overview and a letter to shareholders.

5. Start Trading

Once you’ve opened an account, defined your goals, decided on a strategy, and researched which stocks you want to invest in, it’s time to take action. Before purchasing, you must select the type of order that determines the purchase process. You have two main options when making transactions through a brokerage account:

  • Market Orders: These orders tell your broker to buy a stock or security without a guaranteed price immediately. Market orders are more common than limit orders, especially for those who want to invest long-term. One advantage of market orders is that as long as there are interested buyers and sellers, your order is guaranteed to be executed.
  • Limit Orders: If a market order instructs your broker to get you into stock as soon as possible, a limit order sets a specific price for your order. The order is only filled if there is a seller willing to sell the shares at your specified price. Limit orders give investors more control over the price they pay for a security. Be careful with limit orders, as some brokers charge more for these more technically complex trades.

Joker Tip: When thinking about when to sell your stocks, keep in mind that stocks carry significant risk, so a buy-and-hold strategy will help you hedge against volatility so you can ultimately make long-term profits.

6. Keep Investing

Success in stock trading does not require knowledge of quantum physics, just a calm head and long-term goals. The surest way to make money in stocks is to buy stocks of great companies at low prices and hold them until the companies are great – or until you need the money. If you do, you’ll experience some volatility along the way, but you’ll get excellent investment returns in the long run.

Building an investment portfolio is never complete for those more active traders, as it is an ongoing process that becomes more and more efficient with experience. After a certain period of time, reassess your holdings: are they diversified enough to protect against risk? Is your portfolio perhaps too focused on one industry? Keep an eye on the progress of your investments, but don’t pay too much attention to daily fluctuations because they can burden you unnecessarily.

Joker tip: Many people implement a DCA (dollar-cost averaging) strategy in which a certain amount of money (say 100 EUR) is invested every month or week. In this way, the investment gradually accumulates and can be very beneficial in the long run.


Taking the first step and investing in stocks can seem like a “scary” thing to some. But you can simplify the process by setting clear goals and using all the tools that your online broker offers. The first step in the investment process is opening a brokerage account, and there are several key aspects to consider when building a portfolio, such as determining your time frame and risk tolerance, making a conscious effort to diversify, and deciding which types of stocks are best suited to achieve your goals. The best time to invest was yesterday, and the second best time was today. But remember – never invest more than you are willing to lose. Good luck!

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