I started on the sharemarket when I was 20 years old. I had $2000 I’d put away for a rainy day, money I earned when I worked full time and was yet to go to university. I asked my Dad for some recommendations – he suggested I buy in iron ore and an engineering firm. Both were volatile, but had the potential to deliver major returns.
Unfortunately, neither share delivered and I lost a small amount of money when they stopped trading on the sharemarket.
However – nothing ventured, nothing gained. It was my first taste into creating passive income and a good learning curve. If you have the desire to get started, here are my tips.
Save some money and find a stockbroker
A little goes a long way. $100 per fortnightly pay yields $2600 in a year, which is more than enough to have your first attempt at trading. Good ‘ole Doctor Google can also put you in touch with stockbrokers. They charge small amounts to buy and sell shares in your portfolio.
Find something you are interested in.
For me, I am super interested in education, medicine, psychology, and oddly, airlines. I read a lot about different airlines; their safety records, the airlines that perform versus the ones that don’t, whether an airline has gone bust and why? I read a lot about Ansett and Qantas, just purely out of interest.
Find a share that relates to that interest and check on it daily.
Because of this niche interest in airlines, I started researching airlines on the stock market. Every day, I would type
ASX: QAN into Google. I pressed ‘max’ to see how high the share had traded in its history, and also to get a sense on the price of the share right now versus its potential peaks.
I did not buy Qantas shares as soon as I became interested in them. I watched and waited. When Covid-19 hit its worst period and we went into a lengthy lockdown, the shares that usually traded at about $5 or more per share, suddenly dipped to $3.61 per share. Because I was more experienced, I had $10,000 in the bank and spent that whole amount of shares.
Keep watching the share daily. When it hits a reasonable price and you will make money, sell!
There is obviously a lot more to it than this, but this is a good way to get started.