MAKE YOUR MONEY WORK FOR YOU
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Everyone has heard of investing as a way to make money.
However, there are good investments, and bad investments.
Let's look at some closer below!
However, there are good investments, and bad investments.
Let's look at some closer below!
Most things you buy will lose value over time -- that is called depreciation. If you buy your new TV for $500, you may be able to sell it for $200 if you are lucky. Even something that you never removed from the box can lose value like this. There are, however, a few things that will for sure increase in value, like a house. This is why we say that buying a house is a good investment; because the price of a house will always increase more than any savings, and usually even increases more than inflation!
You can also buy stocks, which are a riskier form of investing, but also much cheaper. You can buy some stocks for less than 10 dollars, and some even for less! Of course the most popular stocks are more expensive; Microsoft, for instance, costs around $600 for one share (or unit of stock).
But stocks can be an amazing investment if you are lucky and if you study the industries and trends. Some stocks have gone up over 1500% in the past 5 years!
But stocks can be an amazing investment if you are lucky and if you study the industries and trends. Some stocks have gone up over 1500% in the past 5 years!
How to buy stocks?
In any sale, the number one rule for profit is to buy low and sell high.
So, when you think of stocks, you try to buy a stock when its price is low, and sell it later when the price is high.
Think of it like buying Pokémon cards at the dollar store and then selling them later for $10 when everyone suddenly wants them.
😬 But here’s the catch:
When a stock price goes down, a lot of people get scared and sell too early.
When a stock price goes up, people get excited and buy too late.
The trick is to be brave and patient:
The Most Important Thing You Can Do: RESEARCH!
Before you invest, ask:
Let’s say a clean energy company has a great idea for solar-powered houses. Their stock is $10 now because the news is ignoring them.
You believe in the idea. You research. You invest.
Three years later, solar homes are everywhere, and the stock is worth $35.
That’s what it means to:
✔ Buy low
✔ Wait with patience
✔ Sell high
✔ And feel smart 😎
So, when you think of stocks, you try to buy a stock when its price is low, and sell it later when the price is high.
Think of it like buying Pokémon cards at the dollar store and then selling them later for $10 when everyone suddenly wants them.
😬 But here’s the catch:
When a stock price goes down, a lot of people get scared and sell too early.
When a stock price goes up, people get excited and buy too late.
The trick is to be brave and patient:
- Don’t panic when prices drop.
- Don’t chase trends.
- Trust your research.
The Most Important Thing You Can Do: RESEARCH!
Before you invest, ask:
- What does this company do?
- Will people still need it 5 years from now?
- Is it helping build the future?
- Who runs it? Are they smart and honest?
- What are other smart people saying?
Let’s say a clean energy company has a great idea for solar-powered houses. Their stock is $10 now because the news is ignoring them.
You believe in the idea. You research. You invest.
Three years later, solar homes are everywhere, and the stock is worth $35.
That’s what it means to:
✔ Buy low
✔ Wait with patience
✔ Sell high
✔ And feel smart 😎
Learning the Trade
Now that you know the theory, you might be wondering how to actually do the buying and selling of stocks. It used to be hard to invest in stocks, but nowadays anyone with a bank account can do it. Some apps such as Wealthsimple make buying and selling stock as simple as a click of the button, but you MUST do research and study before getting into stock investing. And you can start with very little money, like 50 bucks!
But before you get started, it's good to get a sense of how the market works. Many places online offer a free, fake portfolio for your to learn; RBC, for instance, offers a fake $100,000 no-risk “practice money”. It is highly recommended to try one of these places before diving into the real thing!
If you spent this amount on your selection of stocks, how much can you make until the end of the school year?
Write down your selection of stocks in your worksheet, and track them for the next few weeks! How did it go?
But before you get started, it's good to get a sense of how the market works. Many places online offer a free, fake portfolio for your to learn; RBC, for instance, offers a fake $100,000 no-risk “practice money”. It is highly recommended to try one of these places before diving into the real thing!
If you spent this amount on your selection of stocks, how much can you make until the end of the school year?
Write down your selection of stocks in your worksheet, and track them for the next few weeks! How did it go?
