Handbook: A Beginners Guide to Investing in the Share Market

Table of Contents:

Introduction

Four Simple Rules to Financial Independence

Spend less than you earn
Save 10% of your net income and invest it wisely
Develop an investment plan and allow your investments to grow
Understand the power of compounding

Why Invest in Shares?

What is the Stock Market?

The Australian Stock Exchange
S&P/ASX 200 Composite Index

What are Shares?

Ordinary shares
Preference shares
Contributing shares
Bonus issues
Rights issues

Why Share Prices go Up and Down

Supply and demand
A company’s financial health
The industry’s financial health
Economic trends

Monitoring the Price of Shares

Making an Investment Plan

Age
Increased share value vs. regular dividends
Income level
Need for liquid assets
Attitude to risk taking
Taxation situation
Checklist

Ten Strategies for Maximising Profit

Understand the nature of the share market
Understand the investment clock
Understand the psychology of the market
Look for value shares
Buy blue chip growth stocks to hold in the long term
Buy emerging growth stocks
Minimise your risk
Keep an eye on your stock
Regularly review your portfolio
Borrowing to buy

Fundamental Analysis and Technical Analysis

An introduction to fundamental analysis
An introduction to technical analysis

15 Common Mistakes Made by Investors

Conclusion

Definitions