How do you make 1000 dollars in the stock market?

Answer 1

How to Make Money in the Stock MarketThe answer to this question depends on the amount you're starting with and what your time frame is.

For example, if you are starting with 100,000, you only need a 1% return to make 1,000. If you do have this kind of money, and need a guaranteed return over a short period of time, you might consider looking to the bond markets (rather than stock markets) to mitigate volatility in your returns.

If you are starting with $500, you'd need to make a 200% profit (!) over the life of the trade on your initial investment. But this is more achievable than people might realize, as long as you've got time on your side. It is the power of compounding returns.

The Stock Market historically has returned 12% per annum. Assuming you consistantly made 12% per year on a $500 investment, and that you reinvested your profits every year, it would take you 10 years to double your initial investment (i.e., have $1000 profit on a $500 investment, or $1500 in total).

Here's how to calculate that:

• Annual Rate of Return (R) = 12%
• Initial Investment (I) = $500
• Number of Years Invested (Y) = 10

Total Made in 10 Years = [(1 + R)^Y]* I = [(1 + 12%)^10]*$500 = $1552.92

If you have a big appetite for risk, you could try plowing your money into something with potentially higher returns, such as emerging markets stocks vs. US blue chip stocks, or even into the commodities markets.

As a suggestion on how to make money in the stock market, read one of William J. O'neal's investment books. He has been an extraordinary investor over many decades and started Investor's Business Daily. He has written several books on investing that are highly recommended. He also came up with the CAN SLIM methodology for investing in which each letter stands for a key thing to look for. For example, "C" stands for current earnings, "A" stands for annual profits, etc. He demystifies the world of investing and brings it down to a very practical level. In general, his approach involves only investing in outstanding companies with great products and/or services and which have strong upward momentum. In short, this is a combination of investing in companies that have great fundamentals and great technicals

Check the True Home Business at:

http://www.true-home-business.com