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Investing in the Stock Market

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Investing in the Stock Market

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  1. Investing in the Stock Market

  2. The stock market is often compared to gambling.

  3. The stock market is actually a lot more like gardening.

  4. Planting

  5. Growing

  6. Harvesting

  7. Damage Control

  8. And maybe more damage control

  9. Creativity

  10. Money is the language of cooperation. http://www.luthersem.edu/images/home/Student_group_holding_hands2.jpg

  11. Free markets allow thousands of people to cooperate in making an ordinary pencil. Milton Friedman Economist, University of Chicago http://elver.cellosoft.com/Milton_Friedman.jpg http://www.luthersem.edu/images/home/Student_group_holding_hands2.jpg

  12. Social Impact of Investing How do companies use the money you invest? How does this affect ordinary people?

  13. Social Impact of Investing How do companies use the money you invest? How does this affect ordinary people? expand existing businesses start new businesses

  14. Social Impact of Investing How do companies use the money you invest? How does this affect ordinary people? expand existing businesses start new businesses creates more jobs creates higher-paying jobs

  15. But how do I do it? Open a Roth IRA do it right now, takes 10 minutes Buy shares of SSO once a year, just 10 minutes (once a month is even better!)

  16. How hard is it to set up a Roth IRA?

  17. Opening your Roth IRA • Go to office of a discount stock broker • Fill out a form to open a Roth IRA account • Give them $500 to put in your account

  18. Opening your Roth IRA • Go to office of a discount stock broker can also do this on-line, if you like • Fill out a form to open a Roth IRA account • Give them $500 to put in your account

  19. Opening your Roth IRA • Go to office of a discount stock broker can also do this on-line, if you like • Fill out a form to open a Roth IRA account • takes about 10 minutes • they give you an account number and password • Give them $500 to put in your account

  20. Discount stock brokers are very different Minimum amount you may invest Fee per purchase Scottrade $500 $7 TD Ameritrade No minimum $10 Charles Schwab $1,000 $13 E*Trade $1,000 $13 Fidelity No minimum $20 http://scottrade.com/online_broker_comparison/discount_brokerage_comparison.asp

  21. Scottrade is the cheapest right now • only $7 fee for each purchase • only $500 minimum is needed to invest • as fast as opening a checking account

  22. Roth IRA

  23. Roth IRA Instead of choosing this box for an individual account…

  24. Roth IRA Choose this box for a Roth IRA account

  25. Roth IRA and write in “Roth” on this line Choose this box for a Roth IRA account

  26. What you get • Account number • Password • Deposit slip for your $500

  27. But how do I do it? Open a Roth IRA do it right now, takes 10 minutes Buy shares of SSO once a year, just 10 minutes (once a month is even better!)

  28. The Next Day Your new Roth IRA: Cash $500 Total Account Value $500

  29. Your new Roth IRA: Cash $500 Total Account Value $500 Buy SSO SSO costs $70 for one share You buy 7 shares for $490 Fee is $7 for the SSO purchase

  30. Your new Roth IRA: Cash $500 Total Account Value $500 After SSO purchase: SSO – 7 shares $490 Cash $3 Total Account Value $493 Buy SSO SSO costs $70 for one share You buy 7 shares for $490 Fee is $7 for the SSO purchase

  31. Your new Roth IRA: Cash $500 Total Account Value $500 After SSO purchase: Five years later: SSO – 7 shares $490 Cash $3 Total Account Value $493 SSO – 7 shares $980 Cash $3 Total Account Value $983 SSO costs $70 for one share You buy 7 shares for $490 Fee is $7 for the SSO purchase Five years pass WOW!!!

  32. Time

  33. Time We usually just think of time as something that turns young people into old people.

  34. In your job, YOU do all the work.

  35. In your job, YOU do all the work. In the stock market, TIME does all the work.

  36. In your job, YOU do all the work. but only if you turn on the faucet In the stock market, TIME does all the work.

  37. In your job, YOU do all the work. 1. Open a Roth IRA 2. Buy shares of SSO In the stock market, TIME does all the work.

  38. But how do I get my money back?

  39. But how do I get my money back? Easy - go to broker’s office & ask them for a cashier’s check. For larger accounts, they even give you a regular checkbook, just like an ordinary checking account.

  40. Two Easy Steps Open a Roth IRA do it right now, takes 10 minutes Buy shares of SSO once a year, just 10 minutes (once a month is even better!)

  41. Why is SSO a simple, safe strategy for beginners?

  42. Combined Share Prices of the Biggest 500 Companies (S&P500) The basic direction of the US stock market is overwhelmingly upwards Now 1950 http://finance.yahoo.com/q/bc?s=%5EGSPC&t=my&l=on&z=l&q=l&c=

  43. SSO stock price SSO • combination of the largest 500 U.S. companies • stock price has risen at 14.8% per year for 50 years General Motors 1962 Now http://finance.yahoo.com/q/bc?t=my&s=GM&l=on&z=l&q=l&c=&c=%5EGSPC

  44. When you buy SSO, your only risk is that the entire United States economy will continue to succeed as it has for 200 years.

  45. crash of 2000 What about stock market crashes? SSO stock price still haven’t recovered! crash of 1987 crash of 1973-1974 http://finance.yahoo.com/q/bc?t=my&s=GM&l=on&z=l&q=l&c=&c=%5EGSPC

  46. When you buy SSO every year, crashes average out quickly. Suppose you started buying SSO at the worst possible time March 24, 2000 Purchases in later years are much cheaper http://finance.yahoo.com/q/bc?t=my&s=SPY&l=on&z=l&q=l&c=

  47. When you buy SSO every year, crashes average out quickly. Price today Suppose you started buying SSO at the worst possible time March 24, 2000 Of the last 8 purchases, 7 are already profitable http://finance.yahoo.com/q/bc?t=my&s=SPY&l=on&z=l&q=l&c=

  48. BuySSOon your birthday each year. http://www.americangirlplace.com/images/chi/pkgs/img_chi_pkgs_party.jpg

  49. BuySSOon your birthday each year. once a month is even better! http://www.americangirlplace.com/images/chi/pkgs/img_chi_pkgs_party.jpg

  50. Is there a better strategy than SSO?