Stock Market Advice: Investing For Those Under 18
Success in the stock market comes down to strategy, consistency and discipline. The earlier you start, the more rewarding your journey will be.
(Courtesy of Kamaal Morris)
Minneapolis, MN — How is investing in the stock market any different when you're under 18? As crazy as it sounds, there aren't many differences in what you're able to do.
When investing, every trader needs a broker — these can be found in the form of apps such as “Webull,” “Robinhood,” and “Etrade.” In the case that an investor is not 18, Etrade would be the go-to broker; they offer custodial services which allow parents or guardians to be named on the account along with the minor. Although the parent or guardian is listed on the account, minors still have the ability to control everything activity wise (transferring money, buying/selling assets, setting alerts, etc. … ).
Once your account is created and your bank is linked, the only thing left to do is learn. The biggest mistake I made was learning how to trade with my own money. While being a new trader, I was bound to make mistakes. Trading in the stock market, learning lessons like “don't time the market” and “let the play come to you” were the most repetitive. The biggest loss I had in the beginning cost me $5,000; I was options trading on (SPY), an ETF. At around 8:01a.m., $5,000 fell to only a few hundred dollars all because I chased my play. Instead of watching my charts to show formations indicating trade possibilities, I rushed and assumed where specific patterns were headed. Even though allowing myself to make mistakes on real trades was costly, it created some urgency to learn my technique. The best thing to do once your account is created (whether it be Etrade or any other broker) is to learn how paper trading works. In simple terms, it's trading with fake money on real time markets. This will allow you to make all your mistakes, learn your style, and gain experience all while having no real loss.
After all of this and you're confident in your strategy, it’ll be time to use real money. The last thing to do is make your first bank to broker transfer and watch your money grow.
Success in the stock market comes down to strategy, consistency and discipline. The earlier you start, the more rewarding your journey will be.