The key to making money in the stock market is to invest in the long term, buying only undervalued stocks quote Benjamin Graham, the "safety margin". Ben Graham and Warren Buffett both made enormous fortunes by investing in long-term value. In fact, Buffett will continue to do so, and is averaging more than 22% average annual growth rate combined with a period 39 years.
These results are phenomenal and not easy to imitate. However, the time on its side and a bit of work can be done almost as well as Buffett. Although you may not be the S & P 500 average return over the long term, approximately 11%, you're well.
Suppose that invests $ 3,000 in Roth IRA or other tax status of pension account each year and 20 this year to reach average annual profit is 11% During this season. At the end of 20 years you would have about $ 238,000 without taking into account transaction costs and dividends. You only invested $ 60,000 - so $ 178,000 is generated entirely through compound interest. If you were to emulate Buffett's 22%, that $ 60k should be $ 1,031,000. If you want to start earlier and invest $ 3,000 per year for 40 years by 11%, you end up with $ 2,132,483. Match Buffett 22% of these investments over 40 years and you end up with a whopping $ 55 million investment $ 120,000! It is the power of compound interest.
Many people ask me: "What steps can I buy?" and "How do I start?" They will continue to invent excuses for not investing in the long term. My opinion is a bit of publicity as Nike: just do it! Before you start. Open a Roth IRA to start putting money on a regular basis, even though it's only $ 25 a month. It is important to take the regular way of saving. In the meantime, you can take care to buy stocks.
