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How To Invest 500 Dollars - The Ideal Investment I have always liked the notion of a Genie offering me three wishes and me being such a cheeky fellow, I would ask for 1000 more wishes. The fact is when limitation presents itself we typically want more. It is the rarity factor. If something is in plentiful supply, we discount its value but if something is limited than it becomes worth more in our minds. Recently I came into some money. Not a lot, but it was free money and I wanted to do something good with it. My first idea was to go downtown and pick up a pair of those "Bose" speakers I had been drooling over (have you heard the bass on those puppies?) It occurred to me investing $500 instead of spending it may be wiser. But that Genie notion keeps playing around in my head. Yes I want to invest the money, I don't want to put it on a horse or pray for black 22 at the Casino. I want a real and tangible return. But I got a wish. $10 bucks is not a wish. $10 bucks is common and not a big deal, but thinking about how to invest $500, one gets the feeling of being granted a little power, a little freedom to try something different and see what happens. How do I ask that $500 dollar wish for a thousand more wishes...hmmm. I know if I put my mind to something, that generally I can do it. It comes from a strong belief in my own abilities. (My parents must have done something right raising me :P) It really became a bone of contention for me, I got stubborn about the idea. I wanted that wish to give me a thousand more wishes. I knew, if I waited long enough and was determined enough my mind would toss me an answer of some sort. Sure enough, I did get the answer I was looking for. If I put that money in the bank and waited a year at 5% I would make another $25 WOW Snooze town. I wanted to magnify my returns, I wanted to take a risk but not lose the money. Then it came to me in a flash. What better way to invest $500 than to invest it in Education. There are 3 good reasons why investing in an education is better than the 5% a bank would give me. 1) Education generally solves problems by equipping me with knowledge to overcome problems. For example, my problem of wanting a decent return could be resolved by buying some instruction on how to start a part time business as one possible avenue. 2) Novelty. Often learning something new gives people a new lease on life and fresh perspectives leading to even more new experiences and learning. 3) Knowledge cannot be taken away from you. You can try and invest $500 and you may make a return or if the proposition was really risky, you might lose the money, like investing in Emu farms or something. But if you learn something new, it is like a gate you pass through which you can never be pushed out of. Knowledge therefore, new knowledge, is portable and forever. It adds to our personality and our worth.
Short Selling - How To Make Money Investing In Bad Stocks Falling markets always cause investors grief. The media reports any selling in a mortally serious tone, while bullish cheerleaders comfort the masses with promises of better days ahead. Negative sentiment usually intensifies right along with the selling, and desperate prayers are offered to the heavens as everyone nervously holds their breath. Well, not everyone. In fact, more folks are starting to take advantage of the normal rising and falling of the market tides by learning to sell stocks short. For example, Investor's Business Daily newspaper founder William J. O'Neil's latest book is titled "How To Make Money Selling Stocks Short." Selling stocks short is a simple way to make money when stocks drop. To "sell short" you simply borrow the stock from your broker, sell it, and then buy it back when the price drops. You then return it to the broker you borrowed it from and keep the profit. Yes, it's perfectly legal! Imagine that. A conservative well heeled senior investor such as Mr. O'Neil advocating that investors learn how to sell short. As surprising as it may seem, you only have to look back to when Bill began his investing career to see why he is willing to take this "odd" position. In the early sixties O'Neil was a young stockbroker for a major New York Stock Exchange member firm. Based on his research he decided to close out all of his stock positions in the market by the spring of 1962. Then he started selling short. By the end of the year he had made a sizable profit while almost everyone else was getting crushed in one of the worst bear markets of that era. A year later he bought a seat on the NYSE and started his own firm. After more than four decades studying the markets, Bill believes there are two main reasons why most investors "can't sell." First is the obvious lack of knowledge about the subject. Most folks have never even heard of selling short. The second reason is the psychological resistance most investors have against selling short. After all, investors aren't supposed to make money when stocks go down ... right? Beyond the educational, emotional, and mental programming required to get our heads in gear, a big part of our job as active investors is to find the dominant market trend and profit from it - even when it's down. Normal investors might scoff at the notion of shorting, but highly successful investors and stock traders aren't normal. While accepting the fact that the stock market will go in whatever direction it pleases, the latest generation of market players knows how to take advantage of the opportunities offered by the down-side of repetitive market cycles. Maybe it's time for you to consider short selling too.
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