facebookI would like to invest in US stocks and I only have 3k of savings. I don’t have a regular income yet. Should I take the risk and invest? - Seedly

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Anonymous

17 Jun 2020

General Investing

I would like to invest in US stocks and I only have 3k of savings. I don’t have a regular income yet. Should I take the risk and invest?

I have done my due diligence of the company stocks.

Discussion (6)

What are your thoughts?

Sharon

Sharon

17 Jun 2020

Level 10·Life Alchemist at School of Hard Knocks

When we invest, we buy a portfolio of stocks. An analogy will be like the portfolio is to a garden and the plants are to your stocks.

When a plant is growing well, we keep it.

Meanwhile, those that are no longer bearing fruits, giving you problems or drag the other plants down in the garden (e.g. the pests go to another plant), we chop it down and then plant another one.

Overall, the garden is still lush and flourishing.

If you have a portfolio, even if you sell one bad stock, you can put the money returned from the bad stock into a good one. When more stocks are good, the overall pool of money will still grow.

If one only has 1 stock and its fundamentals have changed, when it goes down... want to cut but can't because all the capital is bet on this one company.

Case in point is when you look at funds, these professional fund managers who do this for a living, don't put everything into 1 stock, even they have confidence in a company.

The world is a fluid place. Unexpected things happen all the time, and you will want to protect your downside as much as possible, while balancing to get the best possible return. Diversification of risk is key.

If you want to see how a portfolio looks like, you can visit Kyith's portfolio at investmentmoats.com.

Better do it with U.S. passive indexing ETFs, single stock investing will not work (better) for the retail investor.

View 1 replies

Ng Wei En

Ng Wei En

17 Jun 2020

Level 8·Analyst at Mastercard

I would assume you are still in school and are looking to invest. Just keep in mind of the following...

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