Investing is hard enough, but being young and inexperienced can make it even harder. Understanding all the different statistics of a stock can take a lot of time and studying. Although these statistics are incredibly important, understanding the companies you are investing in and how they plan to make money is equally important. Investing as a teen is not easy, but if you use our strategies below, it will help you understand what companies you need to be looking at to give yourself the best chance of success.
As a young person, do you have any advantages over other investors?
Most young people think that investing is for people who work on wall street and study stocks all day. With this image in mind, many teenagers become discouraged from investing as they believe they can’t compete against these analysts. However, although wall street analysts may know how to study PE ratios and market caps better than teenagers, they don’t have the same views as us. In other words, a wall street analyst isn’t in a school all day watching what trends come in and out of the school. That is where you will find the biggest advantage if you can recognize what is becoming popular before the street does, you will have a huge leg up on even the biggest firms. Another advantage of our viewpoint is analyzing what is going on within certain platforms or applications that are mainly used by the younger generations. For example, in our Snapchat article (https://youthstockperspective.com/2018/02/23/snapchat-update-help-sales/) we recognized that the application has changed in a way that will present more ads on the site. We didn’t do this by listening to CNBC or listening to a Snapchat analyst, we just simply used our observations, beliefs, and trends that we saw regarding Snapchat. While some of the ideas that we proposed in the Snapchat article may or may not be correct, the analysis does a great job representing the type of competitive advantage that we described above.
What Type of Companies to look at when Investing?
The best stocks to look in to are the ones that create products that similarly overlap with your interests and knowledge. It is much easier to understand and apply your opinion on a company that produces products that you truly understand and believe in. Also, another strategy to find stocks is to use the common trends that you see on a day to day basis. Once you have acknowledged some of these trends, you need to ask yourself, “how does this trend affect other products in its realm”. then go and find the companies that could be hurt or helped by the trend and invest accordingly.
Disclaimer: Do not invest your own money without doing your own research, our content is not meant to convince you to buy or sell a stock, but simply to share ideas and unique viewpoints.