What is financial investing?

When you first start hearing about financial investing, it's like social media. Everyone has a preconceived notion of what it is, but very few see it the way social influencers do; As a way to make money consistently.

You must have heard a lot of jargon surrounding it, some more relatable or familiar such as a broker, stock, or dividend, and some you may never have heard before, such as candlestick patterns, margin, or portfolio diversification.

Sidenote: All bolded words in Investing Guides are clickable and will guide you to the definition of a word, to become a more informed investor! Regardless of your investor type

The goal of financial investing

If you boil it down to its core, financial investing has a straightforward goal: To increase your money in the mid to long term. But doesn't this require time & effort to work out, I hear you thinking.

Your time and financial investing

Well, it might. Or, you could decide to play it safe with the lowest risk and highest diverse investment portfolio. Or you can even let a broker or financial firm invest for you. But regardless of how it's done, the characteristics are the same.

We're here to help you cover the basics

Financial Investing - Is it complicated?

We aim to make financial investing accessible, fun & work for you, not the other way around. Stay with us to learn much more in the world of sound investing over a longer timeframe.

The What, Why, How and eventually Where of financial investing

You name it, we will cover it! We will go through all the steps prior to, during, and after financial investing. Our wish is to make you feel comfortable with taking charge of your own financial future, with financial investing!

Financial investing - I can do it!

Let's roll it back a bit though, shall we? We still have a long way before reaching that goal!

What is financial Investing?

In short, financial investment is the process of buying, holding, and selling financial instruments.

Nowadays mostly done online via a brokerage account, the act of investing has become easy. Although many types of financial product types exists, we will mainly be covering:

  • Stocks & Shares – A piece of ownership, that provides a multitude of benefits to it's holder. Think about the largest listed companies like Tesla & Google.
  • Bonds – A loan you extend to a certain company or goverment for which you can collect interest.
  • ETFs – A collection of stocks, following a certain country, industry, technology or otherwise thematic concept.

People and companies might invest in financial instruments because they have heard their friends or other businesses making certain transactions, which they believe are sound. A word of warning though, it's never a good idea to follow someone else's financial investing strategy, without understanding it yourself. Even then, it may not be for you.

Most of the time financial investors are simply looking to make a profit from movements in the price, for example by buying low, then selling high. Although this sounds very obvious, we will get into why this isn't as easy as it sounds in a later lesson.

What are the financial markets?

Similar to any other market, except for most in a digital form, financial markets are where buyers and sellers come to trade. In previous times, physical exchanges would be the heart of financial transactions. Nowadays, most still exist in name but operate using the internet. Your broker or bank would then be the intermediary between the financial market and you.

A financial market can be daunting to any new investor who has just started a brokerage account and simply wishes to understand the latest price for Tesla. Mostly due to the multiple levels of buy and sell orders that make up the market price.

If we just lost you, don't worry, this is a topic we will cover once you are ready. The reason we mention it now is that, although it's a complex machine, the system has many built-in safety measures to reduce, if not eliminate, fraud and illegal activity.

Speaking off, this is usually why opening a broker account can take up to several days. The broker is simply verifying you are an actual person, with money obtained by legal means, prior to allowing you to fund/deposit your account.

Financial Investing in a nutshell

  • Financial investing is the buying, holding and selling of financial instruments
  • There are many types of financial asset, including shares & stocks, bonds and ETFs.
  • Most of the time financial investors invest to make a profit
  • Financial markets are where buyers and sellers come to trade
  • The markets are regulated to reduce fraud

We do not shy away from giving credit, where credit is due. Investopedia also has a good take on this topic, should you wish to read more. Of course we would prefer you browse some of our below other pages instead. But it's your choice, just don't forget about us!

Continue your reading by having a look a the below content. Each page is one step closer to confidence and direction for your own financial future!

Best copy trading broker 2022
This is default text for notification bar