Jason asked in Business & FinanceInvesting · 9 years ago

Some questions about stocks and investing?

Hi. I am just having trouble with some finer details about stocks and trading. I have some questions here, and if you have anything to add besides answers to them, please do tell.

1. Can a stock be simultaneously sold/available for sale on the NYSE and Nasdaq? Or any stock market for that matter. Can the stock be sold in more than one place and, once sold, be immediately taken away from the other ones? Or does this only work with electronic ones such as Nasdaq? Please explain.

2. Where should a young person looking to begin investing start? Is buying online the best way? Anyway, what other ways are there even? I mean, is another way to directly call up a company or call a broker? How do most successful investors start out? Everyone starts somewhere.

3. Once a stock is publicly traded on the public markets, does the company still have the power to sell it directly themselves?

4. Is it as simple as just buying stocks and selling when they go higher...or is a lot more stuff able to be traded? What I mean is, for ETFs and other things, is it possible to buy any of it online or through a stock exchange? When the famous or even just any relatively experienced investor buy stocks, they don't just buy online, right? They must do something. What do they do? Do all of them have umbrella companies? Please explain how the whole process "works" and all scenarios possible.

6. This is a little bit redundant, but, how exactly are things besides stocks traded? Or just stocks? Do most people just go online or what? I mean, I cannot think of another way, but Warren Buffett and others do it. Do they use phones? Email?

7. When someone or some company actually sets out to buy a whole company, do they just go to the stock exchange and buy over 50% of the shares (after research etc. is done), or is it more of a transaction.

8. When a company wants to go public, who do they call to put the shares on the market? Also, do any companies actually market (as in advertise) their shares to potential buyers?

9. Is there any one single book or two or three books that can explain all of this stuff (that are good books)? Or maybe biographies or something? I have read a few investing books, but I feel like they all assume that the questions I just asked are common knowledge.

10. I am 17 and in high school. I am going to major in economics and minor in mathematics at either Brown, Princeton, or UF (applied to all of them and I will at least get into UF) and I want to learn about investing. Investing could definitely be a good career for me, and I am highly interested by it. I understand that some good job opportunities come from going to top tier schools and getting internships, but I do not want to "rely" or even have to deal with that competitiveness. As much as I would like to work that stressful life, I want to have good knowledge on the side. Plenty of famous investors never worked in investment banks. They just managed companies that did hedge funds or something like that. How do they get into those positions? Or must one get an MBA from a top school to get there?

11. Are there any famous or not famous millionaires or rich people that simply made money by investing by themselves and not by working at some bulge bracket firm?

I feel like I do not know anything about this, and I should. Is it because I haven't actually bought a house or anything yet so I do not know? If these are silly questions, sorry.

I look forward to learning. Thanks!

Update:

It's such a deep topic, and there does not seem to be an "order" as to which you learn it. I want to learn about all of it and be familiar so I can begin my journey. There is just so much information. I can feel that I have only knicked the giant boulder.

Update 2:

Also, when you do want to buy online, do you just go somewhere like Scottrade you're good to go? Or is there some process?

It is all so esoteric to me.

1 Answer

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  • 9 years ago
    Best Answer

    1. Yes. You get a couple of stocks listed in both Nyse and Nasdaq. Multinational companies are list all over the world exchanges.

    2.At the moment I recommend mutual funds or ETF's that invest on emerging economies. Developed economies offer very little growth for now. But if you want to play it safe, and are young and working and debt free then BUY A HOME, now,while homes are cheap and interest rates low. A home is a life long investment. You will always need it. And you also don't want to be an old man who is tired by repayments when you should be taking it easy.

    3.A company can issue more stock. A company can buy stocks back and sell them later. Companies never sell direct to the public market at any time, they sell through financial institutions, that's what investment banks are there for. Stocks are publicly traded through market-makers like New York stock exchange and Nasdaq. A company may sell to its employers, it may sell stocks that it is still holding in its books to whom ever it wishes, but these would not really be public trades, but even with these transaction if a company is publicly traded then it has to report to shareholders through financial statements and Sec filings and it must comply with market-maker policies.

    4. Your retail traders mostly buy on line or through a broker. Remember trading really is happening in computers for most countries. Not anyone can just trade directly with the exchange, the big institutions or broker companies place our orders on our behalf. But again everything is online here, in other words very fast.

    6.If your big investor or institutions then you do not have to buy on the market, special deals can be made. The market serves as a guide line or indicator.

    7.There are two main popular types on take overs:

    a) Hostile takeover - that is when the number of shares needed to be a majority shareholder are bought or an offer is made on the public market and or from individual shareholders, without consulting directors or after being rejected by directors.

    b)Friendly takeover - Directors are approached and an offer is discussed with them

    But which ever type of takeover an offer will be made to the shareholders. The stock traffic and price on the market will reflect the proposed takeover.

    8. Financial institutions, such as investment banks facilitates stock offerings. The whole process is complex and has legal requirements and representatives. Normally an offering is announced prior, through financial news media.

    9 Stocks for dummies is very good with basic, even I sometimes refresh my memory by using it .

    10Everything starts with passion. Love finance with your heart. Read books on the subject, follow financial news, makes notes, learn as much as you can about something you come across but do not understand.

    11.Warren Buffet, look him up on wikipedia.

    Yes, but you will have to open an account with Scottrade first.

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