7 Tips for Starting Stock Investments for Beginners

To achieve financial freedom, there are many things we can do. One way is by investing. Nowadays, with the development of the world of technology, investing in stock instruments has become an idol among the public. With all the conveniences provided, such as the proliferation of trading applications, this is one of the factors driving the increase in stock investors in Indonesia. Investors from various professional circles ranging from young to old age try their luck on this instrument. High profits in a relatively short time are also another driving factor. However, in economic terms there is always the phrase "high risk high return", and this also applies to stock investments. Therefore, it would be better before choosing shares as your investment instrument, find out the ins and outs first. Here are some tips for beginners who want to invest in stock instruments:

1. Study stocks first

Don't hesitate to learn. First learn the types, risks and returns of your investment instruments (shares) before you go any further. Understand the basic science of stock investment as well as technical terms that may often appear. You can find out from books, social media, or videos on the internet to expand your knowledge. You can also discuss with the community or people who are more experienced.

2. Select the securities company

Nowadays, there are many securities companies that sell their services to help you start trading stocks. Each company has its own policy in determining the transaction cost. However, it's not just the cost that comes into consideration. The service you're going to get should also be considered. Then you can open your own stock account. Some companies today even facilitate by reducing the initial funds even with a hundred thousand rupees you can open your stock account. If you want to use a trading app, make sure you use an OJK approved application and have a good track record.

3. Use idle cash or cold money

While trading stocks has high returns, it also has high risks. One of the principles of money management is to invest only using cold money, which means that the money you use to invest will not interfere with your basic needs budget or any other priority post. Avoid using debt too. If you've prepared it, start gradually. Use small capital first, not allocate it at once to stocks or one go. It's meant to get you a better understanding of the market situation every day as an attempt to manage risk.

4. Make a trading plan

Stock trading planning is very important for traders to sell stocks on the Stock Exchange. The trading plan includes a number of things such as stock lists for trading, entry points (when to buy), exit points (When to sell), and cut loss points. (sampai batas mana ketika harga saham turun untuk kemudian dijual). Once we've made a trading plan we have to be disciplined in running it. Don't just rely on emotions to make a decision. Be sure that with discipline on the planning that has been made will bring the maximum return.

5. Invest funds in the right company

Don't be lazy looking for information about the shares you're going to buy. How the quality of the stock, the track record of the company, the financial report, and many other aspects. In the stock exchange (BEI) there are stock indices that are useful as a statistical measure of stock movements that are grouped by certain criteria. For beginners it would be safer if you chose stocks in the IDX30 and LQ45 indices, because stocks on such indices have good corporate foundations and have fairly high liquidity, or commonly also called blue chips. Don't forget to also diversify the stocks you buy, you can by buying in several different sectors. It's useful to manage your risk.

6. Learn stock analysis

The more you get used to the upward and downward movements of the stock. However, stock trading is not just about intuition but must be based on in-depth analysis. The stock value of a company can be predicted by studying it. The way is by studying the financial reports or portfolios of the company over the past few years, following the company's developments through the latest news and information. By studying it, you can determine which stock you're going to buy that will eventually yield the maximum return. Remember, don't buy stocks for FOMO or just follow.

7. Realistic and non-emotional when investing

Always realistic in making investments. We have to be aware that there is nothing instantaneous in a process. It takes time and effort to the desired goal. Never look forward to getting big profits in a short time. Besides, when we are already fulfilled with too high expectations then it usually becomes prone to be carried on emotionally in every decision-making. Excessive pleasure in a company is not good either. Hold on to accurate data and information when making investments.