An Education Path For DIY Investors
Source: Melbourne Investor Feb/March 2007
Written by Sean Dostal
Moneybags.com.au
Sean is the founder and Managing Director of Moneybags. Since 1999, the company has equipped Australians with the education and tools needed to invest in the stockmarket and real estate. Their online shop features books, courses, software and newsletters.
An Education Path For DIY Investors
Education will help you make better investment choices. You will invest with confidence with a good understanding of:
• what you are investing in
• potential risks and rewards
• when and why you should buy or sell an investment
• how emotions can effect your decisions.
What are the steps on the education path?
1. Choose your starting point and identify your skill level.
2. Learn and apply your knowledge to build your confidence and advance your skills.
Level 1:
Developing basic financial literacy – Novice Investor to Intelligent Investor
Regardless of whether you entrust your finances to a financial advisor or make direct investments, an understanding of the basics of investing will help you make better-informed investment decisions.
Recommended Resources
• ASX website, in particular the free online courses about getting started and tracking your investments.
• Books about basic concepts, investing methods and taxation and introductory home study courses.
Level 2:
The confidence to invest directly – Intelligent Investor to Direct Investor
You need to decide whether to invest with the aid of a financial advisor, make your own investment decisions, or use a combination of both.
Recommended Resources
To help you select, track and manage investments:
• More books about investing methods, taxation, charting and technical analysis, and trading psychology. Other titles on risk and money management, managed funds and fundamental analysis.
• Free online ASX courses about analysing and selecting shares and developing your portfolio.
• More advanced multimedia home study courses.
• Charting and scanning software. A portfolio manager and risk management software are useful.
Level 3:
Trade actively, explore leverage – Direct Investor to Sophisticated Trader
If you are comfortable making direct investments in shares you may wish to trade more actively, earn income on your shares with options, or use leverage in your investing.
Recommended Resources
• Books about derivatives (options, warrants, CFDs), day trading, risk and money management, strategies and systems.
• Free online ASX courses about options and warrants. Interactive courses to expand your knowledge through practical application.
• Risk management software.
Level 4:
Resources for Sophisticated Traders
You will have developed your own trading system and be comfortable sourcing further educational materials in line with your investing style.
Recommended Resources
To help you venture into new asset classes or run a DIY superannuation fund:
• Books about DIY superannuation, futures, commodities and other asset classes.
• Software to manage your DIY fund.
The path to savvy investment can be fraught with danger, but with the right amount of education, knowledge and a clear idea of what you want to achieve, your goals are attainable.
Call (03) 8616 0270 to enquire about our services Conditions of use | About Melbourne Investor - Melbournes largest franchise, property and investing seminar | Contact us | Custom Publishing | Melbourne Investor: Australia's largest investment magazine covering franchises, property, shares and alternative investing | Investment Shop | Melbourne Investor | Advertise | Australian Email Newsletter featuring infomation on entrepreneurs and investments | Seminars | Everyday Investor Seminar