Have you ever considered investing in something like stocks, ETFs, and derivates besides cryptocurrencies but you don't know how it works? Then this post is exactly for you.

Here is all you need to know before you start investing in stocks and shares.

What Is A Stock?

If you like investing in cryptocurrencies then I am pretty sure that you also like investing in stocks. Cryptocurrencies and stocks are somehow comparable but there are some significant differences you should be aware of.

If you do it right, stocks are a wonderful and safe way of investing. One of the coolest aspects of investing in stocks is that you actually become co-owner of the company when you buy one of its shares. As a stock owner, you are a co-owner of the company. As a result, you can participate in the general meetings of the company and have a say in important company issues. 

In addition to price increases on the stock exchange, you can also earn money with shares through the payment of dividends. Dividends are shares in company profits directly paid out to you.

Shares are traded on stock exchanges where also the price of the share gets determined. In the end, the price of the share is ultimately based on supply and demand. In most cases, the price is based on the expectations of the market participants. If the market participants believe that the value of a company will rise then the price of the according to stock will go up, too.

Why Investing In Stocks?

First of all, you should invest your saved money in something because sure is that money that is not invested loses value. This topic is big right now because the inflation rates are high worldwide. Then you always should keep in mind that investing is necessary if you want to build up wealth.

Of course, there are different possibilities to invest your saved money.

Personally, most of my saved money is invested in cryptocurrencies and I use products like Binance Savings to generate passive income. Besides investing in cryptocurrencies, I also like investing in stocks. It is a more traditional market that is regulated.

Other investment products besides cryptocurrencies and stocks like real estate are currently not interesting to me. 

How To Invest In Stocks?

When you start investing in stocks, you should have a strategy. One important aspect that you always have you consider is diversification. It is very risky to invest in just one stock. In general, going all-in on something is always very risky and never good advice. The thing is that every share contains a company-specific risk. This individual value risk of a single share can be reduced by adding different shares from different companies from different branches from different parts of the world to your portfolio. 

The idea is to invest in many different shares from different companies to eliminate the company-specific risk of a single share as good as possible.

There still will be fluctuations in the stock markets but if you stay invested for a longer period of time like 15 or more years then you can ride out market fluctuations better. So you should have a diversified long-term investment in stocks. Of course, you should also know about the companies you have invested in and keep yourself up to date on the latest developments.

A smart way of investing in stocks is investing in Investmentfonds and ETFs. These instruments enable a maximum of diversification because you can invest in thousands of different companies with just one single product. I am planning to cover both instruments, Investmentfonds and ETFs, in a separate post soon. 

Choosing The Right Broker

You can not buy stocks on cryptocurrency exchanges like Binance or Coinbase, instead, you have to use a bank or a mobile broker like Trade Republic. They place an order on a real stock exchange for you.

Especially mobile broker apps are making investing and trading stocks easier than ever. There are different mobile broker apps on the market. Among all mobile broker apps on the market, Trade Republic is the most popular app, at least in Europe and it is also my favorite mobile broker when it comes to investing in stocks. The sign-up process is fast and you can start investing in stocks right away, also with small amounts.

Also, the trading fees for buying and selling stocks are frequently much cheaper on Trade Republic than at your local bank. The process of buying and selling is easy and meaningless because the user interface of the Trade Republic app is very user-friendly and intuitive. This makes Trade Republic the first choice, especially for new investors in the stock market.

If you also like to invest in stocks, you might want to check out Trade Republic yourself. It is a good choice, especially for beginners in stock investing. If you use this link for signing up for a new account, you can get a nice sign-up bonus (Sign-Up Code: gh0dqpmn). To receive the sign-up bonus, you have to sign up using the invitation link, do the KYC and make an initial investment.

This sign-up bonus for new users changes frequently but on Trade Republic it is always worth it. Currently, you can get a bonus of 50€ after making an initial investment of 100€ on Trade Republic. Usually, the Welcome bonus is a free stock. This is the best sign-up bonus that you can currently get on the market. This is the chance to kickstart your investment in stocks with a juicy sign-up bonus.

In one of my previous posts, I already explained why " I am Only Investing In Stocks With Trade Republic But Not In Cryptocurrencies".

My Final Words

Stocks are a great way to diversity your portfolio. If you like investing in cryptocurrencies then I am sure that you also love investing in stocks. You can invest frequently in stocks, investmentfonds and ETFs. Mobile broker like Trade Republik are making investing in stocks super easy.

I am also interested in what you are doing. Do you also invest in stocks besides cryptocurrencies? Do you also use Trade Republic, will you give it a try, or what platform are you using to invest in stocks? It would be awesome if you would leave a comment.

At the end of my post, I also like to remind you that my intention in this post is to raise your awareness of investing in stocks besides cryptocurrencies and my intention is not to replace your own research. My words may have made you wiser but I am not your financial advisor. However, this article really reflects my own opinion and I hope that it was somehow helpful to you.

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