Just to decide one day that you would like to try investing in the stock market is ludicrous unless you know some of the terms related to making investments. In other words, it's very necessary to know the jargon or Wall Street lingo in order to make informed decisions about who to trust with your hard earned money. One way of learning all you can is to get the advice of an investment broker. If he charges a fee, it might be less than what you could lose by going it alone.

LET'S EXPLORE SOME OF THE OTHER OPTIONS

Before even talking about the stock market, it might be wise to determine if just an ordinary savings account is a better vehicle for you to build a nest egg, or rainy day fund. The objection that most people have about savings accounts is the fact that most banks and credit unions pay too little interest on their money to make it interesting. and that varies slightly from institution to institution. However, with a straight savings account, money is accessible should there arise a situation when it is needed immediately.

There are Certificates of Deposit, which also pay relatively low interest, over a specific term, i.e., from 6 months on a $500 deposit offering an interest rate of 2.57% to five years, with a minimum deposit of $10,000 at an interest offering of 3.4%. Varying institutions offer varying rates and minimums, so it's wise to check around if this is an interesting investment vehicle for you.

PROCEEDING WITH A STOCK OR INVESTMENT BROKER

If you conclude that the stock market is where you want to put your money, there is the decision of whether you want to manage your own stock market portfolio. The stock market portfolio is an individual's record of the stocks he is invested in and the number of shares invested in the various stocks. A share of stock is the dollar value of a single unit of stock, and can vary from day to day on the stock market. An experienced and trusted investment broker is a better choice for just beginning to invest. Be aware, though, that there are various levels of authority that the stock broker is allowed. The discretionary broker has the authority to make decisions in your behalf on which stocks he will choose for your portfolio, and there is a percentage of commission charged for his services. It is very important to choose an investment broker wisely, since sometimes a broker will buy and sell stocks too frequently only to make more commissions for himself.

Then, there is the investment broker that is employed on an advisory basis. He will contact you regarding suggested changes to your portfolio, but is not at liberty to make these changes without your permission. While this gives the stockholder more control, the base commission charged may be higher, since the broker needs to contact you before every decision, which is considered time consuming.

Additionally, an investment broker can be sought just for the purpose of making the stock executions, i.e., the buying and selling of the stocks that you indicate, and only when you indicate.

Caterina Christakos is a private investor and published author. To get more information go to: http://financialinvestmentsdirectory.com

Tags: invest, finance, stock market, broker, jargon, wall street, portfolio, certificates of deposit