A simple approach to equity investing

An introductory guide to investing in equities to understand what they are, how they work and what the main strategies are

Stefano Calicchio

• Publisher: Stefano Calicchio
• Year: 2022
• ISBN:
  9791220892940
• Topic: Commerce
• Subtopic: Commerce Général

How do equity investments work? How do you trade on financial markets? What are stock market indices? What strategies can be used to invest in equities? Questions such as these are becoming increasingly common in the age of global markets. Today, investing on your own has become easier from an operational point of view, but the world of finance remains difficult and complicated for the uninitiated to understand. For the first time, a comprehensive and accessible guide shows you the theoretical and operational principles of the subject. In this practical handbook, you will discover the information you need to really understand what stocks are, what are the basic operating strategies in the markets and what are the main mistakes to avoid if you are just starting out. Readers will learn step by step how to deal with stock markets, how technical and fundamental analysis work and what the implications of money management strategies are for their investments. But at the same time, this guide is also a path to discovering one's own nature as an investor, to finally begin to understand what you can get out of stock markets.

A short introductory test to behavioural finance

Before going into how equities work, it may be important to spend a few minutes focusing on your basic knowledge of the subject.

The following introductory test will help you to better understand the topics covered in the following pages, so as to introduce you to the key concepts of this subject.

Question	Yes	No
I know the main characteristics of equities.
I know the concept of risk and I am aware of how to manage it.
I know how to calculate the return on a stock.
I am aware of the impact of dividends on a portfolio of equities.
I understand the basics of fundamental analysis and its implications for stock picking.
I know what technical analysis is and how it is used to decide when it is best to execute a trade.
I know the bìas and errors of judgement that typically affect investors when managing market positions.
I establish investment plans that are consistent with my objectives and my level of risk acceptance.
I am aware of my expectations with regard to the return I can get from the market.
I understand investors' prejudices and the consequences they have on investments.
Use of investment management techniques th...

Table of contents

• Cover
• A SIMPLE APPROACH TO EQUITY INVESTING
• Table of contents
• Introduction
• What are shares
• A short introductory test to behavioural finance
• A brief history of stock markets
• How actions are categorised
• What are dividends and how they work
• How to buy shares and the role of brokers
• What basic parameters to consider when investing
• Technical analysis of equities
• What determines the price of a share
• When to buy and sell a stock
• The difference between active and passive investments
• Stock indices
• Equity funds and ETFs
• Equity ETFs to generate income
• Speculating on the downside with short selling
• Investment in equities with margin
• Investing with roboadvisors
• Common mistakes in equity investments
• Money management
• Starting with simulated portfolios
• From demo accounts to real investments
• Key points of behavioural finance
• Conclusions
• Final test
• Solutions