If you’re new to investing and looking for a broker, you might already be familiar with Public.com. Public is a new broker with an added social media layer.
Bullish was actually one of the first creators to get on the social networking app way back in June 2020. Since logging on, we’ve been writing the Bullish Rippers series, a tri-weekly column about the top stocks hitting highs and making moves.
We often see new investors asking questions on Public, but many don’t get answered. So, we rounded up some of the top trendiing questions and are going to answer a few of them to help our fellow investors out. Who knows, maybe we’ll make this a frequent thing?
1. “I’m new to all this and have some extra money I’d like to invest. Any advice?”
The best way to jump in as a new investor is to buy what you know. Think of the products you use. If you own an iPhone, you’ll probably buy Apple ($AAPL). If you like Pixar films, you might buy Disney ($DIS). You are arguably contributing to the success of these companies by financially supporting them, so “lifestyle investing” is a good strategy to capitalize on your own consumption.
Another strategy that every new investor should know about is called dollar-cost averaging. You can select a few stocks to place recurring orders in and throw a few dollars at them every day. Over time, you’ll ride the ups and downs, benefiting from the long-term average. It’s a good alternative to buying 100 shares of a company at a set price, which can potentially burn you if the price drops a lot. Public said they’re adding a ‘recurring order’ feature in the next few months, so keep an eye out for that.
2. “How do I decide what stocks to buy? And how to plan for my financial future?”
Phew, that’s a hefty question. Here’s a better question: how did you decide where to go to school? How did you decide what to do for work? These are intuitive questions that you often can’t answer without doing something first, which is why we recommend starting with buying what you know and understand. Basic psychology says that you don’t do things that you find uninteresting or not fun, so investing should be the same. If you don’t enjoy managing your own money or planning, then hire a Certified Financial Planner (CFP), Registered Investment Adviser (RIA) or a money manager who will do that for you.
Planning for your financial future is dependent on your own goals. A CFP, RIA and some digital tools like Wealthfront might help direct you, but they might not be perfect. There’s nothing that says you can’t manage a little bit of your own money and hire an expert to manage the rest of it. So consider looking into all your options: taking advantage of retirement accounts like Roth IRAs, college savings accounts such as UTMA or 529 accounts and tax-privileged investments such as municipal bonds might make a profound difference on your finances.
3. “How do you research the stocks on your Bullish Rippers list?”
We have a criteria for selecting Bullish Rippers on the backend. For that criteria, we are looking for companies with a market capitalization over $500 million hitting 52-week highs or making double-digit gains because of material news. We use free data tools and spreadsheets like Finviz and Koyfin to visualize and analyze these companies a little further. We might pull out Google or Reddit to read a few articles (or WSB posts) to gauge the sentiment around a company or its news, but we generally like to stick to the facts with Rippers. If you’re interested in hearing about finance tools, we tweet about fintech tools and sites to keep an eye on through our Instagram and Twitter.
4. “Where’s the best place to invest $600?”
This isn’t investment advice, but if you’re asking us — you probably should close out of the Public app before you make any bad decisions. The Rippers series has shown us that companies that make it onto the list either explode in spectacular fashion or climb for weeks on end before – eventually – exploding in spectacular fashion.
If you’re new to investing, you should thoroughly consider buying a low-cost index fund like $ITOT or $SPY. These are really strong investments that include hundreds of stocks at once and can make you a lot of money over the long run. No, you will not become rich overnight like some of the GameStop daytraders. But, you also won’t go broke overnight like some of the GameStop bagholders. If you feel like you need to start investing in individual stocks, then start with lifestyle investing. From there, there’s no shortage of resources for you to continue learning about investing. but we do hope you’ll follow us for all stages of your journey.
5. “I purchased a couple stocks over the weekend expecting them to post to my portfolio on Monday, but they are still pending as a limit buy. What does this mean?”
There are a bunch of different types of orders for stocks. For new investors, there are two you’ll probably want to know about: limit and market orders. In both order types, you pen in how many shares you’d like to buy. With market orders, these will generally execute at the current price during trading hours. However, with limit orders you’ll need to type in a price you’re willing to buy at. If that price is not met (for example, it goes higher than the price you specified), then your order won’t execute. If you’re investing for the long-term, then your best bet is to place orders during the trading day using market orders.
6. “Why are some stocks marked high-risk?”
Some people might have noticed that stocks we write about are sometimes marked ‘high-risk’ by Public. There’s a lot of different reasons why momentum stocks might be marked this way. Riot Blockchain, which has been on the Rippers list a handful of times and is marked high-risk, is a stock that collects most of its value from the price of Bitcoin. This is because they are a Bitcoin mining company.
Public also marks small-cap companies (with smaller market capitalization) with their own warning, which is a way to warn people that a company is unproven or might be prone to lower liquidity (i.e: very few shares changing hands = big changes in price).