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A Beginner’s Guide to the Stock Market

By Samuel Becker | Updated April 22, 2024

Learning the stock market, and all of its intricacies, can seem like an insurmountable task for beginners. But like almost anything, learning the basics of the stock market is feasible, given enough time and dedication.

Make no mistake: There’s a lot to learn, consider, and ultimately, put into practice. However, if you’re looking for a guide for beginners, you’re in the right place. This guide will walk you through, step by step, what you need to know to start investing in the stock market.

Stock Market Basics

Before a beginner even thinks about buying a stock as a part of a self-directed trading strategy, they should have some knowledge about the market’s basics.

A Brief History of the Stock Market

The stock market has a rich and volatile history. It can be helpful for beginning traders and investors to take a look back and get some perspective, and get an idea of what they might expect as they start trading.

Learn more: Stock Market History

What Are the Different Types of Stocks?

Investors should also know the different types of stocks that they may be able to purchase on the stock market. And yes, there are a number of different types, and each may or may not have a place in your portfolio, depending on your strategy and risk tolerance.

Learn more: Different Types of Stock

How to Evaluate a Stock Before You Buy

Aside from knowing the types of stocks that are out there, investors need to know some of the basics regarding evaluation of different investments. Being discerning is a critical part of being an investor, and not something a beginner will want to overlook.

Learn more: How to Evaluate Stocks

What Is Stock Volatility and How Do You Measure It?

Investing in the stock market may feel like riding a roller coaster at times, as stocks are naturally volatile. But some are more volatile than others. What does that all mean, and how do you measure and take it into consideration? Learn the basics.

Learn more: Managing Stock Volatility

How to Know When to Buy a Stock

Learning to evaluate a stock is one thing, and learning which types of stocks may be a good fit for your particular strategy is another. With that knowledge in hand, though, you still may be wondering when the time is right to buy a stock. Again, there are several things investors will need to keep in mind.

Learn more: When to Buy Stocks

How to Know When to Sell a Stock

For investors ready to realize the gains (or losses) they made on a stock purchase, knowing when to sell a stock – and the possible outcomes of doing so – is another important thing to know.

Learn more: When to Sell Stocks


How do beginners invest in stocks with little money?

Beginners can invest in the stock market with little money by purchasing fractional shares of stocks, or funds like ETFs. This allows them to purchase only what they can afford, though some platforms require a minimum purchase amount per trade.

How long does it take to learn the basics of the stock market?

Learning the basics of the stock market can take a few days, weeks, or months. It all depends on the individual investor, how much time they can or are willing to dedicate to learning, and then put it into practice. As such, there’s no definitive answer.

How can I practice stock trading?

Beginning investors can practice stock trading by using a paper account, which effectively acts as a stock trading simulator.

Start Investing With SoFi

If you’re ready to start investing, SoFi can help you take the next step. Trade stocks, ETFs, and more using SoFi Invest.

Ready to invest in your goals? It’s easy to get started when you open an investment account with SoFi Invest. You can invest in stocks, exchange-traded funds (ETFs), mutual funds, alternative funds, and more. SoFi doesn’t charge commissions, but other fees apply (full fee disclosure here).

For a limited time, opening and funding an Active Invest account gives you the opportunity to get up to $1,000 in the stock of your choice.

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