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Robinhood vs Stash: Which Stock Trading App is Better?

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Two of the most popular free stock trading apps available are Robinhood and Stash Invest, which allow you to buy and sell stocks for free without paying trading commissions.

Each app has its pros and cons so I’ll be discussing each one in depth in this side by side comparison review.

Sign Up Requirements

Both apps are only available to US residents, people living in the United States or residents with a valid visa. As of now, Robinhood and Stash aren’t available to residents living outside the United States.

Types of Investments Available

Types of investment options are where these apps start to differ. Here’s a breakdown of the differences in trading products:

  • Robinhood offers NYSE, NASDAQ, and many OTC publicly trading stocks as well as options trading, various ETFs and REITS. There are no mutual funds, bonds, or IRA accounts available on the app.
  • Stash Invest offers a select group of publicly traded stocks on the NYSE and NASDAQ. There are no OTC stocks available on the app. They also offer a few low cost index funds and ETFs which track sectors for a specific sector like tranportation or cannabs.

Trading Experience

Robinhood offers a much smoother trading experience with instant deposits and an easy “swipe up” process to buy and sell using their app. You can place market orders, limit orders, and stop loss order using the Robinhood app. They try their best to execute your trade at the lowest possible price and I’ve bought quite a few stocks at the 52 week low using their app.

Stash Invest is best known for “Auto Stash” deposits on a weekly basis where Stash automatically purchases shares for your account. The trading experience is in real-time and you must wait a few minutes for your deposits to show up in your account. You have a lot less control over your trading because Stash doesn’t offer limit orders.

Costs & Fees

Both apps offer commission-free trades but Stash invest charges more fees than Robinhood. Here’s a quick breakdown of the costs & fees for each broker:

Robinhood Fees

  • Stock Trades: $0 per trade
  • Options Trades: $0 per trade

Stash Fees

  • $1 monthly fee for individual accounts under $5,000 (0.25% annual fee for accounts over $5,000
  • $2 monthly fee for retirement accounts under $5,000 (0.25% annual fee for accounts over $5,000)

Fractional Shares Breakdown

So far, you may be wondering why would anyone use Stash Invest if they must pay a monthly or annual fee to use the service? Well, Stash offers fractional shares while Robinhood doesn’t offer this feature. Fractional shares allow you to buy small portions of stocks and build up a position over time. For example, you can invest $10 into Amazon and own a small percentage of 1 share while Robinhood requires you to purchase at least 1 whole share to open a position.

Fractional shares is a wonderful strategy to invest in more expensive stocks over time because consistent purchases lead up to large positions over tie.

Referral Program

Both companies offer a referral sign up program for account holders. Here’s a breakdown of the differences in each referral program:

  • Robinhood offers you and your referral 1 free share of stock when they sign up under your referral link. You have a 1 in 200 chance of getting a free share of Apple, Berkshire Hathaway or Facebook. 1 in 150 chance of getting a free share of GE, Ford or Energy Transfer. Most free shares are cheaper stocks like Groupon or SiriusXM.
  • Stash Invest gives you and your referral a free $5 cash reward for signing up under your referral link. Your $5 reward is credited once your referral signs up and makes a deposit.

Conclusion

At the end, both trading apps are much welcomed into the investment industry because they offer investors the opportunity to save on stock trading fees and build up a large portfolio in an automated fashion.

If you want to buy and sell stocks, ETFS, and trade options then go with Robinhood.

If you want to buy fractional shares in your favorite companies or save for retirement, then go with Stash Invest.

Robinhood App Review 2019 – Is It Safe & Legit?

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If you notice how much fees & trading commissions impact your overall portfolio returns, then you’re not alone. One of the easiest ways to boost your portfolio return is to decrease the amount of fees you pay. It’s simple yet most investors don’t give it much thought.

For example, let’s say you trade with Fidelity (I have a Fidelity SEP IRA) and you buy 1 share of Apple stock at $190. Fidelity charges a $4.95 trading commissions so you end up paying $194.95 to execute the trade. You’re already down 3% on this position from the beginning. This is the worst part about paying commissions. You need to gain a couple percentage points just to break even.

What if there was a way to buy stocks without entering the position at a loss? Enter Robinhood, the world’s largest commission free broker with over 6 million users and counting.

In this review, I’m going to cover everything you need to know about Robinhood and show you how to open your account for free.

What is Robinhood?

Robinhood is a revolutionary commission-free stock, ETF and cryptocurrency trading app for investors who want to save money on trading fees and grow a substantial equity portfolio over time.

The company was founded in 2013 by Vladimir Tenev and Baiju Bhatt who were upset at the current broker options available to the average investor.

The app is used mostly by millennial investors who are new to investing and want to grow their portfolio over time. However, I think all investors can benefit from zero cost stock trades because that extra money saved on fees can be reinvested in your portfolio and will boost your overall return,

I’ve been using Robinhood app for over 1 month and will cover everything in-depth in this Robinhood App review. You can also follow my journey to a $100k Robinhood portfolio by checking out my Youtube videos and hitting the subscribe button

Robinhood Benefits: Why Should You Use It?

The biggest benefit in my opinion is the commission free stock, ETF, REIT and cryptocurrency trades. Most full service brokerages charge a trading commission because they offer 24/7 customer support, have big offices and thousands of staff salaries to pay.

Robinhood doesn’t have any 24/7 customer support or brick and mortar brokerage branches. The company is mostly based online, which allows them to keep overhead costs down and offer zero fee trades to their customers.

Opening a Robinhood Account

Robinhood app is a wonderful free stock trading app but it’s only available to US citizens, US permanent residents or aliens with a valid US visa.

To apply for a Robinhood account, you will need the following:

  • Over 18 years of age
  • Have a valid Social security number
  • Have a legal US address

The signup process is simple and easy but before you sign up, use this link to get a free share of stock as a gift. If you use this link, we both get a free share of stock.

Fill out the application and link your bank account to make your first deposit into your Robinhood account.

Navigating the Mobile App & Website

Once you submit your application, you’ll be taken to the main mobile app dashboard. You can view your account balance, watchlist, holdings and notifications on the main page.

Robinhood Dashboard

On the second page, you can search for stocks by ticker symbol or classification. Robinhood organizes thousands of stocks into categories based on price, industry and popularity.

Trading Experience

The trading experience is very smooth. You can enter a trade to buy or sell a stock or trade options if you have options trading enabled. Enter the number of shares and choose your order type from: Market, Limit, Stop Loss or Stop limit. Market trades get executed immediately while limit trades are more safe if the stock is experiencing extreme volatility. Robinhood requires you to have at least a 5% premium on limit trades so you may have to deposit more money if you don’t have the extra 5%.

Once you enter your trade, you simply swipe up to place the trade. Robinhood does a good job of trying to enter your trade at the lowest price and I’ve luckily bought several stocks at their 52 week low dips thanks to Robinhood.

Range of Offerings

Robinhood only offers stocks, several ETFs, REITs, cryptocurrencies and options trading. You cannot open an IRA, short stocks, buy mutual funds or bonds using the app. They lack a lot of full service brokerage features in order to offer free stock trades to their customers.

Mobile App Design & Usability

The mobile app is well designed and easy to use. I enjoy browsing through dozens of stocks each day and I find it simple to research new stocks I never heard of using the Browse tool.

In the Browse section, you can review the “Top Movers”, popular collections of stocks, or even read headlines from major news sources like MarketWatch, CNBC, and Yahoo! Finance.

What is Robinhood Gold?

Robinhood Gold is the premium upgrade for select users who want access to increased benefits like:

  • In-depth Morningstar Research Reports
  • Bigger Instant Deposits
  • Access to Margin Investing

There are different pricing tiers depending on your account size and desired instant deposit limit:

Robinhood Gold Pricing Tiers

 

FAQ

Do Robinhood offer fractional shares?

No. You cannot purchase fractional shares using Robinhood app. M1Finance and StashInvest are good alternatives for buying fractional shares.

Is Robinhood a brokerage?

Robinhood Financial is an SEC-registered broker-dealer.

Join Robinhood Now

Luckin Coffee: Should You Buy the Upcoming IPO?

Is Luckin Coffee Stock worth buying? Luckin Coffee is set to IPO on May 17th, 2019 under the ticker symbol (LK) as an ADR. Each ADR share will be worth 8 Class A common shares and is set to trade around $17.

So what’s the big deal about Luckin Coffee? They are the fastest growing coffee chain in China and have opened 2,100 stores in just 18 months. While most people are calling the IPO overpriced, I like several aspects of this up and coming Starbucks rival.

Annual Revenue is Skyrocketing

The Company is again only 18 months old but 2018 revenue was a whopping 125.3 million dollars. In just 3 months in Q1 2019, Luckin Coffee revenue was $74 million. The downside is losses are piling up too but this is expected for a young startup with lots of fixed and variable costs. The brand is relatively new in China where Starbucks has been a dominant force for the last 20 years.

Cashierless Store with Few Seats

Another key difference is Luckin’ cashierless payment system where customers use their smartphone to make their order and pay. This is a revolutionary concept for many people but it’s a glimpse into the future for many large corporations. Allowing a cashless payment system saves time and takes advantage of digital payment processing to optimize the customer experience. No more fiddling around for change or running to the ATM if you are a few dollars short.

The chain also has very little seating and aims to serve as many customers as possible to get them their coffee extremely fast. Many young Chinese consumers want to consume their coffee “on the go” and don’t have time to sit down in a Starbucks like environment to enjoy the ambiance.

Should You Buy the Luckin IPO?

Due to the relatively new growth for Luckin, I don’t think you must buy the IPO right away because the company has negative cashflow and shorts could send the stock much lower. The initial $4 billion valuation seems a bit expensive. However, I think it’s a mistake to ignore Luckin Coffee over the long run. The company is revolutionary in its business model and I expect more companies to adopt their “cashierless mode” well into the future.

Should You Buy Turtle Beach Stock?

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Turtle Beach is one of the leading gaming headset companies in America but the stock has taken a huge hit since its peak in July 2018 around $32 per share.

However, I cannot ignore how Turtle Beach looks like an incredible value buy trading at just a P/E ratio of 4. Revenue has increased 39% YOY in Q4 2018 and the company is set to report Q1 2019 earnings on May 6th.

Here are a few reasons why I think Turtle Beach is a wonderful long term buy:

Dominant Player in the Rise of Battle Royal Games

FY 2018 revenue shot up to $287 Million due in large part to the release of battle royale games like Fortnite and Apex Legends. In these games, gamers need high quality headset to hear other characters’ movement around them. This is a relatively new market space so expect growth to continue well into the future.

Signed a Contract with New York Knicks Gaming in the NBA 2k League

The company signed an exclusive rights deal to provide headphones to the NBA 2k league inaugural champion, Knicks Gaming. Professional gaming is a brand new industry but it’s growing at a rapid pace. Super League Gaming went public earlier this year on Nasdaq and the NBA 2K League just started their 2nd season.

Believe it or not, pro gaming will be a HUGE revenue driver in the future and more people are considering gaming as a potential career once they graduate from high school. Selling the dream of “being a pro gamer” will motivate more teens & young people to play video games in hopes of making “the big leagues”.

A Ridiculous P/E Ratio of Less Than 4

Wall Street has largely ignored Turtle Beach but the company also acquired German keyword & mice retailer, , earlier in 2019. This will help them expand their product portfolio outside of the traditional headset and impact their revenue for the rest of 2019 and moving forward into the future.

Sitting at a tiny market cap of $151 million seems too cheap for a company sitting in a great spot to earn lots of money from two brand new industries: pro gaming and battle royal RPGs.

How to Buy Paypal Stock

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Paypal (PYPL) is a large digital payment services company where consumers and merchants use their payment gateway to make payments.

The company was founded by Max Levchin, Peter Thiel, Luke Nosek and Elon Musk in 1998. Since then, Paypal is the largest digital payment company in the world with over 230 million active users worldwide.

Paypal Mafia
The “paypal mafia” photographed at Tosca in San Francisco, Oct, 2007.
Back row from left: Jawed Karim, co-founder Youtube; Jeremy Stoppelman CEO Yelp; Andrew McCormack, managing partner Laiola Restaurant; Premal Shah, Pres of Kiva; 2nd row from left: Luke Nosek, managing partner The Founders Fund; Kenny Howery, managing partner The Founders Fund; David Sacks, CEO Geni and Room 9 Entertainment; Peter Thiel, CEO Clarium Capital and Founders Fund; Keith Rabois, VP BIz Dev at Slide and original Youtube Investor; Reid Hoffman, Founder Linkedin; Max Levchin, CEO Slide; Roelof Botha, partner Sequoia Capital; Russel Simmons, CTO and co-founder of Yelp

eBay was the parent company up until 2015 when they spun off the stock trading on the Nasdaq under the tick: PYPL.

Why invest in Paypal?

Paypal is well positioned to benefit from the “Rise of Digital Payments” and I highlighted them in my top 5 digital payment stocks to buy article. With over 40% annual return since going public, I believe Paypal has a lot more growth ahead of them.

But investing isn’t as easy as snapping your fingers and buying a stock. We’ll show you how to buy Paypal stock and make money with your investment.

Step 1 – Do Research

Before you buy shares in Paypal, you should figure out how much the company is relatively worth and whether sales and earnings are doing well.

Yahoo! Finance is a great place to conduct research on any publicly traded stock. You want to research annual sales, earnings per share, and other key statistics before making a purchase.

Paypal has increased revenue from $13 billion in FY 2015 to $15 billion in FY 2018. Earnings have continued to grow (1.71 EPS) and the company is always focusing on customer needs and prioritizing long term shareholder value.

In the long term, all of these signs make Paypal stock a good long term investment.

Paypal Investor Relations contains all the information regarding Paypal you need to know before you invest.

Step 2 – Decide How Much Money to Invest

Paypal is trading around $115 (As of July 2019) so you’ll need a good chunk of money to buy at least 1 share. Some brokerages offer fractional shares so you can invest a little bit of money to buy more shares over time.

Before you invest, it’s a good idea to think about how much money you can afford to invest.

When you buy Paypal stock, you own a small portion of the entire company.

Remember that buying stocks is like buying a small part of a real life business. Thus, the best overall strategy is to treat stocks as a long term investment.

Portfolio Allocation and Risk Management

It’s a good idea to never investment more than 10 to 20% of your overall portfolio in one single company. This protects you against massive losses if the stock loses value.

Portion of Your Income

Investing at least 15% of your income is enough to get you started on the right track. As you pay down your debts and free up more money, you can increase the amount of money you invest.

Step 3 – Open a Brokerage Account

Buying Paypal shares is extremely easy if you open a stock brokerage account. There are two different types of brokerage accounts: discount online brokers and full service brokers.

The cheapest option is to open a discount brokerage account because they charge lower trade commissions, lower overall fees and make things easier for the average investor.

If you need more hands on services and investment insight, then try opening a full service brokerage account.

I’ve tried and reviewed many brokerage accounts over the years and here are my favorites:

  • Ally Invest: Best online discount broker with $4.95 stock trades and zero minimums
  • Fidelity: Best full-service broker with $4.95 stock trades and zero minimums
  • Robinhood: Best Free stock trading broker with $0 trading commissions (Good for younger investors)

If you want to get started with a little bit of money, then you can purchase fractional shares using M1Finance and Stash.

Step 4 – Place Your Trade

Once your account is setup, it’s time to purchase some shares of Paypal. When you enter the ticker into your account, you will see two numbers: the bid and the ask.

It’s a gap between the highest and lowest price buyers and sellers are willing to pay. It’s a good strategy to buy on dips, meaning buying the stock near the lowest bid or the day’s lowest price.

When making your trade, you will be asked to enter the following:

  • Number of Shares: Total number of shares you are buying
  • Order Type: Market or Limit Order
  • Execution Time: GTD (Good until Cancelled) or For today only

A market order is when your order will be filled immediately regardless of price. This is best for long term investors but is dangerous when a stock is soaring quickly in value. You can sometimes buy at the peak then watch the stock fall in price shortly after.

A limit order is when you set a maximum price you are willing to pay for a stock. This is a much better strategy and lets you prevent overpaying on a stock. If the stock doesn’t reach your limit, then the order never executes.

Submit your order and now your order will be filled by your broker. Be sure to refresh your account until the order status has changed to filled.

Once your order has been filled, you are officially a Paypal shareholder!

Step 5 – Determine Your Exit Strategy

Exit strategy is an important investing strategy to maximize your gains while protecting yourself from massive losses.

Once you own Paypal stock, you should decide when you will sell your shares.

If you are a long term investor, then you can buy and hold forever to keep collecting the dividend if your time horizon is 5+ years.

However, sometimes you buy the stock at its price peak and you end up losing a lot of money as the price continues to fall.

A good strategy is to sell off your stock if you have lost more than 20% on a trade. This will help minimize losses, plus you can always buy the stock back at a cheaper price.

If I buy a stock and it continues to drop in price, I normally exit the position to protect my overall account.

Here Are 5 Stocks I Own in my Stash Invest Account

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Are you looking for some stocks to add to my Stash Invest portfolio? If so, let’s take a glance at my current holdings in my Stash Invest Account.

My current investment strategy is to hold no more than 5 stocks to make it easier for me to track my investments, keep up with earnings, listen to quarterly conference calls, etc.

Paypal

Paypal was the first stock I added to my Stash app portfolio because I use the company every day and could not imagine life without it. My online business depends on Paypal to receive payments from clients and pay for my monthly expenses.

Amazon

Amazon is another company poised to benefit from the “Retail Apocalpoyse” because more consumers are making purchases online. Thousands of stores are closing in the USA every year due to the power of Amazon. I think owning a portion of Amazon makes a lot of sense because I personally subscribe to their Amazon Kindle Unlimited and use their services a lot.

Mastercard

I’m bullish on digital payment stocks in the long term and Mastercard is a strong player in the growing credit card processing & digital payments industry. Revenue and net income continues to grow while total transaction volume remains positive. Apple partnered with Mastercard to provide credit card processing services for their upcoming Apple Card, which is another good reason to like Mastercard stock.

Visa

An alternative to Mastercard is Visa but I happen to currently own both stocks right now. I’ll eventually sell one of the positions but am happy to own both at the moment.

Booking.com Holdings

I earn most of my income online and travel a lot during the year so I know just how important sites like Booking.com and Agoda are to my wellbeing. AirBNB is a great option but I’ve found the Booking’s network of sites to be a lot cheaper than AirBNB. Whenever I travel to a new city, I use their sites to stay in affordable hotel rooms or cheap hostels and notice how much their fees add up. This is a pure play on the growing travel industry.

5 Best Stocks to Profit from the Digital Payment Revolution

The rise in digital payment processing indicates a major shift towards a cashless society where consumers use their mobile phones to pay for stuff online.

What’s the best part about digital payment stocks? These companies earn a percentage of every transaction they process upfront before the merchant receives the funds. It’s kind of like an upfront tax on the transaction. This type of revenue is stable and predictable as long as consumers and merchants continue to use the payment processor.

The following 5 companies have a strong presence in the digital payment processing industry along with a recognizable brand people trust. In the long term, I really love these stocks to profit immensely from the inevitable move towards a digital transaction economy.

Paypal (PYPL)

Paypal is my top overall favorite digital payment stock because I personally use Paypal everyday and could not imagine my life without it. Paypal is a trusted payment processor for millions of businesses and they recently invested $500 million into Uber to offer Paypal as a method of payment for Uber customers.

The company managed 268 million active accounts for FY2018 (up 17% from FY2017) and payment transactions grew to $9.9 billion (up 27% from FY2017).

The company spun off from eBay back in 2015 and the stock has been on a tear recently. The best part is there is plenty of room to run in the long term for a trusted brand like Paypal.

Related: How to Buy Paypal Stock

Mastercard (MA)

Mastercard is another major player in the digital payment boom who actually partners with Paypal to offer a Paypal Mastercard Business Debit Card (One that I personally use myself).

Believe it or not, most people in the world don’t have a credit card or access to a bank account. Smartphones and digital technology are making credit cards & debit cards more accessible to the rest of the world, thus putting Mastercard in a wonderful position to generate profits.

The company has issued a whopping 2.5 billion Mastercards worldwide and net income increased 25% YOY to $1.9 billion in Q1 2019. $1.80 EPS also grew28% YOY in Q1 2019.

I, along with millions of others, use Mastercard on a regular basis so this is another stock I personally support and understand very well.

Read More: Mastercard Investor Relations

Visa (V)

There’s Mastercard and then there’s Visa. Depending on which company you prefer, Visa is another iconic brand in the digital payment industry. The company posted a $3 billion net income (13% YOY change) in Q1 2019 along with an impressive $1.30 EPS (21% YOY change).

Another healthy sign is Visa’s share repurchase program, signaling their long term goal to return value to shareholders. Dividend investors should also take a look at Visa’s 0.67% yield, which adds a bit of passive income and dividend reinvestment to your position.

Square (SQ)

Square is a company focused on making it easier for small businesses and company to receive digital payments for goods sold. Total revenue increased to $933 million (53% YOY increase) in Q4 2018 however the company suffered a $28 million net income loss due to rising operating costs and interest payment on notes.

With only a $30 billion market cap, Square is a much smaller company than bigger players like Paypal. In the long term, Square needs to increase the active members on their Cash App and market the recently launched SquareCard (In partnership with Mastercard) to increase revenue.

This is a good long term play on digital payments for small to medium sized busineses.

Apple (AAPL)

Last but not least, Apple’s Apple Pay product is a natural extension to their core audience who loves innovative tech products. While iPhone sales are increasing, Apple posted record revenue of $11.5 billion in Q2 2019 for its service product line.

More companies are sure to adopt Apple pay and give Apple consumers a simple and easy way to purchase stuff using the upcoming Apple Card. Apple Card is set to launch in the summer of 2019 and looks like a complete game changer in the digital payment & credit card industry. Be sure to look out for that.

Disclosure: I own shares of Visa, Mastercard and Paypal

Stash Invest Review 2019: Invest with As Little as $5

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Looking for an easy way to automate your investments using your smartphone? Stash Invest is a very useful app for investors and I had the pleasure of opening an account and using the app for several hours.

In this review, you’re going to learn about Stash Invest and why I think it’s a very useful tool for automating your investments and doing lots of research in a short amount of time.

What is Stash Invest?

Stash is a cool, innovative saving & investing app geared towards millennials who want to automate their investments by purchasing stocks or sector mutual funds using frequent small dollar amounts.

You can purchase fractional shares in major companies like Amazon without paying a single dime in trading commissions. This allows you to slowly build up an investment portfolio with a smaller amount of money and avoid those costly trade commission fees.

How Does It Work?

Create an account and Stash asks you a series of questions to personalize your investment strategy based on your answers.

Once you create your account, you need to select an investment plan and connect your banking account with your Stash account. The minimum deposit is only $5.

Once successful, you can invest in a wide variety of stocks, bonds and ETFs using your balance.

I signed up for Stash and the entire process took only 10 minutes to set everything up.

How to Use Stash

There are several different ways to use Stash effectively. If you want to maximize your investment returns, then buying shares in individual stocks should be your main focus.

Stash makes it easy to build the habit of investing with just small amounts. I love this approach because so many people avoid investing in stocks like Apple because they feel it’s too expensive.

While you may not have enough money to buy 1 share, you can put some money away each week/month and eventually get a share of stock.

Good habits make you wealthy and one of the most important wealth building habits is consistently doing the right things over and over again.

If you want a more hands free approach, then put your money in an ETF or mutual fund to balance your risk. Stash offers several good mutual funds that invest based on your risk tolerance and overall investing goals.

This is a pure set it and forget it approach to investing that works well for some people who don’t want to worry about the ups and downs of individual stocks. Why not own the entire stock market?

What to Invest in Using Stash

Let’s breakdown the different investment options so you can choose which is best for you:

Bond ETFs

These investments are low risk, low return investments with stable returns to preserve your money. Bonds are basically loans that pay you interest depending on the investment grade. If you are near retirement or don’t want to risk your money, then bond ETFs are perfect for you.

Balance Funds

These are balanced mutual funds where you earn a higher return than bonds but spread your risk across a lot of different stocks. What I like about these funds is that they offer sector funds like Corporate Cannabis so you can invest in massive future growth industries.

My favorite balance funds are:

  • Corporate Cannabis
  • Delicious Dividends
  • In Transit 

Companies

This is where you can really build a strong portfolio by investing individual stocks. You can buy partial shares in literally hundreds of companies although every publicly traded company isn’t listed. Here are some of best stocks you can buy on Stash Invest:

  • Amazon
  • Apple
  • Booking.com
  • Paypal

Life

Life offers 3 basic ETFs but my favorite is the Young Money ETF called Global X Millennials Thematic ETF. This ETF invests in high growth companies like Paypal, Amazon and Starbucks.

If you want to invest in one of Stash Invest’s ETFs, I think this is a great choice for investors.

How Much Does it Cost to Sign Up for Stash?

Here’s a visual breakdown of the Stash Invest App pricing and fees:

Stash Invest offers 2 basic pricing plans:

  • $1 per month for individual accounts under $5,000
  • $2 per month for retirement accounts under $5,000 (Free for customers under 25 years of age)

If your account is more than $5,000, you pay 0.25% annual fee to use Stash Invest.

Conclusion

Stash Invest App is one of my favorite new investing apps for easily automating my investments and analyzing tons of different stocks and ETFs on my smartphone.

Sign up for Stash Invest Using This Link. We both get $5 for free.

How to Buy Amazon Stock

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Amazon (AMZN) is a large online ecommerce company that is currently one of the largest companies in the world. The founder, Jeff Bezos, started selling books out of his garage and took the company public in 1997 under the Nasdaq ticker: AMZN.

Why invest in Amazon stock? Well, Amazon has done a remarkable job at returning long term value to its shareholders.

If you had invested just $1,000 in Amazon’s IPO back in 1997, your current investment would be worth well over $1 million now.

But investing isn’t as easy as snapping your fingers and buying a stock. We’ll show you how to buy Amazon stock and make money with your investment.

Step 1 – Do Research

Before you buy shares in Amazon, you should figure out how much the company is relatively worth and whether sales and earnings are doing well.

Yahoo! Finance is a great place to conduct research on any publicly traded stock. You want to research annual sales, earnings per share, and other key statistics before making a purchase.

Amazon has increased revenue from $107 billion in FY 2017 to $232 billion in FY 2018. Earnings have continued to grow and the company is always focusing on customer needs and prioritizing long term shareholder value.

In the long term, all of these signs make Amazon stock a good long term investment.

Step 2 – Decide How Much Money to Invest

Amazon stock is currently trading between $1,300 and $2,000 in 2019 so you’ll need a good chunk of money to buy at least 1 share. Some brokerages offer fractional shares so you can invest a little bit of money to buy more shares over time.

Before you invest, it’s a good idea to think about how much money you can afford to invest.

When you buy Amazon stock, you own a small portion of the entire company

Remember that buying stocks is like buying a small part of a real life business. Thus, the best overall strategy is to treat stocks as a long term investment.

Portfolio Allocation and Risk Management

It’s a good idea to never investment more than 10 to 20% of your overall portfolio in one single company. This protects you against massive losses if the stock loses value.

Portion of Your Income

Investing at least 15% of your income is enough to get you started on the right track. As you pay down your debts and free up more money, you can increase the amount of money you invest.

Step 3 – Open a Brokerage Account

Buying Amazon shares is extremely easy if you open a stock brokerage account. There are two different types of brokerage accounts: discount online brokers and full service brokers.

The cheapest option is to open a discount brokerage account because they charge lower trade commissions, lower overall fees and make things easier for the average investor.

If you need more hands on services and investment insight, then try opening a full service brokerage account.

I’ve tried and reviewed many brokerage accounts over the years and here are my favorites:

  • Ally Invest: Best online discount broker with $4.95 stock trades and zero minimums
  • Fidelity: Best full-service broker with $4.95 stock trades and zero minimums
  • Vanguard: Good for retirement accounts with $7 stock trades and low minimums

If you want to get started with a little bit of money, then you can purchase fractional shares using M1Finance and Stash.

Step 4 – Place Your Trade

Once your account is setup, it’s time to purchase some shares of Amazon. When you enter the ticker into your account, you will see two numbers: the bid and the ask.

It’s a gap between the highest and lowest price buyers and sellers are willing to pay. It’s a good strategy to buy on dips, meaning buying the stock near the lowest bid or the day’s lowest price.

When making your trade, you will be asked to enter the following:

  • Number of Shares: Total number of shares you are buying
  • Order Type: Market or Limit Order
  • Execution Time: GTD (Good until Cancelled) or For today only

A market order is when your order will be filled immediately regardless of price. This is best for long term investors but is dangerous when a stock is soaring quickly in value. You can sometimes buy at the peak then watch the stock fall in price shortly after.

A limit order is when you set a maximum price you are willing to pay for a stock. This is a much better strategy and lets you prevent overpaying on a stock. If the stock doesn’t reach your limit, then the order never executes.

Submit your order and now your order will be filled by your broker. Be sure to refresh your account until the order status has changed to filled.

Once you’re order has been filled, you are officially an Amazon shareholder!

Step 5 – Determine Your Exit Strategy

Exit strategy is an important investing strategy to maximize your gains while protecting yourself from massive losses.

Once you own Amazon stock, you should decide when you will sell your shares depending on the outcome of Amazon.

If you are a long term investor, then you can buy and hold forever to keep collecting the dividend if your time horizon is 5+ years.

However, sometimes you buy the stock at its price peak and you end up losing a lot of money as the price continues to fall.

A good strategy is to sell off your stock if you have lost more than 20% on a trade. This will help minimize losses, plus you can always buy the stock back at a cheaper price.

If I buy a stock and it continues to drop in price, I normally exit the position to protect my overall account.

WealthFront Review 2019

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Wealthfront is one of the leading robo advisers that use modern technology to automatically balance your portfolio and risk exposure without the emotional input for human financial advisors.

Wealthfront Benefits

  • 2.24% High Yield Cash Account
  • Low 0.25% APY fees on inde funds
  • Portfolio Line of Credit for accounts with $25,000+

I Love the 2.24% APY Cash Account

One of the major benefits of having a Wealthfront account are the high yield 2.24% APY cash account that pays 20x as much as a traditional savings account along with the robo managed investment allocation services.

I signed up for the Wealthfront Cash account and it only took 5 minutes to setup. You will receive two small deposits into your linked checking accounts to confirm everything. Once you confirm these deposits, you can transfer funds from your checking into your cash account easily.

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