IV. Building Your Portfolio
V. Closing Remarks and tidbits
I. Ok, here we go. The purpose of this guide is to make you TONS of money with virtually no risk and an almost guaranteed success rate using the Neopets Stockmarket. Before we do anything, I will say this. The stockmarket requires money. To be a successful investor, you must be willing to commit sufficient funds to the task. Basically you need cash to get started. That really sounds like the beginning of some crummy Infomercial, but, luckily enough for you, I get no money by you following this method, and therefore I have no reason to lie. So to begin with, you need around 50,000 NP to start your portfolio. If you don't have the cash handy, go and get it. Now that you have it you also need to know that there is a possibility (and a high probability) that you will not get an instant return on your investment, so don't get discouraged! The stock market is a waiting game. You will need to make around 15,000 NP for the sole purpose of investing every day. Once you become more experienced, you can depend entirely on your portfolio to make that money for you.
II. Here's how stock investing works. You buy shares of a company at any certain price (neopets has a lower limit of 15, meaning you can't buy below that) and sell whenever you feel like it. This means that you, thats right YOU, are in complete control of your money. Here are some basic rules for buying:
1. Always buy when stocks are in the 15-16 price range. Any more, and you run the risk of not getting a decent return on your investment.
2. Try to buy stocks that are rising from prices lower than 15, not coming down from higher prices. Stocks usually run in trends, and when they come down, they tend to stay down. For a while anyway... *muttering about EDITED *
3. Always buy 1000 shares a day, preferably in a single stock.
4. Diversify! There is an old saying 'don't put all your eggs in one basket.' It's very true, and this also applies to stocks. Buy shares in many stocks, so you have an increased chance of having a profitable stock every day.
As you can see, investing my way costs you 15,000 NP a day! That seems like a lot of money, but when you can make 200k a day easy (I can, using the stock market) you can see how your investment can increase in the blink of an eye.
III. Selling your stocks is a bit more complicated then buying them. Here are some basic rules for selling:
1. Always, Always, ALWAYS sell for a profit. Sometimes you might pick the wrong stock to invest in, and you might have to wait months before you can sell it for a profit: that's ok!
You will notice that that is the only rule, that is because its uberly important that you do this, or else you make me look bad. And you don't want to do that...
Another issue arises as to when is the best time to sell. This can be a matter of some debate and I myself have endured countless rants on the neoboards over when is the best. Really, its a matter of personal preference. Most newbies like to sell anywhere from 19-25 to get their investment back quickly. More experienced players sell at 30-35, and the most stock market pros sell at 45+. You choose where you think you fall in. Personally, I fall into the second group, because this is my primary source of income.
IV. Building your portfolio is a way to insure that you won't have to take funds from your other activities and sink them into the stockmarket. Here's what you do. When selling, invest 15,000 of the profits back into the stock market. That way you will never have less shares on a given day than you started with. It's a simple way to insure that you don't have to keep throwing money into the stockmarket. Always check your stocks to see if any are at your selling point before buying a new lot of 1000 shares. Another small tip is to not sell immediately when you have a stock in your selling range. Sometimes its better just to wait and see. And if it falls, so what? You can just wait for it to go up again. The secret of the stock market is patience.
V. As you can see, the Stockmarket is an easy and fun way to make loads of NP! I hope this guide helps you to make your own discoveries, and remember this is only the beginning. As you play for longer, you will learn your own little secrets, patterns and other tricks. Have fun and good luck!
© Written Work by Patrick Scanlan, a.k.a. redlion
Not for distribution without written or express permission of myself
Edit Jan2, 2012: Updated this a bit. Also corrected my 15 year-old spelling and re-corrected the board's auto-correct for im -> I'm. Certain references retained for comedic and nostalgic purposes.