| There are so many different types of stock out there | | | | The majority of publicly traded companies are |
| that many first time investors have a hard time | | | | small-cap. Mid-caps are those with revenues between |
| choosing their investments. Most simply turn to the | | | | $500 million and $3 billion, while large caps top $3 billion. |
| advice of someone they trust. This isn't a bad idea, but | | | | Blue-chip stocks are the largest cap stocks out there. |
| you should also take the time to learn about the | | | | They are the top of the pile. You have to know that all |
| different stocks for yourself. After all, this is your | | | | blue-chip stocks are large-cap stocks, but not all |
| money. | | | | large-cap stocks are blue-chip. There are a lot of |
| In part one of this series, we talked about some basic | | | | advantages to blue-chip stocks, including liquidity, |
| types of stocks: growth stock, value stock, speculative | | | | earnings and staying power. |
| stock and preferred stock. Let's move to some more | | | | You can also purchase non-U.S. stocks through |
| complex stocks. | | | | American depositary receipts. Though that is probably |
| Convertible preferred stocks start off as preferred | | | | beyond a beginner's level of investing. |
| stock, but it can be converted into a common stock. | | | | When it comes to investing in stocks, the type of |
| Because of this, convertible preferred stock will react | | | | stock you invest in is important. Take your time in |
| to the growth of the company more than a regular | | | | assessing what you want to get out of your |
| preferred will. | | | | investment. What type you choose depends on your |
| A cyclical stock is paired rather closely with what is | | | | financial goals and personal risk level. Look for stocks |
| happening in our country's economy, and sometimes | | | | that perform to your investment standards. If you want |
| even in those overseas. You will see steel companies | | | | a lot of quick growth and don't mind the risk, perhaps |
| and original equipment manufacturers. It takes a bit of | | | | you want to put some money into a speculative stock. |
| financial knowledge to be able to trade in cyclical | | | | If you want something solid that will give you a dividend |
| stocks. You must also take the time to watch the | | | | no matter the future performance of the company, |
| economic indicators. You will usually see these stocks | | | | you might want to shop for preferred stock. |
| rising with growth. If the economy isn't doing well, you | | | | The key is in knowing the pros and cons. You have to |
| won't see the earnings you desire. | | | | understand the risk. And they all have risks. |
| All of the Cap stocks stand for capitalization stocks of | | | | Remember, if you choose wisely and invest for the |
| different sizes. The different sizes equal different | | | | long haul, the stock market is an excellent place for |
| returns, in general. Micro-caps are companies with $100 | | | | your money to grow. All it takes is time and |
| million or less in revenue. Small-caps are companies | | | | knowledge. |
| with revenues between $100 million and $500 million. | | | | |