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      08-09-2010, 07:32 AM   #1
1013mm
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Investments, funds, dividends, omg where to start??!!?!

Ok guys so I've never invested before, I have around $2000 to invest in something. I'm looking for general info in www.americanfunds.com and in the end I'm just running around in circles lost in all this financial vocab. Can anyone tell me what's a relatively stable way to start investing with my $2000? I'm not the type to constantly look at my investments like stocks. I'm thinking something stable with month returns in dividends? Recommendations? Suggestions? Or is $2000 too less? I don't care if it's minimal returns I just want to get my feet wet before I dive deeper into this. Anything is better than the returns of savings account anyway.


So basically....

- I have $2000, where to start?
- Want relatively stable growth
- Monthly returns possible?
- What to invest in?
- What website to go to?
- Taxes?

Help and thanks!

PS. so sorry i so noob.
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Last edited by 1013mm; 08-09-2010 at 07:45 AM.
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      08-09-2010, 07:46 AM   #2
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I would look at bonds. They offer stable growth as well as dividends. Maybe a DRIP too
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      08-09-2010, 07:50 AM   #3
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to be completely frank...if you're looking for long term growth, or any sort of monthly dividends/returns, 2000 is much too low. If you're entering with that little capital either play with the stock market directly, or invest in an IRA/401k
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      08-09-2010, 07:50 AM   #4
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Quote:
Originally Posted by BTM View Post
I would look at bonds. They offer stable growth as well as dividends. Maybe a DRIP too
that's a good suggestion as well, bonds are a good idea with that level of capital
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      08-09-2010, 09:13 AM   #5
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Originally Posted by Freakazoid View Post
to be completely frank...if you're looking for long term growth, or any sort of monthly dividends/returns, 2000 is much too low.
This is why I mentioned a DRIP as well - dividend reinvestment can add up quickly and while the aggregate gains will not be staggering, $2000 in a DRIP over 15-20 years may surprise you...
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      08-09-2010, 09:20 AM   #6
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This is why I mentioned a DRIP as well - dividend reinvestment can add up quickly and while the aggregate gains will not be staggering, $2000 in a DRIP over 15-20 years may surprise you...
+1

NLY has been quite lucrative for me....~16% yield....been tracking AGNC too.....company pays 1.40 per quarter.....~20%.
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      08-09-2010, 11:02 AM   #7
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anything is better than 1% annually.... so how do bonds work? is my initial investment amount locked for X amount of time in or does it depend?

My basic goal is to not lose money in the end but earn money.
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      08-09-2010, 11:25 AM   #8
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      08-09-2010, 11:30 AM   #9
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Originally Posted by jzhang View Post

My basic goal is to not lose money in the end but earn money.
LOL that goes without saying...

Took this from investopedia, they can explain it better than I can:

Defn: A debt investment in which an investor loans money to an entity (corporate or governmental) that borrows the funds for a defined period of time at a fixed interest rate. Bonds are used by companies, municipalities, states and U.S. and foreign governments to finance a variety of projects and activities.

Bonds are commonly referred to as fixed-income securities and are one of the three main asset classes, along with stocks and cash equivalents

Explanation: The indebted entity (issuer) issues a bond that states the interest rate (coupon) that will be paid and when the loaned funds (bond principal) are to be returned (maturity date). Interest on bonds is usually paid every six months (semi-annually). The main categories of bonds are corporate bonds, municipal bonds, and U.S. Treasury bonds, notes and bills, which are collectively referred to as simply "Treasuries".

Two features of a bond - credit quality and duration - are the principal determinants of a bond's interest rate. Bond maturities range from a 90-day Treasury bill to a 30-year government bond. Corporate and municipals are typically in the three to 10-year range.

http://www.investopedia.com/terms/b/bond.asp
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      08-09-2010, 01:47 PM   #10
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Quote:
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anything is better than 1% annually.... so how do bonds work? is my initial investment amount locked for X amount of time in or does it depend?

My basic goal is to not lose money in the end but earn money.
sell 2 yr treasuries and buy a duration-weighted amount of 10 yr treasuries...

you can take advantage of the 2s10s curve (spread between yields of the 2yr note and 10 yr note) flattening.

although with 2K ...you'd be better throwing that into some stocks.
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      08-09-2010, 03:04 PM   #11
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im not looking to become/rely on this to become a millionaire. I'm just looking at this as a smarter and more reliable/stable way to grow my savings.
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