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What do stay-at-home parents and stock investors have in common? On the surface, they may not appear to be similar activities; however, there is the aspect of independence to consider.
Just like parents who stay at home to manage a household, individuals who choose to make a living out of trading equity securities have a certain leeway in terms of managing their daily schedules, and both activities can also be treated as full-time jobs if so desired.
Stay-at-home parents can also be stock investors and vice versa; however, trading equity securities has more of a lucrative potential. Thanks to internet technology in the 21st century, the idea of a mother who works from home is hardly farfetched; after all, telecommuting and freelancing have greatly expanded because setting up a home office or workstation has never been easier.
In 2007, a New York Times article highlighted an interesting trend among Japanese homemakers who ventured into the world of stock and currency trading on a full-time basis. Many of these investors were women who fired up their online trading platforms at night, shortly after they had put their children to bed.
Among these very active traders, a few success stories were found, but there were also tales of deep regret as women traded on margin and lost family savings due to the risky positions they took on the markets.
Stock Investing Versus Day Trading
It is important for stay-at-home parents to know that they can certainly fit stock investing into their lives, but they have to make rational decisions about how they will approach this financial endeavor.
In the aforementioned New York Times article, the Japanese women at the center of the story had become day traders who hoped to squeeze daily earnings from their short-lived investments.
To an extent, they approached the market like “casino grinders” or gamblers who hit the blackjack tables and apply a style of money management to cover their living expenses so they can do it all over again the next day.
Some casino grinders are very successful, and the same can be said of day traders, but many others take on too much risk and lack sufficient money management skills to reach their financial goals.
Stock investing is not the same as day trading; stay-at-home parents who are new to the world of financial exchanges should not take the same risks as a day trader. First of all, stock investing is not a work-from-home job; it is an economic activity that is perfect for people who have some capital they wish to put to work for them, which can be a few hundred or a few thousand dollars.
This capital should not come from vital reserves; it should be money that a parent who stays home will not need to cover expenses.
Investment Strategies for Stay-at-Home Parents
Equity securities, the publicly-traded shares of companies listed on major markets such as the Nasdaq and the New York Stock Exchange, can be bought and sold for profit. The adage “buy low, sell high” is an actual trading strategy that can be adopted by most beginners.
Homemakers and others who stay home to look after their children can certainly make time to set up trading accounts and conduct the necessary research to identify stocks that they can profit from.
Unlike day traders, stock investors can set a horizon for the positions they take on the markets; this will prevent them from being glued to their PC monitors and smartphones as they pour over technical charts with fingers crossed as CNBC blares on the background.
In the end, stock investing can be an ideal financial pursuit for stay-at-home parents. This is not a job like setting up a home office to answer customer service calls from irate cable television subscribers; stock investing can substantially less stressful and far more rewarding for those who take the right approach.
Below are a few companies that can help you get started in the finance markets.
Trade King Advisors – Professionally managed personalized portfolios.
LearnVest – Get a dedicated financial planner and a personalized plan to help you meet your investing, debt, or retirement goals.
The Street – Join Jim Cramer’s investing club and learn how to build your portfolio.
Personal Capital – Track your money, get expert advice, and get custom investing strategies.
Motif Investing – Get up to $150 when you start trading.
eToro – Trade with confidence on the world’s leading social trading network.
Betterment – Customize your portfolio and easily sync your outside investments.
