EP 176: How to Get Started with Stocks and Options as a Beginner Trader

If you’re feeling lost, stuck or confused with how to get started investing in the stock market without using a financial manger. In this episode I simplify how to get started with stocks and options, and even provide you with some free resources along the way. I give you a step-by-step game plan to get you off on the right foot. 

Transcript

Jason Brown [00:00:00]:
I would love to invest, Jason Brown, but I don't know how it works. I would love to invest, but I just don't know where to get started. I would love to trade stocks and options, but don't you have to sit in front of the computer all day? These are the questions and comments that I hear very often, and it keeps people from getting started. But in this episode, I'm breaking down how to get started, how it works, and I'm debunking the myth that you gotta sit in front of the computer all day. So buckle up, strap in. I got some good stuff for you. Let's get into it. Do you feel like you were meant to live a life of financial abundance? Like, you know your money is supposed to work harder for you than you work for it.

Jason Brown [00:00:44]:
Maybe you heard about the stock market and the new millionaires being created and wonder why not me? Maybe you wanna invest in the stock market, but you don't know where to start. Maybe you have a 401 ks or an IRA, but you wanna enjoy your money now, not just in retirement. Maybe you've already had some success in the stock market, but you wanna take it to the next level. Working for somebody else and watching free YouTube videos will only get you so far. To truly be financially free, it takes a strategic game plan, an investor's mindset, and a willingness to take calculated risk. When you're ready to get out of the rat race and go on to the fast track, join us here where we break down how to manage money, how to navigate the stock and options market, and how to approach investing with the right mindset. I'm Jason Brown, stock market coach and options trader. And this is the 5 Year Millionaire podcast.

Jason Brown [00:01:38]:
Are you feeling lost, stuck, or confused with how to get started investing in the stock market without a financial manager? Then keep watching because we're gonna break down the steps to getting started in the stock market and how simple it actually is. So let's get into it. In this episode of the 5 year millionaire podcast, I've been doing a lot of, traveling and getting out and networking and talking to people. And a few things come up every single time when I tell them what I do. I say, you know, I'm a stock market coach and option trader. And almost instantly, everyone says the same thing. They say, I need that. Or if they're a business owner, they say something like, I don't really have a retirement set up.

Jason Brown [00:02:23]:
I don't have anything outside of, you know, my financial guy or my 401 k. And I feel like I need to be taken advantage of the stock market. Those are some of the things that I hear. But inevitably, it results in a response that goes something like this. And tell me if you've ever said this before. I would love to invest, but I just don't know how it works. That's almost the next thing that I always hear. The other thing I hear is I would love to invest, but I just don't know where to start.

Jason Brown [00:02:57]:
Or I would love to trade stocks and options. I'd love to have my money work hard for me, harder for me than I work for it. But doesn't that mean I would have to sit in front of my computer all day? So I thought to myself, we have to unpack this in the episode because most of those things couldn't be further from the truth that you have to sit in front of your computer all day. And if you don't understand how it works or don't know where to start, I want to debunk the, you know, man behind the curtains and explain to you how this all works. So let's tackle the first one, which is I'd love to invest, but I just don't understand how it works. Well, investing in the stock market is similar to, you know, buying anything. You have to have a bank account. Instead of it being a traditional bank account like Chase or Bank of America, you need what's called a brokerage account.

Jason Brown [00:03:55]:
And all a brokerage account is is a bank account for stocks. It's basically a bank account that lies is a bank account to the grocery store that only sells stocks and options. That's the best way to put it. It is a bank account that can only be used at a grocery store that sells stocks or options. And so you need to open up a brokerage account. Here's the good news. If you've ever opened a bank account, it is pretty much the same way. They're gonna ask for your address.

Jason Brown [00:04:27]:
They're gonna ask for your age. They're gonna ask for your social security number. They're gonna ask for you to create a secret PIN in case you get locked out of your account. All of that is going to be the same that you've done with a bank account. Now the only part that's gonna differ a little bit is just gonna be a couple extra questions. It just says what's your investment goals because they wanna know what level investor you are. They're gonna say how much money do you have to invest or how much have you invested, before in the past. And they'll ask you a couple extra questions like, do you want, margin, which means, basically, do you want a credit card is what they're asking you.

Jason Brown [00:05:06]:
It's like, hey. You opened the bank account. What is do you want a credit card? That's what they would say at a regular bank. Well, in a brokerage account, they're like, hey. Okay. So now you you open this account with us. Do you want margin? They just don't call it a credit card. And margin just says, hey.

Jason Brown [00:05:22]:
We do you want the ability to borrow money from us to buy some of your investments? If you can understand that, you do not have to fear opening a brokerage account because that is about as tough as it gets. Now I also have a couple videos where I actually walk through opening a brokerage account. So check the description below. If you're watching this on YouTube or if you're listening to the podcast, be sure to head over to the website. Check the description below because I'll link some videos where I show you where I open an account. I answer the questions live, and you see me open my brokerage account and get it funded right there. And there are even some brokerage accounts that will give you your first stock for free. So be sure to check the link in the description.

Jason Brown [00:06:06]:
So now that you have your brokerage account or your bank account that to the grocery store that only sells stocks and options and investments, what do you need to do next? Well, the next thing you need to do is find out what stocks to invest in. Right? It's kinda like going to the grocery store. You're like, do I need tomatoes? Do I need apples? Do I want alcohol? Right? You know, what what is it that you need to go home and cook a meal, to nourish your body, to play in for that party you throw in? Those are the same questions you're gonna ask in the stock market, which is what stocks do I invest in? What stocks are risky? What stocks are less riskier? What stocks are gonna get me to my financial goals? Maybe it's not individual stocks. Maybe I need to look at a basket of stocks called a ETF, an exchange traded fund. All that is is a sector or a basket of stocks in a particular industry. For example, the x xlk. If you've never heard that term before, the xlk is the sector of tech stocks. So maybe instead of you buying Nvidia and AMD and some of the semiconductor stocks by themselves, you go by the XLK, and you get a basket of these tech stocks, of these semiconductor stocks, along with other stocks that may be in there, like Amazon, Facebook, you know, other technical stocks.

Jason Brown [00:07:32]:
And there's other industries. But I'm just trying to give you an example of the question you have to ask yourself is what do I need? What's gonna get me to my goal? Now here's the problem. Most people don't know how to find a good stock. They don't know what stocks are gonna get you to their goal. But don't worry because I'm gonna tell you about a free resource that I have, to help you out here in a minute. But the question from, I would love to invest, but I don't understand how it works standpoint. What do you need to do first? Open a brokerage account. You need access.

Jason Brown [00:08:05]:
You can't go into the grocery store if you don't have a bank account and anything to pay for the food with. You don't have any cash. You don't have any credit cards. So you gotta open a bank account. Same thing with the stock market. You gotta open a brokerage account, get access to the market. Okay. Number 2, you walk into the market.

Jason Brown [00:08:22]:
The grocery store is a market. It's a grocery market. Now you're like, what do I look for? How do I know if these apples are ripe or spoiling or good? Same thing. You're asking the same questions. How do I know if this company's good? How do I know if this investment is gonna fit my goals? You're asking those same questions, but you haven't been taught how to evaluate those yet. The third thing you might be asking yourself or you might need to learn is how do options work. You know, like, I keep hearing about these things called stock options. Don't worry.

Jason Brown [00:08:55]:
I'm gonna give you a simplified version of what an option is. An option is the right to control an asset, in this case, a stock, at a specific price for a specific amount of time. If you've been following me for a while, you know one of my favorite examples to use. And if you haven't, I'm gonna share it with you anyway. But one of my favorite examples to use is buying a house. Whenever you've bought a house, you've bought an option. Or even if you bought or rented an apartment complex, it's an option. But let's just stick to a house.

Jason Brown [00:09:29]:
So the way it works is you find a house. You're like, hey. This house is a $100,000. Okay? So you put a earnest money deposit down. You put 1 to $2,000 down on this house. And now you have 30 days to get an inspection and appraisal, all that stuff where you could back out of the deal. Now if in 30 days, this $100,000 house after inspection and appraisal appraises for a 110,000, you now have $10,000 worth of equity in the house. Now let's say someone else is like, oh, I really wanted that house, but you have it under contract.

Jason Brown [00:10:00]:
Wish me and my family can move there. You can say, hey. Well, I just got the house appraised, and it's going for a $110,000, But I have it under contract for a $100,000. So here's what we can do. You can pay me $10,000 for my contract, and then you can go buy the house from this person for a 100,000. So you who want the house, you'll be all in for a 110,000 and appraised for a 110. They're like, great. Here's $10,000, and now I have the contract to go buy for a 100,000.

Jason Brown [00:10:30]:
For you, you're like, wait a minute. I never had to come up with the 4 100,000 because only put a $2,000 deposit down to control the house for 30 days to have it under contract for 30 days. And now you've turned that $2,000 into $10,000 because the house appraised for more and somebody paid you $10,000 for the contract so that they can go buy the house for a $100,000. That is how options work. You can control Apple. You can control Google, Tesla, some of the most expensive stocks for a fraction of the cost. And if the stock goes up or appraises for more in 30 days, 60 days, 90 days, you can have options that go all the way out to 2, 3 years. If the house appraises for more in this example or the stock appraises for more in 30 days, you can sell that contract to somebody else who actually wants to own the stock.

Jason Brown [00:11:30]:
And you can just take the difference or the profit out of the middle. That is the simplest version of how options work. And so now when you're like, I'd love to invest, but I don't understand how it works, you can point someone to this episode and say, you know what? You need a brokerage account. What is a brokerage account? It's kinda like a grocery bank account for, like, you would go to the grocery store with your bank account or your debit card or credit card and pull out cash and go to it. Well, this is the same thing. You need a bank account to go into the stock market grocery store to buy Apple, Google, Netflix, Nvidia, all those stocks. That's it. And now that you're in the grocery store, you need to know what to invest in, what to buy, what's a good stock, what's a bad stock.

Jason Brown [00:12:13]:
Same thing you need to know if you're buying good fruit, bad fruit, spoiled eggs, or spoiled milk in a grocery store. And then now you understand that, hey. I can also control stock the same way that I can control real estate, and I can make money off the appreciation or the increase in value in that stock without having ever having to own it. That is a powerful thing to do. So let's talk about the next question. I would love to invest or should I say the next comment? I would love to invest, but I don't know where to start. That is the next one that I hear most often. I would love to, but I don't know where to start.

Jason Brown [00:12:54]:
Well, I shared with you earlier that I was gonna give you a free resources, and there's 2 ways that you can get it. You can text me the word starter pack to 313 251-2260. That number's 313-251-2260. You can text me the word starter pack. If If you're brand new to the stock market, I will send you the stock market starter pack. It's roughly 10 to 12 pages PDF where I walk you through how to determine how much money you need to get started. I break down where the best places to open your free brokerage account, how to get your 1st stock for free. I'll walk you through the 3 most common chart patterns and a whole lot more.

Jason Brown [00:13:37]:
So if you are saying, I don't know where to start, I'm helping you out. I gave you a free resource, or you can look, in the description of this video or this blog post, and you can click the link there and be taken to get the stock market starter pack. It's completely free. Some people say it's so valuable. I should charge for it, but I don't wanna put a payment in front of you getting this information. But sometimes I feel like people don't value free. But I am rooting for you listening or watching this episode that you are a person who says, you know what? If someone took the time out to put together a starter kit for me to get started in the stock market and then walk me through the patterns, the best brokerage accounts, how to get my first stock for free, I am going to trust that you are a man or a woman of integrity, of your word, and that you are gonna at least take that small step, that small action to go get this free resources. A lot of times, people don't understand that investing is all about taking action.

Jason Brown [00:14:44]:
Most people don't understand how the stock market works, don't know where to start because they won't take the first step. They're scared to even get the free resource. So grab the free resource, get the education, learn what you need to do. Text 313-251-2260. That's my phone number. You cannot call it. You can only text it. I will text you back or someone on my team, and we will give you the link to get the stock market starter pack.

Jason Brown [00:15:13]:
So that's your first step. If you don't know where to invest or where to start, grab the stock market starter pack. Second thing is you wanna open an account. It's free. We just talked about that. Once you open that account, here's the thing. Not only do you have access to the grocery store or the market once you open that free account, but you also have access to some of the resources that you're gonna need to research. Is this a good company? Research, how are their financials been doing? Research, insider trading.

Jason Brown [00:15:45]:
Research, all of the things that you need to know about the companies are gonna be available for the most part inside your brokerage account. And so that brokerage account or that bank account that gives you access to the stock market doesn't just give you access to the stock market. It also gives you access to information about the companies, and it's free. Pretty much free. Alright? And so that will help you start your journey. Now the third thing that you need to do. So number 1, get the stock market starter pack. Number 2, open an account.

Jason Brown [00:16:19]:
It's free. We're gonna walk you through it in the stock market starter pack. 3rd thing, don't skip this one. This is the one that most people skip. And either they skip it because they're cocky. Some people skip it because they don't even know that this is a thing. And then some people skip it because, well, they just plain old don't follow directions. You want to practice.

Jason Brown [00:16:41]:
It is to me, it baffles me. It blows my mind that most people believe or think that in order to learn the stock market, they have to put their hard earned money at risk. They have to come in with a 1000 dollars, 2,000 dollars. And if it don't work, they just lost all their money. That is not true. You can actually practice trading, practice investing, practice buying a call option, buying a put option. You can actually practice in a virtual or fake practice account that simulates the real stock market environment, but it doesn't but without the pain of potentially losing real money or making a real mistake that could cause you a financial setback. Now, I mean, just think about this.

Jason Brown [00:17:32]:
Imagine you didn't know how to swim, And I told you there was a swimming pool that you can get in, and you can practice swimming. You get the exact same feel of being in the water. You can do backstrokes. You can do flips off the diving board. You can, you know, work on your doggy paddle and tread in water. But here's the thing. You actually can't drown. You can't drown.

Jason Brown [00:17:58]:
You can't swallow water. There's no way for you to drown or swallow water. You'd be like, oh my goodness. Take me to this magical place. It's the same thing with open and a practice account. It is just like that swimming pool I'm talking about. You can't drown. You can't blow up your account.

Jason Brown [00:18:16]:
You can't lose everything. I can't I don't wanna say you can't make a mistake, but you you can make a mistake, but you can't make a mistake that will actually hurt you because it's virtual. It's practice. It's fake. It's not real. But it gives you the simulation and the feeling of being in a real investment account of pushing the button, making money, losing money. And it gives you the whole experience as if you had real money on the land, except it protects you from yourself, from the anxiety of worrying about if you made a mistake or worrying about, you know, did you buy the right thing or not? And it allows you to get in the game. And guess what? Yeah.

Jason Brown [00:19:00]:
It's pretty much free. It's pretty much free, which we walk through in the stock market starter pack. The third thing that I hear and then I wanna debunk is I would love to trade stocks and options, but doesn't that mean I would have to sit in front of the computer all day? This one is one of the biggest misconceptions. You see, here at Powertrades University, what we teach inside our 5 year millionaire program is we're not about getting wealthy at the expense of staring at computer screens all day. Like, I didn't get in this to just sit in front of a computer screen and look at numbers and blinking things going up on down on screen all day. Number 2, how can you do this if you have to sit in front of it all day? That would mean you would have to quit your job. When I first got started in the stock market, I was working a full time job. I was also going to school.

Jason Brown [00:19:53]:
There was no way that I could sit in front of the computer all day. And even when I left corporate America, I took those same principles with me. I still don't like to sit in front of the computer all day and watch stocks go up and down. And so the distinction that we have to make when you hear the word trading, do you wanna trade stocks or options? Trading just simply means we're coming in, and we're trying to take advantage of price movement for a short period of time. And that short period of time is anything less than a year. So let me give you an example. We did a trade on Amazon. We put the trade on in, I believe it was June or July.

Jason Brown [00:20:33]:
That Amazon trade option trade doesn't expire until January of the following year, which means we have 6 months to let Amazon do its thing and make us some money before we have to manage it or do anything with it. So if I got 6 months on this Amazon trade, how often do I need to look at it? Not every single day. Definitely not every single minute. Definitely not to a point where I have to quit my job and sit and stare in front of a computer all day. And so there is this misconception that if you're trading stocks and options, that the only form of trading is day trading or sitting in front of your computer all day and trading. No. No. No.

Jason Brown [00:21:15]:
No. No. What we do is call swing trading, or we call it power trading at Powertrades University. We set our alerts. So what we do is we do research on the stock, technical, fundamental, and then we look at the time frame that we believe the stock is gonna move in. So those are the kind of 3 cornerstones. And then once we place the trade or feel like we have a trade that we like, we set an alert. Once it hits that alert, then we say, okay.

Jason Brown [00:21:42]:
It's time to get in. Once we get in, we let it do its thing for 30 days, 60 days, 90 days, and then we cash out. And in some cases, we set an automatic sell trigger to say, hey. Once it hits this price, just sell it. Put the money into my account, which means you could be at work. You could be a dentist, a barber, a hairstylist, a high working professional, a sales rep, a truck driver, a stay at home mom running kids to school. You do not have to be in front of your computer to actually get in, and you don't have to sit in front of your computer at the right exact time to get out because you can preset your sale or your exit once it hits your target, meaning if it hits your profit level or if it hits the level where you're like, I'm uncomfortable losing any more than this, you can set an automatic trigger to get you out of the trade. And so you don't have to sit in front of a computer all day.

Jason Brown [00:22:38]:
You don't have to quit your full time job. You don't have to be a bad husband, wife, parent, all because you're trying to make money. Those are all lies that you learn through watching TV. Those are lies that you learn through social media. Those are lies that you learned through people who are just kinda young gamblers, who are college students, and they got all day to be on their phone on a Robinhood app or something like that. And somehow you thought that that was the only style of trading. No. There's swing trading, and there's what we do, which is called power trading.

Jason Brown [00:23:13]:
So as we wrap this up, if you're feeling lost, you're feeling stuck, you're feeling confused with how to get started in the stock market without a financial manager, without just doing it through your 4 zero one k or your job, you don't have to be stuck anymore. You need a brokerage account, which is just a bank account to get access. You need to know what stocks to invest in. And if you're gonna go to options route, you need to know how options work. And once again, I put together a resource for you to get you started so you don't have to worry. Just text the word 313 or just text the number 313-251 2260. Text the word starter. Let me send you the stock market starter pack, the link to get it downloaded.

Jason Brown [00:23:54]:
Trust me. It'll be the best free 10 page report that you've ever read. Or check the description of this video. We'll put the link down below as well. And I'll see you on the next one. I'd love to know once you get the stock market starter pack. I'd love to know that you opened your 1st brokerage account. I'd love for you to come back, comment, or just text me and say, hey, Jason Brown.

Jason Brown [00:24:17]:
Because of you, I opened my first account. I understand the 3 most profitable patterns, and I am ready to start practicing all for free. Let me know. I hope that's your story because that's a story that I want for you. Not a story of fear. Not a story of confusion. Not a story 2, 3 months from now still saying, I don't know where to start. I don't know how to get started.

Jason Brown [00:24:40]:
I'll see you on the next one.