Understanding & Investing in Stocks

 

What is a stock?

When you invest in stocks, you own shares in companies. The value of your investments reflects how well those businesses perform. Stocks tend to react faster and longer to market swings, so investors willing to accept more risk may gain more capital appreciation.
Stocks:
  • Have historically realized higher rates of return over longer holding periods, though past performance is no guarantee of future results
  • Are generally appropriate for long-term investors
  • Carry higher growth potential and more risks than other investments
 
Read: Investing in stocks
 
Investing in stocks
Learn about ownership in public companies, stocks and how they are categorized.
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Merrill Edge Investing
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Learn at your own pace with online courses that include:
  • Stocks versus other investments
  • Investing for the long run
  • Learn the lingo—Basic ratios
 
 
 

How stocks fit into your portfolio

Though past performance is no guarantee of future results, the long-term growth potential of stocks can grow the value of portfolios and outpace inflation, which are common objectives of clients who want to invest for college and retirement.
Play video: Asset allocation and your portfolio
 
Asset allocation and
your portfolio1 (1:48)
When deciding how to allocate your money among different investments, be sure to consider your goals, investment experience, time frame, liquidity needs, and your comfort level with risk.
 
Read: Tactical asset allocation
 
Tactical asset allocation:
Fine-tuning a longer-term strategy
Learn about this technique that helps you maintain an asset allocation strategy while making specific adjustments based on what you think will happen in the markets.
 
How to Build a Portfolio
 
How to Build a Portfolio
  • Consider your time horizon and comfort level with investment risk when choosing the proper asset allocation
  • Select diversified investments that align to your goals
  • Monitor your investments to keep your portfolio on track
 
Go to the Merrill Edge Classroom powered by Morningstar
 
Merrill Edge Investing
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You can take online classes that include:
  • The magic of compounding
  • Interpreting the numbers
  • A profile of investor Warren Buffett
 

How to choose a stock

Whether you're just starting out or seeking fresh ideas, Merrill Edge provides timely and relevant tools and resources to help you along each step of your investing journey.
Read: Building a better equity portfolio
 
Moving ahead:
Building a better
equity portfolio
Ways to take a more strategic approach to building—or rebalancing—your equity portfolio.
 
Play video: Investment risk
 
Investment risk (1:28)
Investing in the stock market is like riding a roller coaster. Realizing long-term gains can be rewarding, but sudden drops and wild market swings can be a little scary. This video can help you prepare for the ups and downs of stock market investing.
 
View a list of stocks definitions
 
Stock definitions
View stock definitions from our Glossary that include:
  • Day's price change
  • Marginable equities
  • Price/earnings ratio
  • Reinvest dividends and capital gains
 
Go to the Merrill Edge Classroom powered by Morningstar
 
Merrill Edge Investing
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Advanced courses include:
  • The balance sheet
  • The fat-pitch strategy
  • Psychology and investing
 

Action items for equity investing

Identify your objectives, risk tolerance and time horizon
Decide which stocks match your investor profile
 
 
Explore the top equity performers
 
View equity research and insights from BofAMerrill Lynch Global Research, BlackRock, S&P Capital IQ and Morningstar
 
 
 
Search for stocks
 
Apply search criteria to thousands of stocks with our Stock Screener
 
 
Learn what influences stock prices with the Trefis® analysis toolPlease login to view content
 
 
Consider trade opportunities with Recognia Technical Insight®Please login to view content
 
 
Save the search results in your WatchlistPlease login to view content
 
Carefully review company information
 
Read more about market capitalization
 
 
Analyze your portfolio with our investment tools and calculators
 
 
Get price, ratings and earnings alertsPlease login to view content
 
 
Access your accounts and market information anytime with our mobile app
 
 

Related resources

Let us help you narrow your choices
Merrill Edge Select™ Portfolios are selected through a proprietary process that takes risk, cost and performance into account.
 
Merrill Edge MarketPro®
Use this powerful market analysis and trading tool to monitor your portfolio in real time, easily place trades and view interactive charts on a customizable dashboard.
 
Stock Screener
You can filter a vast universe of stocks based on specific criteria you choose and adjust.
 
More you can do
 
 
Go to the Investor Education page
 
Investor education overview
You can learn about all of the investments we offer based on your level of experience, topic, or the resource format in the Investor Education learning center.
 
 
Articles
 
Videos
 
Tutorials
 
 
Calculators
 
Courses
 
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1 Asset allocation does not ensure a profit or protect against loss in declining markets.

Investing involves risk. There is always the potential of losing money when you invest in securities.

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