How to invest in the stock market without too much effort?

How to invest in the stock market without too much effort?

Among many, the world of associations that accompanies investment in the capital market includes accounting reports, graphs, economic analyses, analyzes and a long list of terms that create the impression of an overly complicated and complex arena, reserved for professionals only.
11 min to read

Among many, the world of associations that accompanies investment in the capital market includes accounting reports, graphs, economic analyses, analyzes and a long list of terms that create the impression of an overly complicated and complex arena, reserved for professionals only. Although the importance of accumulating knowledge and experience in the investment world, which they possess, cannot be underestimated of seasoned and professional traders, but it is also impossible to ignore the changes and transformations that have taken place over the years under the auspices of technology, which has broken through the dam and made trading on the stock market a more accessible and available option even for beginner traders. Want to understand how? This article is for you

Amit Gurion | VP of independent trading IBI TRADE

December 8, 2021 at 10:07

From the data published by the Stock Exchange ( refer to the report ) regarding the new wave of new entrants that stormed independent trading accounts last year, as part of a broad global trend, several things can be learned, but the most prominent of them lies in the fact that investors understand that trading on the stock market today is more available and accessible than ever before. Evidence of this can be found in the numbers - during 2020, approximately 141,000 new trading accounts were opened in Israel, a jump of almost 50% compared to the previous year, when the number stood at approximately 98,000 accounts. Based on a publication in the WSJ , in the US alone, over 10 million new trading accounts were opened in the past year, mainly by investors who had not "immersed" in the stock market before, certainly not independently.

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The trend is partly attributed to the corona epidemic and the closures that followed it, which caused many to be exposed to the discourse surrounding the stock exchanges and financial markets, and along the way find their place as investors. However, the fact that the new segment of merchants is more interested in the financial world, bears responsibility for managing their finances, and no less, is accessible to trading at the click of a button, also helped to accelerate the trend. Also, the contraction of trading fees in recent years, mainly from entities defined as private brokers (a kind of financial intermediaries between the investors and the stock exchange itself), such as IBI TRADE , contributed to the removal of another barrier and fueled the trend.

Incorporating factors of interest around the markets in the midst of the Corona on the side of accessibility to trading boosted the daily visits to the websites of trading service providers in the USA (the data does not include exposure in applications)


But here the obvious question hovers in relation to the new traders - doesn't a successful investment in the stock market require a high level of expertise, a lot of time and effort? The answer is - not necessarily. Today there are several ways to invest in the stock market with almost no effort and some of them skip the need for familiarity and many years of experience in trading. Sometimes even basic knowledge and understanding of the rules of the game may be enough. Surprised? Let's sort it out:

Table of Contents

The passive investment approach

The nature of investor activity in the capital markets is divided mainly into two approaches: active investment management (Active Investing), which is characterized by close monitoring of developments and market conditions, locating and analyzing financial assets, examining the feasibility of the investment in relation to various parameters and using sophisticated tools. This strategy obviously requires a very high level of knowledge and involves devoting a lot of time to trading.

On the other hand, there is a passive investment management approach (Passive Investing) and its goal is investing in the market in a configuration that does not require complex calculations but in a more technical way, with a minimum of time and effort. This means that investors divide their money between investment assets that produce a wide spread or those that are estimated to rise over time and generate a return ("buy and hold").

For example, passive investors can invest in the flagship index of the American market, the S&P500, and thus in fact they do not choose the securities with tweezers but instead invest at once in the 500 largest companies in the USA (in terms of market capitalization), with the expectation that these will grow in business and yield A good return on the money. Also, basket funds, mutual funds, sector or market indices and others, are part of financial instruments suitable for passive investment, so that investors aim to benefit from the performance of the base asset, in the absence of any active activity. And yet, investors looking for securities Interesting people can do this without too much effort - and this leads us straight to the next section.

If we initially emphasized the advancement of technology and digitization as a Game Changer in the world of independent trade, then the development of real-time information systems and the concentration of recommendations from senior analysts in the world are undoubtedly part of the process. For example, the trading platforms of IBI SMART integrate the TipRanks system (provided at no additional cost), which presents a collection of investment recommendations from thousands of analysts around the world, alongside company coverage, in order to help traders be exposed to investment opportunities and make informed decisions regarding intriguing stocks.

The system actually gathers the necessary information for investors regarding a particular stock, rates the attractiveness of investing in it by leading analysts, as well as their own rating in relation to parameters such as the level of accuracy and success they have demonstrated in their recommendations in the past, and constitutes a "decision support" layer regarding the investment. At this point it is also worth noting the global hoopsAI system, which is unique to users of the innovative IBI SMART trading application of IBI Investment House and with the help of artificial intelligence (AI) provides a continuous flow of real-time reports, articles, market reviews, stakeholder movements and other elements that provide supportive and up-to-date information In relation to the investment assets and developments in the market. This means a concentration of a lot of up-to-date information and a pool of recommendations in one place - elements that make the trading activity much less strenuous. It is important to make a reservation and clarify, investing in a specific stock carries a relatively high risk and requires caution and exercise of discretion.

Advanced trading orders

Another element that reduces the amount of effort and time needed for trading lies in the ability to transmit future trading instructions and in fact neutralize the need for regular and frequent monitoring of the account. This means that traders can pre-define orders that will be executed only if the trigger they set is indeed realized. For example, among other things, investors can set an automatic LMT order in relation to buying or selling a certain security with a price limit, meaning that only when that security reaches the rate specified in the instruction, it will be executed.

Another example is the Stop Loss order and its purpose is to cut a loss. Investors set a certain trigger for the stock they hold so that if the stock price in the defined period falls to that rate, the command will be broadcast. These advanced instructions, along with many others, are carried out automatically and save effort in regular and close monitoring of the fluctuations of the investment assets.

Absolute accessibility and availability

In the bottom line, the flow of investors that led in the past year to records in the opening of the number of independent trading accounts was the opening chord of a broad process based on the understanding that the trading arena on the stock exchange is no longer the private field of only professional traders. Advanced technology and functions that did not exist have made the trading experience much more accessible, available and simple than before.

IBI Investment House recently launched the most innovative trading application in Israel, IBI SMART, which joins a wide range of advanced, efficient and convenient platforms suitable for traders, old and new alike, who wish to benefit from the ability to take the reins and manage their money independently, sometimes even without too much effort.