[For Beginners] How much does stock investment make? 3 ways to make small investments

It seems that many people have the image that "stock investment requires a large amount of funds." However, you can actually start investing in stocks with just a few tens of thousands of yen. Also, there is a good chance that you will get a steady return even if you don't have a lot of money. In this article, we will explain in an easy-to-understand manner the guideline amount for starting stock investment, how to make money easily even with a small investment, and the way of thinking so that beginners do not fail.

Contents

1. 1. You can make money by starting stock investment with "tens of thousands of yen" and "small amount"!
   1. 1-1. You can start investing in stocks with tens of thousands of yen or even less
   2. 1-2. Advantages and disadvantages of small stock investments, and how to deal with them
2. 2. There are other ways to invest in stocks with a small amount, such as "shares less than one unit"
   1. 2-1. Trading example with shares less than one unit
   >
   2. 2-2. Advantages and disadvantages of fractional shares, and how to deal with them
   3. 3. How to smoothly find stocks that allow you to invest in stocks with a small amount
   4. 3-1 .How to use SBI Securities' screening function
   5. 3-2.How to use Rakuten Securities' screening function
3. 4. 3 easy ways to get profits)
   1. 4-1. [Method 1] Aiming for shareholder benefits (low risk)
   2. 4-2. [Method 2] Aiming for high dividends (low risk)< /li>
   3. 4-3. [Method 3] Tenbagger target (high risk)
   4. 5.
   5. 5-1. Points to be aware of when investing in stocks: Consider the balance between living expenses, savings, and investment amount
   6. 5-2. In stock investment, it is more important not to lose than to win
4. Summary: Acquire knowledge and experience with a small investment

1. Stock investment can be profitable starting with "tens of thousands of yen" and "small amount"!

Aren't you under the impression that stock investment requires several million yen? In fact, it is quite possible to start investing in stocks with a small amount of about tens of thousands of yen and earn profits. Here, I will explain the "small investment" of stock investment.

1-1. You can start investing in stocks in units of tens of thousands of yen, or even less.

When buying stocks, the basic unit is 100 shares. There are many stocks that cost several hundred yen per share, so you can start investing in stocks from tens of thousands of yen.

As shown in the example below, even the stocks of well-known companies may cost several hundred yen per share. You will understand that you don't necessarily need a large amount of money to start investing in stocks.

▽ Examples of companies with less than 300 yen per share (as of December 11, 2020)

Sojitz, NTN, Mitsubishi Motors, Citizen Watch, TEPCO HD, Seven Bank, Sourcenext, Livesense, etc.

In addition, there are stocks that are 100 yen or less per share. However, there are also stocks that have been unpopular for a long time and stocks that are at risk of bankruptcy. Therefore, in reality, it may be safer to broaden the options to some extent by setting the purchase guideline to "more than tens of thousands of yen and less than 100,000 yen (per 100 shares)".

1-2. Merits and demerits of small stock investments and how to deal with them

Small stock investments have advantages and disadvantages compared to large stock investments. It is wise to start investing in stocks with a small amount after grasping these firmly.

・Benefits of small investments: Learn while practicing investments

This is a great advantage for beginners in stock investment. This is because there are many things that can be learned by actually doing stock investment.

For example, even if you understand that "long-term holding is important", beginners tend to have a pattern of taking profits (fixing profits) or cutting losses at too early a timing. If you suddenly start investing with a large budget, the damage will be great if you fail, but if you invest a small amount, you can accumulate experience with damage within an acceptable range.

In some cases, it is possible to "diversify investment with a limited budget" with a small amount of investment, but in reality, it is common that there are few opportunities for diversified investment with a small amount. Also, if you invest a small amount, the return is low, and considering the fees, it is possible that there is almost no profit.

Let's also look at the disadvantages of small investments. We will also explain how to deal with it, so please check it.

・ Disadvantages of small investment 1: Return (profit) tends to be small

With a small amount of stock investment, the risk is limited, but on the other hand, there is a disadvantage of "low return". For example, if a 2 million yen (100 shares) stock rises 20%, the unrealized gain will be 400,000 yen, but if a 20,000 yen (100 shares) stock rises 20%, the profit will be only 4,000 yen. . If you deduct the fee, you may not have much left, or it may be negative.

[Solution]

As mentioned above, if the investment scale is small, the return will be small. If you want to get a coherent return, you need to increase the investment size in stages.

・ Disadvantages of small investment 2: Fees tend to be expensive

Fees tend to be expensive for small stock investments. For example, Rakuten Securities stock trading commission is 55 yen for a transaction amount of 50,000 yen, and 535 yen for a transaction amount of over 500,000 yen to 1 million yen (*). Comparing the fees for “transaction amount up to 50,000 yen” and “more than 500,000 yen to 1 million yen”, the fee per 1 yen transaction amount is about twice as expensive for up to 50,000 yen.

[Solution]

Rakuten Securities and other major online securities companies offer a trading plan that waives transaction fees up to a certain amount per day. If you are trading with a small amount, you can use this. However, be careful when using this free transaction fee plan up to a certain amount, as there are cases where the transaction fee for transactions over a certain amount is more expensive.

* Fee for super discount course for spot trading (tax included) < tr>< td>△< td>Up to 495 yen up to 500,000 yen< /tr>

Net Securities Comparison Ranking
Net Securities Company Name	Features	Fees	Small Investment
	Commissions, IPO, foreign stocks all top class	Free up to 1 million yen	◎
Official site
	Convenient trading tools	Free up to 1 million yen	△
Official site
	Extensive support for beginners	Free up to 500,000 yen
Official site
	Strength in US stock trading	◎
Official site
	Strength in IPO	Up to 440 yen up to 500,000 yen	○
Official site

2. There are other ways to invest in stocks with a small amount, such as "shares less than one unit"

In Chapter 1, we introduced "100 It was a method of looking for cheap stocks by stock unit and buying them. However, with this method, stocks with a high stock price per share cannot be invested with a small amount. Therefore, there is a way to find stocks that can be purchased in less than one unit, such as 1 share or 10 shares, without purchasing in units of 100 shares. Here, we will explain how to invest in shares less than one unit.

2-1. Examples of transactions with fractional shares

For example, the stock prices of popular companies such as Nintendo and Fast Retailing are high, ranging from 60,000 yen to 80,000 yen per share (2020 Stock price as of December 11, 2011). If you buy in units of 100 shares, it will be 6 million yen or 8 million yen.

Even with these high-priced stocks, there is a service of "fractional shares" that can be purchased from 1 share. Even stocks such as Nintendo and Fast Retailing, which I gave as examples, can be easily purchased using fractional shares. For example, at Fast Retailing, you can freely set the number of shares to be purchased, such as 2 shares or 3 shares.

However, fractional shares are not available at all securities companies. Among the two major online securities companies, SBI Securities handles shares of less than one unit (service name "S shares"), but Rakuten Securities does not handle shares of less than one unit. Also, the service name for fractional shares varies depending on the securities company. For example, Monex, Inc. calls it “One Kabu”.

In addition, there is also a service similar to fractional shares, "mini stock" that allows stock trading in units of 10 shares (such as SMBC Nikko Securities' "stock mini investment"). Please check the service details with each securities company before purchasing fractional shares.

2-2. Advantages and disadvantages of fractional shares, and how to deal with them

We will introduce three advantages and disadvantages of fractional shares that can be invested with a small amount. We will also discuss how to overcome these shortcomings.

・Benefits of shares less than one unit

(1) You can invest in companies with high stock prices (2) You can receive dividends in the same way as 100 shares (3) Even with a limited budget, it is easy to diversify and invest in multiple companies

・ Disadvantages of shares less than one unit 1: Trading hours are limited (real-time stock trading is not possible)

[Solution]

Trading fractional shares varies depending on the service, such as "Orders can be entered 24 hours a day, but market orders are placed at a set time" (eg SBI Neo Mobile Securities). Find a brokerage firm that offers the services you want.

・ Disadvantages of shares less than one unit 2: In many cases, you cannot receive shareholder benefits

[Solution]

In some cases, you can receive shareholder benefits even from 1 share, but in many companies, 100 shares or more are eligible. If you are interested in shareholder benefits and want to invest, aim to purchase unit shares.

・ Disadvantages of shares less than one unit 3: Since the transaction amount is small, it is difficult to expect short-term returns

[Solution]

Let's clarify the purpose why we choose fractional shares. If you expect short-term returns from rising prices, consider purchasing unit shares.

An example of a service that allows a small investment

In addition to the services introduced in the text, there are also the following as examples of services that allow small investments. Some can be purchased with points instead of cash, so find an investment method that suits you and practice it.

・ “Nikko Froggy + docomo”: You can purchase stocks for 100 yen with d points ・ “Neomoba”: Stock investment from 1 share with T points

3. How to smoothly find stocks that you can invest in stocks with a small amount

Some people may have the question, "How can I find stocks that I can invest in stocks with a small amount in the first place?" If you have an account with an online securities company, it is easy to pick up stocks that allow you to invest a small amount. If you use the screening function, it will automatically select stocks that you can buy within your budget.

Let's take a look at how to use the screening functions of SBI Securities and Rakuten Securities, the largest online securities companies. The following examples assume that you are using a computer.

3-1.How to use SBI Securities' screening function

Select "Domestic Stocks" from the top page of your securities account. Furthermore, if you select "Screening" under the search bar, the following screen will be displayed. You can narrow down the brands that match your budget just by setting the search conditions.

Image Quote: SBI Securities

3-2. How to use Rakuten Securities' screening function

Select "Domestic stocks" from the top page (total assets page) of your securities account. Furthermore, if you select "Super Cleaner" under the search bar, the following screen will be displayed. You can narrow down the brands that match your budget just by setting the search conditions.

Image Quote: Rakuten Securities

4. Three easy ways to get a return (profit) even with a small amount of stock investment

The pattern that you absolutely want to avoid with a small amount of stock investment is just because it is cheap. It is to buy and keep holding meaninglessly. This is going to be a stock investment that depends on luck. There are three ways to make a profit with a small investment.

4-1. [Method 1] Aiming for shareholder benefits (low risk)

Even if the stock price per share is low, there are stocks that offer substantial shareholder benefits. This method may be good for those who want to make substantial profits in kind without being particular about cash. Examples include:

・Tokyu Land Corporation HD

If you own more than 100 shares, you will receive a resort hotel accommodation coupon (1 coupon), a common accommodation coupon (2 coupons), and a sports coupon (2 coupons) that can be used at golf courses, sports clubs, and ski resorts.

・Isetan Mitsukoshi HD

If you own 100 or more shares, you will receive a 10% discount on the purchase price of a shareholder special card (maximum purchase amount of 300,000 yen). If you use this shareholder benefit card up to the shopping limit, the discount amount is 30,000 yen (300,000 yen x 10% excluding consumption tax). If you think that you can get a return of 30,000 yen from an investment of around 60,000 yen (stock price of around 600 yen x 100 shares), the profit margin is quite good (the stock price and shareholder benefits will be announced in 2020). as of December 11).

Shareholder benefit is a system unique to Japan, and is often featured in magazines and web media. There are many sources of information, so use them as a reference.

4-2. [Method 2] Aiming for high dividends (low risk)

Aiming for high dividend stocks may be the most realistic method. There are many stocks with high dividends even if the price per share is low. And it is possible to efficiently increase assets by reinvesting these dividends through the compound interest effect.

In addition, stocks with low investment amounts and high dividends can be easily segmented using the screening function introduced earlier. If you set the condition of "Investment amount of 30,000 yen or less, dividend yield of 3% or more", 19 stocks were displayed as shown below. (*As of August 1, 2020)

Image Quote: Rakuten Securities

No matter how high the dividend is, the capital is small, so it is not possible to increase assets in a short period of time. However, long-term holding allows you to grow your assets steadily. In addition, by accumulating and buying more high-dividend stocks when you can afford it, you can eventually hold a large amount of stock.

4-3. [Method 3] Aiming for Ten Bagger (High Risk)

Ten Bagger is a stock that is 10 times or more than the original price. If a stock with a price of 1,000 yen per share becomes 10,000 yen or more, it is called Tenbagger. The profit on the sale of 100 shares will be more than 900,000 yen. I think there are many people who feel like such a dream, but there are surprisingly many Tenbagger brands.

According to a survey by Nikkei Money, there are more than 800 stocks whose stock prices have increased more than 10 times in the period from immediately after the Lehman shock to just before the corona shock. There are about 3,700 companies listed on the four major markets (TSE 1st and 2nd Sections, Mothers, and JASDAQ), so one in four or five companies is a tenbagger brand (however, the period to become a tenbagger is How much to set is case-by-case).

There is no foolproof way to find Tenbagger stocks, but here are some trends:

▽ Tenbagger brand trends

(Reference: Nihon Keizai Shimbun dated August 5, 2020)

And what you can't miss is that about 40% of Tenbagger stocks have risen more than 20 times. In this way, if the brand and the timing match, there can be a double tenbagger, but there is also the risk of a sudden drop in the rising stock. Please fully understand this risk before taking on the challenge.

5. "Precautions to be aware of" and "NG behaviors for beginners in stocks" that you should keep in mind even with small investments , In order to increase the amount of investment in the future, let's hold down the points to be careful about and NG actions for stock investment from a small amount.

5-1. Points to be aware of when investing in stocks: Consider the balance between living expenses, savings, and investment amount

When investing in stocks, it is necessary to consider the balance of the funds on hand. People who are thinking about investing small amounts may already be aware of this point, but once again, let's be thorough about securing living expenses and savings first, and then investing surplus funds. In addition, in stock investment, it is necessary to decide in advance the target amount of profit and the timing of loss cut.

5-2. 5 NG Actions for Stock Beginners: In stock investment, it is more important not to lose than to win

In stock investment, it is more important not to lose than to make a profit The most important thing is not to lose a lot. This is because even if you temporarily lose money, if you have cash on hand, you can recover it later over time. Conversely, if you lose most of your cash on hand, it will be difficult to recover.

In order for beginners not to lose a lot, it is important to avoid "what you should not do in stock investment". Here are five things to watch out for:

・ NG behavior of stock beginners 1: Use margin trading

Beginners' stock investment is based on "spot trading", and it is wise to invest within a range that can withstand a sudden drop. On the other hand, "margin trading" should be avoided when you are a beginner.

Margin trading is a mechanism that allows you to trade stocks about three times as much as the margin you put in your securities account. If you deposit a margin of 100,000 yen, you will be able to trade stocks up to about 300,000 yen. In this way, you can inflate the return by applying leverage to your cash on hand, but it is very risky for beginners to get their hands on margin trading.

One of the most common failure patterns is, "After getting a return on spot trading, you get overwhelmed and start trading on margin and get hurt." Even companies that are said to be "very stable" in the world often experience sharp declines in their stock prices. There are many risks such as scandals, product development failures, natural disasters, conflicts, and economic crises.

・ NG behavior of stock beginners 2: Cannot cut losses on salted stocks

Some stocks that you choose as "This is it!" may continue to fall in price over the long term. Stocks that continue to be held even though losses are swelling are called "salted stocks". It is also an action that beginners want to avoid if they can't cut losses by holding on to salted stocks forever.

If you continue to hold stocks that have fallen 30%, you will still lose 30% if they do not reverse. With the funds from selling this stock, you can reselect a different brand, and if it rises in price, you can recover the lost portion.

Of course, this does not deny long-term holding. Even if the stock has a loss, if there is evidence (chart, market change, etc.) that it will reverse at some point, there may be a decision to continue holding it.

・Negative stock market behavior 3: Stick to your own judgment

Because beginners have little knowledge and information about stock investment, they tend to make decisions from a narrow perspective. Investments, not just stocks, require an objective perspective. In order to be able to think flexibly, it is important to collect a wide range of economic information and the opinions of experts on a regular basis.

・Negative stock market behavior 4: Buy because it is popular

It is a common behavior for beginners to buy stocks with a vague feeling, such as "buy this brand because it is ranked high" or "choose this brand because it is booming". In investing, "what everyone is buying" is not a positive factor. Rather, if it is popular with expectations ahead, there is a risk of a sudden drop, which may be a negative factor.

Before deciding whether a company is popular or not, we check it from multiple perspectives, such as whether it has medium- to long-term growth potential, whether the stock is undervalued relative to its corporate value, and whether it is financially sound. Ultimately, you should use your own judgment when choosing brands. In order to be able to make appropriate decisions at any time, it is necessary to make efforts to obtain knowledge through books, magazines, and web media on investment themes.

・Negative Behavior of Stock Novices 5: Oversimplifying Viewpoints and Ways of Thinking

Stock investment requires analysis based on deep knowledge and extensive experience. It may be difficult for beginners, but let's gather knowledge little by little and be prepared to gain experience.

For example, the view that "the stock prices of profitable companies will rise" is an oversimplification. It's not uncommon for the stocks of profitable companies to plummet right after the financial results. Conversely, the stocks of unprofitable companies can soar immediately after their earnings. This is because investor sentiment has a significant impact on stock price trends. If you judge the stock price on the surface like this, it will cause a loss.

In addition, there is an investment theory that is often said that "stocks are bought low and sold high". This is the right idea if you are an investor who can judge the bottom price. However, if you are a beginner, you cannot judge the bottom price in the first place. Be aware that you may end up with a big loss if you intend to buy stocks cheaply before the crash.

In addition to what I introduced here, there are things that beginners in stock investment should not do. In addition, basic knowledge to read stock indices is also required. A quick way to understand these is to read a primer on stock investing. Examples of highly rated long-selling books include John Shugyo's "The world's easiest textbook on stocks, 1st grade" and Diamond Zai's editorial department's "Introduction to stocks made by ZAi, a stock magazine that sells crazy".

Summary: Gain knowledge and experience with a small investment

How was it? In this article, I have explained the following contents about small investment for stock investment beginners.

・Equity investment can be started with a small amount

General investment is traded in units of 100 shares, but if you choose a stock with a low stock price per share, you can invest even a small amount. There is also a method of using fractional shares. As a way to find stocks that can actually be invested in small amounts, the screening function of online securities is convenient.

・There is a way to get a return even with a small amount of stock investment

While there is a disadvantage that the return tends to be small for small investments, depending on how you do it, you can also get a solid return.

· Beginners should be aware of points to note and actions to avoid in order not to lose a lot in stock investment

Supplement your knowledge, gain experience, and make prudent investments.

Stock investment is similar to driving a car in that you can improve your skills by acquiring both knowledge and experience. Investing small amounts is like a training course in which you can make a mistake and not have a big accident. If you have never traded stocks before, why not take the first step with a small investment and take the first step cautiously and casually?

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