How to Invest your First $100 in

the Stock Market for Beginners

Getting you started on the path to success in the stock market.

Visit http://www.griffinmilkscourses.com/ for more in-depth training

What you will learn
š What to do before investing
š Why you need to start investing today
š What are stocks?
š 2 ways to build wealth
š What is market capitalization?
š Types of stocks, Categories & Sectors
š What can you buy as an investor?
š Financial documents
š Financial ratios to evaluate a stock
š Account types
š Should you time the market?
š The time value of investing
š Opening a brokerage account
š Buying and selling a stock
š Order types
š Bonuses!
Who am I?

š Honours Bachelor of Commerce from the University of Ottawa

š Serial Entrepreneur
š Over 8 years of investing in the stock market
š Have quit my corporate job to pursue teaching financial
education on my YouTube channel
š Active Stock and Real Estate investor (Over 15 doors)
š Main goal is to teach financial literacy and motivate others to
start investing in their financial future
Bonuses and Extras

š You can download this presentation for FREE (Link in the

description)
š Free stocks and Free money (Links in the description)
š Wealthsimple Trade: $25 for free
š Questrade: $50 in free trades
š M1 Finance
š Exclusive discount to my Full Stock Market Investing Course
š Unique Code for viewers of this video at the end of the presentation
Before you invest

š Eliminate crippling high-interest debt (credit cards, personal,

etc.)
š Save 3-6 months of expenses
š Learn as much as you can (financial literacy)
š Be ready to stay consistent with your investing
š Long-term approach to building wealth
Why invest as soon as possible

š Start building your wealth over time

š Paper assets are some of the best tools at our disposal
š Historic average of 7% to 10% annual market growth
š Lower fees than ever before (DIY, low MERs)
š Low barrier to entry
š Access to a wider range of investment vehicles
š Let your money work for you and create new income sources
š Investing is a hedge against inflation
š Retain buying power
š On average, cash loses value every year
š Your investments returns must beat inflation rates
What are stocks anyways?

š Partial ownership of a publicly-traded company Griffin Public, TSX:GTM

š Other terms used are “stock”, “shares”, “equity” 10 equal shares. If you
own 2 of the shares, you
š Companies issue stock to raise capital
would own 20% of the
š Shares of a company’s stock trade on a stock exchange company

š Canadian exchanges: TSX, NEO, TSX-V, CSE

š American Exchanges: NYSE, NASDAQ, BATS, etc.

š A public company’s value is know as its market

capitalization, or “market cap”
š A company’s market value is constantly changing as shares
exchange hands.
š Market cap = market price per share * shares in circulation
Types of stocks

š Stocks are categorized differently based on numerous elements:

š Growth stocks
š Dividend Stocks
š Value Stocks
š Cyclical Stocks
š Stocks can be a mixture of these stock types.
š Dividend-Growth
š Value-Dividend
Growth stocks

š Very popular in the current market environment (2021)

š Tend to commend higher valuations
š Rapid expansion of operations
š Reinvestment of earnings and taking on debt to fuel
growth
š Don’t usually pay dividends
š Potential for higher returns typically comes with higher
volatility levels
š Higher investor expectations
š Examples: Shopify, NVIDIA, etc.
Dividend stocks

š Pay out distributions to their shareholders

š Tend to be blue-chip companies that are established
in their industries
š A dividend stock’s “yield” gives investors an idea of
the dividend’s current return
š Dividend yield = Dividend per share / Share price
š Dividends are typically paid out quarterly
š Good way to compound growth and create a new
source of income
š Examples: Fortis Inc., TD Bank, etc.
Value stock

š Popularized by investors such as Warren Buffet

š A stock that is considered to be undervalued relative to its
current financials
š Harder to come by in an expensive market
š Market price is simply a reflection of what investors are willing
to pay for a stock at any given moment
š Undervalued based on current and past financials, industry
averages, market averages, discounted cashflow models
š Can be undervalued for a variety of reasons:
š Negative investor perception and outlook
š Short-term negative press and company earnings
2 main wealth building elements

š Dividends
š New income source
š Can be reinvested for faster compounded growth
š Capital Gains
š Appreciation of share value over time
š Organically occurs over time as a company excels
financially
Stock categories

š Stocks can also be categorized by market capitalization

š Large-Cap Stocks ($10b+ in market cap):
š Established companies
š Will generally provide slower and steadier returns
š Higher likelihood of paying dividends
š Mid-Cap Stocks ($2b - $10b):
š In the process of expanding
š Could provide quicker returns
š Balance between growth and stability
š Small-Cap Stocks ($300m - $2b):
š Reinvesting all capital to fuel growth
š Higher returns = higher potential risk
š May be more sensitive to potential downturns
Stock sectors

š Finally, companies also operate in specific sectors

š Utilities
š Energy
š Healthcare
š Travel
š Materials
š Industrials
š Consumer discretionary
š Consumer defensive
š Information technology
š Telecommunications
š Banking and finance
Financial vehicles

š In the modern investment landscape, investors have

multiple types of financial vehicles to choose from
š Individual stocks
š Mutual funds
š Exchange-Traded Funds (ETFs)
š Real Estate Investment Trusts (REITs)
š Bonds
š Real estate
š Precious metals
š Crypto
Exchange-Traded Funds (ETFs)

š A basket of stocks and/or other securities grouped

together into one holding that seek to track a certain
sector or facet of the market
š Great for retail investors
š Bought and sold like a stock on a stock exchange
š ETFs can track passive index funds (S&P 500, NASDAQ 100,
etc.) or they can be actively managed (ARK Innovation,
etc.)
š They offer instant diversification and exposure to all of the
holdings within the fund
š Fees are calculated as ”MERs” and vary based on the
fund
š Investors have no say in the fund’s holdings
Passive S&P 500 ETF

š For most retail investors, a solid base holding should

be an ETF that tracks the S&P 500
š Low management fees
š Exposure to the 500 largest companies in the U.S.
market
š Historic annual appreciation of roughly 8%
š U.S. options: VOO, SPY
š Canadian options: VFV, XUS
Real Estate Investment Trust (REIT)

š A REIT is a company that owns, operates, and finances

income-producing real estate
š REITs are known for their high dividend yields
(obligated)
š Easy way to include real estate in your portfolio
š When properly managed, can be a good and stable
asset to own in your portfolio
š Made up of hard assets, typically slower growth
š The type of property held plays a large role in its
success and longevity (pandemic shutdown)
Types of brokerage accounts

š A brokerage account allows you buy and hold financial

securities
š Non-registered investment accounts
š Cash account
š Margin account
š Registered investment accounts
š USA: IRA, Roth IRA, 401k
š Canada: TFSA, RRSP
Stock brokerages

š There are many different stock brokerages to choose from

š Popular Canadian discount brokerages:

š Popular American discount brokerages:

Let’s trade your first stock!

š Follow along by creating your own brokerage

account using one of the links in the description
š What we’ll cover:
š Stock quote
š Order types
š Time frames
Evaluating a stock

š A company’s 3 main financial documents:

š Income statement: revenue, expenses, net income, etc.
š Balance sheet: assets, liabilities, shareholder equity
š Cashflow statement: operating cashflow, financing cashflow,
investing cashflow, etc.
š Financial ratios:
š P/E
š PEG
š P/B
š Current ratio
š Total ratio
Price to Earnings ratio (P/E)

š Divides the company’s market cap by its net

profits
š The TTM PE and the Forward PE
š PE Ratio = share price / earnings per share
š Used to quickly evaluate the current value of a
stock
š Can be compared to its historic PE, industry PE,
and market PE
š Companies can commend a higher PE if there are
high expectations for it…. Are you overpaying
though?
Price to Earnings to Growth (PEG)

š Quick way to assess a company’s market value

relative to its EPS and its expected growth rate
š PEG = PE ratio / expected growth rate
š Yahoo finance uses the 5 year expected growth rate
š Lower PEG could indicate an undervalued stock
given its expected growth rate
š PEG equal to 1 = fairly value
š PEG > 1 = over valued
š PEG < 1 = under valued
š In an expensive market like right now, it’s difficult to
find stocks with a PEG < 1
Price to Book ratio (P/B)

š Gives investors a quick glance at the current share

price relative to the company’s book value per
share
š The PB ratio compares a stock’s price to its total equity
š PB = share price / book value per share
š Book value = assets – liabilities – preferred share equity

š A healthy PB ratio will be a value of 3 or lower

Debt to equity ratio

š This is a ratio that uses information from a

company’s balance sheet
š The debt to equity ratio is used to evaluate a
company’s financial leverage (use of debt)
š How much of a company’s operations are paid for
using debt rather than their own capital
š Debt to equity = total liabilities / shareholder
equity
š A higher D/E ratio means the company is funder
more of their operations using debt. This
inherently makes it more risky than a company
with a lower D/E ratio
Current ratio

š Gives us insight on the company’s short-term capacity to

maintain it’s debts within a 1-year timeframe
š Current ratio = current assets / current liabilities
š Short-term assets are things such as:
š Cash and cash equivalents
š Marketable securities
š Receivables
š Short-term liabilities are:
š Accounts payable
š Taxes payable
š Accrued liabilities
š Deferred revenues

š Healthy current ratio > 1.5

Dollar-cost averaging & timing the market

š Historically speaking, it’s better to stay invested in

the stock market for the long-term instead of
entering and exiting the market
š Timing the market is practically impossible and
shouldn’t be attempted, especially for part-time
retail investors
š Dollar-cost averaging is the idea of investing
consistently into the market, regardless of market
fluctuations.
š This is best accomplished with market funds and
consistent large-cap stocks
Time value of money

š Time in the market and consistent contributions

are the recipe for massive growth of wealth in the
stock market
š Compound interest will work to your advantage
over the long-term and gain momentum over
time.
What can Warren Buffet teach us?

š Warren Buffet has core investing principles:

š A company’s management is extremely important
š Conduct proper research into the stock’s financials and
keep emotions out of investing
š The market can price things wrong. Don’t panic sell unless
something changes fundamentally. A quality stock going
down in value is a buying opportunity
š Invest for the long term and practice patience
š Trust in the USA. Index funds are fantastic for most
investors
Other videos on my channel to watch
Next steps…

š Download this presentation and watch it again to

get familiar with the concepts
š Open up a stock brokerage account - Use the links in
my description to get free money and support the
channel
š Fund your account
š Learn more about your portfolio’s asset allocation
š Check out the full stock market course and get 20%
off using the code INVEST100
š Discount available to only first 100 investors so make
sure to check it out today
Thanks for watching!

š Good luck with your stock

investing!
š Use code “INVEST100” at
griffinmilkscourses.com to get
20% off the FULL Stock Market
Investing Course and the Stock
Market Portfolio Tracker