Living, Tips & Techniques

How to Invest in Black-owned stocks

Hint: Do your research.

words by: Natasha Marsh
Jul 15, 2022

Now that you know how to invest in stocks (purchased shares of a company), next up is how to purchase them in Black-owned companies. It’s a great way to support companies that aren’t traditionally known to sell stocks, fight for racial justice, and shop Black-owned businesses. As it turns out, the process is quite similar to investing in stocks in general.

 

Firstly, you will want to decide how much you are investing. This number is totally different for individuals and must fit into your lifestyle instead of change it. Once you do that, you can reach out to a robo-advisor like Betterment, who will use your data to conduct a portfolio for you and present you with options. This is typically the route beginners and young people take as it’s less risky and presents less information to worry about.

 

If you have some experience buying stocks, you could also invest by yourself to get full control of where your money goes and exactly what fees you are paying.

 

Next up, you’ll set up a brokerage account where all your shares will live. Be sure to get insights form a professional if you aren’t sure which brokerage account style you should go for, as some have specific tax benefits that could help you save even more in the long run.

 

And then the fun part: Pull up on a Black-owned business. Make sure the company is publicly listed in order to qualify for the stock exchange. Sadly, there are only a handful of these, so make sure you vet through Google lists. Make sure you opt for many different industries and confirm the founder or CEO is Black.

 

You can make sure of this by surfing the companies’ website and reviewing their board of directors to see who is who. Make sure the company you are looking to invest in fully aligns with your priorities and values. This will help diversify your portfolio and give you a better chance at increasing the value on your stocks.

 

And if stocks aren’t your right now thing, but instead your near future thing, you can also assist Black-owned companies via peer-to-peer lending — granting the less fortunate ability to access capital. Just keep in mind, when you become a lender, there is always a risk that someone might not pay you back or perform as well as they stated. All in all, do your research and exercise caution when doing anything related to stocks.

 

If your looking into opening a new bank account, check out these Black-owned banks.