Cherry Picking The Diamonds From The Stock Market

What is the best way to invest in stocks?

Everyone seems to have a method for investing in the stock market. I've also seen many websites selling "how to" information about investing in the stock market and how to pick stocks. The problem is, how do you tell if any of these sites or "gurus" are legit?

I agree with some of the other folks here. Basically you need to invest in a good education. Be cautious of "how to" information. Sometimes, not always, but sometimes the "how to" info that is for sale is sold by individuals who really aren't very good traders themselves. It goes back to the old adage: "Those who can, do. Those who can't, teach.".

That being said, investing in stocks isn't a mystery. There are basically three fundamental views about investing. Technical analysis (the subjective method of investing), an academic "efficient market" method (the intrinsic method of investing), and the objective method of investing.

You need to respect the markets. If you aren't prepared to put in the time it takes to do a really good job of studying the company's cash flows to try to determine if the stock is over or undervalued, the risk of the particular sector you want to invest in, the management, and the underlying philosophy that the management applies to the company, you are going to have a hard time being successful.

Study the greats. Peter Lynch, Warren Buffet, etc. There is a reason they are successful, and it doesn't have to do with throwing darts at a dart board.

You might want to get a basic primer on financial markets by going to investopedia, then read some more in depth information about the three different types of investing at

http://www.twintierfinancial.com/articles/stockpicking.html

Then head on over to amazon.com and pick up "One Up on Wall Street" by Peter Lynch and also the book "Total Investing"