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more first timer advice:
1 - Avoid the use of debt such as margin loans or other borrowed money. Debt will magnify your profits as your investments rise and can be addictive and make it seem easy to make money. But if your investments drop, your equity rapidly goes down and if you don't sell fast enough (and selling in a dropping market is not an easy decision for most people) you can lose a huge amount of equity. Profits made with borrowed money are easily vaporized, everyone sorta knows this but you only fully appreciate it in a meltdown.
2 - If investing in stocks, keep the number of stocks to a minimum, 1 to 3 for starters. You should think you have a good understanding of each company, not only their products or services but also their management and financial situation. A small number of owned stocks will let you spend more time and brainpower on each company. You will need to monitor each company by checking their news at least once a week, or ideally every day, at sites like Yahoo Finance.
3 - Personally I prefer looking for companies that will probably do well for many years, with large stock price gains. That means I can be more familiar with their situation as time goes by, and I find it easier and more profitable than looking for quick trades in companies I'm not as familiar with.
http://en.wikipedia.org/wiki/Ten_bagger
5 - If you end up with some good profits, avoid the temptation to diversify or "diworsify" by buying additional companies that you don't fully understand or won't have time to monitor closely. Only buy companies you understand and have time to monitor.
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