Wednesday, June 20, 2007

How to Learn About Investing (For Free)

A half year ago, I couldn't tell a P/E ratio from a PE class. I am not even close to being ready to start investing in individual stocks, but I think one of my strengths is my ability to realize this and start the process of teaching myself how to invest.

Here are the Steps I have taken thus far:
1) Books- I've read the Motley Fool's Investment Guide as well as another Fool book, which wasn't as good. Other books I have read: A Random Walk Down Wall Street, Kiplinger's Guide to Investing, some Cramer books as well as some others which I wouldn't reccomend to my worst enemy (Someone's Rich Dad apparently never taught his son how to write in clear English). I checked these all out from the library.

2. Warren Buffett's annual letters to Berkshire shareholders. Everyone reccomends these as a great way to learn how to invest. I've only read 2 thus far, I am going to try to read as many as I can.

3. Stock Investing Blogs & Websites: I try to read Marketwatch, the WSJ, Motley Fool Online. and a couple of blogs every day. One Million to My Name has a great blog for stock investing where he runs through his successes and failures on a regular basis and you get the benefit of his experience.

4. Morningstar Classroom: This is huge, Morningstar has an online free classroom, where you can teach yourself about every major investment topic, and afterwards you take tests to test your knowlege. If you get enough points from the tests you qualify for premium trial membership.

5. My local library's website: I can access Standard & Poors' stock reports as well as Morningstar's stock reports online through my library's website (with my library card number)

6. Fantasy Stock Portfolio: There is no subsitute for experience. I have several fantasy portfolios, where I am learning from my successes and failures. For instance, acting on a "hot tip" from a blog, I converted 10% of my fantasy portfolio into MEDX, a biotech I knew almost nothing about. It promptly dropped 10%. Lesson learned: there is no such thing as insider or pseudo insider information, and there is no subsitute for doing my own due diligence.


Q at $1 Million to My Name said...

Yo, thanks for the linkage!

Alex said...

No prob. I calls em how I sees em.


Theirs lots of info online about stock investing.