If you know next to nothing, how do you go about the business of investing? The first thing you need to know about investing is, how much do you really know? If its’ not much, then you will need to read extensively to educate yourself.

To become well-informed, you should read up on the basics. find out what a stock, a bond or a mutual fund is, and what the differences are between these three financial products and it’s variables. Read books on financing and investing.

Talk to savvy investors, watch video and live presentations. Once you understand the differences and the risks entailed investing in each particular vehicle, then you can move forward with confidence.

Now you can go to the second phase of learning about investing. Gain some experience, by investing in small stocks, and learn both from your mistakes and successes. However, find out first what kind of investor you are. Here are some pointers to help you get to the answers.

In going about your business of investing, have a game plan and set definite goals. The answers to these questions will be valuable guideposts for you in your venture into investing your funds.

o What is your timetable for investing?

o What sectors of industries are you interested in investing in?

o What is the amount of funds you can safely use in investing in order to reach your goals?

o Have you considered your short term financial needs or goals?

o Do you plan to live off these investments in your retirement years?

Determine your investing style. Are you a risk taker? Or do you like steady gains? Consider this thought, will you be able to sleep soundly at night, knowing your investment is decreasing and will take a long period of time before it increases? Or you prefer to hand your funds over to a funds manager? Do you like minimal risks in investing your funds? Consider the kind of risk taker you are, for this will help you pick the financial vehicles for investing in.

What is the length of time you want to spend on investing in stocks? Is it just 15 minutes daily? Or do you find consider it the height of entertainment to spend 7 to 14 hours a week, looking over financial statements and debating the merits of these stocks.

Carefully consider the answers to these questions. If you know what kind of investor you are, you can play to your strengths, and minimize the risks on the funds you are investing with.

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