Learn The Stock Market And How to Trade

I’m not one to promote putting all your money in a burlap sack with a big bold money sign $$ on it and handing it on over to the money manager, hedge fund trader, investor guru, or crazy day trader uncle of your choice.  However, sometimes it makes sense to buy into some of their funds or methods in just the same way you would diversify your portfolio between two stock sectors. 

Want some Warren Buffet stock picks?  Buy some Berkshire Hathaway (BRK.A) or you really believe the Turtle Traders had something going…figure out how many shares of Turtle Traders you’d want to buy and set aside that percentage of your portfolio and trade it that way.  (You’ll have to do your homework of course.) 

Buying into these investor shares will expose you to a wider investment style, investor shares should reduce your overall portfolio risk by reducing the amount of related returns, and hopefully improve your investments CAGR.

You can treat these investments like other investments.  If one style has a serious run over the other and your investment rules (You’re keeping that journal right?) say to keep your portfolio balanced, you can redistribute from one investment or investment strategy over to the other.  If you are a momentum style investor and you’re day trading is kicking your LEAP strategies butt then transfer the money from the loser to the winner for the time being.  As always the key is knowing what works for you then giving yourself the most choices possible to find the winning strategy.

I recommend taking time to read classic investment works, current popular books, blogs, news, etc and invest in the styles that work for you as well as the stocks.  You might even save yourself a hefty fee for just throwing that money to someone else and learn something in the process.

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1. Macro Trader
2. Basic Investing Tips
3. Stocks and Shares
4. Issued Shares – The Hidden Dividend or Stealing Money
5. Float – Authorized – Outstanding Shares – Oh My!