Originally <a href='/showthread.php?p=20815182'>posted</a> on 01/09/2014:

The approach to the stock market is a lot like the approach to sports betting because of one simple action...ANALYSIS.

I recommend mixing fundamental analysis (studying earnings reports, balance sheets, etc.) and technical analysis (studying trading volume and price changes by looking at the company's share price charts over periods of time).

I'm sure you know, and I am not trying to sound like a dick or anything, but stock prices are determined by the buying and selling of the company's shares. When more shares are bought then are sold at a given moment in time (so when there is more demand than supply) prices will go up and when the opposite occurs, prices will go down.

I say that because you can do all the research you want (and to be successful you should be willing to do a good bit of research) but like how in sports betting the players, not the sports bettor (with all their analysis), determine the actual outcome of the game. In the stock/forex/commodity/bond market, you can theoretically drive prices with enough personal buying and selling.

I say theoretically, but unless you are some secret billionaire and you want to invest in small cap companies or you manage China's sovereign wealth fund and you invest in mid-cap companies, you won't have nearly enough money at all in order to drive prices personally.

Don't invest in penny stocks, because those are traps. You can potentially personally "drive prices in penny stocks" in certain ways, but you can go to jail for that, so don't try to do that.

Basically, since you won't have enough to drive prices yourself (I mean I think it is fair to assume that you're not a multi-billionaire, because you would be one of a few hundred people in this world if I remember correctly) you need to: make sure you do a lot of research about companies before you invest in them, keep up the research throughout the time you own them, dollar cost average if you have a lot of confidence in your investment and it is having a rough patch, try your best to buy low and sell high, etc. Do all these things and take the ride.

There are plenty more advanced things like options and futures, etc. to learn about later, but this should get you started.

Also, don't believe in the "perfect market" or "random walk" theory. Those things are ideals promoted by academics that have "no skin in the game" and make 6-figures (in the case of people like my finance professors) to just regurgitate the same shit class after class after class.

Warren Buffett promotes promotes the "perfect market" theory TO THE PUBLIC when he says people should just buy shares in an S&P 500 Index fund and just hold them so you make money or lose it based off of what the S&P 500 does. Buffett is a hypocrite because he did not earn his billions by investing in a S&P 500 Index fund. He analysed companies and bought them so he speculated and invested off his own effort and the effort of his employees at Berkshire Hathaway. But, I view Buffett as just another old man and I don't really like old people so fukk him.

If you want to look at certain investors that you can "look up to" so to speak and that speculated/invested in specific companies/commodities/bond/currencies (via the forex market) like I assume you plan on doing, some people that I look up to are: Robert Rubin (just focusing on his trading ability which is all we are talking about here, he was A BEAST bond trader at Goldman Sachs), Peter Lynch (arguably the greatest mutual fund manager of all time), and then a guy like T. Boone Pickens (the greatest oil trader of all time), and a fairly consistent top 5-ish and ACTIVE hedge fund manager like Ken Griffen (guys like George Soros haven't actively managed in years, they just pick up a paycheck now).

Lastly, if you want to put all your money in an index fund, well ok. But, I can almost promise you that if you do the work yourself and invest in the individual things you choose, then it will be better for you overall (financially it may be tough at times, but it will be much better for you over time from a financial and learning perspective in my opinion).

Also like Russian Rocket said, have a different account from your friend. Your money is YOUR MONEY.

Finally, DIVERSIFY your investments.

bubbles may be a wild guy, but bubbles isn't a fukking idiot so take this post to heart.

I wish you the best of luck, bruh.

Now, let's watch sbr trolls flood your thread with laughing smileys and broke dick fukk comments, like they do to everyone else.