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[quote=Anonymous][quote=Anonymous][quote=Anonymous]There's no doubt that someone wanting to learn "how to invest in to invest in stocks" faces a daunting task.  There's no shortage of reading material for that, but I'll provide my quick thoughts as someone who has spent several years in equity research at an investment bank, and is now a senior equity analyst at an institutional asset manager with billions in AUM.

1) Have a diversified portfolio.  In general, I would definitely recommend most investors have a balanced portfolio, invest in ETFs or mutual funds, and avoid individual stocks.  You need to pay closer attention to individual stocks and most individual investors don't do that.  
2) ETFs over mutual funds.  Fees are much higher with mutual funds and most mutual funds underperform the broader indices, as they have cash drag (they need to hold cash for redemptions and indices don't) and it's very difficult for large asset managers to outperform since good ideas are scarce and once you hit a certain level of AUM, there aren't enough good ideas to invest in.  That's generally why smaller asset managers can outperform firms like Fidelity.  It's a lot easier to find good ideas with only $100M to invest versus $50B...you become restricted in the investments that you can actually build a position.
3) You get rich by being concentrated, not diversified - but, as risk-averse investors, most individuals should be diversified.
4) In general, small-cap stocks will outperform large-caps, but volatility will be much higher.
5) You should only invest the $8k in stocks if you already have other investments, but honestly any amount will suffice to get started.  Heck, I started investing in college with $3k, before I really knew anything about it.  
6) Before you invest any money, you should think about the type of investor you want to be: value, growth, style agnostic, special situations, etc...
7) For most individual investors, I would employ a "buy-and-hold" approach and try to find companies you'd be comfortable owning for years.  
8) Read a few investing books before you invest any money into individual stocks.  Here are some of my favorites:
Little Blue Book that Still Beats the Markets by Joel Greenblatt
- Very easy read and pretty short
Random Walk Down Wall Street by Burton Malkiel
- Classic book that for me was a good introduction to investing and provided a nice history of investing and how investors make the same mistakes.  However, it basically recommends sticking to investing in an index.
Margin of Safety by Seth Klarman
- You can find this book in PDF online, as hard copies sell for over $1k on Ebay.  It's a must-read for value investing.  Klarman is a very successful billionaire value investor.  
Finding the Next Starbucks by Michael Moe 
- This is a good book on growth investing (of which there aren't as many...much more literature devoted to value investing like Buffet)
Reminiscences of a Stock Operator by Edwin Lefevre
- It was written over 80 years ago, but it has timeless rules to live by, even though it was more about trading and speculation than investing.  It shows how human nature, fear and greed never really changes.  This is a favorite by several hedge fund billionaires like Paul Tudor Jones.  
9) Try to read a lot, whether it's WSJ, Economist, Financial Times, etc...  You just get a better understanding of how the world works and how things are related.

I personally find investing very exciting and stimulating, but it's not for everyone.  Hope this helps.
[/quote]

Thank you, PP!  That was good advice.  I probably would have for it IRL.   :D [/quote]

^^^  Uh, probably PAID for it, IRL, I meant.  From someone less savvy then you as well.

OP, pay attention!  [/quote]

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