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One concept to keep in mind is diversification. Diversification helps protect your investment if some segments turn sour.

Mutual funds, especially an S&P 500 Index fund, such as Vanguard 500 Index Fund, ticker VFINX, is an excellent way to begin. It is reasonably well diversified, but some would add other mutual funds: international fund, growth fund, reit, hot sector fund, etc. And then add individual stocks as opportunities present themselves.

If you are considering a stock portfolio, sign up for a CAPs portfolio. Once you pick seven stocks, TMF will rate your performance vs the S&P 500 every day. When you can consistently beat the indexes, its ok to start buying stocks. Until then, most would be best off to buy mutual funds and lets the pros do the stock picking.
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