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Most investors are best off to begin with mutual funds. An S&P 500 Index fund such as Vanguards 500 Index Fund (ticker VFINX) or a total market fund such as VTI are good ones.

As your resources grow and as you gain experience, many would add an international fund, a growth fund, a hot sector fund, sometimes a bond fund. Then gradually add individual stocks as you become aware of good opportunities.

While you are learning, try a CAPs portfolio where you can experiment without losing cash. Once you learn to beat the S&P 500 (indicated by a positive score in your CAPs portfolio), you can easily convert to cash investments. Until then you are best off to use mutual funds and let the pros do the stock picking.
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