My VaxGen buy from Tuesday’s blog is a more than a little bit of the cart before the horse, at least for how much information has been revealed on this blog. Sorry.

If you are the kind of small time or beginning investor that I am hoping is reading this blog, then I didn’t just throw you into the deep end of the pool, I dropped you into the ocean. So consider this another swimming lesson. Investing 101. Beginning Investor class. More like a list of Investor tips.

Since you are at my blog, I will tell you what I think is important. This is not a complete list. These ideas are not listed in any particular order. You didn’t go to Gray investing. This is Chroma Investing. Hopefully I can bring a little color to what everyone else seems to think is black and white. There are hundreds of blogs about investing and many have not just different but contradictory ideas. Which is correct?

Figuring out what  is right and what is a load of crap takes time. If you don’t  understand the basics of investing, you will have to learn them. Hopefully that is part of why you are here. And that you like sarcasm.

1) Take it slow.  You didn’t learn to drive in a day. You won’t learn how to invest in a week. There will still be good deals whenever you are ready. Don’t invest with real dough until you have worked through the fundamental investing ideas enough so that you know how you want to invest. That means if someone says they have a great tip, you better get in before the market closes in fifteen minutes. Pass. Run away. They may be right. But you won’t be able to figure it out that fast. Unless have already done research on that particular company.

2) as Graham said, you need to make sure you are protecting your capital before you are earning on it. O.k. that is a paraphrase.  And not a very good one, but the idea is right. There many ways to lose your money. Don’t jump off the bridge, unless the bungy cord is properly connected. Make sure are not taking unnecessary risks or being rewarded too low for the risks you are taking.

3) Get out of debt. This is an easy one. Unless you are the next Warren Buffett you will not be making more money from investing that you are paying on credit card debt. Unless you have been able to secure some incredible deal on a loan, you will be burning cash until you get out of debt. That said, even the master Buffett has used leverage ( a fancy word for borrowing) on occassion. If you know what you are doing, leverage is not a bad thing. Used sparingly and fully understanding the risks. Even many of the financial professionals seem to misunderstand the risks involved with leverage. Just ask Nassim Nicholas Taleb the master of explaining risk and probability and how stupid we really are in understanding it. Taleb is at least a week of posts given the importance of his work in understanding down side risk. (Taleb has two great books that are must reads for humans and doubly so for investors. They are penny stocks for example can be an edge for small time investors over mutual funds.

11)  if your investment has a looming cataltic event or person, or group. Pat yourself on the back. Greenbackd.com, one of my favorite stock blogs, specializes in asset driven investments with a catalyst. Smart. I like catalysts like liquidation. It helps develop a time frame for your stock investment.

12) Make sure you have an Roth IRA. Remember if you do well in investing you want to keep. I love the USA, I just don’t want them taking all my hard earned investment profits.

13) a disagreement with Warren note. Buy and hold is a great strategy for Berkshire Hathaway, the corp that Buffett runs. They are huge and you can’t move ships that big very quickly. But the nimble small time investor needs to be clear when an investment is good to buy and when it is good to sell. Buffett didn’t follow his own advice when he was younger and had hedge fund like partnerships. See tip ten again. What is good for Buffett is not necessarily a good deal for a beginning investor.

14) Don’t deworseify your investments. Peter Lynch coined the term. Stick to your good ideas. No small time investor should own 40 stocks. You don’t have time to track that many companies actively.

15) Do not dollar cost average. This is an idea so patently stupid it must have come from the same geniuses who gave us the Effecient Market Theory. Why would anyone invest in anything when it is clearly overvalued? Bet big when the deal is good, stay out when the deal is bad.

16) Research companies in advance. Have a watchlist of companies you might be interested in buying at the right price. Have a buy in price. If the price drops unexpectedly, you will be ready like a vulture to swoop in for the kill.

Oh good I think I said everything I needed to say with this blog. I guess I can retire.

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