Beginning A Stock Market Investing Program From Scratch

Over the next several months, I wanted to lay the ground work for beginning a stock market investing program from scratch. If you are new to stock market investing, the first step will obviously be to select an investment philosophy. For me, that will be the CANSLIM style developed by William O'Neil in his book How To Make Money in Stocks. Once you have decided on the type of investor you will be, that's when the real work begins. It's time to set out to master it. It's also important to stick with one style. Once you start dabbling in the stock market, you'll be tempted to try all types of things like options, buying penny stocks and in today's market even short selling. You'll get emails and faxes touted this stock or that. You want to resist the desire to fly from idea to idea and focus on one thing. Just like any thing else, there are people who are trying to make money off of you or scam you, so ignore them and stay the course.

Admittedly, I am not a stock market guru. I have limited experience in the market. I've been a mutual fund investor most of my life and so I know enough to be dangerous and also know enough to lose money in the market. But, don't let the fact that I'm not the master of investing deter you from reading further because what is going to follow is the beginning of the what will be a step by step guide to how to implement and learn the CANSLIM theory. You'll get an inside peak in each step I take, the questions that come up and the answers I find. You'll get to watch lose money as well. Because failing is the best learning method, it's part of the approach. If you stumble upon these articles, feel free to provide your input or if you need clarification don't hesitate to say so as it may also help me and others trying to do the same thing.

Let's begin.

Since I've determined that the guru I want to follow is O'Neil, the first thing I need to do make sure that I've read all there is to read that he has written. In addition to How To Make Money In Stocks, I've also got a copy of The Successful Investor which in my opinion is a little easier to see the exact steps to follow. I've read and re-read these books and will continue to refer to them. The next step I took was to renew my subscription to the Investor's Business Daily, or IBD and while I would love to subscribe to the Daily Graphs, the cost is more than I can justify at this point. I did sign up for the eTables service which gives me access to several screens which I can export and manipulate the data in excel. Both subscriptions give me access to Investors.com and this will be helpful as I put together watch lists and will allow me to take advantage of the Stock Checkup feature we will discuss at some point. The subscription to the IBD is vital though and I could have just gotten started using that alone. You are going to want to do that for sure. It's the best financial paper for small investors and give me access to just about everything that I need to successfully implement the strategy.

On Investors.com, there are several tools, but two that you'll want to refer to our the IBDTV and the ASK IBD. I've found the answer to about all of my questions there. Also, don't hesitate to call IBD to get answers to how to use the tools they provide. They have been helpful every time I've called.

The next step is learning how to use these tools to pick winning stocks and will be the subject of my next article.