Re: i want to learn how to pick stocks
Disclaimer: I am just some guy who is NOT an accountant or financial advisor.
If you're going to think of it as "picking stocks", you should probably stick to index funds.
Start by identifying some publicly-traded firms you would like to own. Then, for each firm, figure out how much you'd be willing to pay to own it. (You can make do with basic math, but you cannot do without common sense.) Consider the firm's position relative to actual and potential competitors. (Sometimes you'll have no idea how much a certain firm is worth. When this happens, either gain more expertise or move on to the next possibility.)
Once you are comfortable with an estimate of the value of a firm, compare your estimate to the firm's market capitalization. (If buying the whole firm for it's current market capitalization is a good deal, buying shares of the firm's stock is also good deal as well as long as management's interests are aligned with those of shareholders.)
Perform a bit of due diligence before buying. Look at how management expenses employee stock options, finances acquisitions, takes care of rank-and-file employees and suppliers, etc. If the price is right and if you have no qualms about what the firm does or how it does business, buy some stock.
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