Beginner

• Read a LOT of books, articles, etc. before putting any significant amount of money in the stock market.


• Find a user-friendly stock market app that lets you trade index funds easily and at low cost, e.g.: Acorns, Stash, Stockpile, etc.  Consider putting a small amount into an index fund (we recommend the S&P 500) to get started.


• Start creating trading rules---do not just buy and hold blindly.  Only fools who don't care about their money do that.  For example, if you buy a stock, and the company then declares bankruptcy, and you continue to 'hold' without researching whether the stock price is going to go down all the way to zero, that isn't very smart.  Keep an eye on your stocks and create sell rules.


• It's not a bad idea to create criteria for buying too: buy rules.


• Don't you even consider doing anything on margin.  If you don't know what margin is, good!  Keep it that way.  


• Only buy or sell stocks, and only of large reputable companies.  In other words: no cryptocurrencies, no hedge funds, no strange stock tips you haven't investigated.


• Never ever buy a stock from a stock 'tip' without first running it through your 'buy rules' and making sure it actually does make sense.  


• You can get started with small amounts of money without any emergency fund, but before you start to really put money into the market, first make sure you have at least 2 months expenses saved up in cash.  And never touch it.  


• Make sure you never use any money in the stock market that you need for other jobs.  For example, if you have saved up $500 to repay a $1,000 loan, do not put that money in the market hoping to raise the remaining loan repayment balance by multiplying that $500.  That is not good money management---that is foolish money management, because if you lose the money, you now have to start over from scratch.

Intermediate

• At this stage, you need trading rules.  


• Make sure you have begun to create a philosophy that you stick with.  


• Always be ready to update any rule when you need to.  Don't become stubborn.  Things change.


• Start researching cryptocurrencies, real estate funds, aggressive index funds, etc.


• Start investigating calls, puts, and other advanced trading strategies.


• Allocate your money in categories, for exampe: 5% for super risky picks, 10% in risky picks, 35% in moderately risky picks, and 50% in slightly risky picks.  The idea is: never put all your money in super risky or even risky stock picks.  


• Make doubly sure now that you aren't putting all your money in one basket.  Start diversifying stocks, industries, sectors, and frankly, make sure you don't invest all your money just in the stock market.  There are many other places you can and should put your money to ensure you don't crash and burn if there's a total market meltdown.


• Margin?  NO!  If you must, however, only use 5% of your available investment capital.  It's too big of a risk otherwise (unless you are 100% certain you know what is going to happen, and in that case, it's probably insider trading!)


• Start learning about the income tax / capital gains tax ramifications of your stock trades.  The more often you trade, and the greater the gains, the more tax you will have to pay.  Don't forget this!  Very important!
  
  
  

Advanced

• At this point, you should be consistently making money from the stock market over a period of a few years.  It's easy to make money once or twice on a fluke; it's a lot harder to repeatedly do so.


• You should now actively be considering covered calls, naked calls, and other advanced options strategies you can use to make more money, or to act as a hedge against loss.


• If you have massive amounts of money to invest, now you might consider researching hedge funds in which you could invest.


• You should now have a 95% foolproof trading rules system in place that works for you.  And... you should be sticking to it methodically (and updating only when absolutely necessary).


• Even if you don't use them, you should know and understand what straddles, butterflies, and other advanced trading topics entail.


• At this point, you might consider cryptocurrencies, commodity trading, and yes (if you're a little crazy and feel the gods are shining down on you) margin.  Margin is when you borrow money from the bank to buy stocks.  That's a big risk.  If the stock price goes up, great!  You can repay the margin, but if the price goes down... now you in debt.  It's not a position you want to be in.  If you plan on using margin, proceed at your own risk.