How to Invest in the Stock Market Even if You Can't Pick Stocks
Investing to fund a secure retirement should be one of your top financial priorities, and successful investing requires appropriate asset allocation. This means putting the right amount of money, based on your age, into safe investments like bonds -- and also higher risk investments like stocks.
The stock market has, over time, consistently provided investors with higher returns than "safer" investments like certificates of deposits and bonds -- but there are also risks because buying stocks means acquiring an ownership interest in companies. If you buy stock in a company that performs poorly, your investment could decline in value or even become worthless if the business goes bankrupt.
Skilled investors can examine a company's financial situation to determine the worth of a share using a process called a fundamental analysis. But, understanding the different factors impacting a company's viability is complicated enough, much less trying to project whether its business model will lead to rising share prices. Many people who try to "play the market" by investing in stocks they believe will be successful end up underperforming the market or even losing a lot of money.
Source: Fool.com
