[BluesSwade]

Hey I am a college junior with a little bit of money to invest. I was thinking about putting my money into the S&P 600 small cap index, when I think the market is turning around... Whenever that is. This seems like moderate risk with a fairly good return, and I plan to do something like invest 20% every month for 5 months to even out my risk. I've never invested in anything exept for bank CDs, and I know this doesn't really matter because I only have a couple thousand, but I wanted to get started investing just to get a feel for it. Anyone have any thoughts on this?

[jasaunders]

Portfolio theory would suggest diversification as much as possible to minimize risk. Small cap stocks historically have had the greatest return. I wouldn't wait for "the market to turn around." Investing 20% monthly over 5 months is a good plan. You may want to consider throwing in some large caps, a little bit of bonds (and possibly REITs) with your portfolio to increase the return and minimize risk, assuming (and I hope you are) you are investing long-term.

[RLorenzen]

I agree with Jasaunders. If you're investing for the long term you should diversify into more than just one fund.

Consider buying some individual stocks as well. This is a great time to pick up some bargains for the long term. Just don't freak out if you see your stocks go down a bit when you first buy them.

[Gobuffs1016]

I would check out this book-The Only Guide to a Winning Investment Strategy You'll Ever Need: The Way Smart Money Preserves Wealth Today.
Covers modern Portfolio theory and shows you step by step how to build a solid investment portfolio

[BluesSwade]

Thanks guys

[Gaulkin]

I dont advise, ill just tell you where i put most of my money and you can decide if its right for you. Ive got most of it in CGM focus fund which is a high risk mutual fund and then some other money in Mosaic and John Deere.