Unfortunately, stock market investing is a medium of money making rather unfamiliar to most. However, nowadays investing is gaining popularity, with about 20-30 percent of our high school students having their own portfolios. Taking the initial step into the market may seem scary, but after following these basic do’s and don’ts, you can become a stock market God, wracking in large sums of money every year.

Do: To kick off the list, I want to stress my number one rule of investing. Only invest what you’re willing to lose. When investing it’s important to stick to this discipline, even if you’re oh so sure your investment will make you money. The “hidden gem” of a company you think you may have found can very well take everything from you. This discipline needs to be taken seriously when investing in any company, even huge blue chip companies such as Apple. Let’s say industry rival Samsung releases a killer new phone and tablet, putting Apple’s dominant position at stake. Apple’s sales then decrease, leading to a less profitable company, leading to the share price declining. You can find yourself losing lots of money in companies such as Apple, so again, always remember the number one rule: only invest what you’re willing to lose.

Don’t: Don’t get emotionally attached to your investments. There is no place for love or fear within the markets, only rational decisions based off of data and research. For example, when the markets crashed in 2008, the majority of people were selling off their positions after losing around 50% of their invested money. This was because of fear. Investors didn’t want to watch even more of their money go, so they sold off their positions. In reality, those that held onto their positions, riding out the storm, have made considerable profits, rather than painful losses.

Do: Do your own research. Never allow your financial decisions to be based on a friend’s recommendation. Don’t invest in a company because someone you know believes it’s a good buy. This may be a good starting point for stock picking, but it should never be the extent of your research. Dig deep into the company by looking at the balance sheet, listen to conference calls, analyze the industry and what the competitors are up to. Make educated decisions based off of hours of time spent learning about the company, then give yourself the go-ahead to buy shares.

Don’t: Don’t invest in penny stocks. Penny stocks can be attractive because of the potential short-term gains but have a much greater chance of losing money. As a general rule of thumb, stay away from risky penny stocks.

Do: Do start early! Investing is a valuable skill to have, so don’t shy away from starting the learning process early. While all your friends are learning to invest in their 20-30’s, you’ll already be ahead of the game. If you don’t have a lot of money to start with or don’t want to risk your money at all, a good place to start would be with a dummy account. A lot of different websites such as Yahoo Finance, allow people to make fake trades with fake money, a good place to learn about the stock market in a zero risk environment. Once you’re comfortable with your fake account, try expanding into a real account, turning those fake profits into real profits!!

Don’t: Don’t quit. Investing is a long-term journey, so don’t be discouraged by short-term volatility. Often times shortly after investing, beginners will worry too much about the short term price shifts. As long as the underlying qualities of the business that made you invest in the first place are still there, the volatility means nothing. Keep holding your shares, don’t quit.

I’ll leave you with a quote from perhaps the greatest investor of all time, Warren Buffet. “Someone’s sitting in the shade today because someone planted a tree a long time ago.”

Investing is a process, with the right mindset and discipline you could be benefiting greatly from the stock market.