One thing that I’ve been doing is trying to learn more about stocks.  I have a friend of mine who damn near seems like Warren Buffet.  He learned his skills from a family member and has shown me some amazing stocks.  I’m not someone who just wants the latest stock “tip”, rather, I’d prefer to understand how to find the stock myself.  So, over a few lunches, my friend has been showing me a few things.  I’ve only forgotten about half of what he has said to me, but I guess that repetition will help.

So, picking stocks isn’t easy.  Over time I will perfect my skills and then be a plain old mediocre investor like most everyone else.  You know what’s going to make me different though?  The zoo.  I’m going to go to the zoo once a month and hold up large “flash cards” with stock symbols on them.  Whichever card the monkey points out first will be the stock I buy.  I know, I know.  It’s brilliant.  I may have to look in to a zoo pass though because monthly admission on top of the fees I’ll have to pay to trade the stocks will really start to add up.

Mutual funds seem like they’d be so much easier.  The only problem with mutual funds is a WHOLE BUNCH of them suck.  Their expenses are high and their returns are TERRIBLE.  I have taken the approach of just buying index funds.  It seemed easy enough.  But, you know what?  That isn’t so easy either.  It turns out that some index funds are performing far better than others.  Take the S&P 500.  I have been investing in that for the last couple of years.  Too much as a matter of fact because the returns on the S&P haven’t been that good.  A few months ago I moved some money over to an international index and a Russell 2000 small cap index.  Guess what.  They are kicking some gluteus maximus.  (Yes, I spelled that correctly without a spell checker) :)   Anyway, I’ve learned a couple good lessons.  I feel a lot better about my portfolio now and have even gone so far as to purchase a value investing fund that has very low expenses and has had a strong return year over year.  Long term I think these choices will pay off.

What’s your method for choosing funds?