The stock market is an investing option which can get very complicated if not treaded on carefully. Thus a thorough study is mandatory. Though a lucrative option to becoming wealthy, risk appetite needs to be high. Highs and lows in life are common but certainly not as swift as found in this field. Interestingly, dummies end up investing more wisely in many cases since they read up a lot of information. However, if I were to summarize and write down a golden rule, I would say only one thing - keep your sense of logic high and emotions low. Half your battle would be won if this is followed.

Let us begin at the very basic. What are stocks or shares? They are equal parts into which a company's capital is divided. Every owner is entitled to a proportion of the profits. The two types of stocks that you can avail of are common and preferred. The method being similar, the main difference lies in the security of your investment. While a common stock owner will be the last to be paid in case of a failure, a preferred one will be a little better off in such a scenario. He will be paid before the common shareholder but after the debt holders like bank, etc. His voting rights in the annual meeting too, are stronger than his counterpart.

The most important stock markets in the United States are the New York Stock Exchange (NYSE) and the NASDAQ. The rise and fall in the market is dependent on the simple rule of demand and supply.  If the demand is high but the supply is less, the prices of stocks too are high and vice versa. There are various reasons why someone chooses to invest: 

• The particular company's history
• Its past performance
• Various statistics
• Consistency in growth pattern
• Sense of security attached with the brand
• Purely emotional reasons
• Perception of existing general expectation
• Trend of the buying pattern among other investors

Once the decision to invest has been finalized, finding a good broker becomes the next step.  If personal attention is the key decision factor, then opt for a full-service broker. This comes for a steep price of course. For the rest, there are discount brokers. 

Investments can be short-term, mid-term or long-term. Risk of making losses is lower if one prefers liquid stocks. Understand your risk appetite. Are you aggressive, assertive or passive? Would you rather anticipate huge profits at the cost of losing out some or would you make smaller profits and face minimum loss? Observe the other buyers. Majority is always stronger.  So study well before you make a plan, and tread carefully. The dummy will definitely come out smiling with your efforts.