[SaintessHeart]

TRL has pretty much pointed out alot of things, but there are still plenty of stuff to take note of :

1. Beta : It measures how will the company do in volatile market conditions; a negative beta would mean that it moves opposite in the market condition, and a positive would mean it follows the market. A near zero beta means it is entirely independent of the market mood.

2. Company history : How has the company been performing in the past decade or so? One thing to note is that companies can capitulate even after a century of service, like Bear Stearns, Barings, or the most glaring, Worldcom. High capitalisation doesn't mean the company is rich - sometimes it may have a crapload of accounts payable to their creditors over a term. And you also have to look at the type of corporate bonds they issue; are they long term or short term, and what are the interest rates on the bonds, issued which year, how close is it to maturity, etc.

3. Company structure : Who is their CEO? What is their CEO history? It is a good idea to take a look at the top three histories before buying a company share (CEO, CFO, COO). Usually the biggest assholes in the history of finance tend to make companies do well after its downturn because they are asinine enough to do the dirty stuff to get the company back up, but that is just my opinion.

4. Current situation of the world economy and the company's place in it : this is probably the most important, difficult and confusing subject to learn. I spent close to 4-5 years, even during my NS days, reading up and studying it, but I am still a newbie. You need to have a crapload of knowledge on history, geography, militarisation, production level, corruption level, transparency, media trend and language, trade ties, political enemies, internal stability, main export industry, main domestic industry, domestic consumption rate. It is insane - there is way too much to learn.

You might want to pick a company you like, do research about it, and if you don't know any terms, consult wikipedia, investopedia, Marketwatch, AP, Reuters and TRL. But ultimately :

1. How much is your capital?
2. How much can you lose?
3. What is your preferred range of RoR?
4. How long do you plan to hold?
5. What will you do if the company runs into some shit and loses 25% of its value?
6. What is your investment/trading plan to you?

One more thing is that, do you add to that lump sum? If so, you might want to create a cash flow statement of your income, expenses, savings and investment fund each month. Doing this may take up to 3 months, and you need to build a new one everytime you change a job.

Making an investment is an extremely seriously business, as much as your family's future is to you. If you are not willing to put anything more than your life and utmost effort on it, my suggestion is that you buy an ILP or Endowment plan, or just park that money in a mutual fund, close your eyes, and pray that it doesn't collapse.