<p>^ Somebody who knows something.</p>
<p>This market is one which you should be conservative. While its a small sum of money, for a 19 year old its a lot.</p>
<p>I think eBay is a good place to start, find out if you could get caught up in a frenzy.</p>
<p>dstark ~ this is what my S has been doing. He’s not planning to get rich off his $500 investment (although I’m sure he would like to ;)). It is a trial and error thing, plus a great learning experience. He had been interested in it in HS, then taking a couple of economics courses in college got him going again. He purchased individual stocks and set automatic limits on the account (if the price went down to a certain amount or up to a certain amount, it would automatically be sold), therefore eliminating emotional response to ups and downs in the market. They were conservative limits though. I was hoping he would buy something to hold on for awhile, but he hasn’t yet.</p>
<p>We did buy him “Stock Investing for Dummies”, lol.</p>
<p>Totally agree with Dstark, you learn by doing. If losing the money is not a big deal, go for it!</p>
<p>Myron Scholes and Robert C. Merton knew a lot also.</p>
<p>… just not sure which one.</p>
<p>kitty56…sounds good to me. </p>
<p>People shouldn’t invest more than they can afford to lose. </p>
<p>Well…DocT… now you have 2 pros from different aspects of the financial industry saying its ok. And neither one of us is a broker. ;)</p>
<p>“We did buy him “Stock Investing for Dummies”, lol.” 
So many books for so many dummies. :)</p>
<p>I think that learning on stocks is the way to go. For starting out, I’d prefer to see someone with about $30,000. I know that you can open an account with much less but commissions eat away at your results quickly.</p>
<p>Just what can you type of stocks can you buy with 500? We started DS with a bit more for round lots and enough for at least 3 equities.</p>
<p>Penny stocks. Stocks for a buck.</p>
<p>Most stocks can be bought. Can’t buy Google or Berkshire. You don’t have to buy round lots.</p>
<p>A while back when Nasdaq was climbing everyday, I had a hard time getting my carpenter and electrician to come to my house to finish my basement. They told me that they were making more money trading. I could turn on CNBC at 6am and know if they were showing up. I think the only thing they learned from that experience was not to quite their day jobs. It is the reason I ask what you are trying to teach a 19 year old by investing in the stock market?</p>
<p>The stock market is going to teach the kid.</p>
<p>I started investing at 14 years old.</p>
<p>Bought the stock of Madison Square Garden because I thought the publicity of the Ali-Frazier fight would lead to a good performance of the stock. Didn’t work. The stock eventually lost 50% of its value. I lost less than 100 bucks. I survived. </p>
<p>I learned that I wasn’t infallible and stock investing isn’t that easy. </p>
<p>The carpenter and electrician are going to learn too.</p>
<p>An investor in the stock market can learn about psychology, how he deals with money on the line, how he handles winning or losing, his patience or lack thereof, mass psychology, risk and reward, businesses, economics, investing, saving…and the OP can learn this for $300.</p>
<p>He’s going to learn squat with $300</p>
<p>Penny stocks.
Be nice to marks. :)</p>
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<p>I agree about index funds; they are a great way to go. They’re are a basket of stocks which relieves the novice investor of trying to make educated assessments of individual companies, something even the big boys have a hard time with. And their fees are nominal. I don’t suppose we can mention names here, but check out a large reputable investment company that starts with a “V.”</p>
<p>I don’t see any reason to waste money on a broker. If you educate yourself about investing principles, decide on your goals, and assess your tolerance for risk, you can go directly to the fund company and skip paying the middleman.</p>
<p>As to conservative or not, it depends entirely on the purpose of the investment and when it will be needed. If the OP is building an emergency fund, he should invest conservatively. If he’s saving for retirement, he should be looking mostly at stock funds.</p>
<p>Recommended reading: anything by John Bogle</p>
<p>Agreed w/respect to buy-write strategy specifically (also can be with other strategies if you are disciplined). The problem is that the OP can’t afford 100 shares of anything.</p>
<p>Nonrecommended reading: Anything by Jeremy Siegel, who apparently has never heard of Japan.</p>
<p>I don’t know a lot of 19 year olds who are investing for retirement. Why would you buy an index fund when index etf’s, spyders etc have a lower expense ratio and are easier to trade?</p>