Finding the right stock picks is one of the most misunderstood parts of investing. It's a risky business, there can be no doubt, but there are ways to minimize the risk to your finances while maximizing your returns. A tactical approach works best, as in everything else.

Preliminary Stock Investing Remarks

"Buy low and sell high" is accurate advice for stock investing, but you have to know what this means. You have to know the low points on the stocks you're considering, as well as the high points. This can only be accomplished by looking back through their history. Don't think about the day to day snapshots…you have to get a detailed history of exchanges.

This refines an ancient element of strategy. If you know your opponent, you have an advantage. If you know the typical behavior of your stock picks, you can anticipate what it's going to do next. You'll know when it's at a low point, and when it's at a high point. You'll, in effect, know when to buy or to sell.

Knowing What Stock Values Really Mean

Many people think that companies with high stock values must "certainly" be a good investment. Those are not the stocks you're looking for, necessarily. Where the real money can be found is in the companies that are undervalued or bottoming out. It doesn't matter what the initial price is, as long it's poised for massive immediate gains.

You could very easily make more money with a lower valued stock than a higher valued stock with a much smaller initial investment if you time your purchase right. The higher valued stocks don't tend to fluctuate as much as the smaller ones, but in this you have to take care also.

Aim for Well-Known Global Stocks, not Start-ups

Unless you want the adrenaline rush of investing in a highly risky start up business, you should stick with well established global stocks. Small start-up companies come and go, and as an investor you could be left in the lurch. Bringing up start ups is not a job for the beginning investor.

If you've done your research before you started investing, you will know the stocks which are known the world over, and you will have a good sense of which ones have been around for a while. Further, if you've done this research, you will have a good idea of when your stock picks are at a buying point and when they're at a selling point.

In short, there isn't a magical or overly complicated way to get around simple research when it comes to investing in stocks. What you really need is a good solid strategy based on accurate research in your stock picks. Don't rely on the day in and day out information that everyone gets--a stock may fall a little bit in the course of a day, but if it's not at the peak that you gather from its behavior, you could sell yourself short by selling before its time.