Knowing how much you should invest in the stock market is incredibly important to figure out for your own financial sake. We’re all different in terms of our age, net worth, and risk-tolerance; A simple “invest 50% of your net assets in the stock market” recommendation is too vague for anyone to go by. So this article will show you what’s important when it comes to deciding how much money you should invest in the stock market.

As an investor who is very actively involved in the stock market, I hear a lot of unrealistic and outright wrong beliefs regarding the stock market. Sometimes it’s harmless myths being perpetuated, other times it’s dangerously wrong beliefs that lead to terrible advice being given for your portfolio. Here are some very common stock market myths:

It all started during the mid 1990’s. The Stock Market soared on technology and Internet stocks, IPOs were all the rage, and the sky was the limit for stock prices. The masses believed there was a new world upon us, and the internet was to become the future of business. Then reality set in when the hype didn’t live up to it’s promises, and the stock market crashed. If you take all of this for only its face value, all you see is what happens when a stock market gets overvalued and crashes, but if you look deeper you can find plenty of timeless lessons that every investor should learn. Here’s a few lessons that can be gathered from the Dot-Com bubble:

Imagine a stock that falls fifty percent one day and rises fifty percent the next day. Seems like you’d have broken even, right? Wrong. This is the beauty of mathematics, and it occurs in the stock market all the time. While this shouldn’t be a significant problem for your investments, it can often be misleading and confusing when researching and analyzing stocks.

It’s times like these that I realize that the only thing I know is that I know nothing. I learned it first when I started investing in the stock market over 2 years ago, and I was reminded yet again when I decided two months ago to start my own ‘how-to’ investing website.

Keeping yourself up to date with daily stock market happenings is necessary if you wish to be successful and grow your money. It is a rule to invest by that I strictly adhere to, and you should too! However this doesn’t mean you need to read every tidbit of information that occurs every day in the market. On an average day, reading a daily summary of stock market news is sufficient enough to keep up to date with the stock market. On other days when there are important events such as earnings reports or fed meetings, you would benefit from keeping up with the stock market on a more frequent basis than just after the closing bell. Regardless of whichever degree you wish to stay informed, here are some easy ways to follow the stock market on a daily basis:

It is possible to never fail in the stock market. So what is the catch, you ask? The catch is that you never give up on the stock market, that you don’t ever get discouraged, and that you believe in yourself while simultaneously never letting mistakes happen without learning from them. If you want to succeed with your investments, you need to learn from your failures. If you can do that, you ultimately can never fail in the stock market.

I’m happy to say that as I write this article I am up over 21% in my stock market portfolio. I’m not assuming this will be where I end the year, but I’m still really proud of how well I’ve done so far in the stock market. This is my second year in the stock market and I’ve learned more than I could’ve possibly conceived when I first began investing.

If someone were to ask what I thought was the best method to make money in the stock market, investing or trading, it would not be an easy question to answer. Both investing and trading offers their pros and cons. I personally wouldn’t consider myself an investor or a trader. My own method to achieving portfolio growth is mainly short term investing along with some long term investments and and even smaller amount of trading.