Do Not be Afraid to Hold Cash

Most Wall Street types hate for retail investors to hold large amounts of cash. Many brokers view large cash positions as opportunities to generate commissions by selling stocks, bonds or other financial products to their clients. In many cases converting cash to stocks or bonds is the right move to make. But not always. If your portfolio is already highly weighted in stocks, keeping some cash in the account makes sense.

Of if your broker makes buy recommendations that you do not understand or like, you do not have to act. If you are not sure where the market is headed and you are nervous, keep your cash until you feel more confident. Just because you have money to invest, does not necessarily mean that it's a good time to buy stocks.

Be careful of specific stock recommendations that you here about on TV and radio and from newspapers, books and magazines. The agenda of these pundits is not always clear and often their recommendations are not timely.

And if you are just getting started buying stocks, you do not have to jump head first into buying stocks all at once. Be patient. Study the stock market, research individual stocks and buy at low prices on the price upside.

It's your money so you should spend it when you are ready.