<prompt> Human: Im 21, and thinking of maybe starting to put 500 a month or so into stocks, like maybe 4-5 companies that have been doing well for many years. Whats the best way to do it for a beginner? I have heard good things about Scottrade but I have literally no experience with stocks to advice would be appreciated.  <response>: rather than tell you to do something, i would encourage you to spend some time asking yourself why are people saying these things. why is diversification an appropriate goal when constructing a portfolio? why even have a portfolio rather than picking a winner? hint something to do with risk vs. return how is a stockfirm valued? if i cant readanalyze a firms financial statements should i be buying its stock? etc etc etc. there is a whole multitude of things to learn!why do people say vanguard is a good option for the uninitiated? they focus primarily on low cost. they do not or shouldnt be making lots of trades. they dont have brick and mortar stores for personalized service. etc. everything they do is focused on low cost consistent market returns. again, rather than throw your money into something because someone tells you something, get informed and come to your own conclusions. though starting off with them is probably a good idea while you figure it out. it is your money you should take informed control over it, which is the point of this thread subredit edit.disclaimer: i have a vanguard iraPS. i have not seen anyone touch on the Efficient Markets Hypothesis which seems to be the best reason to be a passive investor, look into this AND look at the evidence against it, unlock your mind! 