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If you are a beginning investor you'll have many choices; stocks, bonds, real estate, commodities, etc. Within those broad investment categories, there are many sub-categories. For example, if you choose to invest heavily in stocks, also known as equities, you'll want to find good stocks to invest in. Be advised that many great minds have tried and failed to both pick stocks and time the market. Others, however, have had great success in doing so, typically the former more than the latter.

If you're going to have a go investing in stocks, your main objective will be to find good stocks to invest in. A tall order, that, but definitely not hopeless. Fortunately, there are many great companies out there from which to choose. If you are going to pick good stocks, you could do a heck of a lot worse than to follow such investors as Warren Buffett. Warren is a champion of an investment style termed value investing. Value investing is an investment style whereby the investor tries to buy stocks in good companies that are undervalued by some measure. The theory is that eventually the market will catch up with the goodness in the company and the investor will profit accordingly. This has proved immensely successful for Buffett and others.

There are other approaches to investing as well. One approach that works very well is to look into the future and try to discern what businesses will have products or services in greater demand than they are today. That accounts for the growing number of investors that invest in emerging markets such as China and Latin America. The economies in these areas are experiencing fantastic growth, and are poised to continue their expansion well into the future. Another area that shows promise for investors is the health care arena. As the population ages and and people live longer, there sill be a greater demand for medical and long term care. Usually, growing demand for a product or service portends great things in the future.

Finding an area to invest is all well and good, but within that area, an investor must still choose what to invest in. How do you find good stocks to invest in? You can pick individual equities, or choose from funds made up of many different ones. If you choose funds that are made up of many different stocks, called mutual funds, you're trusting in the fund's manager and team of analysts to find good stocks for you. Many investors feel more comfortable with this approach, since the analysts and fund managers have experience and training on their side. In theory, this should mitigate much of the risk associated with stock investing.

Other investors choose the go it alone route, preferring to trust their instincts and research to pick stocks. If you are among this group, you'll want to find good stocks, but that's not just a matter of laying out the business section on Sunday and buying up the equities with highest year to date growth. You'll want to look at past performance, sure, but you are actually investing in the future of the company, not its past. The past can be an indicator of future performance, but 100 years ago there were many well run buggy whip companies that probably proved to be poor investments. A quote from Warren Buffett is in order here. “If past history was all there was to the game, the richest people would be librarians. “

That being said, how can you find good stocks to invest in today? I'm kind of partial to Buffett's value approach myself. You can surely find worse investors to emulate. When picking companies in which to invest, Buffett has some rules. His number one rule is “Never Lose Money” Now if you went to business school, you were taught that there is an intrinsic relationship between risk and reward (thanks Finance 325). Higher risk brings with it greater return, if you stick with it long enough, while more conservative investments will provide lower returns. That, however is not always true. There are many examples of very risky investments that fail to pay off, while numerous blue chip companies that offer comparatively little risk to the investor, but pay off handsomely in the long term. Those are the stocks that Buffett (and I) favor.

Here are 10 more quotes from Warren Buffett that give an insight to his investing strategy:

“I never attempt to make money on the stock market. I buy on the assumption that they could close the market the next day and not reopen it for five years. “

“It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price. “

“Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it. “

“Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years. “

“Our favorite holding period is forever. “

“Price is what you pay. Value is what you get. “

“Risk comes from not knowing what you're doing. “

“The business schools reward difficult complex behavior more than simple behavior, but simple behavior is more effective. “

“Time is the friend of the wonderful company, the enemy of the mediocre. “

“We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful. “

“Why not invest your assets in the companies you really like? As Mae West said, "Too much of a good thing can be wonderful". “

What exactly does he mean by these pearls of wisdom? Look at the company first. Is it well run, and do the managers of the company have a good handle on the firm? What line of business is the company in? Do the prospects for the industry and the company's products and/or services look to have look to be strong in the future? Can you invest in the company for a fair price? You don't need to buy it for a song, but you should be able to get stock in the company for less than stock in comparable companies in the same industry.

f the company is well run, has a history making a good profit, with potential for solid growth, and in a growing industry, it should be profitable in the long term. Even better is if you can find a company that has had some recent problems, but looks to be overcoming them. This will often push their stock price down in the short term, creating a opportunity for the investor. The key is, however that the company have intrinsic strength and be in a market with strong growth potential.

Using the preceding strategies is one way to make sure you find good stocks to invest in. You won't always pick winners, but if you do it right, and try not to hit a home run every time, your winners should far outnumber your losers. Remember, don't try to get rich off one stock, get rich off them all together.