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It's not headline news that the more you know about stocks, the better off you'll be. You need to manage your trades carefully, increasing your capital without going through periods of heavy losses. This usually means cutting your losses short and letting your gains run, though there are always exceptions. It also means not being foolish with your investments, or not buying into something on a whim or because someone else is buying it. It could also mean not putting all your eggs in one basket, but even this rule has exceptions.

Besides simple trading mechanics, if you really mean to succeed with your investments, you need an overall strategy, a way to gain control over profits. You have to work within a time frame that suits your temperament and lets you avoid excesses from greed and fear. (They say the market moves up the wall of worry and down the slope of hope.) You need to define your trading arena and become skilled in dealing with your selections in that arena. Knowledge usually wins the day. It also improves your temperament.

Since you really can't choose a discipline without learning about it, you need to get experience. You have to test the waters to discover what depth and temperature you prefer. Unfortunately, this can take a lot of time. It can also be costly, and usually is. And it ain't easy!

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One of the first things you have to do before you can trade sensibly is to get information, presuming you intend to make a profit. (If you merely wanted to give your money away, a charity would probably be more appropriate!) That part is clear enough -- you need to know something about equities. You need to look before you leap. The information has to help you make a decision.

But problems begin when you try to define what the information should be; it's a problem in model construction.

What should you look for? Obviously you need information that helps you establish the profit quality of the equities and gives you a basis for making a trade. But what information is that? What forms the ground for your decisions? The answer depends on the kind of trading technique you favor and can't be determined in advance. There's too much information out there to make the choice easy.

If you happen to prefer a fundamentalist trading approach, for instance, your concern would be with the nature and quality of the company whose stock you might consider buying. You would consider yourself to be a potential owner and would expect information that defined the company as a profit-making competitor. The information would tell you about the company's management, the products it provides, the current and potential profits, and so forth.

Alternatively, if you were a technical analyst, you might only care about the readings of technical indicators. They pertain to the stock's trading price and/or volume, or the pattern of prices over some previous trading period, the time span depending on whether your interests were short term, intermediate, or long. You would then need to have the current price as well as the price history for the desired period.

Whatever your trading preference might turn out to be, once you've decided to be a trader, you have to acquire information. To find a trading vehicle, you need to know something about the stocks.

But where do you get the data?

The answer, here, too, depends. It depends on whether:

• You know in advance the company about which you need data.
• You are screening the population of companies to decide which of them might be interesting and worth further exploration. The result would be a group that was small enough in number to permit a thorough and timely study of each equity.

If you already know the company, it's easy to write to the company for information or call a brokerage to have them send what you need.  All public companies are ready and willing to provide any information that promotes their interests and helps sell their stock. And most brokerages carry market data for their clients about many companies.

The situation is entirely different, though, if you intend to screen the listed companies in search of trading material -- like sifting through a pile of sand, looking for gold nuggets. There is little or no free information. Whether you stress fundamental aspects or technical, you still have a large amount of info to contend with and have to pay to access it. The more you get, the more it costs. And the more up-to-date it is, the more it costs. Free information is mostly noise. So it's important to know what kind of information you need.

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If you intend to screen information or price data in search of equities having the desired trading potential, be prepared to use a computer to do the work. You need a computer program that scans and filters the incoming stream to uncover the stocks that meet your conditions. Most important of all, and most difficult, too, you need to establish criteria for selection. You need to scan the mass of information with a "magnet" that attracts only certain kinds of "particles." It's up to you to define the filter.

And how would you select potential winners and avoid losers? Even if you scan printed charts, what tests would you apply to narrow your field of study? If you don't wish to be overwhelmed by quantity or depend on tips from others, you have to apply criteria of some kind -- rules or models -- to delimit the potential trades.

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