Knowing where you want to go

OK. Wanting to get a feel for the basics, I've purchased a couple of beginner's books and one that seems more advanced in terms of strategy (I've had some recommendations of others which I will definitely look into, but stage one... know thy territory!)

I wanted to launch straight into strategy, but the first book I'm ploughing through (Investing in Shares for Dummies, UK Edition) spends a long time talking through what kind of investor you are and just what it is you want to achieve. It shouldn't be news to me... it seems to be all about defining well formed outcomes :-)

Seems there are three kinds of behaviour (not necessarily mutually exclusive)

* investing - a long term strategy... your investment may fluctuate in the short term, but with a knowledge of the market and wise investment, you are looking at a long term growth over maybe 10 years. Investing requires that one is prepared to tie up one's money fairly long term.

* saving - savings don't fluctuate... they are safer, but don't offer the same potential in returns.

* speculation - pretty much a gamble... a gamble based on a knowledge of the market maybe, but a gamble none the less.

Actually, I know a man who speculated on spread betting and made 10's of thousands of pounds in a few weeks. He lost it in less.

Our strategy certainly includes all three behaviours, but initially our share buying has a speculative flavour... we've put some money in based on an initial assesment of the market and some likely looking prospects (good move) and instinct (oops)