An observation before we close out the hour. It isn't easy living through a financial services revolution. Yes, low-cost online trading has opened up the world of owning individual equities to millions of people. Yet the past few months have been sobering as the stock market lurched lower on extreme volatility. For instance, the NASDAQ Composite index is down some 30% from its March high, despite recording its biggest one-day gain in history last week. If you've been trading online, or are thinking about it, the experience of the past few months is a timely reminder of the basic rules of investing, the ones that long predate the Web.

Rapid trading is hazardous to your wealth. The ease of buying and selling stocks with the click of a mouse tempts many people to trade too much. Economic research and financial history alike tell us that it's tough to beat the market for a sustained period of time, especially after taking fees and taxes into account. There is no evidence to suggest that trigger-happy traders will ever outperform buy and hold investors.

Know what you are buying. Unless you enjoy gambling on a hunch, it pays to delve into the fundamentals and try to answer the question: "What is this stock worth?" If you don't have the time or the inclination to educate yourself about individual stock picks, stick with index funds. At least you'll match the market's performance and pay razor-thin fees.

Finally, manage your overall portfolio around the concept of risk. Limit the odds that you will end up with less money than you want to live on in retirement by creating a well-diversified portfolio. Have fun trading stocks, but don't put your future standard of living at risk to your stock picking abilities.