{"slug":"beginner-investment-strategy","title":"Beginner investment strategies: index funds, picking your own stocks, and following someone else's Portfolio","description":"Chris Josephs had $50,000 in savings and no time to pick stocks. The main options for a beginner, from index funds and dollar-cost averaging to growth vs. value and bull vs. bear markets, and how following a Portfolio in your own brokerage account works.","category":"Guides","publishedAt":"2026-10-13","updatedAt":"2026-10-13","author":"Chris Josephs","url":"https://start.joinautopilot.com/journal/beginner-investment-strategy","markdown":"https://start.joinautopilot.com/journal/beginner-investment-strategy.md","agent":"https://start.joinautopilot.com/journal/beginner-investment-strategy/agent","contentText":"I'm Chris, one of the co-founders of Autopilot.\n\nOpen it in the Autopilot app. https://link.joinautopilot.com/eXKr?c=beginner-investment-strategy&af_sub1=intro\n\nShort answer: the main beginner strategies are buying an index fund, picking your own stocks, getting help from an adviser or robo-adviser, and following a Portfolio someone else picks. Dollar-cost averaging, putting in the same amount on a schedule, is about how the money goes in. https://link.joinautopilot.com/eXKr?c=beginner-investment-strategy&af_sub1=body\n\nI had $50,000 sitting in my savings account, not knowing what to do with it. I wanted to pick stocks, but I didn't have the time, and I don't think I'm really good at it.\n\nI would spend Sunday nights trying to figure out, am I buying the Chipotle or Sweetgreen stock?\n\nLet me explain the options.\n\n1) Before any strategy\n\nFor those unaware, the SEC has a short list of things to consider before you make investing decisions. A few come before you buy anything:\n\n- An emergency fund. The SEC says some people keep up to six months of income in savings.\n- High-interest credit card debt. It says no investment strategy \"pays off as well as, or with less risk than\" paying it off.\n- Your employer's retirement match. If you don't contribute enough to get it, the SEC says you're passing up \"free money.\"\n\nThen two questions shape your mix of investments. How long can you leave the money alone? That's your time horizon. How much of a drop can you sit through? That's your risk tolerance. Investor.gov says the right mix depends on both, and it changes at different times in your life.\n\n2) Index funds\n\nJust like you, I used to think index funds were enough. For a lot of people, they are.\n\nFor those unaware, an index fund is a mutual fund or exchange-traded fund (ETF) that tries to match an index, like the S&P 500, instead of beating it. Investor.gov says that passive approach usually means less trading, lower costs, and more favorable tax consequences than actively managed funds. It also says, \"Over time, higher fees and expenses can significantly lower investment returns.\"\n\nTo put that into context, a total stock market index fund \"owns stock in thousands of companies,\" per the SEC's beginners' guide. One fund.\n\nCredit to John Bogle. In 1976, Vanguard, the company he founded, opened an index fund to individual investors. It's now the Vanguard 500 Index Fund. Vanguard's own history says industry insiders called it a \"sure path to mediocrity.\"\n\n3) Picking your own stocks\n\nSome people love this. They read the filings and learn how businesses work. I respect that.\n\nHere's the problem. It takes time, and it takes more stocks than people think. The SEC's beginners' guide says four or five stocks isn't diversified, and \"You'll need at least a dozen carefully selected individual stocks to be truly diversified.\" FINRA says new investors may want to consider stock funds instead of individual stock picking as a cost-effective way to diversify.\n\nSo the question was never just buying either Chipotle or Sweetgreen. It's a dozen or more stocks, and keeping up with all of them.\n\n4) Dollar-cost averaging\n\nThis one is about how the money goes in.\n\nInvestor.gov defines dollar-cost averaging as \"investing your money in equal portions, at regular intervals, regardless of the ups and downs in the market.\" Same amount, every month. You buy more shares when the price is low and fewer when it's high.\n\nThe SEC says it can protect you from \"the risk of investing all of your money at the wrong time.\" It can help manage risk. It doesn't remove it.\n\nSavings still has a place, and an emergency fund is on the SEC's list. Investor.gov also points out that savings can lose buying power when the interest doesn't keep up with inflation, which is why many people keep some money in savings and look to investing for more over longer periods.\n\n5) Growth vs. value\n\nFINRA says growth stocks come from companies \"that are expanding, sometimes quite quickly,\" and value stocks are \"selling at what seem to be low prices given their history and market share.\"\n\nFINRA also says growth stocks generally tend to be more volatile than value stocks. It says a common approach is to focus on one style or mix the two, since their returns tend to follow a cycle of strength and weakness.\n\nGrowth and value are styles. An S&P 500 index fund holds both kinds.\n\n6) Bull markets vs. bear markets\n\nA bull market is generally a rise of 20% or more in a broad market index over at least two months. A bear market is a drop of 20% or more.\n\nPeople search for a bull market strategy and a bear market strategy. The SEC's beginners' guide doesn't give a separate strategy for each. It says savvy investors typically don't change their mix because one part of the market is hot. They rebalance back to the mix they picked. And it says an investor with a longer time horizon can \"wait out slow economic cycles and the inevitable ups and downs of our markets.\"\n\nSo the guidance is one plan for both markets, plus rebalancing. The hard part is sticking to it.\n\n7) Getting help: advisers and robo-advisers\n\nA financial adviser can look at your whole situation and build a plan around it. The SEC's beginners' guide says you may want to ask a professional to help set your mix, and to check their credentials and disciplinary history first. Autopilot Advisers is an adviser too.\n\nA robo-adviser, per Investor.gov, is \"an automated digital investment advisory program.\" In most cases, you answer a questionnaire about your goals and risk tolerance, and it creates and manages a portfolio for you. Investor.gov says robo-advisers often seek to offer advice at lower costs than traditional advisory programs. Credit to them.\n\n8) The other way to do this: follow someone else's Portfolio\n\nThis is what Autopilot does. You don't have to pick the stocks. You pick who does, and it runs in the brokerage account you already have.\n\nA Pilot is the person or team behind a Portfolio. The \"who\" can take a few forms:\n\n- A firm's public filings. Autopilot Advisers builds the Buffett Tracker from Berkshire Hathaway's 13F filings. It holds the 15 largest positions and rebalances with each new filing. Berkshire doesn't run this Portfolio.\n- A finance professor's AI-enabled scoring system. The GPT Portfolio, from Dr. Lira's AI Finance Labs, scores every stock in the S&P 500 and holds the top 15, rebalanced monthly. It's been live on Autopilot since April 20, 2023.\n- Independent investors who publish their own Portfolios. As of October 8, 2026, there were 391 live Portfolios on Autopilot.\n\nEvery Portfolio has a page with its description, its holdings, and a performance chart that starts the day it was added to Autopilot. Not a backtest. How to judge one is in How to read a Portfolio's track record.\n\nAs of October 9, 2026, more than $2 billion is invested through Autopilot, and we have over 250,000 users.\n\n9) How following one works\n\nIt's three steps. You connect the brokerage account you already have. You pick a Portfolio. You allocate the money.\n\nYou give Autopilot Advisers limited authority to place trades. It can't move or withdraw your money. The money stays in your account. Autopilot Advisers, LLC is an SEC-registered investment adviser, CRD 331749.\n\nOn Basic Tier, there's no Autopilot fee: we send your broker your starting allocation, then alert you when the Portfolio changes. On Premium Tier, where your broker allows it, we send your broker the changes. Premium Tier is a flat subscription per Pilot of $29.99 to $199.99 a quarter or $99.99 to $699.99 a year. The minimum is $500 per Portfolio. The full breakdown is in What does Autopilot cost?, and the brokerages are in Which brokerages does Autopilot support?\n\n10) What I'd want a beginner to know\n\nI want to be honest with you. Following a Portfolio doesn't take the risk out of investing.\n\n- Some Pilots go up for years, some are flat for years, and some lose money.\n- A flat fee is a bigger share of a small account.\n- Portfolios change often, so in a taxable account, expect frequent trading and mostly short-term gains and losses.\n\nResearch the person and the Portfolio. Read the description, look at the holdings, and check how long it's been running.\n\nGo spend 10 minutes in the app and look through the Portfolios.\n\nTLDR: The main beginner strategies are index funds, picking your own stocks, an adviser or robo-adviser, and following a Portfolio someone else picks. Dollar-cost averaging is about how the money goes in. Before any of it, the SEC lists an emergency fund, paying off high-interest debt, and taking your employer's match. On Autopilot, you can follow a Portfolio like the Buffett Tracker or the GPT Portfolio in the brokerage account you already have.\n\nFrequently asked questions\n\nWhat are some investment strategies for beginners?\n\nThe common ones are buying an index fund that tracks the market, picking your own stocks, using a financial adviser or robo-adviser, and following a Portfolio someone else picks. Dollar-cost averaging, putting in the same amount on a schedule, is about how the money goes in. Before any of it, the SEC lists an emergency fund and paying off high-interest credit card debt. On Autopilot, you can follow a Portfolio, like a tracker built from Berkshire Hathaway's 13F filings or an AI-picked Portfolio, in the brokerage account you already have.\n\nWhat's a reasonable long-term investment strategy for a beginner?\n\nIt depends on your time horizon and how much of a drop you can sit through, and Investor.gov says there's no single mix that's right for every goal. The SEC's bulletin and beginners' guide together cover these pieces: an emergency fund, a diversified mix of investments, regular contributions through dollar-cost averaging, and occasional rebalancing instead of reacting to a hot market. Following a Portfolio on Autopilot is one way to own individual stocks without picking them yourself.\n\nWhat's the difference between a bull market strategy and a bear market strategy?\n\nA bull market is generally a rise of 20% or more in a broad market index over at least two months, and a bear market is a drop of 20% or more, per Investor.gov. The SEC's beginners' guide doesn't give a separate strategy for each. It says savvy investors typically don't change their mix because a market is hot. They rebalance back to the mix they picked, and a longer time horizon can help an investor wait out the ups and downs.\n\nWhat's the difference between growth investing and value investing?\n\nGrowth investing buys companies that are expanding, sometimes quickly. Value investing buys stocks selling at what seem to be low prices given their history and market share. That's how FINRA describes them. FINRA also says growth stocks generally tend to be more volatile than value stocks, and that a common approach is to focus on one style or mix the two, since their returns tend to follow a cycle of strength and weakness. A broad index fund, like an S&P 500 fund, holds both kinds.\n\nWhat are some wealth-building strategies?\n\nThe SEC's list of things to consider includes keeping an emergency fund, paying off high-interest credit card debt, and contributing enough to get your employer's retirement match, which it calls \"free money.\" The rest of its list includes dollar-cost averaging, a mix of investments that fits your goals, and occasional rebalancing. Investor.gov has a free compound interest calculator if you want to run your own numbers.\n\nHow should my investment strategy change as I get closer to retirement?\n\nInvestor.gov says the most common reason to change your mix is a shorter time horizon, and that most people investing for retirement hold less stock and more bonds and cash as they get closer to retirement age. A target date fund is designed to make that shift automatically. How much and when depends on your situation. If you hire a professional to help, the SEC says to check their credentials and disciplinary history first.\n\nWhat's the difference between passive and active investment strategies?\n\nA passive strategy tries to match an index, like the S&P 500, instead of beating it. An active strategy has a person, a set of rules, or a model pick what to own. Investor.gov says passive funds usually trade less, cost less, and have more favorable tax consequences than actively managed funds, and that higher fees can significantly lower returns over time. A Portfolio on Autopilot follows a method someone else sets, like a Pilot's picks or a firm's filings, and you can see the holdings.\n\nCan beginners use copy trading to start investing without picking stocks themselves?\n\nBeginners can follow a Portfolio instead of picking stocks, which is different from what people call copy trading. On Autopilot, you follow a Portfolio, not a person's personal trades. You connect the brokerage account you already have, pick a Portfolio, and allocate at least $500, and on Premium Tier, Autopilot Advisers sends the orders to your broker when the Portfolio changes. You're never trading at the same time as the Pilot, and your holdings won't match exactly. Some Pilots go up for years, some are flat for years, and some lose money.\n\nOpen it in the Autopilot app. https://link.joinautopilot.com/eXKr?c=beginner-investment-strategy&af_sub1=end\n\n\"Autopilot\" refers to Autopilot Holdings Corp and Autopilot Advisers, LLC, an SEC-registered investment adviser. The GPT Portfolio strategy is managed by Dr. Lira's AI Finance Labs, an independent Third-Party Pilot unaffiliated with Autopilot. Autopilot doesn't manage, validate, or guarantee this Pilot's portfolio. Individual stocks shown are illustrative and not a recommendation. Past performance is no guarantee of future results; investing involves risk of loss. Figures current as of 10/13/26. View our Customer Relationship Summary and other important info at joinautopilot.com/disclaimer.\n\nPortfolios and pilots mentioned in this article:\nBuffett Tracker (Autopilot): https://start.joinautopilot.com/strategies/buffett-tracker-28825\nReturns as of October 19, 2026. Month +0.90%, 3 months +0.01%, YTD +12.5%, 1 year +9.0%, Since start +74.4%.\nGPT Portfolio (Dr. Lira's AI Finance Labs): https://start.joinautopilot.com/strategies/gpt-portfolio-63080\nReturns as of October 19, 2026. Month +4.2%, 3 months +13.6%, YTD +27.4%, 1 year +35.0%, Since start +106.6%.\nDr. Lira's AI Finance Labs: https://start.joinautopilot.com/strategies/pilots/dr-lira-s-ai-finance-labs-5\n8 public portfolios."}