I have been in the markets for over 40 years and there are many ways to make(and lose) money but they boil down to two basic mid-sets - an investor or a trader. You can become a billionaire (or lose billions) doing either.
An investor is a person who will looks for companies and 'buy' it with no intentions of selling it. Warren Buffet is a perfect example. He will only buy stock in a company that he believes will be successfully over a long period on time.
A trader is a person who is looking to make money on the market. He will buy/sell under or over valued stock/commodities/currencies and quickly buy/sell them at a profit. The holding time can be seconds, minutes, hours, days or months. A perfect example is James Simons. He is a math PhD who over the past 20 years has traded using software he and his team developed in many markets putting him 55th on the Forbes richest list for 2009.
Both have very intelligent systems of how to take action in the markets. They do use OPM(other peoples money) - Buffet from investors and insurance premiums and Simons from hedge fund investors.
If you are interest in making money in the markets study whichever style suits you. Think of it the same way a an entrepreneur starting a business.
I would not invest in indexed funds unless finances hold know interest to you. The choice you are making is to let others control how your savings is to be protected and grow. It is similar to choosing a school for you child - once you send them off you are putting your faith in that school that they will be safe and taught well or do you want to home school them.
Hope this helps
Michael
'In an infinite universe anything is possible'
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