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Jim, you often mention the importance of homework. Can you please elaborate on what you think investors should do as a minimum in terms of homework for each of their holdings and point to us which of your books you can go through.
 
Jim Cramer:
 
The homework exercise, Stay Mad for Life has got the homework exercise. I need you to do the homework.
 
Number one is the annual, number two is the balance sheet. If the balance sheet has enough money, you should be able to... go read Stay Mad for Life. It actually tells you how to read the balance sheet to see if it's healthy. And now I like to see whether it's got, is it secularly challenged? If you do homework and you say, okay, well look, we want to know the macro and you go to the top of what I said at the show. Is it going to be hurt by the macro? Is it going to be hurt by the
micro, are there micro things that matter? How are the mechanics?
 
How's the chart? These are all figuring in and you've got to do all them. Which is why so often I say, you got do it. You should do index funds because it is so hard. Or you know, I always like to say, okay, listen, do index funds and then you become members of the club and we help you and you help us. But you have to understand if you can't do that
minimum, it's really hard to just stop.
 
Jeff Marks:
And I would only add conference calls on top of that. Any conference call that you can get your hands on, read it. That's where you'll kind of get the pulse of what management saying. You'll get the pulse of also kind of like, well, how the analysts are, are sort of mistreating management. So you'll get a really good idea of what the business is and where things are going.

Investing can be scary, especially if you are a beginner.  

We get it! "How do I become a better investor" is a common question for Jim Cramer, TheStreet's co-founder and Action Alerts Plus portfolio manager, gets asked all the time. In fact, it came up again in Action Alerts Plus monthly member's only call.  

Cramer outlined a multi-step investing plan for doing your homework.  

And, so, we're sharing his answer with you. We want you to be a savvy investor too.

[When it comes to investing] I need you to do the homework, Cramer says.

He added, "number one is the annual, number two is the balance sheet..."
 
Cramer went on to say that you need to know the micro macro and mechanics."Is it going to be hurt by the macro? Is it going to be hurt by the micro, are there micro things that matter? How are the mechanics? How's the chart? These are all figuring in and you've got to do all them. "
 
 And there's so much more great advice, even some recommended reading by Cramer and Action Alerts Plus analyst Jeff Marks. Just watch the video for more.
 

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