Jim Cramer has decided to take a step back, and go back to basics this week to cover the most important aspects of investing. After all, this isn't an education that you learn in school, so it has to come from Cramer. To begin, you must save enough cash to create a discretionary and retirement account.
Now what the heck do you do?
Cramer believes that a diversified portfolio of five to 10 individual stocks is the best way to maintain a portfolio.
"Now, before you start picking stocks, you need to forget everything you've ever heard about that classic piece of so-called investing wisdom, buy and hold. We don't buy and hold here on 'Mad Money'—it's a great way to lose your shirt," Cramer said.
That means you need to practice the buy and homework mentality.
To start to pick individual stocks, you need to read the company's SEC filings. The most important ones are the annual report, known as the 10-K, and the latest quarterly report, called the 10-Q.