Tips for investing in a hot stock market

The stock market is booming right now, particularly in the area of artificial intelligence. A few of the largest technology companies are dictating the market.

In the first 6 months of the year, the S&P 500 index — which tracks the stock performance of the 500 largest companies — is up almost 15%. Nvidia, Microsoft, Apple, Amazon and Meta made up 60% of that index. And shares are still soaring.

Jill Schlesinger, CBS business analyst and host of “Jill on Money,” has some tips for getting involved in this hot market.

What should people do to get started investing?

“I think we're going to go backward a few steps. And I think the most important thing you can do if you're going to be an investor, is to remind yourself why exactly you are investing. And you do that by creating a plan, meaning you have a blueprint. You're prioritizing your goals.

“Am I saving for retirement? Am I saving for college? Maybe I'm saving to buy a home. If you don't know why you're actually investing, it's hard to actually do this well.”

Is it a good idea to invest with index funds?

“Index funds [are] where you can buy the whole market as it were.

“I like index funds because those kinds of investments are pretty cheap. And if you've got a nice mix of them, you'll get a pretty good asset allocation for your overall portfolio. And I think that that's usually the path of least resistance for investors.”

Should people try to follow the hot trends that they see reported?

“Some of those core financial planning questions that you answer in the planning process are actually far more important than whether you find the next hot sector.”