Buy "hot" stocks?

Q – A friend told me he’s making a killing on certain tech stocks. How do I find these stocks and buy them to make easy money?

A – Your friend should be able to tell you if he’s beaten the compound return of the total stock market over the past 10 years to substantiate his claim that he made a killing or that he knows what he’s doing. And if he did, he beat out the majority of mutual fund managers who spend day in and day out trying to beat the market. Unlikely. Your friend probably doesn’t like to remember all the stock trades that he lost money on (or, won’t admit to them). So, if he didn’t accurately track and compare his total performance to other portfolios, he’s kidding himself that he knows what he is doing.

I’d also like to dispel the notion that it’s easy to find hot stocks or the next big thing out there just waiting to be found. For every Apple Computer, there were dozens of others that now only exist in displays at the Computer Museum of America. In reality, the fewer the stocks you own, the riskier it is. While it's true that price momentum can be found with certain stocks at certain times, what's more likely happening is increasing speculation which increases the liklihood of a crash back to reality.