You need to educate yourself. Stock picking is not the gamble people make it out to be. Stock picking isn't rocket science either; the people who profit from your ignorance just prefer that you think it is.
Check out
Investing for Beginners and
The Motley Fool. They're good places to start your education, but bad places to stop. However, you'll find things through them that you want to investigate on your own, and wind up self-educating.
I think it's important to make a distinction between traders and investors. Traders want to buy cheap and sell expensive, flipping stocks left and right for a quick profit. Investors buy stocks and hold them for the long term, they want to own companies and reap the benefits. I prefer to behave as an investor rather than a trader, and so far it's worked for me.
To invest for the long term, look for solid companies in promising fields, ones you expect to be around for a good long while yet, and that you'd like to own a piece of. Check out their data sheets and find out about their expenses, their income, payouts to shareholders, really get to know how profitable and sustainable they are. Ask yourself where this company is likely to be in ten, twenty, thirty or more years, and do your homework to justify the answers, don't just go with your gut. If you still like what you see, enough to commit to it, pick up some of the stock and hang onto it. To paraphrase Warren Buffett, one of the greatest investors of all time, buy stock like you expect the market to close right afterward, and stay closed for five years. It
has happened before.
Dividends aren't everything, but I do love dividends. That's not some intangible thing like stock price going up today (but maybe down before you get around to selling it), it's real money in your pocket, money that you can do something with, not just numbers on paper. When you're looking at the numbers for a company you're researching, investigate how much of their money they're paying out to shareholders in dividends. You don't want an extremely high payout, because that drains the company coffers and is unsustainable. A dividend payout ratio that looks like it could last for decades and even has room to grow, without bankrupting the company, is preferable.
I always reinvest my dividends into more shares, (ShareBuilder will do it for me automatically), so that even when I can't afford to put money from my job into stocks, I'm always growing my portfolio, slowly but surely. It also takes the guesswork out of timing the stock market, by ignoring timing completely. If the stock price is up when I get my quarterly payout, I buy a little; if the price is down when I get my payout, I buy more... whatever the payout can afford at the time. See
here for a simple explanation of DRiP investing.
Note that diversification isn't just buying different things, it's buying different kinds of things, in different sectors, so that an unforeseen disaster that takes out one or a few isn't likely to hit all of them. Having shares in Target, Walmart, Costco, and Kmart isn't diversification, they're all retail stores and anything that hits the retail sector is going to hit all of them. Having shares in Walmart and Amgen would ironically be more diverse despite only being half as many companies, as one is retail and one is biotechnology, and an event that hurts one isn't likely to have much impact on the other. To get really diverse you should also look into bonds, income generating real estate and other sources.
Good for you thinking about this early.
Time is a huge factor in growing your wealth with compounding returns. Good luck to you.