You may have felt a collective shudder from small investors last month when federal law enforcement officers made a coast-to-coast sweep of brokers and brokerage houses, including one in Carlsbad. Officials accused a ring of brokers and wholesalers of accepting bribes to lure investors into little known and possibly risky stocks for which the broker would receive unusually lucrative commissions.

    Crime stories like these feed a common paranoia of small investors — a fear that the markets are rigged and that the cards are stacked against the little guy.

    Actually, a huge majority of stockbrokers, financial planners and investment advisors are honest — which isn’t to say that their recommendations are always the right ones. Even an honest financial expert can misunderstand your needs, misjudge the quality of stocks, bonds or mutual funds or just make stupid mistakes with your money. These things occasionally happen.

    Too many individual investors get caught up in scams or boondoggles because they hope to simply hand their funds over to someone else for management and forget about it. There's nothing wrong with seeking help, but an uninformed investor and his or her money are soon parted. Not only are knowledge and vigilance the price of living in a free society, they also are the price of financial independence.

    Fortunately, learning about financial matters can be both easy and entertaining. From the Wall Street Journal to Public Television's "Nightly Business Report," there is a plentiful supply of excellent information. Books offer the most fundamental and often the most complete investment advice. Since I am an investment author, I continually browse bookstores in search of interesting and helpful material.

    On a recent trip to Barnes & Noble I found some gems. The first book described here will lay the groundwork for beginning investors. The second two are great for all of us who hope to become truly skillful at managing our own money. Best of all, these books are easy and entertaining to read.

    "Personal Finance for Dummies" by Eric Tyson is a good handbook for beginners. Presented in the standard "Dummies" format, this is a step-by-step, formulaic approach to organizing personal finances. Example: Subtract your age from 100 and put that percentage of your portfolio in stocks. It would be silly for investors to slavishly follow such edicts. All sorts of factors, including business arrangements, income property and retirement resources must be considered. But the formulas are helpful guides. They get people started in a safe, simple, non-threatening way. Once an investor has a financial base and has gained enough experience and confidence to think things through, it’s OK to stray from rigid rules and to personalize your financial life. In finances as in art, those who know the rules best break them most successfully.

    "The Craft of Investing" (in paperback from HarperBusiness) by John Train covers some of the same territory as "Personal Finance for Dummies," except that Train's book is enormously more sophisticated. Train walks readers through various approaches to investing, the nature of investment markets, and stretches beyond the standard financial instruments such as stocks and bonds. He explains, for example, why and why not investors should buy land, art, gold or precious stones.

    This is a terrific book to give an ambitious young person as a high school or college graduation gift. One section describes how to launch a career in the investment field. Train's chapter, "One way to get rich," advises young people to hone a talent that is essential and useful to society, then take that skill to a newly developing, fast-growing nation like Vietnam. Train gleans this lesson from this country's founders — it’s easier to get rich when working at a frontier.

    Train is best known for recognizing the genius of Warren Buffett early and describing Buffett's investment strategies in a book that still sells well, "The Midas Touch." Train's writing is colorful and laden with good stories and common sense.

    My final recommendation also is a paperback, "Wall Street's Picks for 1996," written by Kirk Kazanjian and published by Dearborn Financial Publishing. It may seem late in the year to buy a book to help make 1996 investment decisions, but don’t let the title put you off. This is a good buy, and if you wait a few months and find it on a sale rack, the information will still be worth having.

    The author promises tips from "Wall Street's biggest star names," including their favorite stocks and mutual funds for the year. Yet it’s not the investment recommendations, rather the "stars" quoted in the book who interest me the most. Many of the "gurus" — and they include La Jolla publisher of Investment Quality Trends, Geraldine Weiss — are widely quoted in the media. If you’re like me, you've probably asked yourself who these people are. What are their beliefs? Their credentials? What are they peddling? Kazanjian includes several pages of description of about three dozen mutual fund managers, investment advisers and newsletter publishers. Obviously he's allowed these people to describe their own philosophies, but that does not detract from the value. If you've wondered what makes Philip Carret, William Donoghue, Gail Dudack, Elizabeth Bramwell or Louis Navellier different from other experts, this is a place to find out.

    No single book will tell you every thing you need to know to protect yourself from fraud and to become a financial wizard. But work your way through the library investment section book by book, and you have a good chance at achieving Wall Street wizardhood. The books described here will go a long way in that direction.

    Trust me, your efforts to educate yourself with be well rewarded. There are few sweeter victories than making a good investment decision and knowing that it was a good choice.

    Janet Lowe has authored seven books, including "Dividends Don't Lie: Finding Value in Blue Chip Stocks," which she co-authored with Geraldine Weiss. Lowe's most recent book, "Value Investing Made Easy," was published by McGraw-Hill and is available in local bookstores. It also can be ordered from an Internet bookstore, amazon.com.