To make Posions and potions, and to raise your alchemy level, do the following: Buy (Or harvest) as many ingredients as you can, get allt he main alchemy tools(not sure what all of them are)the beter the level of them, the beter stuff you'll make beter stuff and more things,(along with being able to tell what the diffrent effects are of the items):

Posions are all the things together that are somthing like "damage fatige 50pts for 16secounds." or "Drain health on target." those ingredents together make posions.

Potions are made by adding the good ingredients together, were it says like "Fortify health 100pts on self." or "Cure Common Aliment". Those together will make potions.

You can mix these together, adn get all diffrent resulets, depending on witch is domominet. Like if you have 5 loafs of bread and 20 rats Meat, the Potion/Posion you'll mkae will be a Posion.

There are also other ways to get your alcehmy up, eat the ingreddients that you already have, it'll get it up, not very fast, but it'll still go up.