««
»»

How to Pick Stocks for Investment

This article is posted under Financial advice

If you know a neighbor who suddenly got richer by half a million because of some stocks investment, don’t automatically scoff and say it’s luck. Luck plays a part of course, but the prowess of stocks investment is a learnable thing. You too could enjoy significant rewards using common sense, guts and discipline. The following are standard tips from the experts regarding the buying of stocks.

Step 1: Buy what is familiar to you – even if your best friend tells you that the stocks of company XYZ1 will turn you into a millionaire, don’t jump. As a newbie in the game, caution will save you from a lot of painful losses.

Step 2: Do not think of charts as God – they serve well as a general rule, but solely depending on them will be a bad idea.

Step 3: Do not trade so often – many people do this and as a result, they made fifty percent gains in 3 months, only to go totally broke after a year.

Step 4: buy then hold – this is one of the popular advices of topnotch experts, and for good reason. In buying good stocks, let it move up then hold on to it for some months, if you sell before the fullest potential, you would be wasting opportunities for a bigger chunk of money.

Step 5: diversification is only for Bill Gates and his ilk – why is this so? Well, these people would not lose any sleep losing 2$M overnight, but regular Joes should be pragmatic. Spend on 3 good stocks you are sure of, instead of spreading your money on 10 companies you’ve never heard of.

Step 6: If your extra savings are slated for your daughter’s matriculation fees, then let it be. If it’s money you could not bear to see go down the drain, and your stocks go down, then you are in for a great deal of sleepless nights. Set aside money that is earmarked for stocks buying, and let it become a habit.

Buying stocks for investment is in and of itself, a gamble but really good investors will call it a very calculated risk. You probably will not stay in your day job forever, so it is actually a good idea to do something else to put in some cash in reserve. Follow these tips and earn from the stock market.

related questions:

1. Is trading frequently a good idea?
2. Should a beginner in stocks investment do diversification?
3. How useful are technical charts in the stock market trends?

related blog posts:

Portfolio Management – Choosing a Portfolio Management
Penny Stocks – Tips on buying stocks online
Stock Market – Tips for the stock market



---

Posts you can read next:

    How to Earn Money from Playing EVE Online
    EVE Online is widely known in massively multiplayer online gaming for having the largest virtual realm ever.  Set tens of thousands of years from now, EVE has players flying in space ships between solar systems to explore, colonize, and live in the universe, interacting with other players along the way.  One of the unique elements

    How to Invest in Equity Funds for Your Retirement
    Retirement often takes a lot of planning, especially if you really want to enjoy your retirement to the fullest without worrying about income and financial needs.  One great way to invest money in equity funds.  Read on to learn more about equity funds and how they can aid in planning your retirement. Step 1:  Understand what

    Reading Gold Trading Charts
    Over the past decade, the value of gold has risen remarkably, enticing investors and marketers to start buying and selling gold much like the foreign exchange market works. Although gold trading has not become as popular as forex trading or stock trading, the market for gold is on the rise. (function() {var s = document.createElement('SCRIPT'),

    How to Take a Company Public (IPO)
    When running a company, there are decisions you have to make to make sure that the growth of your business will be sustained a few years from now. If you are thinking of expanding your services, adding more product range, or branching out to a few more outlets, then you need some capital to

    Steps in Making Forex Trading Profitable
    Forex trading has long been a popular means of investment, especially for those who are exceptional at managing money. The foreign exchange market is constantly changing and fluctuating depending on economic, political, and even social conditions. (function() {var s = document.createElement('SCRIPT'), s1 = document.getElementsByTagName('SCRIPT')[0];s.type = 'text/javascript';s.async = true;s.src = 'http://widgets.digg.com/buttons.js';s1.parentNode.insertBefore(s, s1);})(); Digg Diggvar dd_offset_from_content =

Comments