Posted by admin on December 7, 2011 under Stock Market News | 
There’s a saying, started by a well known evangelist: “Tough times don’t last but tough people do.” There’s a definite truth in that, but there’s also a corollary: “Tough people that last in tough times had better watch out for scammers.”
Tough times definitely bring out the scammers.
Those of us who have experienced setbacks during these times that left us vulnerable to situations we never imagined we’d encounter are oftentimes searching for some “ray of hope”. This can include an online job that will pay the bills — or make us rich, or a “sure fire” method to invest that will bring us “insane profits” (or dividends). In this economic climate of a wildly swinging stock market, major housing loss, and ten percent unemployment (not counting those who have been out of a job for so long they are no longer included in US Labor Department statistics), those of us who have a little reserve cash would like to substantially increase it and create a source of steady income, perhaps to offset the income we have lost.
KNOW THE SCAMS
Those of us who are able to take the investment route are prime targets for stock market Shares scammers. Here are a few of their scams:
1) Predictive scams.
In this type of scam, described in his book Innumeracy by John Allen Paolo and quoted on the Investor Home website, a stock market “adviser” sequentially divides a mailing list in half, sending out predictions to the first half that the stock market will go up, and to the second half that it will go down.
This is repeated for the half that receives an accurate prediction and so on until he has a list of “marks” who have received at least three accurate “predictions”. These then will be eager to invest with him, and he will use “success” stories from that group to further promote himself. The moral of this story is to be very skeptical of testimonials…they may not exactly be false, but they may be the result of manipulation.
2)Playing the numbers game
Another version, described in several books including Martin Fridson’s Investment illusions and on the website Investor Home, involves mutual fund share market companies that produce a lot of offerings, aggressively marketing those that perform the best and down playing those that don’t perform well. It will continue to “sift out” the low performers and tout the high performers until it can establish a reputation for picking the winners, which it will then use to recruit investors, hyping itself as a predictive “super” firm. In choosing a company, one should evaluate all of its offerings and their past performance.
Wykipedia describes four scams, all similar to each other:
3) Pump and Dump Schemes
These are schemes where companies inflate the value of a stock stock trading, then sell it through telemarketing or the internet. They pocket your money and you are left with stock that is nearly worthless.
4) Chop Stocks
Similar to “pump and dump”, stocks are purchased for pennies and sold at inflated prices. Once again, your money goes to the brokers and promoters.
5) Dump and Dilute
Companies issue shares primarily to get investor’s money.
6) Bait and Switch
The broker or adviser leads you in with a “bargain” stock or mutual fund that is destined to rise dramatically, and then persuades you to “switch” to a more costly stock (that might be fundamentally worthless).
Scams work when a company or investment “adviser” has sufficiently “hyped” itself and created an illusion. This can be done by playing a variant of the “numbers” game listed in techniques 1 and 2, and then by leading you to purchase stock that is fundamentally worthless because of a variant on scam techniques 4, 5 or 6.
PROTECT YOURSELF
How do you protect yourself? There’s an old saying, “if it is too good to be true, it probably is”. We all have heard that saying, and yet when we find ourselves in a difficult or desperate situation (such as a job loss with no prospects in sight, or imminent foreclosure), we are considerably more vulnerable to the scammers who come along with fantastic offers.
Protect yourself by:
1) Checking out any broker or adviser with the Better Business Bureau and US Securities and Exchange ommission.
2) Research out for yourself what is being offered.
3) Type the word “scam” after the name of the broker or adviser and do an Internet search. His name might appear in forum posts by his victims.
4) Familiarize yourself with stock broker and adviser scams. It’s worth it to make sure you aren’t falling into one of them.
5) Always sleep on it before you make an investment, don’t jump. This is particularly true of telemarketers. There are many who won’t let you off the line until you’ve invested with them.
6) Do not be intimidated. If you feel the broker or marketer is intimidating you, tell him in no certain terms to “never call your phone number” again or you will report him to the FTC. If he calls back, do so.
YOUR LINE OF DEFENSE
Your first line of defense is to be aware of the scammers and their scams. Your second line is to never panic when you find yourself in a desperate situation. Don’t fall for any promise of “instant riches”. Don’t leap for what looks like a way out…
Especially when it’s too good to be true.
Posted by admin on October 4, 2011 under Stock Market News |
The past four years have been brutal for stock market how to stock market investors and have given pause to the expectation that online stock trading is a good way to make money. Rank and file investors have come to the conclusion that brokers offer no panacea for making winning trades.
But investing without guidance can be a very big mistake (to say the least), and if you are new to the market it would be foolish in the extreme. As such it is best to make a wise choice of a broker — one that can provide you with information, advice and support.
A novice investor stock broker can make the mistake of choosing an online broker solely on the basis of cost. That consideration can propel you in the direction of discount brokers that charge low fees, or even offer free trades, but can backfire with a broker that at best offers little, if any, experience in the market, and at worst might actually scam you.
In choosing an online stock broker online trading you need to consider seven things:
1) Fees
All brokers charge fees to buy and sell stocks, which means you’ll be charged twice for the same stock. Many new traders look only at the cost of the transaction fees and fail to realize that there may be hidden “nuisance” fees that are not immediately apparent. Some of these may be custodial fees, inactivity fees (for not trading over a period of time), transfer fees to or from another broker, and fees for closing the account. Remember, once you have invested with the broker, you’ll become subject to all of these “hidden” costs. Be sure you know what they are, and include them in your assessment when shopping for brokers. Make sure you can afford all the fees that will be charged to you, and that there are no “surprises”.
2) Initial Deposit
Aside from the commission, you will also be charged with a minimum initial deposit. This can range from $500 to around $10,000. But if the balance in your account is less than the minimum, your broker may charge a monthly or quarterly fee that could range from around $10 to $20 or higher.
3) Web Site and Amenities
Evaluate the web site of each of the brokers you are considering. Be sure it’s easy to use. You are going to spend a lot of time on this site, and you want to make sure it doesn’t frustrate you as you navigate around it, evaluating market activity.
Many brokers allow you to pay bills online and take transactions with a debit card. At tax time you should be able to easily obtain a Schedule D. Statements of your investing activity should be provided free.
4) Tools and Features
Every online broker has a set of tools and features that can be integrated into your account. Some you may want to have included are:
-Tracking and monitoring
-Portfolios
-Asset Allocation
-Financial planners
-Stock evaluation
-Research reports
-News Releases
-Back Testing
-Market Clarification
-Streamers
Portfolio tools and financial planners can help you identify your financial and retirement goals and suggest the best strategies for achieving them. These can be extremely useful in charting your investment options. As part of your broker evaluation consider only those companies with the easiest to use applications.
Stock evaluation tools can be essential in determining what stocks to invest in. The more readily a broker makes available information that clarifies the stock market, the better will be your success.
The last feature on the list, streamers, should be made available to your account at no extra charge. Streaming charts and data allows you to watch stock market behavior, which includes the latest real time prices. Other streamers can simplify the process by directly allowing you to buy and sell stocks without having to open other websites, facilitating your trades.
Many of the tools may cost extra. Compare brokers to determine which ones offer the greatest number of tools and features at no extra charge.
5) Access to Funds, Bonds and Foreign Markets
You will want to go beyond just trading U.S. Stocks. The broker should offer a range of mutual funds, bonds and foreign stocks. Try to determine what the broker has in these categories and whether or not you can gain access to overseas markets.
6) Customer Service
Make sure the broker offers good customer service and technical support. You can evaluate this through online reviews, checking forums and actually calling the customer service telephone number listed on the web site. Be sure you get a “live” person after a wait that doesn’t stretch into hours. Email the brokers, or access their online “live” chat application, if they have one. You should get a live customer service person within seconds, and they should be knowledgeable and helpful. Ask them questions to test their knowledge, for example about the tools online and what they do. Even as a new investor you should be able to get a feel for the broker and how much help you will get when you sign up.
7) Popularity and Reputation
It’s best to choose a broker that is well known. Choosing an obscure, low priced broker can, at best, lead to frustration, and at worst make you the victim of a scam.
Your first and foremost consideration are your needs as a trader and whether or not the broker you are looking at will be able to meet them. Financial factors, services, knowledge and experience in the online trading market are vital for you to achieve success.
If you are choosing a lesser known broker as a cost savings measure, be sure to do a web search connecting his name to the word “scam”. If there are problems with this broker, they may show up in posts in forums. Also investigate him with the Better Business Bureau and the FINRA Broker Check Program (found on the US Securities And Exchange Commission web site), which keeps a database of licensed brokers — make certain he is licensed and has no serious issues.
Choosing an online stock broker may seem difficult and even overwhelming at times, but as long as you keep in mind the important factors mentioned above, you will be on track to finding the right online stock broker.
Posted by Finance Professional on July 6, 2011 under Stock Market News |
The rapport amongst stock exchanges like New York, London, Singapore, Hong Kong, Malaysia and over lapping of trading at all the stock exchanges all around the world has made investors aware of the importance of stock broker listings. The internet technology has made broker listing an essentiality which cannot be overlooked.
Stock brokers are an indispensible lot for those who have their hands on both the purse and the pulse of the stock market. They represent the parent investor and deal with the changes taking place in stock markets in such a way that investor is safe and sound as far as returns on investments is concerned. They maintain and sustain steady relationship with the investor family. With the spread of stock market business, investors need to identify stock brokers in other parts of the world who would represent their clients as if operating from their native country. Also, the local and the resident stock broker could deal with affairs stock exchanges elsewhere in the world at par with local or national conditions.
Stock broker listings are essential for investors. Internet has come truly handy with the appropriate stockbroker and stock market search box becoming available. It is a custom search engine by Google and covers the very best of stock market websites.
The investors can have access to highly customized stock market search results. There would be no need to go through millions of unrelated pages. Broker listings serves as a tallow page in the directory the investor is free from unwanted hassles and is more organized.
Stockbrokers have their individual skill sets and knack for controlling the stock market. Just as a person has different cooks, tailors, hair dressers, etc to suit individual requirements, an investor also need to seek advice of different stock brokers who have wisdom and experience in guiding investors. But usually it is not feasible to hire too many stock brokers to maintain diverse portfolio in different sectors. Thus it is a good idea to look up good stock broking firms from stock broker listings available in the local yellow pages or on the internet.
Any broker listings and the information provided under it can be created, updated and retained till nine years. It can be refreshed and updated while confining it to a central source. This usually goes well with investors who might have stored stock brokers information at various sources. Thus keeping information in this manner becomes much unorganized. Moreover, it also poses a risk that the information could be stolen, tampered or affected adversely by any unknown or unexpected circumstances.
Stock broker listings at a centralized place are much safer and efficient manner. The centralized storage data centers are usually equipped with state-of-art technology. Moreover, these listings are constantly updated and new entrants are also constantly updated. Thus, if you look up stock brokers for any local area under these listings, you would find more update information rather than digging into your old databases.
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Posted by Finance Professional on May 17, 2011 under Stock Market News |
Out of the millions who try investing their hard earned money in the stock market, a very small number succeed in making money, in my previous article Making money from stocks I mentioned that the only way to make money out of the stock market is to learn how not to lose it. By making sure that you are only increasing your wealth you will certainly be one of the winners.
Even though this appears as if it’s a simple advice, still no one follows it. The get rich quick, I want to be a millionaire over night and I want to double my money in three months mentality are all ways of thinking that lead people to catastrophic loses.
How much money can I make from the stock market?
Having invested my money in developing and developed countries and having invested my money in different markets around the world I can confidently say that you can never turn 10,000 dollars into one million in the stock market in few years. Even if a miracle happened and you bought a stock before it headed to a price bubble you most probably won’t know the right time to exit and you may end up losing money.
Yes the stock market can make you rich but not quickly, a 20% yearly return is even considered a very generous number. Come to think of it, gaining an average of 20% per year can let you quadruple your money in few years. Thus the 100,000 dollars can become 400,000 without much pain.
The get rich over night mentality is a big dream that most new comers to the stock market try to realize. However, after they end up with painful loses most of them either close their accounts or forget about investing their money in stocks all together.
There is only one way to making money out of the stock market which is getting rich slowly but surely. If you followed other’s promises or hyped systems you will only waste your time and money, then discover the same fact in the end, making money requires patience and discipline.
How to make money from the stock market?
In simple words, if a mobile phone costs 100 dollars and you saw a friend selling it for 50 dollars, won’t that be a good chance for making profit? Sure it is, you will buy it from him for 50 dollars then sell it to someone else for 100 dollars.
You realized some profits in this case because you knew that the mobile has more value than the price it is being sold for, and this is exactly the same way of making money from stocks. Suppose that someday you realized that Nokia’s shares were worth 40 dollars yet they were selling for 25 dollars, won’t that be a good chance for making money?
Making money out of stocks is very simple, you just need to realize what stocks are selling for less than their worth then buy them and holding on to them until they reach their true value.
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Posted by Finance Professional on May 14, 2011 under Stock Market News |
Most people’s experience in the Equity Market is relatively short and in no way profitable. They hear about the market and think it is an easy way to make a lot of money in a very short space of time. Now we are not saying this can’t be done, because for some this is true, but for the majority it’s certainly not the case. Let us explain in more detail …
In the early stages of most Equity trader’s career, the first trading decisions normally come from tips and recommendations from brokers, alert services, or sometimes even mutual novice trading friends. Then, at some point, traders decide to study the market and try to find the perfect system or methodology to trade with. We are sure you can relate to the following statement; for many traders, the Stock market and its nuances truly become a passion that takes up limitless hours of searching on the internet, books, and forums, in the hope to find the perfect stock trading system, which they ultimately find out, simply does not exist.
Traders develop or buy a system and start trading way to soon. Sometimes it is profitable, but when it has a few losing trades (which is normal), they change the system. After some time, and after more losses and frustration, most give up and stop trading altogether. Or, they go on over analyzing, keep paper trading and never get any financial success from their trading; hopefully a few realize that the trading strategy they are using is not the actually problem and the most important element in their trading is actually them.
A sound set of trading rules is critical to trading profitably. But if the rules are not followed, an average trader will have difficulty maintaining a profitable trading strategy. Ironically, a disciplined trader who has an average skill set and a sharp mind can make a consistent profit with even an average trading system.
All traders encounter setbacks at some stage; either the market conditions change or they don’t follow their own rules. However, if good money management is followed these setbacks can be overcome. Often, even after trading profitable after several months, many great traders stop trading to evaluate and critique their own strategy. Traders will always have doubt and fear controlling those emotions and sticking to your disciplines in essential to stay consistently profitable.
Here Some Common Traps Traders Fall Into:
A. They stop trading for periods at a time and lose their market feel and discipline.
B. They find a new strategy, read a new book, but never fully implement what they have learned and how it pertains to their existing skill sets. Many new traders get confused and are apt to make grave mistakes and become to aggressive without controlling the emotional ups and downs one experiences over many years within the equity market.
C. Over analyze what happened. Mostly it will be that market conditions had changed or they didn’t follow their discipline.
Most equity traders who go on to achieve greatness:
(1) Always Monitor the markets, trade small amounts and don’t force trades.
(2) Wait for market conditions that suit their trading style.
Trading success is a result of consistency, discipline and patience and most importantly self belief… When you have a trading plan that involves clean price action strategies, and that is built on practical workable parameters and it suits your personal and financial requirements, and you stick to it, then your Equity trading will become more profitable.
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Posted by Finance Professional on May 12, 2011 under Stock Market News |
Investment is putting money into something with the expectation of profit. A stock/share is really an unit of your partnership in the organization. The worth of each share of the provider is determined by dividing the complete funds of the enterprise by the number of shares.Stock investing, consequently, indicates getting or selling the shares from the stock market or with the stock of a business. Stock trading requires place within particular parameters of the program. For instance, you can not directly buy the stock of any provider through the organization alone. You need to acquire and promote its shares by means of a broker who is registered with all the stock exchange where the company is outlined. The shares are marketed and bought in the marketplace costs prevailing at a provided stage of time. Once again, the price with the stock can’t be decided arbitrarily by the seller or even the purchaser. It truly is decided by a mixture of certain market forces comprised mostly of provide and desire, which in turn, is linked with efficiency with the enterprise and so forth.
Owning individual stocks can be time consuming and is possibly riskier than owning mutual funds. But if you feel comfortable that you are ready for this roller coaster ride, then you need to set up an account with a broker. Brokerage companies provide full service which means they will advise you on stocks based on your own personal situation but this assistance does not come without a price tag. Are penny stock fortunes for real? If you are truly confident that you can make your own decisions about what individual stocks to buy, then you may do fine using discount brokerages which simply facilitate stock trades online for you at a fee generally less than $15 per trade regardless of the dollar amount of the trade.
Share market investing is fun if you have the stomach for the daily ups and downs. It can be lucrative, but no stock can promise that. Recent failures of long time successful companies such as Ford (F)which traded as high as approximately $40 in 2000 and in late 2008 was trading for $3! But if you are careful, knowledgeable and can ride out the “bumps” for the long term, you could create great wealth for yourself by becoming a stock market investor.
Stocks for beginners can be a risky business if the right advice is not followed. It’s important that a newcomer to the investing world grasps the basic concepts of how to identify an undervalued stock and then what qualities to look for in a stock broker. At Buy Stocks For Beginners the aim is spell out investing concepts in plain English for everyone to understand.
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Posted by Finance Professional on May 10, 2011 under Stock Market News |
Investing seriously isn’t a sure thing normally, it is a lot like a game person don’t know the actual result until the game has become played and won has been expressed. Anytime you play almost any good game, you employ a strategy. Investing isn’t almost any different, you would like an investment approach.
An investment strategy is defined as a plan for investing your hard earned dollars in various sorts of investments that can help you meet your financial goals within a specific period. Each type connected with investment contains individual investments that you have to choose from. A clothing retail store sells, clothes – although those clothes include things like shirts, pants, garments, skirts, undergarments, for example. The stock market is a variety of investment, but it contains unique variations of stocks, which all comprise different companies you can invest in.
When you haven’t done your quest, it can quickly become really perplexing – simply mainly because there are a wide variety type of ventures and individual investments from which to choose. This is where by your strategy, put together with your risk ceiling and investment style all enter, play. Too typically, people invest dollars with dreams of becoming rich overnight. This is doable – but it is additionally rare. It is a very bad idea to get started investing with hopes of becoming rich overnight. It is safer obtain your money to the extent that it will probably grow slowly after sometime, and be for retirement or some sort of child’s education. Even so, if your investment goal is usually to get rich swift, you should learn as often about high-yield, short term investing as humanly possible before you devote.
If you are fresh to investments, work closely that has a financial planner previous to making any ventures. They will assist you develop an investment strategy that won’t only fall in the bounds of ones risk tolerance whilst your investment style, but will help you gain your financial aims.
Never invest money without a goal as well as a strategy for accomplishing that goal! It is essential. Nobody hands their money to the site any one without learning, what that money is it being used for, and once they will understand back! If you don’t employ a goal, an approach, or a approach, that is essentially what your are performing! Always start that has a goal and a strategy for reaching of which goal! You should strongly consider discussing with a financial planning software before making almost any investments. Your financial planner will let you determine what style of investing you ought to do to reach these financial goals that you’ve got set. He or she can grant you realistic information as to what kind of returns you can anticipate and how long it will need to reach your distinctive goals.
Again, remember that investing requires more than calling a brokerage and telling them that you’d like to buy stocks and options or bonds. It takes plenty of research and know-how about computers the market when you hope to devote successfully.
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Posted by Finance Professional on May 9, 2011 under Stock Market News |
The first step for you to understand the share market is to understand stocks. A share of stock is the smallest unit of ownership in a company. If you own a share of a company’s stock, you are a part owner of the company. You have the right to vote on members of the board of directors and other important matters before the company.
If the company distributes profits to shareholders, you will likely receive a proportionate share. One of the unique features of stock ownership is the notion of limited liability. If the company loses a lawsuit and must pay a huge judgment, the worse that can happen is your stock becomes worthless. The creditors can’t come after your personal assets. That’s not necessarily true in private-held companies.
There are two types of stock:
•Common stock
•Preferred stock
Most of the stock held by individuals is common stock.
Common Stock
Common stock represents the majority of stock held by the public. It has voting rights, along with the right to share in dividends. When you hear or read about “stocks” being up or down, it always refers to common stock.
Preferred Stock
Despite its name, preferred stock has fewer rights than common stock, except in one important area – dividends. Companies that issue preferred stocks usually pay consistent dividends and preferred stock has first call on dividends over common stock. Investors buy preferred stock for its current income from dividends, so look for companies that make big profits to use preferred stock to return some of those profits via dividends.
There are many types of shares from which some of them are :
•Authorized Shares – These shares represent the total number of shares of stock authorized when the company was created. Only a vote by the shareholders can increase this number of shares. However, just because a company authorized a certain number of shares doesn’t mean it must issue all of them to the public. Most companies retain shares for use later called unissued stock or shares.
•Unissued Shares – Shares a company retains in its treasury and not issued to the public or to employees are unissued shares.
•Restricted Shares – Restricted shares refer to company stock used for employee incentive and compensation plans. Restricted stockowners need permission of the SEC to sell. There is a waiting period after a company first goes public where insiders’ restricted stock is frozen. When insiders want to sell their stock, they must file a form with the SEC declaring their intention. Even insiders of established companies must file with the SEC before selling their restricted stock.
•Float Shares – Float refers to the number of shares actually available for trade on the open market. You and I can buy these shares.
•Outstanding Shares – Outstanding shares includes all the shares issued by the company, which would be the restricted shares plus the float.
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Posted by Finance Professional on under Stock Market News |
If you’re interested in trying out online stock trading, you’ll want to know more about how this investment method can make you money. Today, many stock market novices quickly become savvy shareholders because of the ease and affordability of online trading.
With this service, you’ll gain easy access to the stock market, right from your own MAC or PC. The benefits of trading “from home” – or any remote location with an Internet connection handy – are myriad, and they include cost-effective trading, the ability to make trades fast without going through a brokerage firm, and the simplicity of having all of your bank accounts and stock portfolios at your fingertips.
Enjoying lower costs for trades is the key benefit of using online stock trading services – after all, people don’t play the markets just for the fun of it…they want to make money and build wealth. When you choose to trade stocks online, you’ll eliminate the costly fees you would traditionally pay to a stockbroker, who needs to recover his costs of providing trading advice. With online stock trading, the whole commission structure is unnecessary, and you will save money because you pay a flat fee for actually making the trade. You’ll also have more control over decision-making when you decide to make a trade…
Those fees for advice are what differentiate the full-service broker from the basic trading service. In fact, many online trading services offer incredible access to stock market information, tips, and analyses. In general, all of this trading advice is free to members. With a brokerage house, you can be charged for asking a question about trades – however, when you trade online, you can browse through pages of helpful information without paying an extra cent.
Some small traders worry about the downside of online trading – they fear that they will make bad investment decisions because they don’t have access to advice from a full-service broker. This concern is valid if you are totally new to the stock market and how the system works. However, you can quickly gain knowledge about smart investing by looking for real-time stock prices, charts, and other technical indicators.
When you choose a great online stock trading service, you will usually gain access to all of these informative tools when you sign up – unlimited access to market research data will be available to you for no extra charge. In lieu of this, you can peruse magazines and newspapers for stock market investing tips, or use Google to find the hottest blogs or articles from successful stockbrokers and investors.
Online stock trading is a great way to avoid big commission payments – it’s also a clever way to augment your income or retirement savings from the comfort of your own home. If you’ve considered the pros and cons of trading shares online, you may be ready to make a firm decision about signing up for online trading services. Be sure to do your homework and choose a reputable website.
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Posted by Finance Professional on under Stock Market News |
If you are in the stock market participating in an active or passive way, the most complicated thing to know is when do you buy or sell your stock. There are different types of players in the market. Some believe in intraday trading, where people buy and sell stocks in a very short period of time in order to make quick gains.
There are also people who trade in a pre-fixed schedule like every quarter. And there are also some instances where people just want to purchase and hold in order to make long term gains. These long term investors are also known as value investors. These are few of the major approaches used by traders and investors all around the world.
In order to know when to buy or sell, first stage one needs to be aware of the fundamentals of stocks and how it operates. Stock form part of the equity investment done by the company and its shareholders. Anyone who buys a share of a company e.g. Microsoft, means that individual is a partial owner of Microsoft to the extent of the number of shares he’s got. If the company does well he’s bound to get some gains out of it and in the against scenario he’s going to make losses.
There are a minimum things one needs to consider while entering the stock market. Firstly try to find a stock which is trading very near or at par to its book value. If you find out these types of stocks buy them only after learning a few technics about the company. Try to look for into the company’s past annual and quarterly reports in order to get some awareness about the company’s position. after that completing the whole research go on and buy the stock, as you will be getting it at a very low price.
Before buying make sure you find out a brokerage house offering low brokerage rates, fast trading facilities and a good research desk. While buying, make sure that you have a profit target. Try to decide why you are making this investment. look it that how the stock performs along with the other investments made in your portfolio.
Depending on your investment goal decide how much risk you can bear. It can be for your retirement, new house, car or even children’s college education. In case of a long term investment horizon you can take higher risks as the probability of risk decreases as the time goes by. So in the end you can buy shares at a low price and sell it depending upon your investment horizon. Here the chances of gain are very high due to the low price of stocks during the basic stage of investment.
Once your profit target has been achieved get out of the trade as soon as you can. This is something a lot of people don’t follow as they hold on to a stock when it is going through a bull-run. By following this strategy you might make lesser gains but it will definitely save you from making further losses down the line.
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