Stock Market Strategies

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Stock Market Strategies

Post  little man 21 on Mon Jun 28, 2010 7:41 am

If you are investing stocks and want to make profit from your investments, you need to have some stock market strategies. There are investors, whose buying and selling decisions are largely influenced by people they know. They blindly follow what others are doing without understanding what might be profitable for others might not work for them. The result is inevitable in these whimsical trading and would result in huge loss at the stock market. On the other hand, if you can have a strategy of your own and you meticulously follow it, then there is a better chance that you will succeed in the long run and make profitable stock market investments.

Make a strategy - The first and foremost thing is to draw stock market strategies for your self. For that you need to have a clear understanding of the available stock types and different methods of doing stock market trading. For example, there are different stock types, such as large cap, mid cap, small cap stocks, penny stocks, sector stocks, growth stocks, dividend stocks etc.

All of these have their own characteristics and not all the stock types are suitable for a specific investor. Then there are trading types, you can do derivative trading, you can invest in cash segment, and you can do day trading or you can invest on long term. After you have gained comprehensive knowledge of the pros and cons of all these trading types and have a clear understanding of the risk associated with each type of trading, take notes on your capacity and your willingness to take these risks. Then you can find a suitable strategy for your stock market investments.

Always adopt a long-term strategy - While investing in stock market, it is always better to have a long-term stock market strategy. This does not mean that you should buy a stock and hold for months and years. Rather a long term strategy is to have a predefined entry and exit points for a particular stock and follow them without fail. That will make sure that you can gain from the trading.

Stick to the fundamentals - While forming your stock market strategies, stick to the fundamental rules of the market. Follow the results of the technical analysis and fundamental analysis and take decisions based on that. Do not get confused with the sudden trend change in the market and never give in to the panic. If you have done your research well and have a well-defined strategy to follow stick to it and you will gain in the log run. To have the best effective strategy for your stock market investments you can also consult an experienced broker or stock market analyst.

Do not surrender to the sentiments - When you do the analysis of the stocks and form your stock market strategies, never surrender to the sentiments and rely on your personal feelings about a particular stock. Remember when it comes to stock market, numbers speak for themselves and if you want to make profit, follow them.

little man 21

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Re: Stock Market Strategies

Post  MANOLO on Wed Sep 08, 2010 2:20 pm

Each stock has its intrinsic value which is calculated from the initial capital of the company plus what the company earns in a year. The ideal assumption is that the rate of earning will remain constant depending on parameters that can be controlled by the mother company. Because this assumption is ideal and not always true, stock market strategies cannot be delineated based on accurate predictions.
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