Stock Markets Exposed
What are some good strategies of trading (buy, sell and hold)????
When to buy? When to hold? When to sell? When is too soon to sell? and When is too late to sell? Is it better to sell a stock when it gets to the peak or hold and wait next year or 2?
Public Comments
- buy at low cost sell it when it's value becomes high
- I am a believer in long term buy and hold of mutual funds. Don't try to be smarter than the market traders. You may win 3 out of 10 times but they will win most of the times. Visit diehards.org to learn how investing in low cost funds and diversified. You will be fine when you retired
- Keep your trading account in cash. Monitor the market - it has crest and troughs. When there is a crash or mini crash, buy. Buy in small amounts. in case the market slides further; then you can buy more of the same. Keep the share and never sell unless you are sure the share will go down again. If you are in the game of buying and selling shares, do not trade in shares, rather go for futures or warrants. Let's assume that you buy shares for the sake of investment and as such never sell for a long time. However, when you do decide to sell ie lets say you bought at 100c and it's now 400c, then do not sell everything, rather just sell the amount of money you require or sell half or whatever percentage but you always retain some stock just in case it does go up further.
- My best experience with online brokers was with Remata Trading. They are professional and will not rip you off. Their commissions are low and they provide you with direct access to the market from your own home computer. They also provide real legitimate training. You can contact them at: http://rematatrading.com/contactus.aspx... For training call Steve at 201-236-2500
- I generally agree that most people would probably be best served by investing in index mutual funds (I usually steer folks towards the SPY and IVV ETFs), not because the market is impossible to comprehend, but simply because most folks probably don't want to spend their every waking moment doing stock research. (If you find the market to be really interesting this rule obviously doesn't apply.) So, buying: You want to find a stock that trades at a discount to its intrinsic value. (Google the term and I'm sure you'll find a good explanation of the concept.) You also want a company that has some strong competitive advantage (for example a company with a really strong brand name like Harley Davidson, or Apple, or Coke) that makes it difficult for new competitors to enter its market, and ensures that consumers will pay a premium for its products (ie a lot of people--myself included--go to the store to buy Coke, they don't go to the store to buy soda and then happen to pick up Coke because its on sale). Now, after you have these two things don't just wade in and buy the stock. Wait for some event to hammer the price down--for example a mediocre quarter that causes a selloff, or some other event that causes the share price to drop but doesn't threaten the long term viability or competitive advantages of the company. For example last year Harley had a lousy quarter that caused the stock to drop from about 60 to the upper 40s. The company rebounded later in the year and got up to around 75. Jitters about the company's loan practices have sent the stock down to a bit less than 60 now. Note that if you had simply bought the stock before the price slump at 60 and held until now you'd have lost money, but if you'd bought in at around the low point you'd still have a very handsome profit. You won't see stocks that meet all three of the criteria above terribly often-- which is fine. Be picky. Also, hold for the long term. Taxes and commissions can eat up a surprisingly large amount of money. Selling: IMHO this is the tough part. You want to get out when a stock becomes rediculously overvalued, or when the stocks competitive position against its competition erodes significantly. You also may want to sell if a stock simply saunters upwards for no obvious reason for a long time--human vanity being what it is, folks tend to assume that if a stock is going up they must have been geniuses, but in reality they can sometimes simply go up by chance or because folks who spend too much time staring at charts think they see a pattern. When you've made a huge amount of money in a short period when the company has not released any news worth speaking of, you may just want to take the money and run, because a lot of other people will be thinking of doing the same. Again a good entry point and a good exit point in the Harley example above are a lot more profitable than just buy and just hold. A good entry point and simply holding may also be good over the long term. Good luck.
