Sunday, 17 April 2011

Stock Market Investment

A stock market may be a physical place, sometimes known as a stock exchange, where brokers gather to buy and sell stocks and other securities. There are some Stock Tips , first, it’s important not to try to time the market. Timing the market is usually impossible, and there isn’t any factual way to decide on its different trends .Second, use cost averaging. This can be achieved by purchasing shares on periodic basis, through this purchasing technique the shares will be bought at an average price, rather than bought on times at high valuations. Third, taxes should be taken into account.

Spreading out investment strategies will help keep risk factors in balance. It will be a good idea to purchase steady, slow growth mutual funds as well as riskier stocks. These strategies help keep large losses in tact, cautiously protecting money. Start slow and build from there.

There are 2 significant factors that lead to this finding. The primary is that most investors try to time investing in the stock market. They add to their holdings during Bull markets and sell during Bear markets. This Buy High/Sell Low pattern causes them to miss rebounds, which is when the most profitable investors make the majority of their money. The stock market has always bounced back from crashes and downturns, usually in an explosive manner towards the upside. Missing even a few of the best days during a rebound can greatly hamper long term investment returns.

There are different options trading strategies Short, Medium and Long term for every market conditions.

First, the short-term stock trading strategies, they involve losing confidence when high risks arise, this will result in losing whatever the investor worked for so fast.  It includes Momentum Stock Trading, Penny Stock Trading, Shorting Stocks, News Trading, and Extended Hours Trading.

Second, the medium-term and the special stock trading and investment strategies, they include; Gap Trading, ETF Trading, Elliott Wave Theory, Fibonacci Trading Strategy, Contrarian Investing Strategy, and Following Insiders.

Third, the long-term investment strategies, they include Income Investing, Value investing, and Growth Investing strategies. The Income Investing, also called Investing for income, focuses on stocks that provide high dividends.  These stocks are usually volatile and safely pay dividends every year. The main aim of this strategy is to hold a low risk stock and generate income.


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