What are top investing tips one beginner should know before investing

-

 



Buying stocks are not difficult. But the real challenging thing is choosing companies that consistently make you profitable by beating the stock market. These four stock tips will help you find winners, manage emotions and keep good prospective during hard times.

  1.       Pick the companies with great potential not the stocks.
  2.       Determine your risk tolerance.
  3.       Have Investment goal.
  4.       Sell a position based on sound facts, not emotions.

 


 1.  Pick the companies with great potential not the stocks.

Buying a share of a company’s stock makes you a part owner of that organization. There are many ways to pick stocks, and it’s important to stick with a single philosophy. So, choose companies whose business you understand and don’t let stock picking based on only theoretical concepts.

  2.     Determine your risk tolerance.

Historically it is proved that even great up-trending market have seen panic moments. The volatility made investors lose money also in the strong uptrend market. So, determining proper risk per investment before taking a position is the basic work one investor needs to do.

 3.     Have investment goals

There's nothing wrong with hoping for the 'best' from your investments, but you could also make loss if your financial goals are based on unrealistic expectation or assumption. For an example, lots of stocks have generated more than 50 per cent returns after market recovered during the great bull run last year. However, it doesn't mean that you should always expect the same kind of return from the stock markets.

 4.     Sell a position based on sound facts, not emotions.

Many investors have been losing money in stock markets due to their inability to control emotions, particularly fear and greed. So first understand your investing system. You also should be familiarized with market volatility. Underestimating the risk associated with the stock is the only reason why investors make bad decisions.

So always have a target price of every investment and exit your position when it hits by not affected with greed.



Reach us: www.leantechnicals.com