There is so much to know about stocks; the learning never stops. As expected, there are several persons with different levels of expertise when it comes to trading. There are the Wall Street geniuses that command top dollar at every hour of the day, and there is probably you that is looking to start, or you just started trading stocks.
The truth is, there is no reason to feel bad about not being a whiz in trading stocks. The geniuses of stock trading are those that take it up as their day job, investing for others. If you are looking to have stocks as a means of investment, here are some things you need to know.
- Buy low, then sell high.
This sounds like a simple thing to do, but it is not. There is a learning of the stocks and when to buy or sell. Different factors culminate in every decision you need to make, so you need to spend ample time in understanding the various terminologies and intricacies.
- Nothing is sure in stocks.
Don’t be a part of those that believe that some stock market situations will never change. Some people used to preach that oil prices will always remain at $100 per barrel. However, we have seen some part of the oil market deep to negative values beyond zero not too long again. This is just proof that sometimes, common knowledge may have the wrong timing. There is no perfect way to it; there is nothing sure for a long time. You need to always be on the lookout for whatever stock option you purchased.
- Stay abreast with filings.
This is important, especially if you are not one of the genius investors that have an eye for the perfect stock option and companies. The truth is, those persons are rare. For most persons, due diligence must be done, and the core to this is that you are kept abreast with the filings the companies make with the SEC. In these filings, you get to know every tiny detail about the financials of the company you are looking to buy into. This will help you understand the risk you are looking to take, better.
- Always think in the long term.
Buying stock is different from trading forex, where there is immediate gratification. If you are going to make anything reasonable from stock trading, you should always think in the long term. Especially if you are starting in investing in stocks, you shouldn't try to be like the whiz that can buy or sell every quarter. Even if your stock is not performing so well currently, the market may suddenly be favourable in the long run, which will leave you to a massive gain.
- Don't be fooled by Dividends.
Dividends are known to offer a degree of insulation when things go south, but you should also be careful of very high dividends, as they don’t last. You need to ensure that you are targeting stocks that pay dividends out to its shareholders, but don’t get carried away.
There are so much more to know about stock trading, and you can always find out on www.tradable.com.
