5 Stock Investing Strategies
As a stock investor, you should keep on learning new stock investing strategies. What worked in the past may not work now. What works now may not work tomorrow. So, as an investor, you need to keep on learning new things. Buy and hold was one of the most favorite stock investing strategies of the past. Does it work anymore? Most analysts are of the opinion that the days of buy and hold stock investing are over. Markets are much more volatile now. Electronic trading has infact changed the very nature of today's markets. Here are five stock trading strategies that you can use over and over again;
Stock Investing Strategy#1: Invest in Ignored Companies
Many investors don't do much research while investing in a stock. They tend to invest on the recommendations of friends or analysts they hear recommending stocks on CNBC or other financial channels. This is a wrong way to invest and will only make you repent later on. Before investing in any stock, first do your thorough research. Make a list of stocks that you think will be best for your portfolio. Do research on them, on the company, about the future prospects of that company and about the market sector in which that stock is. Never invest in stocks that have been hyped by the media. Most stocks that get hyped up the media get overpriced in matter of days. When you invest in them, chances are already you have lost a major portion of the price appreciation. Always hunt for ignored stocks that might have gone out of favor of the market but still have sound fundamentals. The possibility of these ignored stocks making a comeback is always there.
Stock Investing Strategy #2: Use Stock Charts Often!
Stock identification is the first step. Once, you have made your list of stocks that you want to include in your stock portfolio, time your entry into the market. Buy them when they are at their lowest prices. You can do this by using charts and observing the stock behavior on these charts for a few days. In the same way, time your exit from the market using charts. Good entry and exit are the two most important elements of a market beating stock investing strategy.
Stock Investing Strategy #3: Always use limit order to enter and exit the market
Using market orders means getting the best available price at the moment. This price may not be what you had wanted for your stock. Use limit orders so that you can get the exact price that you want.
Stock Investing Strategy #4: Keep an eye on the currency market
Suppose, you had included foreign stocks in your stock portfolio or you had invested in a market sector that is correlated in a positive or negative way with the currency market. In case of foreign stock, if the currency of that country appreciates, this helps increase your return on that stock. Similarly, if you had invested in oil company, weakening dollar means higher prices for oil and more return on your oil stock.
Stock Investing Strategy #5: Have an open mind
Always invest with an open mind. Always use that investment vehicle that can give you a much better return. Commodity investing has historically outperformed stocks over the last many decades. You should think about investing in commodities. In the same way, currency market can also give you a superior return. Investing in different markets can also hedge your risk.
Article Source: FxTradingStock.com
About the Author
Mr. Ahmad Hassam has done Masters from Harvard University. Watch this weird 30 minutes Stock Trading Video just now. Turn $200 into $100K in just 1 month with this FREE Penny Stock Trading Report that shows how to find killer penny stocks about to make a big move in the market.
by: Ahmad Hassam
Total views: 27
Word Count: 598
Date: Mon, 1 Nov 2010
Publish/Share this article
To use this article on your site click here to get the HTML code
Rating: Not yet rated
Login to vote
Related Articles
Choosing Dividend StocksFacts About Online Stock Trading
Is Penny Stock Trading Right For You Personally?
What Is Meant By Penny Shares?
Ideas To Do Stock Trading
Getting Started With Online Stock Trading Companies
How Is Day Trading Totally Different From Other Trading Methods?
Can You Truly Make 100 Percent Annual Returns On Your Stock Trading Account?
