A man decided to make money in the stock market but he just got to know about the stock market from reading about it in a particular investment guide book. Funny enough, he had lost most of the money in buying dead stocks, remember all dead stocks are penny stocks while not all penny stocks are dead stocks. This will lead us into part three of what we have been discussing.
The first important point is liquidity. Liquidity is when your shares can be easily converted to cash. This is a major characteristic that dead stocks do not possess. If you are going to trade successful you should check the liquidity of the stock. How can you check the liquidity? By checking the volume of the trades for the past one week, it will suggest to you the value of the share.
The second important point is the lazier you are about researching ,the less money you will. Take time to find out before you fund it and investigate before you invest. Any step you make in research is a step to make money in the stock market. stockmarket ideas Many people want to make money in the stock market but they do not want to make research. The deeper your research ability, the higher the returns you will make.
The third important point is to get know the undervalue stocks and position in them.
If you are investing for long term, I will strongly advise you to do a dividend research. Check for any stock that will give higher dividends year in year out and purchase such but avoid any stock that shows opposite behavior pattern.
The fourth important point is market timing. That is entry and exit should be known to you before buying at all. You need to find out how much buying is going on in the market now on the particular stock you want to buy when the next statement will be due. What the general state of the market is?
The fifth important point is planning your trades. Many buy stock not knowing when to get out or how long they should hold it or when to get out. Anytime you buy stock without a concrete reason, you should know that you will be making a loss and locked up in the prison of poverty.