The appeal of big money means investors often fall into the stock market trade however making money is not easy. To make money in the stock market you need discipline, research and patience. No formula tom winning has been discovered for stock market success but these are some golden rules:
- Being unique
A buyer’s decisions can often be influence or rely on opinions on others, whether they know the industry or not. If everyone is investing in a certain stock or mutual fund then potential investors are likely to follow suit. , Warren Buffett, who was the one of the most iconic investors of all time, once said “Be fearful when others are greedy, and be greedy when others are fearful!”
Of course just because you don’t want to follow the herd doesn’t mean you can’t research. Investors have a habit of going by name recognition but that’s not the right way of putting money into the stock market. Also invest in a market you understand instead of going along with the crowd and their interests.
- Don’t try to time the market
Financial planners have been warning investors for years that you should never try to time the stock market. It’s a strategy that has historically never been done successfully or consistently through stock market cycles or over multiple businesses. This technique is most likely to lose you more money than cause financial gain.
- Lose emotions
There is a direct link between losing money in the stock market and the inability to control emotions, not just anger or sadness but also greed or fear. Many investors get a case of the green eyed monster when they hear of success in fellow investments, this leads to speculations and then rash judgemental which often leads to snap and unjudged decisions. In the bear market investors can often panic and then sell their shares at rock bottom prices.
- Be aware
We live in a global world. Any important event that’s happening in the world will have an impact on financial markets, which is why we should monitor portfolios, keeping affected the desired changes to it. If you don’t have the time to fully assess your review on a regular basis a good financial planner is vital. If you have too much time constraints, lack of knowledge and no will to get a financial planner perhaps stock investing isn’t the route for you, try less risky instruments.
- Be realistic
We all hope for the best but it will only ever go bad if you’re the type who has unrealistic financial goals. Yes a large amount of stocks will generate half of their returns during the Bull Run but don’t always expect this type of return from the stock market or day trading or ftse trading. Another Warren Buffett pearl of wisdom that any investor should be lucky to make more than a 12 percent earning from stock.