Stock Market Advice – Here’s Why It’s Free!

One of the most plentiful commodities in all of the world is stock market advice. It is readily available from friends and family. When your hairdresser or milkman finds out you invest in the market they will willingly provide you with free advice.

Stock market gurus appear frequently on the cable news channels and the network morning shows. They are fairly bursting with new stock tips. In this wonderful world of ours everyone has a ready supply of stock market advice.

This great abundance of free flowing stock advice is not a new phenomena. It seems to have sprang up almost as quickly as did the stock markets themselves.

Perhaps my favorite story of free stock market advice comes from Edwin LeFevre’s Reminiscences of a Stock Operator. As the story goes, two hapless fellows become angry at the man that keeps giving them bum stock tips. They have followed a couple of this tips and lost a great deal of money. In frustration the two compose a torrid telegraph message to tell the tipster off.

Just before they send the message, one of the fellows has second thoughts. He says something to the effect of, “Hold on, Jim. You’re not really going to send that message are you?”

To which Jim replies, “And why shouldn’t I?”

“Well, if you send that telegraph, he might get sore and never give us another tip!” the friend answers.

This amusing story illustrates the second part of the problem with stock market advice. Not only do people love to give advice on the stock market, they also love to receive a juicy morsel of stock market gossip.

It is just human nature. When you hear the latest rumor or the latest whisper about a certain stock, you feel like you are in on the inside story. These tips can fill your head with dreams of great fortune. Stock tips are very tempting to take seriously.

But in almost all instances, the only fairly priced stock market tips are the free ones. And even these can cause you to lose money you would not have ordinarily lost. Stock market tips are a very tempting form of stock market gossip.

They will undoubtedly be a part of the stock market for as long as we have stock markets. But they are really a foolish way of going about investing in the market. The next time you hear of a hot stock market tip, just smile and walk away. Your pocketbook will thank you later.

Stock Market Tips

This article discusses and highlights a few tips that individuals can keep in mind to maximize their profits when dealing in stock markets.

1. Be well informed

Information is the key to excelling in the stock trade. It is important that those who wish to trade in the financial markets should be willing to learn at all times. Even though they are aware of the basics they should be vigilant enough to notice a changing trend. Those who are working at the beginners’ level should make sure to learn from varying relevant sources. It is worth mentioning that the stock market reveals its diversity and vastness on a daily basis at multiple levels and knowing about its workings will help individuals in profiting from it without difficulty.

One topic that every investor should have relevant and up to date information about is “dividends”. These are the corporate profit portions that are paid by a corporation to their stockholders. Some companies keep their retained earnings and pay out dividends from the remaining amount. Having know-how about the companies that offer dividends will help stock market investors in prioritizing their investment plans accordingly.

2. Be ready to risk

A true stock trader is always ready to risk and own his or her win or loss with a clear headedness. The acumen of a stock trader and his or her ability to think under pressure is what will give a competitive edge to the stock trader. Every loss incurred by the stock trader is considered as an opportunity to improve the previous strategies and learn from mistakes.

3. Never be short of determination

After completing the three main tasks of learning about the financial market, evaluating oneself and defining rules; the financial market investors enter the challenging world of the stock markets. Here they might be lured by the wrong practices to increase their profits or the faulty trends that might be common. But it is important to remain disciplined and stick to the principles which will come in handy when it comes to building an unshakeable capital base.

All those individuals who are venturing to invest in the stock markets as beginners must keep in mind a few things;

1. Opt for online registration for investment

2. Opt for minimum risk in the initial phase

3. Make a list of expectations and stock market goals

Those who want to earn in millions from the financial markets can always invest in long-term stock investment options. However, such investment requires more time and is often considered by those who are young. Though young age is often considered a disadvantage in the financial markets, as it marks inexperience, when it comes to long term financial goals, it can be of vital importance.

Revealed – “Successful” Stock Market Trading Strategies for Almost All Investors

Let’s get this straight right at the beginning – there’s no single policy or strategy that works for all investors. And the funny thing is, a strategy that worked for you before, might not work for you again. So the natural question to ask is – is there really something like a winning strategy?

Well, that’s the interesting part about the stock market. The uncertainties, the huge risks involved, and of course the potential to go for the kill and make a fortune in record time… everything comes together to give us the “stock market”.

But of course that’s not always true. For instance, if you buy at low prices, and sell at high prices, you can always make a profit. This is the fundamental truth on which the stock market, the brokers and the investors work. It is simple and it is true, no matter what the market condition. But the problem is, the stock market, and its strategies are not always that simple.

So here’s the truth

It is essential to formulate a policy based on your objectives, current market conditions, the state of the economy, and of course the actual stocks you are trading on. In other words, stock market trading strategies need to change based on several variables.

How to Formulate Your Stock Market Trading Strategies

Mentioned here are some of the approaches that can reduce your risk, by helping you formulate your stock market trading strategies.

Value Investing – A good strategy would be look for stocks that appear undervalued. This often happens because of factors like short term trends and others. So the actual worth of the company might be more than what the value of the stock is. Such a stock is always a good pick, because it is sure to rise soon enough. However, don’t expect a good return immediately – you must wait.

Swing Trading – This strategy can make you money in the short term. Make an attempt to identify weekly or even daily trends. If you are good at it, you might be able to identify a stock just when it has started climbing, and buy it at the right time. Remember, market timing is very important here. This approach is however risky because if you pick the wrong trend or the wrong timing, you could lose a lot of money.

Seasonal Tendencies – Often certain stocks fluctuate due to seasonal variations. The price changes here are not related to any change in the actual value of the stock or worth of the company. It is often driven by expectations and perceptions rather than anything else. For instance, if a big event is coming up such as the Olympics, the stocks of hotel and airline companies might go up because people would be traveling more.

Blue-Chip Investments – This is perhaps the most conservative approach, and a strategy that can never lose you money. First you select a few sectors such as steel, power, banking, and then you buy stocks of the best companies in this. You can earn the dividends, and the value of the stocks will also give you money when you sell off.