How to reduce your losses in the stock market and make profits


Junior member
30 0
Hello there,:smart:

Read the tips if you want to find out how to reduce your losses in the stock market and make profits:
Tip # 1: Study the situation on the market and companies that sell stocks. It can be car manufacturers, stores that specialize on hardware or simple grocery stores. If you sphere of interests lies within the area of financial services, then you may be interested in stocks of insurance companies, banks and brokerages. You should study financial statements of the companies and make analyses of their potential.
Tip # 2: Decide upon the investment strategy you are going to follow to reduce risk. You should set the risk tolerance regarding the volatility of this market. Will be able to follow the market on a daily basis? If not this point is of particular importance for you. Buy-and-hold strategy should be selected. For instance, Warren Buffet sticks to the following strategy when investing into stocks. He acquires quality stocks and holds them up to the point when the fundamentals of the company deteriorate. Another variant of this strategy is regular investment within the long term making an average of high and low points. If you follow the strategy of momentum investments you take huge risk. Trader should have good understanding of the market in this case. But even with this knowledge one can easily lose because even talented traders do not have forecasts 100% true.
Tip #3: You should get ready to invest. Make a list of stocks that are of interest to you. Read information, press releases from corporate websites. Study the history behind the stocks of particular companies and assess the price on the basis of data you have collected.
Tip #4: If there is sudden movement on the market you should not pay attention to it. Market is volatile and all news of the day changes it always. Let us consider it as buzz in the background. This is just useless noise. You should treat it like this. Certainly, these moves can tell on your portfolio but they do not affect the fundamentals of the company. The circulation of such things should be just neglected.
Tip #5: Diversification of portfolio is a fundamental thing for any trader to be successful in this sphere. Spread your risks between different companies.
Tip #6: Any business requires management and the portfolio should be monitored as well. You should remove the stocks that do not bring profit to you and find more profitable substitutes instead.

Good luck.
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