There have been many times when investors lose in the stock market. There are several factors resulting to the losing scenario. Apart from unexpected twists of the market and financial disorders, the main reason is the poor stock buying decision.
Some tips are to be followed while buying a stock, as this is the decision that decides on the further steps of stock investing including the time they should be retained for and then sold. There are many stock advises that any investor comes across, however, enlisted are some poor stock buying decisions that prove disastrous for expected profits.
1) Buying In Weak Stock Market: if you feel that you are smart enough to get profits out of a bad stock market, then it is a high-risk decision. Weak markets do not care about anyone; hence, buying stocks at that time may give losses. Being patient and wait for the bull is the right thing to do. It should be noted that a weak market generally tends to be a loss giver because most of the day traders tend to sell their shares for profit liquidation.
2) Bottom Fishing: greed always kills and over-smartness accompanied by greed is a total disaster. Some stock investors end-up buying falling stocks at discounted prices in the expectation of them to rise. These stocks tend to give them huge losses. Each thing available at discounted prices does not always get you sheer returns. Hence, bottom fishing is an absolute no as per stock investing even if the company you are investing in posses a strong historic stock data.
3) Late Buying of Stock or Missing the Train: the company out with its stock in the market may be good and the stocks are rising vigorously, but you may miss its buying at the right time. Buying late may not get you the profits as the price climbing of any share is not assured and it may fall as soon as you get it in your profile. On the other hand, very often, many traders do not buy the stock late in fear of its breaking down. But, the situations being fluctuating the stocks go up and you loose on the opportunity to earn. Hence, better to keep your eyes wide opened for investments.
4) Do Not Bet On Other’s Tongue: being a stock trader you come across various mouths every day. Each investor carries his own calculations and estimates of market moves. It’s important to listen to all to get the wholesome idea but investing on other’s words is sheer carelessness. Have faith on your calculations and invest according to what you and your stockbroker estimates.
5) Calculate and not guess: investing on gut feelings and guesses always pays losses. The guess works are not only reckless and illogical but also stupid to risk the hard earned money. Always have logical calculations and enough data to support your investments.
Consider small cap stocks if you want to earn better on your investments. Small cap shares is a better approach to make an entry and establish yourself as an investor of the stock market as it does not require a large sum to initiate. In addition, one can gain additional knowledge once you enter not it and start trading.
Paradigm Capital Management a small cap company employs a disciplined, bottom-up approach with an emphasis on fundamental analysis and extensive management contact. We can help you to meet your investment goals. Call us at (518) 431-3500 to align our capabilities with your long-term goals.
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