Anyone who is interested in trying to make money by investing in the stock market needs to learn some useful stock market strategies. Getting a sound stock market education and applying particular investment strategies can make the chances of profit much higher.
Over the past year the stock market hasn’t been doing that well and it’s certainly not a place for someone to put money they can’t afford to lose. If you invest your whole life savings in stocks then this is never a good idea.
Stock Market Strategies And Risk
When choosing particular stock market strategies it’s important to realize that every single stock is risky. All share prices can fall as well as rise in value.
If you ever get any financial advice or stock market tips informing you that stocks are always safe then you should run a mile. The only form of safe investment is in government bonds or bank accounts, but at the moment these have very low interest rates.
Long Term Rewards
Stocks are more risky but you get a greater reward for the exposure to risk. Stock market strategies must correctly identify how much of a return you need to consider purchasing certain stocks based on the size of the potential return.
Over the last decade the stock market has become much more volatile than it once was. This could be because so many people are now investing in the stock market thanks to online stock markets. It is now easier than ever to invest in stocks and there are people looking for stock market strategies to help them do just this.
Thanks to the internet it’s now very easy to buy and sell shares. This means that many investors are buying and selling shares very quickly to try and achieve short term gains. This type of stock market strategy is never very successful and the stock market should only ever be used for long term gains.
Stock Market Language
Before you can start to look at stock market strategies you must first learn some of the unique language which is used by people investing in stocks and shares. The language is very confusing and can be difficult to understand.
It won’t be possible to learn everything you need to know straight away, you must spend time slowly learning what you can. Read books and study internet websites to try and find all the knowledge that you possibly can.
Stock market strategies can make it easier to make money but they won’t actually guarantee that you will never lose an investment. You should only ever invest money that you can well and truly afford to lose.
{ 25 comments… read them below or add one }
Good advice here, your stock market strategies need to be well thought out. I agree with the philosophy of not investing money you couldn’t afford to lose, I think we have all been burnt at times. We use the long term stock market strategy and have made some good investments this way.
Melanie Braggs´s last blog ..Building Chicken Coops
Long term strategies are the only reasonably safe bet and even that isn’t a sure thing as many people have found out over the last 18 months or so.
My advice, don’t become a day trader unless you really feel you know the intricacies of the stock market and only if you have money that you can afford to lose.
And no matter how long you’ve been investing in the stock market you should always continue with your Stock Market Education.
Don White´s last blog ..New Ireton Data
There are many stock market strategies but only some are suitable for each potential trader/investor..
I like this blog and have bookmarked it for easy reference…
P.S. Have just noticed the RSS feed and will subscribe now..
John Davis´s last blog ..Expose Your Strengths
Hi Sean
This is a great blog you have started here and I am very happy that you are writing about stock market education.
All that you have said in your post is true and a thorough education in stock market strategies, especially those for entering and exiting the market is extremely important. Paper, or virtual trading is available from many trading companies now and it is good to trade this way for at least 6 to 12 months because going live is completely different.
Paper trading is where you can cut your teeth on the stock market as you will be able to ‘play’ out all the different strategies at no cost and see what works for you plus gauge your emotional state as a trader..
Stock Market Strategies ….
Many come undone when venturing into investing in the stock market.
A reason for a high percentage of those is simply… No Strategy.
Does one have a strategy when buying a home? Usually, yes.
They think short term, long term, learn the marketplace, look at what they can afford, repayments (exposure) etc… and the other side of the coin, the risks.
The same strategic mentality is essential for investing in stocks. As suggested in this article, you may take a ‘hit’ now and then, but if you stick with a strategy, in the long term you will be a winner.
And it is so much fun.
Geoff Harnden
Totally agree Geoff.
This is a great “basics” guide for the fundamentals of stockmarket education. Alot of so called market experts like to baffle you with bull so you will think its too hard to do yourself and invest through their manageed funds…often to your moneys peril. Jamie McIntyre offers a free cd on some basic stockmarket principals…it will be easy to find just google his name or you can find a uwc link on my facebook page under links.
Hey Sean, I am not sure if this part of the blog reads correctly … headline..Long Term Rewards….
Stocks are more risky but you get a greater reward for the exposure to risk. Stock market strategies must correctly identify how much of a return you need to consider purchasing certain stocks based on the size of the potential return.
I totally agree with you that you need sound stock market strategies before venturing into any form of shares. You have to decide whether you are going to purchase the shares and sit on them long term or whether you are just going to rent them. There are so many stock market strategies to choose from and it is very overwhelming for the beginner.
Jackie Stenhouse´s last blog ..Types of Child Anxiety Disorder
I don’t understand this sentence Sean, is it written correctly? “Stock market strategies must correctly identify how much of a return you need to consider purchasing certain stocks based on the size of the potential return.”
Good advice! Some people think if they invest in safe and secure stocks and shares (is there any such thing) that they will see their money grow, maybe slowly, but grow. A relative of mine lost over $50,000 on a $200,000 investment (loss of 25%) overnight on a so called “safe stocks”. They paniced and sold out at a huge loss. The stock recovered 3 months later. Had they stayed in and they would have seen growth and a profit. Knee jerk reactions can be dangerous and a good stock market education would have helped my relative not to make such a bad decision.
Bev Langford´s last blog ..Yoga Instructor Certification
I have a lot to learn about the various stock market strategies and just the stock market in general. For now, I think my involvement needs to be kept to a minimum.
I’ll leave my shares in the hands of the bank and I’ll start to slowly learn about the stock market. I think I need to do a lot of learning before I move on to paper trading. Let alone using actual money.
Jazz Salinger´s last blog ..Finding Your Passion
This stock market education is a great new blog that you have created Sean and I am very interested in furthing my knowledge. I have been involved in an online stock market game that is run every few months and am looking forward to learning more from you.
Eventually I might be able to actually do the real thing and your stock market education tips might well prove invaluable. Thanks again.
Isa Potter´s last blog ..Just had a Go Ahead Make My Da…
Hi Sean,
I have a friend who has been trading in the stock market for a couple of years now and doing very well,So I have been interested in learning stock market strategies, after reading this blog I think it may be a little while longer before I will think of starting.
Great and easy to read discussion above; I often suggest that others not repeat our mistakes and pay for a program to teach them investment strategies they cannot afford to loose in and offer the same advice we give anyone who asks: great for those who truly devote time to understanding what they are doing- ASX even offers free online paper trading games a few times a year that are an invaluable learning tool!
Having a strategy when investing into stock markets is a must – like you should have a strategy for any kind of investment. And just putting money somewhere because a friend of a friend said this would be a great idea doesn’t count as a strategy in my eyes.
And I fully agree with your last statement: “You should only ever invest money that you can well and truly afford to lose.” Because this might happen, even with a good strategy!
Renee´s last blog ..How To Enjoy Healthy Diet Food Even With A Busy Lifestyle
and in re-reading the posts and this blog again, I decided to do a bit of paper trading this week too! here’s a link if anyone is keen to just have a bash around on asx and nyse has heaps of helpful articles too! http://asx.com.au/products/options/education/online_courses.html
I like the idea of learning about Stock Market strategies and am happy to follow this blog. I am aware it will take some time before I am confident enough to play the stock market.
Now I have started my Stock Market Education I will be thinking about online Paper Trading to help gain knowledge about the stock market and about trading.
Jill Brown´s last blog ..Couples Marry at Common Law
Your approach to stock market strategies is very balanced and just good advice. Measuring risk is a good foundation for long term rewards.
Understanding the stock market language is an area I need to invest some time into.
Thanks
David Pearse´s last blog ..Targeted Internet Marketing-Market Samurai
Thank you to everyone who has left comments. Your Stock Market Strategies advice is very sound and wonderful for a newbie in this field.
My husband knows a heap more about this than me, but it is great to hear commonsense approaches from a variety of sources.
Cath
The stock market is just like learning anything else new. As i found with internet marketing when i first started, there appears to be this language that is very foreign to a beginner. However once you get into it and start learning it, you find you’re speaking it fluently in no time!
Tegan Hadley´s last blog ..How can affirmations help change my mindset
Dipping your toes into the stock market for the first time can be very daunting and if you don’t know what you are doing or using the right stock market strategies then you can lose a lot of money very fast.
Paper trading is always the best way to do things whilst you learn your strategies and good a grip on the language and terminology
Hi Sean,
The first strategy one should partake of is a sound stock market education, this should include paper trading as Jane points out above.
Then the number of strategies is virtualy limitless such as shares, options, CFD’s, warrants, short selling, share rental and many more.
Thanks Sean,
I really like this post. It has taught me something and that is to learn Stock Market Language slowly in order to fully understand what traders and talking about before you start to put your leg into it.
It is true, I read it somewhere that the only safest investments are bank accounts and governments bonds. This reminds me of a saying ” MEN ARE LIKE GOVERNMENT BONDS, THEY TAKE SO LONG TO MATURE.”
And of course Stock Market Strategies are a must learn in order to part take it this game if you are to gain something back.
Cheers
Rose
Thanks Sean,
I’ve heard of a few stock market strategies involving share renting & share insurance that are suggested to be very good but I have never been in the right situation to take part in any stock market investing myself.
Like anything, I think learning the ins & outs of an industry is key to success & lowers the risk levels as well.
jeremy´s last blog ..jlagatule- RT @gurubob- True influence is not forcing people to say yesit is systematically destroying their reasons to say no – GuruBob