12 Rules for Investment basis of a successful investor should be to
There are many important things that you need to know to trade and invest successfully in the stock market or other markets. 12 of the most important things that I can share with you based on years of trading experience are listed below.
1. Buy low, sell high. As simple as this concept seems to be to make most investors the exact opposite. Their ability to consistently buy low and sell high, are about the success or failure of your investment. TheirMarket determined yield of 100% when the floor.
The second bag is always right and the price is the only reality in trading. If you want to make money in a market, you need to mirror what the market is doing. If the market goes down and there are long, the market is right and wrong. If the stock goes up and you are short the market right and wrong.
ceteris paribus, the longer you stay rightwith the stock market, the more money you will make. The longer you stay wrong with the stock market, the more money you lose.
3. Each market has or is going up and down and most markets or stocks that went down, you are increasing. The most extreme up or down, the more extreme the movement in the opposite direction when the trend changes. This is also known as "the trend always changes rule."
4. If you are looking for "reasons" that stocks look or markets have moved large directions, you'll probably never know. Since we have the perception of the market, do not necessarily reflect the reality that move waste your time looking after the many reasons markets.
A big mistake most investors make the assumption that stock markets are rational or that they are able to determine why they do not relate to the market. Make a trading profit, it is only necessary to know that the markets are moving – not because they move.> Winners of the bag only care about direction and duration, while market losers are obsessed with it.
. Five stock markets generally move in advance of the basic messages or care – sometimes months in advance. If you expect to move, to invest until it is completely clear why a title or a market, it must be assumed that others have done the same thing may be too late.
You must position itself to move before the largest directional trend willPlace. The market reaction to good or bad news in a bull market is more often than not positive. The market reaction to good news or bad in a bear market more often than not negative.
6. The trend is your friend. Since the trend is the basis for any profit, we need long-term trends to earn significant money. The key is knowing when to get aboard a trend and stick with it to maximize profits or for a longer period ftime. Big money can be moved to capture the large market. DayShort-term trading or investment shares may
Pending the registration of the worst long-term trend to assert itself.
7. You must run your profits and cut losses quickly if you have no chance of success. Trading discipline is not a sufficient condition to make money in the markets, but it is a necessary condition. If you do not practice highly disciplined trading strategy, you do not have the money in the long run. This is a stock trading"System" itself.
8. The Efficient Market Hypothesis is fallacious and is actually a derivative of the perfect competition model of capitalism. The Efficient Market Hypothesis in the case of root shares many of the same false premises as the paradigm of perfect competition described by a noted economist.
The model of perfect competition is not based on anything that exists on this earth. Consistently profitable professional traders simply have better information – and act accordingly. Mostnon-professionals trade strictly on emotion, and lose a lot more money for them.
The combination of superior information for some investors and the usual panic as losses caused by the high purchase and sale of other low mount, creates inefficient markets.
9. Traditional technical and fundamental analysis alone does not always help in money markets. "Market timing" is not successful with the analytical methods that employ most people can.
If youeliminate optimization, data mining, subjectivism, and other statistical tricks and data manipulation, most trading ideas losers.
10. Do not trust the advice and / or ideas of commercial software vendors, stock trading system sellers, market commentators, analysts, brokers, newsletter publishers, authors, trade, etc., unless they trade their money and / traded successfully for years and / or offer third party verification services.
Note thatsuccessfully commercialized for very long periods of time, very few. Remember that Wall Street and other financial companies money by selling something – not instilling wisdom in you. You should take your trading decisions based on a rational analysis to meet all the facts.
11. The worst thing an investor can do is a significant loss of their position or portfolio. Market timing can help avert this experience, too common.
You can avoid the big mistakeTo buy, avoiding things when they are high. It should be clear that you only buy when stocks are low and sell when stocks are high.
Since the starting point is crucial in determining the total return, if you buy low, the results of long-term investments are irrefutably better than someone who has bought high.
12. The most successful investing methods should take most individuals no more than four or five hours a week and for most of us only an hour or twoinvolved a week with little or no stress.
