How to Become a Stock Market Genius
Stock market trading is very popular among investors. However, ups and downs in the market make several investors reluctant to enter the stock market trading. Everyone knows about the potential of stock markets that has the caliber to make anybody millionaire overnight. The game of market pays you extremely well and requires very less time input from you. Even if you are new to the markets, you could become a stock market genius by following some easy tips.
Always remember two golden rules of the stock market game; emotions have no place in trading and one must enter the market with extreme dedication. If you have these skills then you could easily become a market genius by following the tips given below. Following traits are mostly found in most of the successful market genius.
1. Don’t be fool- never buy dead stocks- Many investors buys dead stocks with a hope to make money from them. Such thinking is totally absurd. Always remember that the dead stocks have no value and that is why they are dead. However, you could go ahead any buy penny stocks. All dead stocks are penny stocks but not all penny stocks are dead stocks. Many people had tried buying penny stocks and over a period of time they have made millions by investing in such stocks.
2. Research is the key to success- in stock market trading one has to be really very active while researching for stocks and trading opportunities. The lazier in researching you are, the more money you will lose in the course of your trading. It is very important that a trader must take time to research and find out the best stock for him before he funds in it. If you are also interested in buying the penny stocks and getting rich with them then only hard research could help you buy such stocks. Whatever you do while researching, always remember that it is helping you gaining experience and knowledge of the market. Higher returns in stock trading are only possible if one research deeply.
3. Always invest in stocks that have good liquidity- Liquidity means the conversion for the share for cash. So, whenever you buy a stock, must check for its liquidity. Of course dead stocks will never provide you liquidity. Shares with more liquidity are popular on the stock markets and of course guarantees you more returns. Checking liquidity of shares is easy. Simply analyze the volume of trades for the past one week of the share you want to check liquidity for. Liquidity refers value of the share and therefore more liquidity means more value and vice versa.
4. Determine the undervalue stocks and positions in them- when going for purchasing shares, you must lookout stocks that give you more dividends. This is called as dividend research. So next time you buy the stocks, simply perform dividend research and go for higher dividend paying stocks.
5. Market watch- again one of the most crucial task, you need to perform. Before buying any stock, you must look for oversold or overbought and then decide your move. Keeping a watch over the market will help you take good decisions and you will be updated with the current trend of the market.
6. Effective planning- before entering the stock trades one must plan his trading strategy effectively. Many investors buy stocks, and do not know when they have to come out of the trade as a result they lose money. If you preplan your trade then not only you will make money but would also be able to avoid emotions (the biggest enemy of a stock trader.)
7. Check for stocks from reputed companies- this does not means that you have to buy the top stocks that cost very high. By checking for stocks from reputed firms means that before buying stocks of a company you must cross check the reputation of the firm. It will help you determine their trading practices, which indirectly affect value of their stocks. Even if the shares of a company are at low (risk), one could buy invest in them citing the past company performance and its reputation.
Becoming stock market genius is not a tough job. Following few simple tips anybody could become a successful stock market trader.
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Tags: Become, Genius, Market, Stock
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