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How to better follow the concept buy low, sell high

Everyone knows that to make money in the stock market you have to buy low and sell high. Well, you usually can't tell when an investment is high-priced and ready for a fall, or vice versa, but there are some things you can do to better follow the concept:

You can consult a professional. Often times professional can recognize a high prices stock before the average public does, which means you can sell before most people figure it out. So, if you are not confident in your ability to recognize when a stock is a good deal, and when it goes too high. So, when in doubt, it can pay to pay for help.

You need to recognize that the higher the price goes, the more people begin to be fearful and start selling. You want to sell before this happens or the price will drop. This also plays in with the first tip as you may not recognize the price is high in time to take advantage of it. You are not looking at sweaters with an average price that is good or bad, you are looking at something volatile, changing, and somewhat risky.

People tend to look at past performance when buying stocks, and this will not help you buy stocks low and sell high, in fact it just usually does the opposite. Instead, it means buying high and selling low. So, instead of looking at past performance, look at future prospect. You won't know until it happens, but you can speculate, look at trends, and determine if the market is right. So, think future.

Know the truth that it is easier for something to fall than to rise, and thus prices will generally fall much faster than they will rise. So, keep this in mind or you won't buy low and sell high.

To better follow the concept buy low, sell high, do the following things before investing:
- Researching the market
- Create a spreadsheet to compare stocks
- Invest in your chosen companies
- Keep a daily record
- Track your stocks

You probably already have some companies in mind that you would like to invest in, choose a few more to look at. Then use the Internet to gather as much background information as possible about each company, including:
- Type of company
- Number of years in business
- Summary of what the company does
- Profits last year
- Profits thus far this year

Once you have your information you will want to review it. Based on trends, and future prospects decide on some companies in which to invest. Find out the current selling price per share for each company's stock. Decide how many shares of stock you want to buy in each company. Now remember, while past performance is a little bit important, a better way to buy low and sell high is to evaluate what lead to falls, and whether or not that problems has been solved. Did the whole market turn down? Did the CEO of the company make a poor financial decision?

To buy low and sell high you have to keep yourself informed, through your research, get to know the head of the companies you invest in. Determine how stable they are, this will often give you ideas on how stable your investment will be. If they are known for having a booming idea that later crashes, keep that in mind, and sell when prices start to rise. Even if they go up some more, you are better selling safe than risking a hug loss. However, this is a decision you have to make. If you are worried, you can consult a professional. Remember, buying high and selling higher is not your goal.


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