Every investor has several characteristics that lead to success. Success depends on how well you can implement them and how well your strategy works.
Investors’ method of choosing the stocks they want in their portfolio is arguably one of the most important areas of being a successful investor. in a long-term upward trend and that they themselves outperform the market average.
The next important component is the trading plan. It doesn’t have to be too complex. All you need to know is what you are going to do if the stock price goes up, down, or deviating. If you can hedge these three things, you stand a chance for whatever the stock price can throw at you, and, more importantly, you avoid reacting to sudden market fluctuations that are constantly occurring.
The trading plan should also contain a general strategy for the action you choose and explain the reasons why you are doing what you are doing. For this reason, you have decided to place your order level here.
You need a strong risk management strategy and to be successful in the long term you need to execute the strategy. A bit scared.
The above three things are great to have but don’t forget that you need to be disciplined to do it or else prepare for failure. And you need to remember that to be good at anything you need to practice and gain experience: champions are made in training. Not on the line.
Now that you have identified these strategic factors, it’s time to decide how much you want to spend on each action. It is important that you try to spend the same amount on each stock, i.e. $ 5000 on a portfolio of 10 stocks in different industries, in order to maintain a balanced portfolio.
Finally, before you decide to invest, you need to assess whether the risk of return is worth it. There’s no point risking $ 1 trying to win 50 cents. I have stayed at a ratio of 1: 3 throughout my investment life. For every dollar, I risk I can win at least three, or if I can make $ 3,000 out of a trade, I am willing to risk $ 1,000 to get it to reach. And never lose too much;
Include contingencies in the plan so you know what to do if the price of the stock being traded rises, falls, or moves sideways. The share price cannot do anything else. But you can do what you have planned. dictates actions and prevents unprofitable emotional reactions;
Only invest your money in financially secure companies;
buy shares when they are cheap and sell shares that are expensive in relation to price development;
Trade only with companies whose prices are in an upward trend;
Act without emotion and have the discipline to negotiate the plan. You plan the exchange and negotiate the plan;
Keep making money in the market. You only make money selling stocks; and thanks to experience enough self-confidence.