10 Tips for Stock Market Investment

Stock tips

When it comes to stock market investment, it’s not about how hard you work. It’s about knowing exactly what to do, and putting that knowledge to work.

Here are 10 tips for stock market success …

Read More :- How to be successful in stock market

Tip 1: Don’t attempt to time the market

Never Time the market. Timing the market is like taking a random walk. People only recognize the correct path after they set foot on the wrong one. One exception to this is “bottom-fishing”, an approach to buy stocks that you want in your portfolio at prices below the prevailing levels.

Tip 2: Don’t try to over predict the market

Stock market movement are dependent on many factor hence don’t ever try to over predict stock market movement. Stock market requires enough knowledge and experience if you are not absolute never bet on stock.

Tip 3: Treat investment like marriage

Always make investment for longer term. Research reveals that stock investing should be part of a long-term strategy, lasting for five to ten years or even more. Remember every year stock market may not give positive return on your investment, however in long term it is likely to give positive return with substantial margin.

Tip 4: Be careful before investing on Tips

Today many brokers and advisor give tips for investment. These tips may not turn true every time so before acting on these tips you should be careful and must do homework.

Tip 5: Select your stock carefully

As stock market investment is risky affair we advise you to select your stock carefully. Invest only in established companies with a good track record. Beware that not every stock will rise after you buy it.

Tip 6: Prefer to buy stocks in installment rather than at single go

Always prefer to buy stocks in installment by this you can average out stock price. This is called rupee cost averaging and is one of the safest approaches to investing. It works just like any other habit: you buy, regardless whether the price is up or down, until you reach the desired number of shares of that stock.

Tip 7: Diversify your portfolio

Keep mix of stock in your portfolio. Diversify and make investment in multiple sectors. For example do not invest in only one sector because if that industry goes down your portfolio will be affected badly.

Tip 8:  Never buy stock with borrowed money or with emergency fund

If you don’t have many you should not invest. Investment done with borrowed money sometime turns to be big disaster.

Don’t purchase stock from your emergency fund because you never know when financial emergency arise. Before start investing you should keep comfortable cash reserves in emergency fund approximately six month income.

Tip 9: Leave your emotion behind while investing

As we are unable to control our emotion while investing we make mistakes, Emotions such as fear and greed. Fear of losing money although you have bright possibility to earn good return. Greed of earning more return may sometimes leads to loss, So it is better to Leave your emotion behind while investing.

Read More:- How to stay away from emotion while doing investments?

Tip 10: Set Realistic Goal

Before making investment decide your goal, you need money for what: For retirement, For education of kids or to fund your daughter’s marriage or just to preserve and build wealth? Whatever the goal you set, make sure it is reasonable and attainable. Expecting too much will only lead to disappointment. Aim for an expected return level that is realistic.

Remember Investment success is journey it won’t happen overnight, so stay focused on long-term returns and avoid overreacting to short-term market swings. Remember, investment success depends on time, not timing.

At last I would like to share with you famous quote of Evan Esar on Success.

Success is the good fortune that comes from aspiration, desperation, perspiration and inspiration.

10 Tips for Stock Market Investment

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Article by Raviraj

Raviraj is the man behind moneyexcel.com. He is graduate in finance, engaged in blogging since 7 years. Moneyexcel blog is ranked as one of the Top 10 Personal Finance Blog in India. He is not affiliated with any financial product, service provider, agent or broker. The purpose of this blog is to spread financial awareness and help people in achieving excellence for money. Please note that the views expressed on this Blog/Comments are clarifications meant for reference and guidance of the readers to explore further on the topics. These should not be construed as investment advice or legal opinion.

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