I found that the more you research a stock and the more you get a feel for the price of the stock the better your trades are going to be.
Well I beg to differ.
If there's any correlation between amount of research and the outcome of the trade, then my work has told me that If anything the correlation is negative and it makes you hold dogs for longer than you should.
You are less likely to be a "believer" if you looked at a chart for 30s or ran a scan of the market for candidates.
wipz said:
Dont rush into a buy because someone has told you to buy it. You have to feel comfortable with each and every trade, if your losing sleep at night over a stock i say cut it off.
I agree not to buy off tips.
Losing sleep at night has to do with your psychology and nothing to do with your profitability.
But I like the way you chop those dogs.
wipz said:
If your bullish about a stock and in a loss position it shouldnt bother you (because you know it will recover in the near future). Cheers
Well i can't see how you can "know" this.
But there has to be a time where you figure you've got it wrong, take the loss, and move on.
The key to being successful in the stockmarket is cutting your losses short and letting your winners run.
The exit is key.
And money management also (how you divide up your capital).
And have a plan. Know what criteria to look for to BUY, when to sell, and how many to buy or sell. When to add to positions, etc. There's many factors to consider.
If you want to invest through fundamental research in picking candidates know that you are prone to becoming a believer, but still its okay. BUT you still need a stop loss. And you need to know how to divide your capital.
And rememebr that being profitable is more important to being right.
But some people just want to be right. And sometimes you cant have both.
Reminds me of what Ed Seykota said: "Everybody gets what they want out of the market."