Many people invest their money in the stock market, but only a small percentage gains experience necessary in order to become a truly seasoned investor. This is because a large percentage of new investors don’t stay long enough in the stock market before they drop out.
We have gathered the most common tips that the experts suggest that a new investor should learn before entering the big stock exchange game:
- Just because you have earned anything on the stock market doesn’t mean you’re an expert. Enjoy your earnings but always keep in mind that the stock exchange is more complex than any single person can understand.
- Options have a small life span. Always check closely for the expiration date and mark potential selling points.
- Sometimes the party ends. As we saw in October 2008, the market can wipe out years of profit in a matter of months or even weeks. Understanding that the market has reached its peak is what differentiates the biggest winners and the worst-off losers. When you feel that the market reached its peak, you should sell.
- Daring might reward you in remarkable profits. A sophisticated and daring investor can achieve what might seem impossible to all other average investors. Keep in mind, though, that rushing into a complicated situation without a real understanding is not sophisticated it is just plain stupid.
- Sometimes, no matter how much you planned and thought about it, you lose money more and more. Knowing to cut your loses is an important attribute in an investor that expect to survive in the rough stock market. Even the great Warren Buffet lost from time to time, but the only difference is that he can afford losing a couple of million dollars and you can’t.
- Every time that you lose money on the stock exchange, you gain a unique chance to learn from your mistakes. To waste this opportunity by not learning from your mistake will only assure that you will make the same mistake again.
The CEO Game