Do you have one of those huge investment winners - a stock that went from $ 2.00 to $ 80.00? Or any other songs you want me to give you a huge percent profit?
Did you take the profit or did you watch the equity drop back down to what you paid for? I hope you sold and kept the money. That's what it's all about. As often as I've seen clients make big gains a broker and then think they were about knowing the market and give them what they had done. Return within a short period
If an owner brokerage company I seasoned brokers do the healthy thing. One of my men made $ 150,000 in a short time. I called to congratulate his performance and he suggested a break from trading for a while. He said, "No, Al, I know what I'm doing." The very next month he lost $ 155,000. What happened?
Listen carefully as I am going to one of the great truisms not found in commercial training manuals tell. If you do any trading strategy or in stocks, mutual funds, real estate, currency, whatever, this is true. Print it out, frame it and put it on your office wall.
"Making a lot of money is just as annoying to your mind when losing a lot of money."
A big score destabilizes thinking. Many people want to do it again and again, so they immediately dive back into their investments with their winning money and make larger bets. It is almost without exception that they are losers and give their profits back.
I called for taking time out after a big win for many years. It takes time to regain your head on straight. As a former floor trader I would have during the year when I was a good "hit." About 6 or 8 times I would immediately call to ask where I could go for a week. My travel agent I knew I must leave because my investment would be overshadowed by the success.
Too many of the big winners seem to change their basic trading plan because they now had a large amount of trade that makes them different from their successful pattern. She then became losers. Because of their success changed their thinking and they were unaware of what had happened. The trader has to go and let his emotions down.
A disturbing event, even a positive, can change your thinking. If you want to keep your investment returns you need to keep your emotions. Control
Best selling all of Thomas' book, "If it does not go up, do not buy!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter at http://www.mutualfundmagic.com and discover why he's the man that Wall Street does not want you to know. Copyright 2005...
Saturday, 31 May 2014
Thursday, 15 May 2014
Top Ten Investment Mistakes
1. Lacking an investment plan a / k / a / "Do not be a trip without packing the map". A pre-planned asset allocation generates positive results and eliminates emotional panic selling.
2. Buying cheap stocks a / k / a "Road crews erect" Dead End "sign for a reason." Most stocks with low market prices also come at the bottom for a reason. There should influence be important institutional price and many will not even look at the stocks under $ 8 or $ 10.
3. Purchase story stocks a / k / a "A good fable lulls to sleep a child." Do not be taken by stocks compelling "story". The plots have a cure for cancer, a major oil strike or a revolutionary invention. Such promising stories rarely prove true. If the "story" materializes, the company will continue to buy.
4. Selling your winners a / k / a "You have to know when you need 'em" hold. "Do not sell your winners. These companies combine excellent management, product and cash flow, creating a steady growth for the coming years . Keeping these companies for the long term will compensate for other investing activities errors. Actually can create. one or two big winners real wealth
5. Company on a stock highlight a / k / a reached "Trees do not reach to the sky, and companies not to pursue growth beyond reason". Top companies peak for reasons such as attrition of senior management or competition. Systematic pruning will help you avoid a rotting, unhealthy investment.
6. Under diversification a / k / a "Ideas are good, but a mind full of them is better." Resist the urge to rely on a few stocks that you know. Lack of portfolio diversification leads to erratic and volatile returns, and owning several companies in the same industry also is not diversification. The best investment results achieved by investing in leading companies in various sectors.
7. Diversification than a / k / a "A benefit an investor's portfolio stretched like an old T-shirt will not help their understanding." You do not make diversification by spreading yourself too thin. Although a mind full of ideas is good ideas acted on a whim waste good thoughts.
8. Than trading a / k / a "replanting a garden every week will not produce high quality tomatoes." Do not follow the market "noise" and bounce from sector to sector or theme to theme. This prevents investors reap the benefits of a long-term winner. stocks Give sufficient time to mature and compound.
9. Too much margin a / k / a "Living on borrowed time brings a wave of excitement, but it's a quick trip as time passes." Can not underestimate the damage. Margin The relatively low cost and ease of obtaining leverage investors take down a dangerous road. When a portfolio on margin decreases rapidly, it can overwhelm even experienced investors.
10. Too many options a / k / a "In life there is always potential, (but the timing makes the difference"). When you buy options, you are right to use and impeccable timing. Options allow an investor to influence to use and control more shares, but there are relatively high spreads involved in the trade in them. Many times investors lose money on their transaction, even after they followed proper assumptions.
Mr. Kimmel is a private money manager and author of "Magnet Investing, building a portfolio and pick winning stocks using your home computer." His method was the subject of a Forbes Magazine article (June, 2004)....
2. Buying cheap stocks a / k / a "Road crews erect" Dead End "sign for a reason." Most stocks with low market prices also come at the bottom for a reason. There should influence be important institutional price and many will not even look at the stocks under $ 8 or $ 10.
3. Purchase story stocks a / k / a "A good fable lulls to sleep a child." Do not be taken by stocks compelling "story". The plots have a cure for cancer, a major oil strike or a revolutionary invention. Such promising stories rarely prove true. If the "story" materializes, the company will continue to buy.
4. Selling your winners a / k / a "You have to know when you need 'em" hold. "Do not sell your winners. These companies combine excellent management, product and cash flow, creating a steady growth for the coming years . Keeping these companies for the long term will compensate for other investing activities errors. Actually can create. one or two big winners real wealth
5. Company on a stock highlight a / k / a reached "Trees do not reach to the sky, and companies not to pursue growth beyond reason". Top companies peak for reasons such as attrition of senior management or competition. Systematic pruning will help you avoid a rotting, unhealthy investment.
6. Under diversification a / k / a "Ideas are good, but a mind full of them is better." Resist the urge to rely on a few stocks that you know. Lack of portfolio diversification leads to erratic and volatile returns, and owning several companies in the same industry also is not diversification. The best investment results achieved by investing in leading companies in various sectors.
7. Diversification than a / k / a "A benefit an investor's portfolio stretched like an old T-shirt will not help their understanding." You do not make diversification by spreading yourself too thin. Although a mind full of ideas is good ideas acted on a whim waste good thoughts.
8. Than trading a / k / a "replanting a garden every week will not produce high quality tomatoes." Do not follow the market "noise" and bounce from sector to sector or theme to theme. This prevents investors reap the benefits of a long-term winner. stocks Give sufficient time to mature and compound.
9. Too much margin a / k / a "Living on borrowed time brings a wave of excitement, but it's a quick trip as time passes." Can not underestimate the damage. Margin The relatively low cost and ease of obtaining leverage investors take down a dangerous road. When a portfolio on margin decreases rapidly, it can overwhelm even experienced investors.
10. Too many options a / k / a "In life there is always potential, (but the timing makes the difference"). When you buy options, you are right to use and impeccable timing. Options allow an investor to influence to use and control more shares, but there are relatively high spreads involved in the trade in them. Many times investors lose money on their transaction, even after they followed proper assumptions.
Mr. Kimmel is a private money manager and author of "Magnet Investing, building a portfolio and pick winning stocks using your home computer." His method was the subject of a Forbes Magazine article (June, 2004)....
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