Some tips from someone who has never made any money out of shares.
But I bet it is as good as any advice you will get from a broker or multi-thousand dollar charting package.
1. Unless you invest in blue-chip stocks and plan to leave your money in the same stocks for years, trading in stocks is gambling. As in any form of gambling, don’t put in more than you can afford to lose.
2. Buy when everyone else is selling, sell when everyone else is buying. The same applies to real estate.
3. Stocks at historic low prices may be a great investment if the company is financially sound. But keep in mind, dead cats don’t bounce.
4. Don’t panic over minor day to day price variations.
5. Low value stocks (penny stocks) may give high profits. If you invest $1,000 in a stock at 2c and it goes up 1c, you have made $500. But if it goes down 1c, you have lost $500.
6. Tracking stock price cycles through charting is a bit like following the racing form guide. Don’t put any more faith in it than that. It isn’t science.
7. Despite all the above, if you watch the news, think about what is happening in the world, what the weather is doing (this affects grain and exploration, amongst other things), and where the cycles are in stock prices (both general trends and the price cycle for the particular stock you are considering), it possible to make a better return on capital trading stocks than any other legitimate investment.