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20 Do's & Don'ts For Traders & Investors

Here are some points to consider when you have a thought of investing. When people think of investing, there is a fear of loosing money also. Its not what you are investing for right? You are investing your hard earned money to make money not to loose.

Its not that you will master it, the masters are still learning it what do you think Mr. Rakesh Jhunjhunwala is not making loss? Its only about making the right decision on right time.

You buy a stock make some profit exit it, if things go wrong be prepared to book loss also. Its okay its part of the game. If you can do that you can be an investor.

Now, what you should be knowing is:
  • Invest regularly: Make a regular trade or investment wherever you invest. Buy stocks every month with some part of your salary. 
  • Brokerage and Taxes will eat into your returns, therefore know your actual returns in hand.
  • Diversify your investments across asset classes, to spread your risk. 
  • You must maintain a proper balance in investments among different asset classes.
  • Expect reasonable returns from your investments and sell, once you have got the returns you seek.
  • You may end up losing your hard-earned money due to wrong investment decisions. But it is important that you learn from your mistakes to avoid such losses in the future. Before investing in financial instruments you should consider whether they will help you meet your financial goals and suit your risk appetite.
  • Investments in every asset class need thorough and detailed analysis. You should restrain yourself from buying or selling in haste as that may lead to financial losses. If the fundamental aspects of your investment instrument are good, you need not worry about short-term volatility.
  • Remember the old proverb: “All that glitters is not gold.” There are many investment products available in the market, which are complicated and are not easy to understand. Some products also lure investors with unrealistically high returns. You must stay away from such products as they may contain some hidden risks which are either unknown or are not completely understood.
  • Spend time on your investments (it’s your hard earned money) or get a good financial advisor to do it for you
I can acknowledge you on a basic working pattern which you can try if it helps. There are 5 Golden principle of trading:
  • Always do your research
  • Stick to your research no matter its right or wrong
  • Never ever trade without target and stop loss
  • Never ever change your target and stoploss. If required decrease the two rather increasing from the initial levels.
  • This market is in existence for years and it will be opening tomorrow so we are in no hurry.
Things to take care of:
  • Listen news daily between 8:30 to 9:30 am so you have ample amount of time if you find something good to invest.
  • Day Traders or Intraday Traders should be active or handy with laptop or desktop and mobile phone if you’re offline trader.
  • Put your trade only above high/low value only.
  • No one is God in this market and can not be 100% accurate and doesn’t guarantee you profit always and loss is part of market.
  • Don’t wait or sit for huge target Rome wasn’t built in a day.

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