Although the stock market can be an area of uncertainty, there are some tried-and-true strategies that can help you improve your odds of long-term success.
Investors should first identify their financial goals. For example saving for retirement, purchasing a house, or paying for the education of your children. This will allow them to decide how much money they should invest and which types of investments will be best suited to their needs.
Making a priority of building an emergency fund or paying off loans with high interest before investing heavily on the market is also an excellent option. If you have the funds to invest in the market, start small and gradually increase your investment as you gain experience.
One of the biggest mistakes novices make is to try to time the market, Keady says. « Nobody knows the exact moment to make a move, » she adds, noting that the best approach is to commit to an investment for the long run and stick with it even through the tough times.
If you’re just beginning it’s best to concentrate on stocks of companies you know about. Peter Lynch, the legendary Fidelity Magellan Fund manager, once said that you have higher chances of success by investing in companies that have a solid performance and growth prospects.
It’s recommended to stay clear of online forums and ads touting certain-thing stocks. They’re usually part of an alleged pump and dump scheme where unscrupulous individuals purchase buckets of shares of a poorly traded company to drive the price up, then dump their shares for their own profit.