Sunday 13 July 2014

6 Spectacular Stock market investment tips for novices

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Every investor finds stock market a very attractive place for investment. Here are some tips that assist you in the wise investment in stocks that can yield better returns on investment as compared to investment in mutual fund and indexes.


Stock market is not all about profits

The prime rule that every beginner must be aware about the stock market is that you have no guaranteed success in the market. An attractive paper investment is not always the same in the real life. Before you make a decision to invest in the stock market, think that you can lose all your money but this situation is not very likely. It is not the ideal investment solution for sure.

Purchasing Stock is easy

It is quite easy to get started in the stock market. You can purchase stock in an easy way and this thing is often quite surprising for the beginners. However; it is not free to buy and sell stock.

Utilize Limit Orders to Purchase and Sell Stock

While purchasing stocks, you have got the choice to purchase through the "market" order or "limit" order. A market order signifies that you will give for current stock price. A limit order helps you in setting premium price you are willing to give for stock.

When you purchase through a market order, you are leaving yourself open to market whims. Stocks keep on fluctuating few percentage points on a regular basis. You can save yourself from market fluctuations by purchasing through the limit order. A limit order enables you to set premium price you would be willing for paying for a stock and the lowest price you would be willing to sell a stock.

Avoid Mutual Funds and Indexes

One of the great mistakes made by the beginning investors is that they invest in the stock market by purchasing an index or mutual fund. You should avoid these indexes and funds completely.
Although people are aware of the fact that the mutual funds deliver less returns, majority of the people invest their entire money in these funds. Mutual funds are having two issues: fees and rules. You have to pay a management fee in large amounts.

Invest in the Individual Stocks of Great Companies

There is nothing better than investing in the stock of great companies that have established a strong place in the market. Great companies stocks are charged at premium price.

Do not buy all stock at once

A good stock market tip is to split your investment over several purchases. This will help you protect form hefty price drops because of poor earnings or any other catalyst that hurts the price of the share significantly. Always opt for the best investment solution to attain best ROI.

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