Get more from your stock market investment by following these tips & tricks!
by Makoy Velasco, Certified Securities Representative
One very important trait that successful traders have in common is focus. Focus is simply paying very close attention to something. It could mean dropping other things of lesser importance to dedicate time, energy and resources into something of greater significance.
Lack of focus can be too costly. It normally leads to losses and traders clueless on what to do or what hit them when things go wrong. You may know a thing or two about fundamental or technical analysis and you could be well versed but without focus, success can still be out of your reach. By working on how you focus and what you focus on, you can easily increase your odds of earning more and doing so consistently rather than just being a loose cannon. Here are some tips on how to improve your focus:
1.) Know what makes markets and prices move. Markets and stock prices don’t move randomly. There is that “force” that makes them move. Buyers and sellers dictate the direction of stock prices and markets. Determine what makes buyers buy and what makes sellers sell. Focus on information. Information dictates the sentiment and sentiment dictates the movement of stock prices and markets. UTrade has a unique customized content feature such that it provides you with the information and content that matters the most to you. Recommended news that appears at the bottom of the MAIN tab will give you the latest updates about the news topics and companies that interest you. The same feature will appear in the RESEARCH tab of the platform depending on what you type in the search query. With this, you have access to all the information you require – no need to search anywhere else!
2.) Pick your forte. There are a lot of ways on how to buy and sell. There are a lot of ways to determine when to hold or let go a stock. You don’t have to master everything. Knowing and perfecting one or maybe two (at the most) will suffice. Understand fundamental and technical analysis well and come up with a system that will suit and work for you. Don’t look at all 270++ stocks and figure out where their prices will go next but rather look at all 270++ stocks and only pick those that fit your system. This will easily simplify your work.
3.) Pick sectors. The PSE is made up of six different sectors and these sectors don’t always move in the same direction together. Some sectors are considered leaders of the market while some have inverse correlation (go the opposite direction). One way to trade profitably is to buy and hold stocks from leading sectors. Leading sectors push the market higher. Another way is to keep track of what is going on in such sectors. For example, when metal prices go up, mining stocks go up. When oil prices go up, oil related stocks go up as well.
4.) Stick to your plan. There’s focus and there’s focusing on the right things. Most traders are good planners (for their trades) but are lousy followers (of their own plans). Don’t do a very costly mistake of violating your own rules when the going gets tough. Cut loss when it’s time to cut loss. Hold when the trend or your plan tells you to do so. Your plan will help you a lot in keeping yourself from becoming too emotional. One example of how catastrophic it is not to follow one’s plan is going “long term” when a short term trade fails to pan out.
Knowledge and experience when coupled with focus will result in consistency and better trading. If you’ve been trading for quite a while already and still trying to figure out how to get better results, keep your focus in check. If you’re new to trading, work on disciplining yourself and develop your focus. Don’t be a jack of all trades yet a master of none.
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