While some people view playing the stock market as just that, playing; the truth of the matter is it’s big business. To truly be successful at investing, one must treat the hobby as a business, instead. Investors should understand their profits and loss, as well as do research on the companies in which they make an investment. Once you establish this pattern, the entire process of buying and selling becomes simple. Ask yourself when looking at a transaction, “If I make this trade/purchase/sale, will it make money for me, or lose it?” When you have a clear cut answer to this question, you’ll know exactly what to do.
Other people treat investing in the stock market as something akin to gambling. They buy today, sell tomorrow and expect big profits. A famous quote from long ago stated that when an investment is most intelligent is when it’s most business-like. This couldn’t be more true. Think about how seriously fund managers, analysts, prop traders and other employees of the trade take the business, and if you want to be successful, you should as well. i
There’s no need to try and re-invent the wheel when it comes to investing. By taking the information you find out at Bloomberg, investing in software and having a reliable internet connection, there’s no reason why you aren’t prepared. Experts advise newcomers to the “game” invest in two kinds of software: personal money management and one for tracking stocks and fund pricing. The first money management software is used to track the profits and losses and keeping track of any subscriptions, fees to stockbrokers and the such. The second type of software will also handle storing company information garnered and technical/fundamental analysis and the like. These software packages will help you to become organized and see investing as the business it should be.
Understanding money management is critical to a successful investing career. It’s likely every investor will have that one big loss. However, the loss should not be the cause of a portfolio’s downfall. Don’t worry so much about tips to make you a successful investor, or the next big stock. Think instead about how to allocate your funds and what industries you should be targeting.