When it comes to buying stocks the following rules have help me succeed in the market.
1) When buying quality stocks, wait till they go on sale. This means that you wait to buy a stock when the market in general is having a bad day. This is hard to do. You have to go against your psychology to buy when everyone else is buying. Buy when everyone else is selling . You have to tell yourself that it’s like buying a stock on sale. Just like buying a pair of pants when they are on sale at JCPennys. Remember the adage buy low sell high. Part of Warren Buffet’s success was that he would load up on quality shares on days when the market was crashing and thus getting them at a lower price.
2) Do your homework and listen to the company’s conference calls. This means spending at least a few hours a week doing research. If you are going to own stocks you need to keep track of them by reading the news in yahoo finance and googling as much as you can about the company. Doing research on the CEO of the company you are interested in. Be sure to listen to company conference calls. You can find out when a company will have a conference call by looking it up under conference calls in stock research section of yahoo finance. This should tell you whether the company of a stock that you own is on the right track or not, and how they are performing. Utilize the yahoo finance screener located on this blogs home page or in yahoo finance under stock research. You can search companies by category and what annual percentage dividend yield you are looking for etc. I utilize the HTML screener at yahoo finance stock research. Finally, read books on stock trading. Jim Cramer a successful trader and tv personality has several books out that are good reading and easy to understand.
3) Look for things that are changing in the world that might help your portfolio. Did you notice when you went to the supermarket that there was a new machine renting dvds called redbox for a 1.00? or some other new product or innovation that came on the market that just simply would beat the current competition. Keep your eyes and ears open to the world around you for changes that may help you make money in the market. If you find something new, do the research on that company or person and see if there is a stock behind it. It could pay off big.
4) Make sure the stock you buy has a catalyst behind it. Why are you buying this company? Are they coming out with a great new product like the I-phone? Are they building a new casino? Are they coming out with a new cancer curing drug? The company should have something going for it that you think will propel the stock higher.
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