Written by R. A. Stewart
“How can I make a fortune on the share market?”-a question some random person may be thinking to him or herself and if I really knew the answer to that question then I would be rich beyond my wildest dreams.
I can’t tell you how to get rich but at least I can give you some hints to help save you losing your shirt and a lot more.
Share prices do not always represent value, but rather the opinions of the wisest men in finance. The markets tell the story of the times. The stock market moves according to the news coming out from various companies. Shares prices are often ahead of actual happenings.
When you are trading on shares you are competing with some of the best financial brains in the country. They have the benefit of years of research and experience behind them. Not to mention huge financial resources and every conceivable aid to assist them.
Never lose sight of the fact that someone’s gain is nearly always someone else’s loss-don’t let it be yours. Share prices can drop sudden and faster than they rise. Don’t let it overwhelm you.
A “tip” is just an opinion. There are plenty of people who are willing to advise you to sell or to buy. Don’t let any of this throw you off course.
Some companies have professional directors whose job it is to enhance the company’s image. They add little else to the company’s bottom line.
All of the glossy brochures about a company may look impressive but they can be doctored to look better than they really are.
The financial jungle can be rough and those losses can be hard to swallow but one must learn to take a financial hit occasional and not be discouraged from taking further risks. When I say risks I mean calculated ones.
If you are going to make yourself ill by worrying if your shares drop by a percentage point or more then stay out of the share market and be a little more on the conservative side with your investing.
In this day and age with modern technology and online share market platforms it is much easier for ordinary people to build a portfolio on a modest income. Managed funds enable anyone to tap into the best financial brains in finance-even the financially ignorant.
Even so, keeping up to date with the financial world will help you in the long run.
Share trading can be divided into three categories.
1 Long term: For people wanting to build a nest egg for their retirement. The type of investment will depend on your risk profile and your age. Investors may want to just invest regularly into this type of fund and forget them.
2 Medium Term: For investors wanting a reasonable return up to five years with a chance of a capital gain.
3 Short term: This is for money that may be needed within the next 12-24 months. It should be placed in more conservative accounts. Money in this category may be required for appliance repairs or replacement and so forth. It is for the unforeseeable expenses. Many financial advisors even suggest having an emergency fund for this purpose.
About this article
This article is of the opinion of the writer and may not necessarily be applicable to your own personal circumstances, therefore caution is advised. Read my other articles on www.robertastewart.com
