This site is about learning how to buy stock. I've been a big believer that you can probably learn how to invest your money better than your broker. This is because your broker usually only tells you when to buy and never when to sell. Owning a stock forever and not selling it for a gain is probably the biggest myth of the stock market. Buy and hold. You've heard the advice before. This advice works great for mutual funds because the fund manager is actually buying AND selling the stocks. They aren't holding them forever. You shouldn't either.
That being said, perfecting the art of buying stocks is easier said than done. You will have to study the market daily. You'll have to set up a system that fits your personality and that eliminates the emotion of investing. But not only that, you'll need to set up a way to learn from your mistakes. Learning by doing is the only way. You can't sit on the sidelines.
Step one is to pick a strategy and stick to it. Make it your sole focus. You can't make money practicing 18 different techniques at once. You'll never master them all. Pick one that's proven to make money and get to work. That's why here, I only talk about CANSLIM for the time being because I am trying to master one specific proven strategy. This is key. There is no reason to recreate the wheel. Whether you pick CANSLIM or value investing or penny stocks or options it doesn't really matter. Just set out to master whatever strategy you choose.
Once you have done that, you've got to practice. You do this by using a simulator. This is what I've been building my series of articles around over the past several weeks. You can see the beginning here at this link: Buying Stocks - A Case Study. If you want to see my last four articles in the series here are the links.
Stocks To Buy Today
Best Stocks To Buy
Stocks To Buy
Good Stocks To Buy
In the processing of learning how to buy stock, you'll take some lumps on the way. Notice my red losses. This is what happens when you buy stocks extended to far from a proper buy point.
Before I learn how to buy stock online, I spend time in the gym so to speak. All the professionals do. From scrimmages in professional sports to airline pilots, all learn from practicing. And while real world experience is the best teacher, we live in a world where we can recreate real world conditions. This will save you money when learning how to buy stock. You can start by practicing. You can see what kind of mistakes that you will make. Then you'll repeat the learning process by using real cash. Because this again will require a learning curve as well, because let's face it, the practice field is not the real thing.
So what I would do is spend time setting up your daily stock market investing routine. For me, that means that I first check out the days market action. My rules say that I will only invest when the market is in a confirmed uptrend. The market is still in a confirmed uptrend so that's good.
The stocks I've been looking at make me feel like we are in a correction. But the market itself doesn't show that right now.
Next, I check out my stock market screens and today decided to add three stocks to my watch list. They were:
EMV, FFIV, FOSL
Well I guess that I only really added EMV as the other two were already on my list.
I've been suggesting that you build your watch list from one screen until you get the habit down. The IBD has so much information in it. After awhile, you'll expand it. Lately, I've been looking at the other screens. In particular, the Weekly Review and the Stocks in the News. Mainly because they have the mini charts. I also take note of the stocks mentioned in the Big Picture column. Many of these stocks will probably be stocks that you will probably have on your watch list.
Anyway, after that, I take a look at the stocks on my watch list and prune the list of stocks. For example today, I removed a stock that I'd taken a position in ARUN because it's Acc/Dist Rating was now a D. I also have to sell that stock as well.
My problem in unloading some of the stocks I've purchased is that the investopedia simulator has been down all week. I also sold FFIV. I've been using Wall Street Survivor as a back up and was able to unload it. I expected it to rebound today. It did by a few percent but not by a whole lot.
Today, I picked up PPO.
I've got a little added pressure to because a friend of mine decided to pick it up with real cash. We'll see how it does and he'll tell me if I really know how to buy stock. He already decided that you all should short the stock...lol.
Good luck!
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