Stock trading strategy - mind of a successful trader

www.investing-performance.com

Stock Trading Tips
-
Mind of a Successful
Trader

Disclaimer
Trading stocks, especially low-priced stocks, is VERY
risky.
You are on your own, no warranties.
Check with a qualified investment professional.
Do not invest more than you can afford to lose.
This is not investment advice.

In talking with people who want to
learn how to trade with great
profits, or who ask me to evaluate
stocks for them, I notice that there is
a difference in the mindset, in
addition to the procedures that we
use to evaluate trades.

This will focus on the
difference in the mindset that
let's you pick the best stocks,
and not the stock scams.

First, the successful stock trader
thinks only of the future.
Stock traders, stock pickers, are in
the business of prediction.

Those who invest successfully
are not excited that the
company has just made a big
announcement - they want to
find a company that is about
to make a big announcement.

Thus, the old saying,
“buy on the rumor,
sell on the news.”
Anticipate. Predict.

Or another old one, buy straw hats
in January.
You buy in advance of the demand
if you want to take full advantage
of the hottest stocks.

If the stock is trading in a dull,
lackluster fashion, the
question is will it go up?
Most traders ignore such
stocks because there is no
"action" in them.

In fact, Wall Street is the only
business where to get more buyers,
you increase the price. In the retail
business, if you are selling straw
hats, you lower the price and
announce a sale.

Stock manipulators, on the
other hand, use increases in
price and volume to get
buyers. If you are buying only
the most active stocks, you
are probably losing money.

If you are buying only those
that hit new highs, you are
probably losing money.

One of my favorite hunting
grounds is the list of new
lows (Note, however, I know
that stocks move in trends
and I do not get in front of
moving trains that are going
down.)


Second, I instinctively go
against the crowd. You want
to buy cheap and sell high,
right?

Well, stocks are cheap when
nobody is buying, duh.
And stocks are high when
everyone is buying.
Enough said.

When I was telling people to buy
the day after the crash in 1987,
nobody wanted to listen but you
could have bought blue chips
names below almost below their
cash per share and certainly
below their liquidation value.

I got on a financial radio show
in Miami and told people
"mortgage your houses and
buy, you will never see these
prices again!"

Only one person called and he
didn't buy anything.
Yet the market never saw
these prices ever again.

There is an indicator out there
called the consensus and it tells
you what percentage of folks are
bullish and bearish. We also note
that contrarian investors are
successful but not wildly so.
There is more to learn.

Start thinking of the future. What
has happened now, what you
know now, is only your starting
point. What will happen next? Is
there a trend or is this move the
first leg of a reversal pattern?

Buy value and look for the
cheap stocks that have a good
future of ahead of them.
Anticipate and predict.

Third, the successful trader,
while he wants to know
everything before he buys,
does not wait to know why to
sell.

If the price declines sharply and
suddenly, the up trend is broke
and the trader does not know
why, it means something is
wrong and he sells as a knee-jerk
reflex action.

He knows that about six weeks
from now, when the price is
much lower, he and the world
will know, but right now the
trader knows that he must sell to
save his skin.

Fourth, the successful trader is a
professional and he is constantly
looking to keep up with the latest
techniques, to learn more, and he
spares no effort in his quest for
more knowledge. Yet he knows that
it is the basic principles that are the
most powerful.

He focuses on the application of
these principles by learning,
learning, learning. He invests in
learning, even knowing that
some of this might be wasted. He
is always looking for the latest
improvement, the secrets of
trading.

Finally, the successful trader deals
in action. He makes decisions.
Once he has enough to make a
decision, he acts or not.
In the stock market, it is action
that makes you money!

Discover more free at
Investing-Performance.com

or

Get “How to Find a Home Run
Stock” Or
“How to Pick Hot Reverse
Merger Penny Stocks”
on Amazon.com

Stock trading strategy - mind of a successful trader

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