How to manage a winner’s stock and how to buy your first stock
When owning gainable shares, investors often make two mistakes:
First, they often sell shares as soon as trading becomes a bit profitable. Then, after the sale, they miss the massive jump the stock makes when its price rises.
Second: Investors want to hold certain stocks forever, despite the fact that some of the winning stocks may be losing. In fact, nothing is worse for you (and your account) than watching a profit disappear and turn into a loss. There are several strategies to prevent this from happening.
If you are an investor, you are thinking in the long run and you are not worried about the daily fluctuations in the price of your shares. However, you should have an idea about the potential selling prices. The profit target may have been reached, or it may appear that the stock price is overvalued based on fundamental analysis or Technical For more information, you can refer to the articles of basic analysis and technical analysis.
As I said before in previous articles, if your stock falls by 5% from its highest level, be careful, if it rises, then this is great. And if it doesn't go up, once it drops by 5%, consider selling it. If it lands more, sell it. This will preserve your remaining profit if there is any remaining profit from the base.
If you still think the stock will go up (and don't want to sell a profitable position), you can sell the half. It is true that you should keep your winning stocks, but if that comfortable arrow starts moving in the wrong direction, then it may be time to close the position.
Using these tools will help you determine the time to sell. For example, if a company declares that its earnings are worse than expected (fundamental analysis), this could be considered a strong selling signal. In addition, if the stock falls below its moving average (technical analysis), this may be an indication of selling. I will discuss this in more detail in later articles so we followed up.
Before you buy your first stock, you must familiarize yourself with the vocabulary in order to know how to properly place an order. You have a number of options for submitting the application, it is necessary to learn them all, and it is very common among people to make mistakes when submitting applications, which can cost Money.
Let's say you decided to buy the company 100 s xx shares, which are offered for trading at $ 10 a share.
Note, before you buy shares of any company, it is suggested that you conduct research. Where do you start?
First, I suggest that you only buy stocks after you have read all of our articles on stocks and trading, then you will know the risks of buying stocks as well as their benefits.
Secondly, an article from which you get sources on stocks. I provide a list of dozens of sources, including books and other websites on the stock market that you can view.
Getting to know the stock market takes a long time, so be patient. Opening a brokerage account will also help you become familiar with the market (but start with small amounts).
To buy stocks online from a brokerage company, first, enter your user ID and password (which is provided by your brokerage firm), and log in to your account. You will directly see the amount available in your account.
In our example, you have ۵۰۰۰ dollars in your account, and you want to buy الشركة the company’s stock, oo, whose stock was last traded at $ 44,69. The current bid price is $ 44, 44 per share (the bid price). It will cost you 4,471 in addition to commissions (100 shares at 71, 44 dollars per share = 4,471 dollars).
In order to continue, you must follow the instructions on the Internet and you will most likely click on the "Trading" tab.
Symbol: Enter the correct stock symbol. Sometimes investors (who are neglected of them enter the wrong stock symbol and buy the wrong arrow. Fortunately, there is a display button that allows you to discover errors before you submit the request.
Action: Choose to buy or sell. And because we intend to buy SSY shares, we will choose to buy.
Quantity: Choose how many shares to buy. For this order, we enter 100 shares.
Order type You can choose a limited order or a market order. We choose a specific request and will tell you the reason later.
Effective Time: You can set a time limit on any request. The default setting is “Day” which means that the request is valid for this day only. You can also choose "Sar to be canceled".
Market demand: fast execution at an uncertain price
The fastest and easiest type of order to place is a market order. Let's say you searched for the stock price of SSCC and saw that it is trading at prices ranging from 67, 44, 71, 44 dollars, and in order to refresh your memory if you want to buy shares for SSX, the current selling price is 44, 71 $, Which is the most you would expect to pay if you entered the order now. You don't like that price? do not worry; Because it will change in a second (it's kinda weather).
When you place a market order, it is quickly executed. Why? Because the computer picks up the lowest selling price (published) and hunts shares at that price. This is a good price for the seller, but probably not for you, the buyer; It is like buying a car and paying the price in the price list, but without negotiations. If you want the stock fast, you may have to pay the market price. Remember, you pay a little more because of the speed.
Example: Let's say you submitted the market order to buy the SSYC shares at the current bid price if you choose “market order”, the order is executed immediately. In our example, you would buy the stock at $ 44, 44.
The brokerage company automatically transfers 4471 dollars (71, 44 dollars multiplied by 100 shares = 4471 dollars) plus a 10% commission from your cash account. If you press the enter button, submit the request, and receive confirmation of the trading process, then you are one of the shareholders of SSCC.
If the xxx share rises by one point, then you made real but unrealized profits on paper of $ 100 (one point profit x 100 shares). Although it seems easy to see your money working for you while you are sitting on the beach, making and keeping profits is much more difficult than most people realize.
Conclusion: Remember that the stock market is an auction, and you do not have to pay all that is required of you. However, if you don't want to bargain for pennies per share, the market demand will satisfy your needs. Unfortunately, in a fast market, or with an unstable market, market orders can be executed at a very poor price.
Fortunately, there is an alternative: limited demand.
Limited demand, slower execution at a more competitive price
A limited order usually takes a little more time before it is executed, but it also allows you to negotiate for a better price. The advantage of a limited order is that you decide the price at which you want to buy or sell stocks. However, there is a possibility that no one will want to trade with your order, and the trading process may not take place. The limited request may take several seconds or additional minutes to fulfill, but don't let that hold you back. Is there a real necessity to buy stocks now?
Here's how the limited order works. The SSX share is trading at $ 67, 44 to 71, $ 44 per share (the difference between the bid and sell price) and you want to buy it, but you feel you can pay a lower price. Enter an order for a limited price of $ 44,50. If the SSX share falls to $ 50,40 (which is not likely to happen on the same day), the order will be executed at that price, and if the share price does not reach $ 44, 50, your order will not be executed.
Sometimes and for some reason, whatever the place where you submitted the limited order, it is not executed at the most competitive prices, all there is to it is that the limited order gives you more flexibility. Many investors prefer limited demand; Because it makes you control your request.
Limited order is usually a good choice. In our example, the market quoted prices range from 67, 44 to 71, 44. If you made a bid of $ 44,69, you are now the highest bidder. Trading on that exchange is not permitted at a lower price until after your purchase order has been fulfilled. In other words, your limited order cannot be ignored or hidden. All you need to do to fulfill your order is for a seller to enter the image. And you do that for the seller known to give him the opportunity to sell at a higher price than the specialist's bid of $ 44, $ 44. Thus you and the seller save $ 0.02 per share.
This does not always happen, but if stocks are actively traded, and when there are buyers and sellers involved, there is an excellent opportunity for your order to be executed. The downside is that if stocks rise after falling, their bid may become too competitive, meaning that the order will not be executed.
The time went until it was canceled and it only worked for one day
If you choose a limited order, you have options regarding how long the order will last. For example, let’s say you made a small request to purchase the company’s shares in QCX at a price of 44, 50, and 50 per share even though the current selling price is $ 44, 71 per share). When submitting an application, you must specify whether the application is valid for this day only (daily request) or valid until you cancel the application (valid until it is canceled).
If you choose SAR until it is canceled, you do not have to worry about re-entering the order every day (but be careful not to forget that the order exists). As for the daily order, if the brokerage firm did not submit your request on that day, the order is canceled.
Example: We are entering an order to buy SSX shares (which are traded at prices ranging from 67, 44 to 71, 44 dollars) at a limited price of 70, 44. We're not thinking of offering a lower purchase price. Because we really want to buy the stock; Therefore, we offer a limited purchase order SSX for $ 44,44 which is valid for this day only.
After we place the order at the current bid price, the SSCC share may increase to 44, 75, so our request is not executed, at least not yet. But after a few minutes, if the stock starts trading at a price of 70, 40, there is still a possibility that our request will not be executed because there are other investors ahead of us in the row (and they make a bid at the price of 70, 44), but if there is a sufficient number of shares it trades, Or if we were the first to bid at that price, our order would be fulfilled. Congratulations, you just bought an SSX share at the price you entered, which is $ 44,44. In this example, you saved a penny by using a limited order.