To achieve success in stock investment, of course, various strategies are needed. What stocks should be chosen, when is the right time to trade, and what attitude a stock trader should have are included in a stock trading strategy.
Moreover, currently, there are many services and applications that make it easy to make stock transactions via mobile phones. So it will be very unfortunate if you trade stocks without a strategy in order to maximize the benefits. In order to get the maximum benefit from stock trading, let’s look at the following article.
1. Define Trading Goals
All investment activities will be greatly influenced by the objectives to be achieved by investors. You as an investor who chooses stocks as an investment product, you should also determine what your goals are in trading stocks.
Goals are important in order to be able to control yourself in investing. So you will invest consciously and understand the goals you want to achieve. You will not be easily influenced by the strategies of other people.
There is nothing wrong with setting goals. Everyone has different stock trading goals according to their respective dreams and plans.
Some people choose stock trading with the aim of getting more money quickly, but there are also those who trade stocks as a means to get retirement funds.
To be sure, whatever goals you set as your trading goals, are made and decided with care and consideration.
2. Know the Risk Profile
Every investment activity, must have risks that must be borne by investors. In trading, of course you will be faced with various stock options that you can trade according to your wishes. However, be careful. Don’t just choose stocks for you to trade.
Carefully study the risk profile of each stock you will trade. Adjust the risk profile to your character. If you are a brave person and ready for challenging risks, then you can choose stocks with medium or small market capitalization in your stock trading activities.
On the other hand, if you are a beginner and are careful in trading stocks, then BUMN stocks or blue chip stocks could be the right choice for you, the consideration is that the risk in these stocks is smaller because the movements are more stable and liquid.
3. Pay Attention to Influencing Factors
Social, economic, and political conditions in a country tend to affect stock prices. Don’t be careless about what’s happening in your country.
It may be that certain political conditions, such as approaching general elections or religious holidays, can determine the movement of your stock trading.
The best time to invest in stocks is when the economy is improving or at least stable.
4. Choose Stocks Wisely
You must select a type of stock index that can be used for trading, as well as one that has high quality and is owned by a professional company.
5. Take Opportunities When Stock Prices Drop
Some investors argue that buying stock prices when they are low is a bad idea. There may be some truth to this, but there are some issues that must be addressed.
In some cases, after a stock’s price has decreased, the price of the stock has increased again, which could be at a normal or even higher than usual level.
So, by purchasing these shares, you can reap the greatest benefit.
However, you must be more cautious and cautious in recognizing this opportunity.
Do not apply this condition to all stocks.
Do stock transactions with caution and consideration for other influencing factors.
6. Portfolio Is Key
In determining which stock you want to buy, carefully study the company’s portfolio. Be careful in screening and filtering to choose companies with good financial fundamentals.
One way to reduce the risk of loss is to choose a company with good financial fundamentals. You don’t have to worry about choosing the company in vain and worrying about experiencing big losses.
A company with good financial fundamentals means that the company is well managed. The managers and employees also pay attention to the health of the company so that investors in the stock market continue to look at them.
7. Don’t Miss Analysis and Evaluation
Every new thing that is lived, of course, requires adjustment and learning. This includes investing and trading stocks. The learning system is trial error.
Even though you have determined your investment goals, know the risk profile of the stock, and care about the surrounding environment that can affect stock market conditions, you need to conduct an analysis and evaluation of your stock trading behavior.
Have you chosen the right stock so far? How is the stability of the stock lately? What about your investment targets with the stocks you currently choose?
Perform analysis and review regularly. It could be every 3 months, 6 months, or maybe once a year. You can find out if the product you choose is not in accordance with your character and goals.
So the next step you can take is to replace it with a better stock. Stocks that can lead you to your investment goals and suit your character.
To achieve success in stock trading is a long journey, Continue to increase your knowledge about stock investing including strategies that can be done in trading such as position trading, swing trading, day trading (intraday), scalping, and transition trading. Choose the best strategy according to your goals and character.