If you’re an investor, you want to make money but unless you’re in the financial services field as a career, you have to balance your trading and investing with other life responsibilities—your job, your health, taking kids to gymnastics, quality time with your family, and more.
How are you going to fit investing into the mix of life’s responsibilities? Before diving in, keep these thoughts in mind.
1. There is no fast money
Don’t get into the stock thinking that it’s your key to fast money. You’ve heard the saying before—if it were that easy, everybody would do it. Investing is hard; trading is harder. Making fast money is even harder. The right expectations will save you from a lot of financial heartache. If you’re investing to build long-term wealth, you’re far more likely to come out ahead. If you want to gamble, go to Vegas.
2. Don’t Trade Solely on Tips and Recommendations
Financial media, blog posts, Facebook articles, friends, family, financial advisors, and just about everybody else with an opinion will offer you plenty of stock tips. Instead of taking tips or advice and blindly trading on them, make note of the stock and research it.
Check it against our screeners to see how it compares to its industry and the broader market and read through the company’s financials, press releases, and other public information. If your research backs up the tip you received, invest.
Remember your portfolio is different than the person making the tip. Just because it works for them doesn’t mean it works for you.
WooTrader will always show you the data we used to formulate our recommendations and we encourage you to study it before making a real investment
3. Favor the Sectors You Know
If you’re in the medical profession, look first at medical stocks. Do you work with cars for a living, check out automotive stocks. If you understand the product, you can better understand the company. Trying to read through complicated medical research to evaluate a biotech stock might not be the best use of your time. If you’re a technical trader, the specifics of the company may be of less importance but you should always understand the companies in your portfolio.
How much time should you invest into investing? If you don’t have expectations of making fast money, you plan to research the stocks you own, and most of your stocks are in companies that do something you understand, take popular TV personality Jim Cramer’s advice: One hour per stock per week. If you have 5 stocks, plan to put 5 hours of your week into your portfolio plus extra time researching new ideas.
WooTrader can cut down on the amount of time you spend researching because we put all of the data in one place. Even better, we compare it to other data and create lists of stocks to place on your research list. We’re not here to eliminate your research time—just to make it a little more efficient and valuable.