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Stock Trading Tips for Beginners

Stock Trading Tips for Beginners
January 13
12:43 2016

Entering into the world of stocks is a huge risk that can pay off ten-fold if you’re prepared and know how to navigate the market. Whether you decide to settle for a company’s 401k plan or open your own account is up to you, but regardless of your choice, learn the ropes before you make an investment with these helpful tips:

Learn the best time to trade.

The history of stock trading has shown that the best time to make a trade is in the afternoon hours between 1-2:30 p.m. EST. During this time, all time zones in the U.S. are officially at work and have read the top news stories. Also, the government and corporate earnings reports tend to be released in the morning, meaning investors have had time to react to these releases by the afternoon hour.

…and the best days.

Typically, the best time to buy a stock is between the 18th and 22nd of each month, when cash from dividends or pension funds are dispersed and invested back into the market. History has shown that during the months of September and October, the market tends to hit its lowest points of the year, making it the prime time for buyers.

Set a per share minimum.

Don’t invest in a stock that is trading at a value below $10. Low share prices indicate the company may be in financial trouble or have a history of financial trouble, so you should avoid investing.

Always analyze.

After you have made a trade, whether it was a success or failure, be sure to review it and learn from your mistakes (or wins). Apply what you’ve learned to make different investments in the stock market with more experience under your belt.

Know where to look.

Most financial advisors look at sales and earnings to determine whether or not to purchase a stock. Among all other financials that a company can make public, these are the two numbers you should look to when making an intelligent decision about taking action. For more thorough investors, it’s best to do a fundamental analysis, which examines a company’s earnings, growth, sales, profit margins and return on equity.

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Mina Sinai

Mina Sinai

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