2. KNOW WHEN TO BUY AND SELL
The key to making money in the stock market is to know when to buy and sell your stock. Many people purchase stocks and ride them through the tough times. This can work out well sometimes, but often people end up losing money or making very little gain.
Watch the IPOs (Initial Public Offering). When a company offers their stocks publicly they are usually offered at a low price initially. Depending on the company and their profit history the stock's can rise drastically very quickly. Do your research on companies that are about to offer their stocks publicly to decide if they will make a good investment.
Buy stocks from companies whose values are underrated. If you know a company is being underrated by the people who rate the companies it may be wise to invest. You will make money down the line.
Use the employee stock option at your work. Some companies offer stock to their employees at a huge discount. If your company is strong, it would be wise to invest in the stock option they offer.
Sell when the price starts to drop dramatically. You will want to sell your stock if the price drops but is still above the price you paid for it.
Sell your stock if it does nothing for a long period of time. If the price of the stock you own has remained fairly stagnant for a few months it may be wise to sell your stock and invest your money elsewhere.
Sell your stock if a competing company is stronger. If a competing company shows stronger earnings it may be wise to sell your current stock and reinvest in the stronger company.
Practice before you play. If you want to play in the pros you may want to practice before you invest your hard earned money in the stock market by playing the Stock Market Game online. For $25 you can play the stock market with an imaginary one-hundred thousand dollars against other teams in your area.
