To much of the population, stock investing has remained a source of both mystery and intrigue. While very few people actually understand stock market investing, the idea of getting a return by investing in companies is an idea that appeals to many individuals. In this quick guide based on the resources at HowtoInvestHQ.com, we will be covering the best ways to enter and exit the stock market to gain the most out of your investment.
Entering the Stock Market
One of the most important things new investors will need to learn is the importance of timing when entering the stock market. If you entered the market at the highs of 2008 before the crash, you would have had to wait nearly 5 years just to get back to even. Your return can go from barely beating inflation to making massive returns depending on the timing of when you purchase your stock.
The truth is no one can predict exactly when the best time to buy stock is going to be. As a result, the top strategy is to just buy stock slowly over time rather that all at once. That way, you get an average entrance price into the market. If you entered the market during times when the prices were average, you would have done very well with stock investing over the past few years, so this strategy does really work. You do not need to get in at the absolute bottom of a stock to make money – you just need to make sure you are not buying at the top!
If you are worried about how exactly how to buy stocks – that is easy. Just open a brokerage account through your bank or a brokerage site like Scottrade. Once you set up an account, you can deposit money and buy your first stock in just a few day’s time.
Exiting the Stock Market
Exiting the stock market is much easier than getting into it. If you make a big profit on a stock and sell the position entirely, you have made your profit. That is all there is to it – you do not have to move out slowly like you did when you entered the market. Sure, the stock may go higher, but hindsight is 20/20. Once you make your profit and a happy with current levels, sell the stock and move the money somewhere else. One method for maximizing the gains of a stock while protecting yourself from future loss at the same is to set a stop loss order. You can set this just under the stock’s current prices.