Playing in the stock market could provide a much profit doubled compared to save money on deposit or invested in bonds. But playing in the stock market can also cause substantial losses. Therefore, before deciding to play the stock is very important to evaluate whether you are someone who is willing to take risks commensurate to the commensurate benefits. The greater the risk that would generate greater profits.
If the risk the greater the yield advantage that only small, it means we are wrong to apply the most basic financial strategies, higher risk, higher profit or lower risk lower profits. This is the underlying why deposit rates quite low, because the risk of deposits is also quite low.
Thus, choosing to play stocks, rather than bank deposits, means must obtain greater profits from the deposit. When we find that the benefits obtained lower than deposit rates, then there is something wrong in how you play the stock.
Here are the steps you need as a beginner to play stock. This article assumes that you have read enough books to understand the mechanism of playing stocks, as well as procedures to open accounts at securities companies.
General formulation :
1. You must have a big enough desire to play or know how to play or have a strong desire to earn profits by investing in the stock market. This should be ingrained in you from the start, or do not ever play the stock, you should buy mutual funds only. The first formula is: you must have a strong urge or desire to play the stock and profit.
2. Play in small enough quantities to first consider there is always a small possibility of a loss could be too big. Therefore, play in a small amount of money, such as pilot projects. If you begin to feel comfortable and know how to play to make a profit, then you can slowly increase the amount of money invested. When adding the amount invested, always remember that money you can add these exhausted, do not just remember that once you earn a profit, but must remember that your investment can be reduced even exhausted. You never know when an important event that negatively impact the market place; suddenly could happen prices plummeted, and you did not get out of the market. The second formula is: always remember that money you invest can be decreased or even exhausted.
Technical formulation :
1. See the direction of the economy, national growth rate estimate
It is important to know where the direction of economic growth, meaning whether it is the boom, or depression or in between. If the economy is in ever-increasing growth, then that’s the best time to invest. Conversely, if economic growth is in negative circumstances, then you should exit the market, unless you already have a regular shorting and experience as a trader.
2. Options recordnya industry and tracks. Select your industry and more familiar love / like. Learn the history of the industry in depth and read the opinions of experts about the industry. Select the industry that have a good track record in delivering profits.
3. Stock options and track recordnya
Select 1 or 2 stocks, no more, in the industry point 2 above. Choose which have a good track record.
4. See PE
Stocks that you choose those that have a PE must be the lowest in the industry. PE is the ratio between stock market price per share divided by net net income per share. PE is essentially a relative number. PE 10 can be called cheap if the other PE is higher. But in general, now 10 PE can be said to limit cheap and expensive, although there is no theoretical foundation.
5. Capitalization
Select stocks that have large market capitalization. This means that stock market value of the rupiah in circulation is quite large. So the stock fryer does not have enough money to fry these shares. This means that if the market capitalization of a small stock, then the individual players can easily work the stock price fluctuates with the amount of its equity.
6. Market Sentiment
Notice the market sentiment. Although our low PE stocks, and large capitalization, market sentiment is often a determinant of our stock price ups and downs. This sentiment is the most common regional stock price index. Sentiment is the second, interesting events that affect the industry in which stock we are. For example, certain commodity prices and the effect on profit company whose stock we have. The third sentiment figures the economy in general, such as coverage rates of economic growth rate, rise and fall of interest rates by central banks, inflation rate, unemployment rate, the rate of retail orders, consumer sentiment, the general rate of consumer purchasing power.
Similarly, some guidelines for playing stocks for beginners. If you are disciplined in the steps mentioned above is unlikely you will not experience losses. There are many lists or tricks that can be learned in playing the stock when you have much jump in it. But as a novice, lest you become part of a 90% stake beginner players generally lose money before starting a profit. You do not need to lose early, you can directly profit. Do the 6 points above with full discipline.
Incoming search terms for the article:
- what does play stocks
Bonds are similar to shares of financial instrument traded capital market. Definition: A bond is a debt waiver of the issuer to bond holders concerned. Called the bond issuer issuer. Bonds are also included in the category of securities that provide fixed income (fixed income securities) to the holder, because the bondholders will receive the amount of money (income) in each year that have been established when the bonds are sold by the publisher.