First Learn, not to lose money!

As we all are discussing fundamentals, technicals in so many of our blogs and the motive of every blog are not only earning but focused on the minimization of risk. In the stock market, everything is rotating before and after stop losing money and managing your risk.

The people who take the biggest risk and gamble on big money and luckily got success in the bull market always the one who hurt the most as they become overconfident due to the bull market and once he generates some income then he gambles in the bear market also and takes the much bigger bid and then loose the more than he earned in the bull market and after you lose money then you put harder and harder money into the markets again to cover those losses, until and unless you are not much lucky it would be a great series of disaster.

We will understand some points which will help to learn, not to lose your money and not be a part of the above-explianed disaster :

• Know if stock is bottom out or not yet  

What happens maximum times that whenever any retailer buys a stock then it goes down and when any retailer sells the stock then it goes up. Why this is the story of every retailer? Because we don't have any idea that if the stock is bottom out or not yet. When the stock starts moving upward then we consider that as a breakout and invest money that time either for swing trade or long-term investing but every upside is not a breakout signal. If we want to buy the stock at a good value then it would be considered at value investing then you may be required to wait very long for its upside or breakout otherwise if you want to wait for the real breakout then you have to buy expensive and profit would also be less comparatively value investing. some investors consider that value investing as a loss so this is also important that at which level you entered into the markets because that only will be defined your actions profit or loss.

Learn technical analysis 

Spinning Top Tool

Paper Umbrella

Support and Resistance

Volume Bars

Moving Averages

• Always leave a scope of Averaging

I have seen many people who buy in bulk at a time like 1000 or 2000 or 3000 like that. Whatever quantity you would like to buy in any particular stock, you should first go with half quantity so that if unfortunately, your stock goes below your buying price then you can do averaging there. Averaging any stock is also an art as we should never do averaging in the wrong stock or wrong levels. 

The first rule of averaging is, never do average before 10% downside in the stock. 

Second, never do average in the stock when it is in a downtrend, let it complete its downside and once the stock starts moving in upside then only try to accumulate the stock.

• Fix your buying strategy

This is very important that you should know your buy strategy and fix them for your purchase. Suppose you buy the stock for a swing trade and getting 5% profit then exit from the stock because swing trade has to be work for 2% to 5%, otherwise, this stock would become your long term pick means you will be stuck into that if you become greedy here to earn more. Further, if you want to play with momentum then put stop loss and trail the same otherwise the stock today giving you 5% can show 5% or more loss in your portfolio. sticking with your buying strategy is very important.

• Track your investment regularly

It is very much important that you track your investments regularly, earlier we listen that buy these stocks and forget for 10 years but nowadays this strategy doesn't work on the other hand it can exploit your money to anything because these days everything, every norm are changing very next days so anything can be so good and anything can be so bad for investors sentiment which can affect stock prices to any extend so tracking your investment at least every month is very much necessary.

• Don't Panic very soon

 Some people start doing panic very soon like if today you bought your stock in uptrend and stock is resting for a while and your stock value show you in red for a short period of time but the investor/trader comes into panic and sells their holdings without knowing the exact reason of fall, even they don't understand the stock market always move into waves like structure and if stocks/Markets are going up then they have to come down or consolidate to continue its rally and same happens in downtrend really if stock is going down then it has to come up to make another lower low. This need to be analyzed before buying the stock, and not after buying.

Above all the explained points have to be taken care of altogether before reaching out to any conclusion, these things are based on my own study and learning experience, you need to check them with your own experience and learnings.