Do most people lose money trading stocks or gain it?
How can people lose money while trading stocks, i dont really understand it. If im going to invest in a company i will invest in a company that i know it will give me profits and i willl do a lot of research before investing in this company. Even if the company is not gaining much profit for the mean time, i will just hold it until it is back on track (i wouldnt mind holding onto it til 3 or 4 years), so i dont understand why people lose money by trading stocks.
One more question, if there is a slight change on my shares price of 5% in few minutes after i buy it. Should i resell it? and does the percentage of the shares change everyday? Ten points for the best answer. I hope i dont get any comments from people that tend to make fun of those who want to learn, i know this place is full of intelligent people but it has too many dummies. Thanks.
Comments
Well, stocks are a very tricky business and to master the market you need to be very smart. But sadly, just like make gambles even if you win a bit you usually end up losing your money. My advice would be to sell if your in a gain, because in this market stocks are bound to drop.
Most people lose money when buying and selling stocks because they don’t know the secret as I do. 99% of the rookies on here like(The Old Guy) and many others don’t know anything about how to pick stocks that are about to rise in price. Just buy the stocks that i buy and sell when i sell and u will be rich.
Listen to everyone else. They are smart. Also, though, keep in mind that there is a transaction fee of around $20 I think (per company transaction. sorry if that is confusing) so you want to sell your overall stocks for over $20 more than you bought them. Actually, I fell like answering, so you could lose money if after you buy a stock, the percentage is lower than the original price. Even if the percentage went up, it might not be enough to go through to go to the positives. Think of a number line (sorry if my answer is too nerdy) When you buy your stock, your at 0. if the price goes down, your in the negatives. As you go up, you have to reach above (positive numbers) to actually get profits.
July 2nd, 2010 at 2:53 am
Losing money trading stocks is very easy, especially if you get a tip on a stock. By the time you get a tip and move in, everybody else has been there. Entry and exit (or partial exit) are as important as picking the right stock. Stocks are subject to market conditions as well as the analysts expectations, come in pennies short on the wrong day and you could lose 10-20%.
The 5% question is interesting and depending on how many shares and the price of shares, I might sell 1/3 of my position and if it went up another 5% the same day another 1/3. I take out partial profits on the way up and move my stop on the last 1/3 to entry or higher.