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.
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.
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