Although the stock market is unpredictably volatile There are tried-and-tested strategies that can increase your chances of achieving long-term success.
The first thing that any investor needs to establish their financial goals, such as saving for retirement, buying a home, or funding your children’s education. This will allow them to determine how much to invest in the market and what kinds of investments will be suitable for their particular situation.
The importance of establishing an emergency fund or repaying high-interest loans prior to investing heavily in the market is an excellent idea. Start small and increase the amount you invest as you get more experience.
One of the biggest mistakes novices make is to try to time the market, Keady says. Keady says no one knows what the ideal time to invest.
If you’re just beginning your journey you should try to invest in companies you know about. Peter Lynch, the legendary Fidelity Magellan Fund manager, once said that you have a greater chance of success investing in companies that have a solid track record and growth potential.
Avoid forums and advertisements that promote stocks with a high probability of success. In a majority of cases, these are part of a pump-and-dump scheme in which shady people purchase shares in a thinly traded company to drive up the price, and then sell their shares to line their pockets.