The stock market is often described as a way to earn easy money. But the reality is that investing in stocks requires time discipline, discipline and a systematic approach to investing. It also requires patience and a long-term investment plan.
It’s easy to be lured by the promise of quick returns and quick fixes, however, the reality is that investing in stocks is a long process that has many highs and lows. However, the rewards of investing in the long run can be significant. Here are some share market tips that novice investors should be aware of before they start.
Don’t be a jack of All Trades
A common error made by new investors is to jump from one investment strategy to the next. This is costly, especially for those who are just learning the ropes. Some novices, for example attempt to be “jacks of all trades” changing from buying and trading short-term investments (options or futures) into investing in US stocks. This strategy is risky and costly, as it involves many charges for transactions, currency conversion charges, and exchange rates.
Follow a single investment strategy instead and concentrate on the potential value of a stock in the long run. Avoid overreaction and focusing on immediate events. Keep track of your stocks every quarter, or when you receive quarterly reports. Don’t be distracted by the pursuit of the next big thing.