Archives For Stock Investing

Few months back I talked about forex trading, here is a guest post which compares Forex trading with stock trading. I am personally not a big fan of either. I am better off with index funds and mutual funds. Enjoy the post if you have risk appetite for trading.

Forex trading chart

Forex trading chart

Forex trading and stock trading are two different forms of financial trading. They may both represent two different ways to make money from the financial markets, but they have some subtle differences which may or may not work in the trader’s favor.

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Hope you haven’t frowned seeing the title. There are many who invest in stocks out of compulsion or impulses. This article is for those. I generally tend to write about people who are like me, middle class, having some money to enjoy life but, mostly trying hard to maximize money’s worth.

People like us, do not usually have money for buying stocks on impulse. Still, it almost happened to me last week. I was on the verge of buying into Facebook on the opening day.

In the end, I did resist myself against buying the Facebook stock. Not that Facebook is a bad investment but, the whole affair was nothing else than impulse buying. I didn’t study the valuation, I wasn’t reading analyst reports. I was just buying it, for the sake of it. Giving in to the hype and hoopla.

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I am not talking about traffic signals – I mean the stock market and its movement upward or downward. I get excited when I have money to invest in a market and it goes into the red. I worry about my investable income when I see the market in the green for an extended period.

In plain language, I am just in my mid 30′s so now, I am not bothered at all about the market being low. I don’t buy and sell frequently on every ups and downs, I don’t care by how much stock market goes up or down every day. I hate frequent stock trading.

“Wall Street makes its money on activity. You make your money on inactivity.” – Warren Buffett

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Millions of investors ask the same question over and over again: ‘How can I time the stock market?’ You have seen a stock or fund’s 52-week high and 52-week low, and if you are like me, you’ve probably wondered why you didn’t buy at the lowest and sell at the highest.

Every stock I see on Yahoo! finance makes me sigh… If only I could have bought the stock at such-and-such date and sold on such-and-such date. I could have been a multimillionaire by now had I timed the market correctly.

Various fools and alphas have written tons of articles on timing the market.

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Statutory Warning: Stock market investment is the most risky investment possible. Stocks may lose its entire value, leaving you with no money and no future! (My version of the disclaimer)

Saying the above warning let me confess that I started buying selective shares starting today. This is investment, not trading. I don’t trade stocks, I invest in stocks that means I buy and hold them for long-term.

I do not follow Cramers of the world or for that matter any TV expert. I don’t go to alphas and fools for their advice either.  I believe only in Buffet and his philosophy.

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