Monday, August 13, 2007

What are you thinking?


Well, during stock market boom time most people earn money by just buying what ever stocks that comes into their mind... little do they even care to read up on the company that they are buying into....To be frank there are more younger stock traders/investors these days compare to a decade ago where most of them are relatively much older in age....

The younger generation realizes much earlier that in order to be financially sounds and ultimately achieves financial freedom is through investment.
However, stocks are not like any other tangible assets (eg. Property).

Tangible assets will in time appreciate in value because as the human population grows, available land/resources on earth are scarce and depleting. The demand for such assets will only increase as time past.

Stock price on the other hand is a value that represents a corporation which the current market feels it is worth. Stock price will not necessarily go up as the time past…and this applies to good company as well. A performance of a company in the future depends very much on what the company does today. The goal, plan and vision it has today is crucial to determine it’s profitability in the future or even the survival of the business in the long run.

Having said that, by just buying a stock and keep without monitoring it’s profitability and business condition overtime is like walking across the road in the middle of the night expecting nothing will hit you.... trust me you will be hit one way or another.
Therefore entry and the exit timing is the most important thing an investor needs to master and grow its financial power. Only then one can maximize return in the shortest possible time.
So try looking into the future and anticipate the upcoming wave of interest before you invest…well a few good ones will do the trick….there’s no point in having a lot of counters…put more time and money into the few key stocks. That’s all you need…

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