subject: Four Top Tips For Investment Success [print this page] Four Top Tips For Investment Success Four Top Tips For Investment Success
Spread your money between different sectors and companies. How: choose different sectors and then scatter funds over a large number of companies. The outcome is that if you rely on just four enterprises and one collapses, it's serious. Invest in ten or more, and you can live with one or two losses.
Look for slow but steady risers that rarely falter. A fact is that these tend to be shares in fairly unknown firms that are not in the public eye and do not attract media attention. Study the financial pages for equities that rise a cent or two on a daily basis without comment from financial analysts. Possible causes: a big investor may be buying stock gradually to avoid attracting attention, a bid may be in the offing, or the annual report day may be approaching and big profits are to be announced. It's wise to get in now at the start of the ascent.j
Never buy on a rumour. Why: the market hums with rumours all of the time and many have no factual basis. Exception: some shares at the centre of a trakeover rumour often adopt an up, down, up further and down for good' pattern which can be milked profitably. How: buy when the share has risen on two consecutive days. Ride the share until the first fall and sell half. Wait for the momentum to gather again - and sell the rest when the share price just beats its earlier high.
Buy into a company when it's competitors are doing badly. High-flying investors relish the crash of a large firm they know that its customers will have to buy elsewhere. So they pump money into its rivals, and make a profit. Warning: if a firm crashes because it makes a particular product which the public no longer wants, then the competitive firms are also likely to fail. Essential: inspect the products and services on offer before investing. Key question: is the core product or service provided a fad or something with exhilarating future?
