Setting your own set of parameters or rules will allow you to avoid large losses in the market and it will also aid you to receive better gains in your investments. I have seen it so many times in my own life and with the people I meet whether they are tenured traders or newbie investors. Losses get magnified when you don’t stick to your trading rules.
Catch me in my live training events! (quick plug)
The heart of why I do this seminars is I want to build a generation of Filipinos with the right foundation in stock investing. I want to bring smart investing to every Filipino around the world! If you would like to know more on how you could time the market checkout the trainings below.
These are a couple of things off the top of my head (as of the moment) and I will make more and more snippets for all of you in the coming weeks. My goal is to make you and more Filipinos profitable this year in the stock market! I really believe that there’s so much more in store for each Filipino! Trade Well. Trade Strong. Trade Smart.
1. I only trade using technical analysis.
Everything else is just purely speculation or guessing.
2. I invest only with fundamentals
It does not make sense to me to buy a company that is not earning or growing at all.
3. I ignore hype, speculation and rumors.
As mentioned in the two videos above, I just follow my own strategy and use technical and fundamental analysis.
4. I ignore the buys and sells of my friends
No matter how rich or how more tenured some of my friends are in the market I have learned to stick to my own convictions. Listening to your friends will cause you to second guess yourself and your strategy. Better learn to trade on your own regardless of what other people would say. After all, it’s your money, it’s your responsibility. Your friend won’t reimburse you if you lose money.
5. If I did not do my research the night before, I do nothing the next day
I am not here to gamble my money. I am not here to leave everything to wishing or hoping. This is not a slot machine or me throwing the dice just thinking positive that the dice will roll in my favor. It has to come to a point that when I invest, I base everythingon what the numbers are telling me before I make a decision.
6. I only trade what’s in my watchlist.
If a stock goes up and it’s not on my watchlist I am fine with it. I do not get jealous if a stock goes up and I was not able to buy it. I rejoice when a friend earns from a stock that he works hard for. I have learned to be content with the stocks that I am suppose to keep an eye on.
7. I do not buy on rumors and sell on news
When I trade. I buy on bounces from the support and breakouts. Nothing more nothing less. Even if the news is bad but if the stock breaks out, I still buy. Even if the stock is high but it still breaks out, I buy. I sell on breakdowns and the failure of a resistance to be broken. Nothing more nothing less.
8. I am okay to cut my losses in trading as long as it will prevent me from bigger losses
I am not here to play a perfect game. (The only perfect person in this world is my wife. We all fall short from the glory. She’s perfect!) I am here to make money and maximize my earnings when I am correct but I am also here to admit my mistakes and sell them at a loss should I be wrong. I have learned to be humble enough to know that I cannot get it right all the time.
9. I am okay selling companies that I invest on as long as I know the fundamentals have shifted.
As an investor, it does not make sense holding on to a company that has declining earnings or the company is maturing already. I could invest my money in other companies that have a better shot of giving me growth in the future.
10. When in doubt, I do nothing and avoid the stock.
I don’t force the issue. When technical indicators give me readings that give more confusion than clarity, I do nothing and just stay away from the stock. I want to use my money when I know I am fully convinced the stock is worth buying. One of the best ways to lose money is to buy and sell a stock without any conviction.