Sailor to Student: How I Made a Quarter of a Million Dollars in the Stock Market, and You Can Too. by Tony Elion Jr

Author:Tony Elion Jr [Elion Jr, Tony]
Language: eng
Format: epub
Published: 2019-11-11T05:00:00+00:00

Stock Tips

• I try never to make purchases of stocks within the first 30 minutes of the stock market opening. Usually, during that time, I find the market to be pretty volatile, and the prices go up and down a lot. In the beginning, there were several times when I purchased stocks at the opening bell, and 15 minutes later, the stocks have dropped in price by $5, $10, even $20 or more. By purchasing at a higher opening price and then the stock price falling, unrealized loss is created that could have been avoided, by simply waiting a few minutes longer. I like to let things settle down before I make a morning purchase.

• Additionally, the above tip is assuming that you are purchasing stocks at “market price.” (Market price simply means how much the stock costs at the exact time you buy it.) You can set a price point for what you are willing to pay for a stock. For example, if McDonald’s is trading for $150 per share and you want to buy it for $140 per share, you can set an automatic purchase of the McDonald’s stock if/when it reaches $140 per share. So, inside your brokerage account, you can put in an order for 10 shares of McDonald stock at $140 per share. If the McDonald’s stock drops to $140 per share, the sale will happen automatically. If it drops to $141 per share and then shoots up to $250 per share, then it will not automatically purchase, and you will have missed out on making over $100 per share on your investment. As you get more comfortable trading and purchasing stock, you will know when to set a limit and when to purchase at market price.

• Be careful with news and media coverage of the stock market. The news outlets are trying to gain ratings based on emotional response. If the market drops several hundred points, the media will try to make you believe the sky is falling, and it’s the end of the world as we know it. That same media will have you believe that good times are never ending when the stock market is doing well.

• When the overall markets are low and your stocks are down in value (along with all the other stocks on the market), this is a good time to buy more stock. Yes, I do invest more money when I may be down. These are unrealized losses and will likely go back up when the entire market returns up. No matter if you buy stock in the same company or a different company, the low price point will likely pay off when the market swings back up.

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