The stock market not in a world outside the rules. What's more, these have a very important value if you want operate in the financial markets with certain guarantees of success. And that even its operations are governed by a series of certain sayings that are very useful to apply in the movements that you perform regularly. Both strategies should become a source of learning from where you can make your savings profitable.
Investors with more experience in financial markets know this perfectly well, and for this reason they do not hesitate to apply these strategies to their investment models. These are the most basic rules in investing. They are used primarily for the stock market, but also for other widely popular financial products or designs. Exchange traded funds, derivatives, or futures are some of them, although they carry more risks in their contracting.
To channel your operations in equities, you will have no choice but to act under these rules. Of course, if you want to achieve your goals, which will not be other than to obtain the maximum return on your monetary contributions. No more no less. It will take just a little bit of interest to be receptive to these guidelines, and in time the positive results will not be long in coming. Of course, not without minor setbacks.
Rules on the permanence of investments
One of the most controversial issues is the one that affects the terms to which the investments are directed. They can be short, medium or long. And there is a very popular saying that in the long run you never lose money in the stock market. To some extent this is true and supported by the experiences of many investors with extensive experience in operations in equity markets, and even in alternative markets and even fixed income.
However, long-term investment is very difficult to meet. And not all investors are willing to abide by these dense deadlines. It is not surprising that many who are left by the way, and others cannot take advantage of the performance of these movements. The idea of selling on time is very suggestive, even in exchange for minimal capital gains, in exchange for giving up these conservative terms of permanence.
Normally it is true that at these times you always win, unless surprising events occur, or simply that the listed company goes bankrupt. As on the other hand, it has happened with more than one value of the Spanish stock market, and of those that you will surely remember at this time. La Seda de Barcelona, Terra, TPI or Picking Pack are some of the examples of how you can lose all the money in equities.
But if you opt for more conventional values, surely you will earn money. Although for this you have to have your operations immobilized for a long time, perhaps excessive for your interests. Not in vain, these deadlines require a period of stay between 3 and 10 years, even higher in the more defensive investors. Are you willing to accept these deadlines? This will be the main question that you will have to analyze from now on.
How far to rush the profits?
The stock market scenario most desired by all retailers, also from you, is to be in a profit situation. It is one of the reasons to invest the savings. But the process becomes enormously complicated when you are not clear about what levels you must sell your shares. In this sense, an old saying on the stock market that refers to "that the last cent of a euro takes another one" is very useful. Not surprisingly, you can benefit from its application to the orders that you have open in the equity markets.
Under no circumstances should you be guided by greed, because even in the end you can lose everything, as has happened to some other small investor, with little experience in the stock markets. From this scenario, it is always better to make sales with profits, even if they are minimal, that the occasion passes and the stock market goes down, even in a very marked way. This is something that savers with many hours of flight in the financial markets know very well.
Do not go to the rumors on the stock market
Another topic of great controversy is that which refers to rumors on the stock market as a strategy to invest life savings. In some cases they are true, but in most situations they are not confirmed. It is a very big risk that can hurt you more than you think. And even take you to situations that are not recommended for your interests.
In this case, there is another phrase with a certain predilection among more experienced investors that says "It is bought with the rumor and sold with the news". This phrase is full of great truth, although it is very difficult to put it into practice. On few occasions it materializes with great success. Usually you are always late, and buying the shares will surely not be profitable.
And much less enter the markets when the news has been definitively confirmed. Not surprisingly, if you do it, it can be one of the worst operations you have made in your life as a small or medium investor. It should not be a very adequate strategy to create an investment portfolio, whatever the profile you present as a saver. There are other much more reliable sources of information, do not forget it, and that you will surely be able to give yourself more than one joy from these moments.
Buy very cheap stocks
There is another general belief about the benefits of values that They quote for ridiculous prices, generally below the euro unit. They are expected to rise in not many months, even weeks. It is another serious mistake that you should not incur under any circumstances, but you want to commit an imprudence that you regret sooner rather than later.
These values have these prices so low for many reasons, and one of them because it is its real value. Not for other mysterious reasons. In addition, they are usually companies with serious problems in their business accounts, and that have a very high level of indebtedness. In some cases, it is completely non-assumable, and that can lead to their suspension in the equity markets. These are the true ones for which they are listed at these prices.
However does not mean they are cheap, far from it. Being in any case a very dangerous class of securities and with which it is very difficult to operate in the markets. Not even in such short-term operations. You should not fall into the temptation to open positions in this class of companies so little solvent as to deserve your trust.
There are months more bullish than others
In this case it is a reality contrasted by the history of the stock markets, although without clearly identifying what months they are. Not surprisingly, in some years they are one and in other exercises other different months. They vary depending on the reality of the equity markets. It's that simple, without having to look for other more mysterious explanations.
Traditionally the months of the last semester of the year are more bullish than the first. If you go to the historical prices you will be able to verify that this is reality. As a consequence of this situation, your investment strategies may go through opening positions in the stock market during the last months of the year. And in this way, take advantage of the upward momentum of the financial markets.
The strategy that could be developed in this scenario will be take advantage of the most bullish months to open positions in equities. Through various operations during the same year. In any case, there is another saying that can be frankly profitable for your interests as a saver that you are. It consists of leaving positions in the vicinity of the arrival of the second quarter of the year. To later resume positions with the arrival of the last months of each year.
Do not invest more money than necessary
With regard to the amounts that must be dedicated to the investment, there is no fixed rule, but It will depend on the profile you present as an investor. And of course the status of your personal accounts. But in any case, it will not imply assuming excessive amounts that your household budgets may depend on, and even some other expense not foreseen in the accounting that you keep at home.
Enough that dedicate between 30% and 60% of your savings to open positions in financial operations. You will only have to overcome it in very specific cases, and as long as you are covered by a regular and large income. Whereas if you formalize a speculative or riskier operation, there will be no choice but to reduce the monetary contributions for this type of operation.
One of the biggest mistakes you can make is investing your entire checking account balance. Surely you will pay for it with more than one problem in your personal situation. And that may even affect you having to make some partial salesiales under conditions less favorable to your interests. And of course, without being forced to demand a means of financing that covers possible lack of liquidity in the current account.
If you meet all of them, or at least some of them, you will have a long way to go, to at least maintain your positions in equities. It will help you not to fare badly in the investments made, nor that they incline you to formalize bad sales, neither totally nor partially. Surely you will be better off from now on.