Stock Market Tips for the Average Investor

My stock market tips were developed from personal experiences I've had while investing in stocks. From losing every penny I put into a stock (actually, all of my investing money) to making the best stock suggestion to a friend. These tips are a combination of all of the good experiences and bad experiences I've had along the way that I want to pass along to you so you don't make the same mistakes while in the markets.

Ever since I started trading stocks on the stock market, I always wished I had a little guidance or a coach along the way. I blindly invested, figuring everything out on my own with no outside influence.

Where do you start learning?

What information do you study?

Where do I get the money to invest?

How do you know when to buy and when to sell effectively?

I always seemed to get into my trades a little too late and got out of my trades a little too late (or early). I seriously fouled up my chances at making my early millions in life, but I did learn a lot along the way... the hard way of course.

These stock market tips are a compilation of some of the things I learned along the way that will be sure to help you avoid the same mistakes along your educational journey.

Stock Market Tips and Suggestions

The following stock market tips are here to help you in your educational journey toward stock market success. There are more that I come across every day, so I will periodically add more here and there. Every little bit helps, but some of these tips aren't in your typical educational syllabus.

Tip #1: Always Keep an Investment Journal

The first of my stock market tips is whenever you trade stocks, you should always keep track of what you are doing. Everything! You should know what your very first trade was just as clearly as the last thought you had regarding your investments.

In this journal you should write down everything you experience with your investing. When you buy a stock, you should write down why you bought it - what signals were you following, what criteria was met, what was going on in the news... You should write down how much it cost, how much you invested, and what your exit plan is.

If you read something or learn something new, write it down. If you hear about a decision making signal, write it down.

I can't emphasize enough about writing down everything involved with stock market investing. When you write it down, you won't forget it, that is, if you read back over your journal every now and them.

Just as important as writing down the good things, you should be writing down the failures in your stock market adventures. You learn more from one failure than you will ever learn from all of your successes. I'm not saying to fail on purpose, but you will have failures along the way. Write down what happened, why it caused failure, brush yourself off, and move on with your corrective actions.

Tip #2: Don't Trade on Emotion

Emotions are a very powerful feeling in the human genome. Everyone has them and not a lot of people know how to truly suppress them from influencing their decisions.

Emotions can take their toll on anyone during an investment decision. If you are buying property, you may really love the house, but as an investor, you don't want to buy it because you like it a lot. You want to buy the house because it will turn you a very nice profit. If you love it too much and you become attached, it will be that much harder to sell or part ways with it.

This goes the same with stocks. Owning stock shares in a company is owning a piece of the company. As a shareholder, you own a piece of that company and your say matters with how that business operates. You have a vested interest.

But say you simply own the stock because you love the company more than anything, like it builds your favorite car or electronic device. You really want to hold onto the stock because you have an emotional attachment, so you may miss a perfect selling situation if the stock starts to decline.

So one of my stock market tips is to not let emotion drive the trade. Let your signals and criteria make the call and never buy or sell based on your emotions. If you are afraid because of all of the news you are hearing about a company but the indicators are still pointing up, why would you want to sell. Hold until the indicators tell you to.

Don't buy a stock because it sounds like it is a good investment; buy it because the indicators are saying the stock price is about to turn up and run.

Tip #3: There's More to Stock Price than Price Alone

Sure, you can make pretty significant profits simply buying and selling stocks at the right time. But you should also consider some very long term plays that can make even more money over time.

How else can you make additional money with a stock?

Dividends!

Read more about high dividend stocks to see how they can lower the breakeven point of your stock price and produce better profits than simply buying and selling stocks with no dividends.

Tip #4: Follow What the Charts Say

This tip took me the longest to come up with because there was so much involved in the learning process. But once I've learned charting, I've never made a buying or selling decision without consulting a chart.

Charts show you the dynamics of a particular stock. And using all of the indicator tools within the charts adds so much more to the big picture.

When I first started trading stocks, I didn't really look at the charts at all. I concentrated on numbers such as the Earnings Per Share (EPS), analyst calls, the news, and peaks and valleys of the basic chart. I rarely left the stock quote page to gather my information.

With a chart, you have this thing called history - you can go back in time several years to see what the stock has been doing through good times and bad. Add a few indicator tools and you can effectively see the future.

If you don't make a stock buying or selling decision with a chart in front of you, then you shouldn't make the trade. Know what the stock has done and what it's doing before investing your money.

Tip #5: Don't Wait to Start Investing

If you are waiting to start investing because you don't think you have enough money, you can stop waiting. You can invest right away. You can find money in a lot of places that you can use to build up enough to start investing. The big question is, how much is enough to invest?

Most stock accounts don't cost anything to open. Some require a small deposit, which you can use to trade stocks. But essentially, all it takes to get rolling is enough money to buy a few shares and cover any buy and sell fees.

Learn more about finding money so you can start investing in stocks right away.

This is all of the stock market tips I have for now. Like I said before, I'm periodically adding more stock market tips, so keep coming back to see more helpful hints and tricks to improve your investing chances.

If you would like to see stock market tips I haven't added yet, please let me know and I'll get them on here.