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Stock Investing

The first aspect of stock investing is to know why you are buying the stock in the first place. Many people wait for the stock to move up or down to think about it. Many investors are caught is a sudden drop and then look to see why they purchased their investment, this is the most common mistake. There are many different stock investing strategies investors take. Here is a list of the main ones.

Friend investor

Your friend calls you and says he has the scoop on a great stock but you will have to buy now. If you fit in this category then you are a friend investor.

Technical investor

Moving averages, triangle breaks, candlestick patterns, trend lines and resistance levels are the things the technical investor looks at when buying stock online. Technical investors are chartists since they deal with nothing but studying charts of stock prices. Technical investors hope that past patterns will reoccur in the future.

Economist investor

This type of investor bases his decisions on forecasts of economy. They do less research on different stocks and more on the overall economy. This investment strategy is almost as a coin flip since all stocks don’t always follow the general economy.

Value Investor

A value investor focuses on the value of the company including assets, earnings, dividends, definite prospects, including the factor of management. Many value investors find a valuable company where the stock price is lower then book value to create an undervalued stock.

Penny Stock Investor

This investor focuses on the OTC market to find the next big stock. This is very risky since many stocks are not reporting. The gains can be very large but a penny stock investor could lose their whole portfolio.

Whatever approach that you decide to take, the most important thing is to know why that you decided to invest in a certain stock. The reason is so you don’t fall into the behavior of, if the stock rises it was your ability but if it drop then you blame someone else.