Play The Market with Hot Stocks

By Jason Demand

The is a new game in the stock market these days called hot stocks. This goes against the traditional Wall St. Advice of buy low and sell high. The new hot stocks strategy is to buy high and sell even higher. The way it works is that you buy stocks that are rising in value and sell them while they are still rising. The time between the buy and the sale is short.

The benefit of buying stocks this way is the short turn around time. Your money isn't tied up waiting for an undervalued stock to rise. The old method is still good, but adding hot stocks trading to your investment planning will help grow your money quicker.

Hot stocks are excellent for day traders. If you watch the market trends closely you can choose from stocks that are on the increase. The biggest trick is not to get greedy. Decide before buying the stock the maximum time you intend to hold it before selling. Whether or not the stock is still rising, sell according to your time table. Take your profits and get out.

When a stock stagnates or starts to go down, sell it straight away even if you loss on it. This way you minimize your loss. When you use a hit and run strategy, you will take some losses. The idea is to pick more winners than losers. You cover your losses and make a profit.

Hot stocks are transient investments and shouldn't be held onto for more than a day or 2. Keep a lid on of the market trends and your stock prices so you can sell at the most advantageous time. This method of investment has risks and infrequently you'll lose. That's's alright. The important thing is to chose more winners than losers.

Anyone who is trading seriously in the market should use more than one methodology. Hot stocks are great, but they are often high risk. Your portfolio should be diversified, with proven stocks from different business sectors. This helps offset losses and protects your investments. Hot stocks should only be part of your investment plan.

The idea with hot stocks is to get in and get out. Even if the stock continues to go up after you sell, it is not money out of your pocket. Remember it may just have easily dropped and cost cash. Buy, watch the price and sell when you have a good return on your investment. Don't be greedy.

If you are paying a brokerage for your investments, hot stocks isn't a choice for you. Brokerage fees can swiftly swallow your profits. Look into online stock services that charge a set weekly or regular charge for unlimited trades. Trans action charges can be really pricey. Let your brokerage firm handle your long term investments, look after your hot stocks yourself.

the market is a great way to grow your investments. Hot stocks is a method to make reasonable profits in a short amount of time. When investing your money always use more than one strategy and ensure that at least part of your money is in a safe, if low yield, financial instrument. Never gamble on the market with money you can't afford to lose. Remember the old Wall St. Saying" often you eat the bear, and sometimes the bear eats you." Good luck! - 31876

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