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Published : January 03, 2012 |
Author : priyanka
Category : Finance | Total Views
: 27 | Unrated
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In stock market there are two types of people one is investor and other is trader. Strategies for investors and strategies for traders can vary. Generally investors are those who invest in the market or stocks for long term perspective and traders have short term perspective. Many people who want to make money from stock market do not recognize themselves whether they are traders or investors.
If your investment perspective is for short term then you should concentrate on short term trading strategies. For short term trading you need to have knowledge of technical analysis, which help you to find and predict price movement (at some extent) in short run. Fundamental analysis do not help you in short term as it is good for long term investors.
Penny stocks also known as micro stocks are risky, but if trade or invest in it with a sound knowledge of technical analysis you can make huge profit in minimum investment.
If you want to make money with penny stocks you need to find a penny stock company that has good prospects in near future. Use technical analysis for good entry and exit points and trade according to it. Technical analysis will help you to find good entry exit points.
Though technical analysis is complicated but very helpful to find profitable opportunities for short term. It needs time to learn, before investing in any stock devote little time to learn it and make a simple but effective trading system. Initially do paper trading only and find whether it works on not.
Any trading system that gives you 70% to 80 % success rate consistently is good trading system. Do not waste your time to find trading system with 100% success rate all the time; there is no such system exists. With good success rate and using other methods such as stop loss and money management will improve your trading performance and hence the profit.
If you can make a simple trading system, having good success rate say 70% success rate and use it with other trading techniques such as money management and stop loss you can make big profit in any market or stock. Even in penny stocks.
People often like penny stock investing as it offers very big percentage gain as compare to other stocks. Here is example. SAY XYZ stock trading at $5 (Five dollars) and it rises to $6 (Six Dollars). The gain is $1 i.e. 20 per cent. That is good gin but say you find a penny stock with good future prospects and trading at $0.10 (Ten Cents) rises same as previous one i.e. $1 i.e. To $1.10. Your gain is same one dollar but in percentage your gain is 900% yes Nine Hundred Per Cent!
If you too looking for such huge gain in minimum investment you can achieve it with effective system like penny stock prophet,/a> that help you to find right penny stocks at right time. |
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