How to Make Money Trading Stocks

How to make money trading stocks is a great question that has a pretty simple answer. The answer is to buy low and sell high and remain patient while you wait to buy. Never buy a stock that doesn’t reach a price you are willing to pay for it. Realize that the stock market goes up and down, and if you hold your ground you will get the price you want to pay.  When it comes to selling your shares find a good average price high and gage your sale price to mimic it. You don’t have to wait for the highest point the stock reached within the last year but you don’t want to sell yourself short either.

The great thing about stocks are that if you know the companies you invest in and you follow them long enough you will most of the time find a trading range for that particular stock. Once you have found that range you will be able to see what you can buy that stock for and the more important thing how much upside is possible. If the stock has a good upside it might make you some money. The other thing to check out is how many times in the past year has the stock you want to buy has been in a range where you can sell it. You want to see that the company you are buying has been in an area where you can sell it more then just a few times in the last fifty two weeks.

Another thing to keep in mind is you need to know what kind of news is out there on the company you want to buy. If all you’re seeing is bad news and the price is on a downward spiral because of it, I would stay away from this kind of stock. A company’s balance sheet and cash flow statement is a good way to do some checking on a prospective investment. If the company has good fundamentals it is probably a solid investment. Remember if a stock has a good trading range you can make money on it even if it is a bad company. The trading range is very important for short term investments. For long term investment the companies fundamentals are important to determine if a company will pay you in the future.

So as you see there are different ways to make money buying and selling stocks. You might be a long term investor buying quality companies that will pay you back in the long run or you might be that person looking for smaller quicker gains and then trading for the short sale my be your game, but whatever your poison is you can’t make more money faster anywhere else but in the market.