Friday, October 23, 2009

Strategy




One thing all stock trader/investors have to keep focused on is what is their strategy for making money in this game. Without the master plan you can get lost in a hurry,especially in the venture stock arena.

It's so easy to get thrown off course in these kind of markets and start hop- scotching from one hot play to the other. The problem with the hot stocks is usually by the time you find them they already did most of their run and any remaining profit makes the risk so high that it is not worth it.

That's why I try to stick to a simple plan of searching for companies that are "underfollowed" but more importantly "undervalued" based on the DD of new company developments on the horizon. Once you find all three elements then usually you will make some decent profit if general market conditions are in place and the coinciding sector is also in market favor.


What I try to do is keep my focus on 4-5 stocks max, all with potential to make 100% to 400% profit over a period of 3-6 months. If I can do that once a year then I will be in the drivers seat. If I even make on 2 of them I will still be doing decent.

Not to say I won't play a blue chip, or an option play along the way, but my focus is getting the ducks lined up, planting the seeds and being patient and watching them grow. No brain surgery involved or high priced newsletters here,just solid hunting and digging for those gems laying in the weeds ready to explode when the time is nigh.

Most important is to learn to trust your research. As long as the company's plan is still in motion, then eventually your profits will come. If it changes,then you have to make a decision....but that is for another blog post.

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