Do you know the right time to sell share?

Most of the investors give a lot of importance only to buying. That is buying right shares at the right price. But selling is also important. Selling at the right price and at right time.

sell shares

In most of the advice and article written by analysts and brokers, one can get a lot of buying tips. Many however neglect article or advice on selling stocks.

Buying shares at the right price is important since it determines profit gained. At the same time selling shares at right price determines actual profit.

Must Read: How to become a Successful Stock Trader?

Since share market moves in both the direction, what are quality stock today may not be so after a decade or so down the lane. One should go through the performance of shares, one is holding after few years’ intervals. If their performance is gradually decreasing it is better to go in for other high performing shares.

One has to develop own plan of action or the price target is achieved. Here are few proven tips that can help you decide the right time sell shares. Otherwise you can contact stock advisory company to know more.

.1. Swift or instant price appreciation

Share markets are volatile in nature. They swing in both the directions. That is, they are highly unpredictable and uncertain. Sometimes the swing is very dramatic and sharp.

Must Read: Why should you invest in blue chip companies?

When you buy shares and they appreciate swiftly in a short period of time. It will be a wise decision to book profit and move ahead. One can again purchase when prices fall. After your sell and the shares still move north, you can comfort yourself that you have not gone broke by booking profit. Other opportunities are always open. Like nifty future tips or nifty options tips

2. Shares reaching stop loss level

Share prices move in both the direction. Suppose you have purchased shares at a certain price. After a certain time, you see that the price is constantly spiraling down. You may encounter a loss. As the prices keep dipping, your loss increases proportionally. But you can minimize this loss right at the beginning that is when you have purchased. Always remember to place a stop loss order.

Must Read: What is a stop loss order in share trading?

So once you purchase the shares, you have to decide how much loss you can absorb. Once you come up with that figure, you can place the stop loss at that point. So in future, if share prices reach your targeted price your sell order will be automatically be triggered. Thereby saving you from a huge loss.

3. Decreased dividend or holding back

The dividend is paid by the company to its shareholders when the company makes the profit. Usually once in a year and as decided by the company’s management.

If the earnings of the company increase they pay a higher dividend. Conversely, if the company is in loss or not making sufficient earning it does not declare the dividend.

Must Read: How to avoid big loss in share market?

If the company is decreasing or cutting dividends than it signals that the company is in financial difficulty. Perhaps it the right time to sell your shares.  However, the company may cut or decrease dividend for business expansion or may be considering buyback offer or some acquisition etc. If it is the reason, then you should hold your shares for some time and wait and see the results.  You can get best results of nifty options tips from advisory companies.

You should get to know the reasons first before taking any further steps.

4. Problems in the invested sector

Investors invest in shares after analyzing the company from many angles. But what happens if the entire sector is tumbling?

Few reasons for tumbling of the entire sector can be government policies or rules which are not favorable. It can be because of the unfavorable economic condition, political uncertainty, recession etc.

In such an unfavorable business situation of the complete sector or industry, it is better to sell the shares and exit before getting deep in losses. One can also go in for commodity trading to diversify the folio, and get commodity tips.

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Why is research important in share trading?

We knowingly or unknowingly do research in everyday life. We seek options and suggestions from our family, friends or acquaintance before buying a house or taking a bank loan. Even is our day to day life we discuss and compare before finalizing certain things.

research in share trading

All big things are accomplished with the help of good research. Investing for your lifetime also need good research. Sometimes research has to be carried out in phases or different stages. As regarding stocks you can get advice from best stock advisory company.

Must Read: How to become a Successful Stock Trader?

First or initial phase of research is important before you start any business. It can be any regular or traditional one. Stock trading is also a business. A serious and profiting one too.

The stock market is an open market. It is a fair play market for one and all who wish to gain. It is a platform for trading company’s shares. It caters to a huge cash flow from one hand to another.

Many big and accomplished players are on the field. Years of experienced have helped them to judge what to buy and what to sell. Your one wrong move can set you back by thousands of bucks.

If you have done extensive research, you will be more prepared for what to do and what not to do. Though it is a form of investment, now a day’s shares are in electronic form and not in any physical forms like share certificates companies used to previously issue.

No doubt shares trading has confidentially attached to it. Same thing applies to commodities tips.

  1. How to make good profit from your investments

Research is part and parcel of stock investing. One should devote more time and energy to researching the stocks one intends to buy or sell. The time devoted to research should be more as compared to actual action that is sell or purchase. Selling or buying may take few minutes, but research may take hours together.

Must Read: Top Ten steps you need to know to become a day trader

List the major companies from the industry or sector you feel that are in better position. One has to analyze each company in the sector or industry and after analyzing it on certain basis narrow down to maybe ten or something companies.

Then perform fundamental and technical analysis of these companies. Compare these companies to each other and filter out best three.  Now check and compare the performance of these three companies side by side.

And then you can select the one that you think will best results in the future. You can get best nifty future tips too.

There may be certain companies who prefer to keep a very low profile. They do not come in the limelight. But are good performers on a constant basis or perform very well when the change in government policies favors them or there is the change in management.

Must Read: Top ten day trading secrets for beginners

These are usually called multibagger stocks. They may be fundamentally strong. But at the same time, these are quite risky as far as their performance is concerned.

  1. Safe market conditions

By constant amendments and changes, SEBI has formulated strong rules and regulations. They have been rectifying their mistakes or shortcoming or loopholes.

It is becoming safer to invest in stock now than it was a decade or so back. Fewer frauds are taking place. Now a day’s markets cannot be easily manipulated by whims and fancy of the few traders. And same thing applies to nifty options tips.

Most of the information now a day is available with a click of the mouse.  You can get information for your research in a format that you think is most suitable for your analysis.  You can segregate what all data is required by you and leave the unwanted one.

Must Read: How to start investing for a useful purpose?

Doing an in-depth and good research gives you an edge over other traders.

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How to start share trading with minimal risks?

Share market is a place which has shows frequent up and downs moments in its working. And this provides a good amount of opportunities. Supply and demand situation of shares changes within a very short span of time.

trading with minimal risks

It gives an edge if you are alert in the market. And at the same time, it does not give an edge over other opportunities in the market if you are not alert.

Few shares may be having run on one day and maybe on some other day, you will not see any movement in those same very stocks.

Must Read: How to become a Successful Stock Trader?

One can easily get a huge amount of data, of any company, industry or sectors. There are also software tools which analyze the data for required parameters that you might be seeking. Say, 52 weeks high and low for a particular company. Share price position starting from present instant to five days to six months to a year.

Share prices are influenced by local factors, national factors and fluctuations in the world markets. They can increase or decrease depending on their supply/demand position. But there are few ways by which we can minimize our risk and also safeguard our invested amount while share trading.

At marketplace we can gather sufficient information, present trends, so as to rough prediction the future trends. And make gains from it.

Must Read: Top Ten steps you need to know to become a day trader

How should one start trading with minimal risk? What should be your approach?
  1. Getting advice from experts

As in every field, there are experts in the stock market field. People having years of experience behind them. Taking advice from them increase our knowledge of the market. They guide us with their expertise and advice. They can show us better and suitable ideas, as of how to gain from the market. But experts also fail sometimes. Their failure rate may be too low as compared to a new entrant.

When a new person enters a market, he has very less know-how of the market functions. He may be at loss of ideas. At this point and experienced person can provide the insight of how the market actually works. What things are there those trigger the markets for better or for worse?

This advice will help new entrant to develop their ideas, to get profitable returns from their investments. If new entrant does not profit in short run, at least the advice will help him in some way or the other. Being experienced, they have a fair idea, which sector or industry will be on the rise in future.

Must Read: Top ten day trading secrets for beginners

People are always on the outlook to on strategies which give them maximum benefit. If online trading gives them better and easy opportunity, they will go for it. A stock market is a place where investors are attracted like a magnet because of the higher returns it gives compared to bank FD or other financial instruments.

  1. Maximizing returns with minimum risk

It is the common tendency of people to earn maximum benefit from a minimum of investment. For this, they have to get an edge over others in the same field. People are always on the outlook for such an investments option such that they earn can earn maximum returns in the least possible time.

In the stock market, one can have the best of both worlds. That is maximizing returns on their investments in the shortest duration of time, as compared to other investment avenues. Once their teething troubles are over they can develop a better understanding of the market-place.

Must Read: How to start investing for a useful purpose?

They understand in a better way how to read charts. Their analysis of the market matures with the time. They learn how to manage money in a more efficient and effective way. Improve their chances of getting better returns on their investments. Decrease or contain their risk to the minimum.

Must Read : Top 4 Myths And Facts About Indian Stock Market Exposed

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How to become a Successful Stock Trader?

A trader takes a short-term view of the market. He is a market participant. He trades for a day to few days. They are more interested in volatility and take advantage of volatility in the market. They are neither value investors nor growth investors.

Successful Stock Trader

A good trader knows the importance of discipline, patience, and persistence. It is not only about taking a risk and moving suddenly from one trade to another.

Here are some habits that successful traders should possess
  1.  Managing risk optimally

Each trader has a limited capital to trade with. Within that capital, he has to buy, sell, hold and earn the profit. He has to rotate his capital in such a way that he should not miss any opportunity which it comes for purchase, and at the same time, some of his capital is stuck up in the shares that he is holding. He should know, how much from his capital, he can afford to lose in the worst case scenario.

Must Read: Top Ten steps you need to know to become a day trader

  1. Be confident and practical

The trader should be confident and optimistic about his trade. Though not overconfident, of course, realistic and reasonable. He should believe in the dictum “There is always the other day to trade profitably”.  Successful traders do not attach emotions to any stock. They always go for logic and calculations. They have a strategy for all their trades. They know how many maximum returns they will get in each trade. They have realistic targets.

  1. Cost matter a lot when you are a trader

Traders should have cost consciousness. That is while trading they should count each any every cost that they incur at each and every step.  Like brokerage charges, holding charges, demat account charges, margin (loan) money interest charge etc. A trader ruffles (put into use) his money as often as possible in search of opportunities. Since trading is a continuous process even little increase in cost adds up quite a bit in long run. And after taking all the trouble and tension, if he is not able to generate income more than the bank FD, then there is no use trading.

Must Read: Top ten day trading secrets for beginners

  1. Steadfast and resolute should be your pillars

Great traders are steadfast and resolute to a high degree of their trade. They have to train his mind towards attaining one’s goal. One cannot gain from all trades and conversely one cannot lose in all trades. Winning some and losing some. And this should not shake up the trader. Once the trader has created a plan,  he should have due diligence to stand by it.

  1. Learn from market trends

Everyday market offers new and new things. Hence a trader should be a constant learner. He has to tweak his strategy according to market needs. They try to be in sync with the market trends as far as possible. Though there are traders who take high risk. But they are few in number. It is better to learn from the market instead of blindly doing guesswork.

  1. Read, learn and research

The successful stock trader use their maximum time for reading and analysis. Reading annual reports of the company, business newspaper, change in government policies, new schemes launched by the government, world news, etc. Learning from past experience, noting down success and failures. Doing their own research and analysis of trends, the effect of news on prevailing market condition.

Must Read: How to pick a good stock for intraday trading?

  1. Executing trading plan

A trader focuses closely on how he executes his trades. Because a lot of things are involved like using candlestick chart effectively to identify entry and exit points. Purchasing shares in bulk, at one go or purchasing in small amount of pieces at a time. Is the trader over selling/buying because of the direction of the market.

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What is a stop loss order in share trading?

There are many things a trader or investors look before buying or selling the shares.  Like current market price, return on investment the share can give, does fundamental and technical analysis. But many times it so happens that he forgets about a small little thing as stop loss order. This can make a huge difference in containing losses.

stop loss order

Stop loss order is an advance order, given to the broker/agent from trader/investor to sell the shares when it reaches a particular price. Usually, it is designed to limit loss on his position.

Must Read: Top Ten steps you need to know to become a day trader

If one sets the stop order loss at say 10 percent, it means, when the share price reach is 10 percent below the purchase price it automatically triggers sell order.

Suppose share of XYZ Ltd. is purchased at Rs. 20 per share. And 10 percent stop loss order is placed. No sooner the share price reaches Rs. 18 the sell order will be triggered. And the share will be sold at the prevailing market price.

As far as share trading is concerned, stop loss has both advantage and disadvantage. The advantage is that once stop loss order is placed you do not have to monitor the share price on a regular basis. In this situation, you will not have to keep a constant watch on the market for a long period of time.

Must Read: Top ten day trading secrets for beginners

The disadvantage is that if the share price touches your stop loss order for only a moment, your sell order will be triggered. No matter even if it is for a brief period.

Stop loss order percentage should be placed taking into account range of day to day fluctuation of the share. Since some shares show high/low volatility on daily basis. It can be 5 or 10 or even 15 percent. Depending upon, as the case may be.

Most people think that stop-loss order is just a tool only for preventing losses. It can also help to lock in your profits, sometimes called trailing stop. In this, stop order loss is set just below the current market prices. As the prices increases so does your stop loss gets adjusted to now 10 percent below new market prices. Using trailing stop, allows you to let your make profits while at the same time assuring some realized capital gain.

Must Read: How to take first step to make money in share market?

Taking the above example of XYZ Ltd., stop loss was 10 percent at current price that is Rs 18. Now suppose share price rose to Rs. 30. Your trailing stop loss order will be locked to Rs. 27 per share. Calculation – Rs. 30 minus 10 percent of Rs.30 that is Rs.27. In case of any downfall now, in the worst case, you will get Rs. 27 which is far above Rs. 18 that you might have received earlier.

You may be a value investor (seeking shares believing it to be undervalued) or growth investor (seeking shares for potential capital gains) or active trader (seeking shares to exploit profitable condition). Only one strategy works. And one must stick to it.

Must Read: How to pick a good stock for intraday trading?


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