1. Divide your "savings" into two : 50% as liquid cash and 50% for share business. This ratio has to vary depending upon market’s rise (60:40, 70:30, 80:20) and market’s fall (40:60, 30:70, 20:80)
2. Buy only growing company (potential stocks) by assessing its performance. Don’t buy blindly stocks recommended by others.
3. Don’t invest all your money in one stock or in too many stocks. Invest only in 5 to 10 stocks which are to be assessed and periodically changed.
4. Find the bottom and high price of the stock you want to buy by studying its last one month and three months price movement. Buy only at the bottom price or near to the bottom price. Sell only at the high price or near to the high price.
5. Don’t panic when everybody sells during market’s fall. This is the best time for buying.
6. Don’t buy when everybody buys during market’s rise. This is the best time for selling.
7. Don’t invest your whole money for business and watch passively without money. Invest only one twentieth of your business money in one stock. Keep reserve for buying the same potential stock during each fall after your first buy. Investors and traders don’t commit any new mistake but repeat the same already done.
8. Buy only upward movement stocks and reject both downward movement stocks and linear movement stocks.
9. Investment stocks are not good for trading and trading stocks are not good for investment. If you don’t have enough time but much patience , go for investment. If you don’t have patience but much time, go for trading.
10. Don’t buy penny stocks just because the price is cheap. They are mostly not transparent and reliable but mostly inaccessible and unprofitable.
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