The expression, "don't put all your eggs in one basket" is meaningful
when it comes to money investing. Don't put all your money in one stock. Also,
buy fixed income securities (i.e. bonds) and stocks. Don't pick only one type
2. Do Your Homework
Obtain and analyze as much information as possible before making your
investment decisions. This will alert you of any problems a company may have,
or what to expect from your investment.
3. Set Goals and Limits
Determine the price (high target price or low stop-loss price) at which you're
willing to sell. Analyze interest rates to decide what return you want.
4. Don't Gamble With Money You Can't Afford To Lose
The less you can afford a loss, the more conservative you should be in your
choice of investments.
5. Don't Be Greedy
Don't expect your broker to recommend stocks that will double in value within a
few months. If you do have a stock that goes up considerably -- i.e. 50% or
more -- sell.
6. Invest For The Long-Term
Company stock prices will fluctuate, sometimes unfavorably, in the short-term.
Invest for the long-term, but keep your current financial needs in mind. You
never know when you might need some of that money.
7. Avoid Acting On Impulse
An impulse buy, whether at the mall or on the stock market, is still an impulse
buy. Stick to your plan. Don't buy a stock on a hot rumor; you'll get burned
90% of the time.
8. Go For Value
Undervalued stocks will help create the most growth in your portfolio. Look for
bonds of companies that are out of favor too. They should be selling at a deep
9. Tax Planning Is Important
Consider income-splitting techniques. (Ask your investment advisor).
10. Get Professional Help
If you're starting out, hire the best professional help you can afford. Professional
advice will likely pay for itself within a short period of time. Once you
become used to the market, do the research yourself. Later on in the game,
switch to an online broker.
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