On the previous topics Stock Broker introduced the investment ways and how to start stock trading. On this chapter we will go through trends and which ones to by and which ones to avoid.
The most basic rules about the stocks to buy are following two rules. It is important to remember them because this can save your investment and it helps you to avoid bankruptcy.
- buy stocks that have general trends going to upwards
- do not buy stocks that general trends are going to downwards
In other words when shares are going up mostly then buy it and when the chart is showing a lowering line most of times then don’t buy it. Of course those rules are the very basic concept and there are many more things to check before to buy the stock, but this would be one of the first things to check before you would continue to investigate more about the company.
How looks the up trends?
To show the up trends we will use share 888 from London stock market, take a look at the picture below.
On the chart you should note there are ups and downs but general trend for 888 has mostly is upward on year 2012. Please keep in mind that the example does not mean you should go and buy the stocks of this company. It’s only showing on the chart that a share with this trend may become a share in your following-list and the next stage would be the company deeper analyze.
In short: a share with the chart above is worth to look at.
How looks the down trends?
Stock Broker has choose Vodafone share from London stock market on year 2012 to show down trends.
On the chart above you can find again ups and downs, but the main trend is dropping and we do recommend to avoid buying stocks from company who has the same trend. If you will buy stocks with this type of trend you will end loosing your money most of times.
P.S. You should not buy shares who has a down trend as on the last picture. Stock market has many companies who’s shares you can look at and who don’t have the down trends. The risk with those shares would be lower than with trends like on the last chart.