Is Stock Trading Really This Easy ? :
How easy.
The question detail has it. Buy during a crash when everyone is selling and hold. Market will definitely go higher with time.
My views on this:
Stock Trading is easy.
Making money from trading is not.
Trading is easy because it is just buying and selling. Not much else is required. Why stock trading, any other kind of trading is same whether you are selling rice, wheat, peanuts or even fruit on a push cart.
You buy the goods and then sell them.
Here you buy the stocks and sell them.
No rocket science is involved even though experts would like you to believe otherwise.
For making money, there is a formula taught to us in primary school.
Profit = Sell Price - Cost Price.
As long as selling price is higher than the cost price , profit is the natural outcome.
No other formula for deriving profit has yet been invented nor is likely to be found in future.
But the opportunity to sell at a higher price does not come so easily for most of the traders.
While waiting for the price to move higher, prices move lower than our price and panic sets in. Traders become paralysed and keep on waiting for reversal which does not happen. Ultimately they get out at a loss.
One should get out at a pre decided loss. This is called a stop loss. It helps in limiting the loss to manageable level.
As we have no control over markets, we can exercise control over our trades/investments. That control should be on losses. Profits will manage themselves.
My Earlier Answers on trading being simple can be read here:
Thanks for reading.
Image : Google Images
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