zaphod's Blog : 4 simple rules for trading

There are thousands of possible choices to make when choosing a stock, etf, or bond. It's easy to get lost in a sea of indecision when there are so many variables that make the price of stock on a given day, (earnings, price to sales, supply and demand, sector performance, etc...). A set of very basic trading rules is a necessity. Here are some of mine...

1. Price Matters.-nothing is more important. There has to be a very solid justification to pay up for a stock.
2. New highs beget new highs. -simply put, it's easier to hold on to a stock when you have a profit in it. When a stock hits new highs, everyone has a profit, so more people wait to sell.
3. New lows beget new lows. -corollary to 2.
4. Find a group to trade with. -bouncing ideas off others is one of the healthiest ways to get better at trading.
zaphod