Make Money On Stock Markets, Part-iii
Stock markets are dynamic in nature. People read in the newspapers orview on Television that 'sensex' has either plunged or risen by some points. What is sensex? Sensex is a sensitive index of a particular stock exchange and its movement is directly dependant on the traded price of shares listed on the stock exchange. The fundamental question many investors have in their minds is whether it is safe to buy or sell shares when the traded price is rising or falling. as I have already written in my previous article, it doesn't matter so long as you are a medium term or long term investor. A short-term investor is essentially a speculator who just wants to make a quick buck when the markets are volatile. If you fall under the category of a speculator then it is essential to know two phases of the market viz., bullish phase and bearish phase. A bullish phase is that time of the market where majority of the shares listed, say 80% are on the upward trend both price-wise and volume wise. Here the thumb rule is to buy in the afternoon session of Friday and sell it in the morning session of Tuesday. Again a note of caution is to study a little bit about the company?s performance for the quarter ending, half-year ending and annual ending and make an informed decision on what shares to buy. A bearish phase is that time of the market where majority of the shares listed, said 60% are on the downward trend price-wise or volume wise. Here the thumb rule is to buy shares which are traded below the 52 week average preferably on Tuesday morning and sell them in Thursday afternoon session. If the price is lesser than the buying price, wait for a week and then offload and the chances of booking a profit are high.A basic doubt that crops up in the minds of the speculators is about the quantum of money that can be speculated. Here again, the thumb rule is speculating with that much amount of money that you are comfortable with and which don?t run you into a debt trap.
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