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It may come as a surprise to you but trading in stocks and shares is a science. It is not what you thought that trading in stocks and shares is akin to gambling or another casino project. No. It is definitely not.
It is a science because there are clear indications when the prices will go up or down. It is not something that is totally random. It is for this reason that you need to equip yourselves with the skills to read the graphs and charts so that you can guess the potential moves.
The trick is to buy slowly for long term purpose such as twenty years. Stocks tend to go up and down. There is some risk involved but you do not need to sell it just because the price goes down. You are doing it for long term and you should choose well established companies. So after twenty years, the shares should appreciate in value.
The breakout box technique on the other hand, shows how to read the different candle types and their colours so as to anticipate when the price will go up and when down. This technique enables one to trade in any market whether it be bullish or bearish. This is the most difficult method but the best if you have good knowledge.
There are also other banks that actually provide a method of investment which is handled by a team of fund managers. You do not need to worry so much because you decide on the amount of money that you wish to spend per month. The amount is fixed. In this way, if stock price is higher you would buy fewer shares. If the price is lower you would buy more shares. The actual companies would be chosen by the fund managers because of their experience as well as their knowledge in reading financial reports of companies. This is all automated. So you can check on your account anytime you wish by logging in.
So you see there are a few different approaches to investing in stocks and shares. You have the strategic averaging method where you buy slowly every month. You also have a method program which is handled by fund managers and the amount of money spent is fixed. You also have the breakout box technique which involves the reading of charts and candlesticks. There are clearly different methods which are fixed. Hence, trading is stocks and shares can be said to be a science.
But before you get into it you need to understand what is actually going on. You do not need to fully understand if you intend to follow the strategic averaging method or the method handled by fund managers. However, if you intend to follow the breakout box technique, then you need to understand the process well.
Regardless of your choice, it is good to know what is going in so as to appreciate your investments and the efforts made by others for your benefit.
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