Beware of Recommendations
The beauty of the stock market is that anybody can make a solid recommendation and back it up with some solid information. The negative aspect is that the “recommend-ees” do not always know what time frame the “recommend-er” is using or what kind of return is they are looking for.
Are they looking to hold stocks for months at a time? How much return is good enough for them? Are they looking to get rich quick or safe long-term investing? All these questions are possibly more should be taken into account before going along with the recommendation.
That is why you should always do your own homework before following a recommendation. Make sure it is the right play for you.
Recently I have had a some people question what my particular outlooks were (on the average):
- I look to hold a stock anywhere from a day to 2 months.
- I DO NOT like to deal with slow moving stocks.
- Typically trade stocks that value between $8 – $80.
- Looking to GET RICH NOW rather than LATER.
- Trade between 50 – 200 shares PER TRADE.
I’m sure I forgot some important details to jot down, but you get the idea. Remember to do your due diligence. Don’t just see the track record of the “recommend-ator”but also what kind of trader they are.
What good is a successful long-term trader (Warren Buffet) to you, if you are not looking to hold a stock more than a couple months?