1. Secure. Your. Profits. Couldn’t tell you how many times I got burned by not securing profits when I had the chance.
2. Don’t bother trying to get rich off penny stocks. Most are penny stocks for a reason and you will end up losing a lot of time and money chasing them.
3. Have an exit strategy. This means knowing how and when to get out of a stock or option. This of course means you must have a level of confidence in the stock or option so you don’t sell for a loss simply because the stock dips on a red day for the market or sector. Know why you’re invested and what relative PT you’re going for.
4. Don’t chase! If you miss your entry point for a stock, then just let it go and look for the next stock. Chasing is one of the sure fire ways to lose money.
5. Buy long term options for stocks you believe in long term. And don’t overextend your portfolio. Always try to keep some money in your available buying power for a quick move.