Having an investing plan can be broken down into parts to help figure out exactly how to begin the stock buying process.

6 Rules of Preparation for Buying Stocks

1. Objective – before buying into a company or purchasing an ETF consider your objectives. How much are you willing to pay. How much do you want to sell for or to stay until you feel you’ve earned enough.

2. Watch List Criteria – what to look for when purchasing stocks

• Identify the trends of the market
• Find the best sector and industry
• Find the best stocks and ETF’s for these trends

3. Entry Rules – Analyze the stock’s time period between 6 months to 5 years to help you see the trends before committing.

4. Allocation – How much are you willing to buy. A good rule never buy more than 10% of a single stock in your portfolio.

5. Exit Rules – When to get out – set your limit to sell at 3% below what you bought this way you’re not sweating that you lost too much money!

6. Routines – weekly check on new stocks to buy. And always continue your education!

Recommended Read: SSR Rule in Stocks

How to Start

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