1. We should follow a system or set of rules strictly without any sort of modification as per our needs and time gap.
2. Low priced, low quality stocks are dangerous and should never be put hands into it.
3. Greed is dangerous.Once a reasonable profit is made the investor should get out of the market quickly.
4. Do not fail to cut/book losses at 8% below the purchase price A strategy of selling while losses are small is a lot like buying an insurance policy. Once you've sold, your capital is safe.The 7%-8% sell rule is a maximum, not an average. Time your buys right, and if the market goes against you the average loss might be limited to only 3% or 4%.
5. Do not let emotions or ego get in the way of a sound investing strategy You may feel foolish buying a stock at 60, selling at 55, only to buy it back at 65. Put that aside. You might have been too early before, but if the time is right now, don't hesitate. Getting shaken out of a stock should have no bearing on whether you buy it at a later date. It's a new decision every time
6. Invest in equities for long term view then for short term prospective.
7. Do not make unplanned investing and starting without setting clear investment objectives and time frame for achieving the same.
8. Patience is a virtue in investing. Do not panic on your existing stocks.
9. Do not be unaware of what is happening around in the market. As always, knowledge is power and in investing, it's also a comfort. Dig for more information other than just the top stories that are flashed.
10. Do not put all your money on the same horse. Diversify your portfolio ideally into different stocks.
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