Ok so this morning on my stock market simulator i shorted 1000 shares of Yahoo at 29.41 anticipating that the price would go down.....BUT i was wrong and the price didnt go down it went up.Its at about 29.60 and i missed my opurtunity a long time ago.Can any one give me some advice.Even thought its only a simulator its still personal to me because i need to learn how to treat real money.
2007-02-13 05:47:03 · 3 answers · asked by vlady88 1 in Business & Finance ➔ Investing
No need to stress out about it.....it's no different than had you gone long (bought) 1000 shares at 29.41 and the stock went down to 29.23 . Your loss position on the short trade (not including commissions) is just little more than 1/2 of 1% ($190 on a tade of almost $30k).
A trading simulator will only prepare you for actual trading if your trades are similar to trades you would make in real life. If you get nervous from being down $190 on a $30k trade, trading individual stocks is probably not for you.
2007-02-13 07:42:52 · answer #1 · answered by SmittyJ 3 · 0⤊ 0⤋
If you're going to trade, you HAVE to learn to cut your losses short, especially when shorting. You should never even get into a trade unless you know beforehand under what conditions you will exit that trade. One of the most common mistakes traders make is holding on to a losing trade, thinking (then hoping, then praying) that the stock will bounce back. Once a stock isn't doing what you expected, bail out with your small loss (before it becomes a big one) and look for your next trade.
2007-02-13 06:14:18 · answer #2 · answered by LongArm 3 · 0⤊ 0⤋
Forget about shorting, options, currency trading, etc. Stop having to guess on long odds. Keep the odds in your favor. There is no short term get rich quick deals. Do lots of research, learn about earnings, sales, cash flow. Find good large companies that have made money in each of the past XX years (and increased dividends each year for many years), & sell products or services everyone needs, use up quickly and needs to buy again (oil, soap, toothpaste to name a few). Buy and hold for the long term. Its time in the market, not market timing that gets results. Read books about/by Peter Lynch and Warren Buffet and Ben Graham.
2007-02-13 05:58:05 · answer #3 · answered by gosh137 6 · 0⤊ 0⤋