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Protect Your Investments And Money Using Simple Techniques

George Sterling | Monday, January 7th, 2013

Protecting your money and investments is of utmost importance. If you are careful and take action before your investments enter the risk zone, you can make a huge difference and save yourself from potential loss. The only ones who are safe from risk are day traders, but since very few people fall under that category, all of your investments are under risk from sudden shifts of winds in the investment market. Market winds can easily shift due to natural or political causes.

There are many software available on the internet that can help you decide when to buy and sell your stocks, but none of these software can tell you how the sudden future can change the market in your disadvantage. You cannot hope to protect yourself from risk if you are not watching the markets every hour, so what can you possibly do to stay on the safe side while keeping an eye on your investments once in a while?

 

One of the most successful methods of protecting your money and investments is to play safe. But remember playing safe also means that you are restricting the growth of your money. So the best option to choose would be a moderate investment strategy. This strategy usually protects you from risk and harm of the markets and as well as give your money opportunity to grow more. You may be missing out on some rapid rising in the markets but on the other hand you will also get away with major losses.

In order to protect your investments, it is often recommended to use the ‘Stop’ strategy.

This strategy consists of Purchase or trailing or high. In purchase stop strategy, you sell your stocks if the price of the symbol you invested in drops by a small margin. In the Trailing or high stop strategy, you sell your stocks if they rose in prices but came down after their high but still higher than the price you paid for it.

You can easily keep an eye on these ‘stops’ if you tell your broker about it. Whenever there is an opportunity for you to apply the stop strategy, your broker will inform you.  It is important to note that you should not wait to apply this strategy whenever you get the chance. If you doubt and wait for the stocks to change in prices, you may lose money. Using the stop method to play around with your investments is one of the safest and best methods to protect your investments and your money.

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