Monday, October 24, 2011

Trend Following in the Stock Market

Trend following by its very nature is a system that needs to be adhered to. There is no point in adopting a trend following strategy and then, if you think that the market may be beginning to move, changing the way that you trade. But trend following is following, it is not a way of knowing what the market will do. If it were that then there would be no market as everyone would invest in the same thing and there would be no profit in trading.

Trend following is a way of analyzing risk based on the trend that you are following. It is a way of working out what you should be investing in based on the current trend of that stock and also what price you should be paying. This is called the initial risk rule. Trend following is not a fashionable way of trading that is being followed for a while until the next big thing happens along. Trend following is a good solid and reliable way of trading that should, if your analysis and applicatio n are good, be a reliable way to make a profit. Of course there will also be times when you lose out, but on the whole trend following has been shown to be a good system.

One of the most important things in getting it right, is knowing how much you should trade for the trend that you are following. You also need to trade in the context of the market at the time. If the market is unstable and there are large shifts in prices, then it might seem to be a good time to make a good profit, but it is just as easy to lose a lot of money and it is generally best to make smaller trades in this type of market. To make trend following work for you, you need to work out when it is best for you to start to trade, how much money you should risk, the best way to sell quickly if the prices drop and when to sell if the prices rise so that you make your profit before the market starts to turn.

Trend following is not a way to quick profits, it is good basic trading and you need to know what the real value of the company that you are buying is, how much it is rising and why that trend might continue. If you follow the data that your analysis gives you and do not change you mind when the trend following system is working, then you are quite likely to do well.

"http://www.insighttechnical.net" INSIGHT TECHNICAL</a> a stock advisory and investment solution provider in the Intraday Stock Trading, Day Traders , Information, Futures, International Forex, Commodities market and Indian Equity and Commodities Market. At <a rel="nofollow" onclick="javascript:_gaq.push(['_trackPageview', '/outgoing/article_exit_link/1396688']);" href="http://www.insighttechnical.net"> INSIGHT TECHNICAL </a>our mission is to preserve and grow assets. Our services give investors access to the same investment and risk-management techniques usually availab le only to the largest institutions.

Insight technical - we aim to provide our clients with accurate information, news, company reports, global market activities, Market News, Financial Information, Forex, economy, bombay stock exchange news, indian stock exchange, bse stocks, Commodity Watch, Market indicators, Information Technology, debt, gilt, government, disinvestment, balanced, scrip, stock ticker.

Insighttechnical.net provides Business, NRI, personal finance, BSE, NSE stock, market tips, Indian, equity, quotes, derivatives, share, stock, result, quarterly, annual, news, demat, trading, broking, Indian finance site, Indian stock market quotes, India shares, free investing tips, listing, stockometer, FII sensor, latest business news, equity, mutual funds, corporate results, Union Budget, loans, tax, insurance, NRI finance, ADR, GDR, broker reports, investor tips, Market News, website ,Financial Information, Forex, economy, bombay stock exchange news, indian s tock exchange, bse stocks, Commodity Watch, Market indicators, Information Technology, debt, gilt, government, disinvestment, balanced, scrip, stock ticker, ticker, live market,India business news, finance, Indian stock market quotes, free investing tips, BSE, NSE, Portfolio manager, stockometer, FII sensor with latest news on business, equity, mutual funds, derivatives, Union Budget, loans, tax, insurance, NRI finance, shares,intraday,deleivery,btst,stbt.

We Insight Technical provide Intraday Tips, Share Tips, Stock Market Tips, NSE Tips, BSE Tips, BSE intraday tips ,MCX tips, NCDEX tips,
Future Trading tips, Nifty tips, Fno tips, Equity tips, Commodity Trading, Option trading, Future option, index trading, Futures, Day trading, Commo

For More information Visit : http://www.insighttechnical.net

Email : contact@insighttechnical.net

Contact : +91 9822226867


0