When To Buy Or Sell Stocks in Share Market

by Nikesh | Last Updated On September 27, 2022

When To Buy Or Sell Stocks in Share Market?

Understand When To Buy Or Sell Stocks in Share Market. Common Practice is Buy Shares at LOWEST PRICE and SELL at HIGHEST PRICE. But is it that Simple? Let us do some Analysis.

Table of Contents

My Stock is Going Up. Should I Buy More?

If your stock climbs 20% to 25% in 7-8 weeks and the stock still shows strength and growth signals, you can consider buying more of this stock.

Understand:

How To Understand When to Buy Stocks?

Here are some expert tips that can help you understand and decide when and how to select stocks to buy:

If the company shows growth of about 20% to 25% in last 3 years and last 3 quarters, it has potential for long-term and short-term earnings growth, you can consider buying it.
If the sales, profit margins and return on equity is consistently growing in the last 3 quarters, the stock is worth Equity Investment.
If the company has launched some dynamic new products or services with great demand or if there is some strong change in the top management of the company, the stock need some attention.
Focus on leading and trending sectors such as Textile Stocks and leading companies in the sector. Don’t run after cheap stocks.
Focus on stock where leading mutual funds are investing. Mutual fund companies do lot of study and research before investing. They do proper Fundamental Analysis of a Company before investing.
Focus on trending stocks that make new highs with high volume.

Learn:

How to Understand When to Sell Stocks?

When to buy stocks is relatively easy to understand. When to sell stocks needs some thinking. Here are some tips to help:

If you bought a stock with some expectation but your expectation is not met, consider selling the stock. Avoid Too Volatile Stocks.
If your stock has made new highs, consider selling some portion of your position. Never sell all your shares. Monitor the stock and the market before selling all your shares.
If you have better alternative stocks than your poorly performing stock, consider selling your stock and take new position in a better performing stock.
Consider selling your stock if you are getting tax benefits.
If something wrong happens with a company and you are expecting things to get worse, consider selling the stock.
If the earning of a company is not improving over 6 to 9 months, then the stock needs some attention. Study the reasons and if required, consider selling the stock.
If you are making loss with a stock and there is no sign of recovery, consider selling the stock.

FAQs: Buy or Sell Stocks

Is it a Good Idea to Buy and Sell Stocks?

Yes, it is Good Idea to Buy and Sell Stocks. Emerging and Developing Countries like the Indian Economy will keep growing for the next several Years. Investors must cash upon this opportunity. Investment in stocks is also a great way to defend inflation.

When Should You Sell or Buy Stocks?

Buy Stocks When:

There is Market Crash or Correction;
Undervalue Stocks with Good Growth Potential;
The company shows growth of about 20% to 25% in last 3 years and last 3 quarters;
Leading mutual funds are investing;
Leading and trending sectors such as Textile Stocks

Sell Stocks When:

Other opportunities can earn a greater return;
Stock is plunging;
Your expectation is not met;
Your stock has made new highs;
Earning of a company is not improving over 6 to 9 months.

When Should you Cash out Stocks?

You should cash out your stocks when:

Your investment goal is met (OR Not Met);
Company Acquisition;
You need the money;
You need to Reshuffle your Investment Portfolio;
There is Better Investment Options for High Return

Is it Buy or Sell Market?

You can understand if it a Buy or Sell Market, if you understand When to Buy or Sell Stocks.

Conclusion: When To Buy Or Sell Stocks in Share Market

As a basic rule of share trading, most experienced investors sell their stock if it falls by 8% of the buy price. Not booking loss at an early stage can lead to even bigger loss.

However, if you have done your homework and have picked the best stock, you can still keep it in your Investment Portfolio. Monitor the stock and the company consistently and act according to the situation.

I hope you enjoyed this Article. Please SHARE with Others. Thanks!

Is it a Good Idea to Buy and Sell Stocks?

When Should You Sell or Buy Stocks?

When Should you Cash out Stocks?

Is it Buy or Sell Market?

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