To be successful in stock investing, it is essential to understand the basics such as identifying undervalued companies. This foundational knowledge can help us make informed decisions and avoid common pitfalls. However, having an in-depth knowledge of stock investing isn't always necessary to achieve success. Many investors find that a basic understanding is sufficient, especially since the stock market can be influenced by a variety of unpredictable factors. For example, many analysts provide price targets for stocks but these targets are often inaccurate due to the volatile nature of the market. This unpredictability can make it difficult to rely solely on expert analyses or forecasts.
Regardless of whether we are a beginner or an experienced trader, what truly matters more are timing and luck. Timing involves buying and selling stocks at the right moments to maximise profits. This can often depend on market sentiment, economic events or sector-specific news. Luck also plays a significant role because the market is influenced by numerous factors that are beyond any investor's control. Political events, natural disasters or sudden changes in consumer behaviour can all impact stock prices in unexpected ways.
For example, when I first started trading on Webull, I made over a 100% profit with First Foundation and Homestreet stocks. The timing was right. I bought these stocks during a period of fear in the banking sector and sold them when the fear subsided. This experience highlights how critical timing can be. The profits were largely due to buying low when others were selling out of fear and selling high when confidence returned to the market.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
