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Strategy
No. 8:
Keep an Eye on your Stock
Keep a constant eye on
your stock. Apart from checking the value of your
shares, read the newspapers to find out what is
happening within your companies. Don't just look at the
share price each week. Scan the business pages for news
about major personnel changes, or news of strategic
decision-making within your companies.
Share prices are very
sensitive to factors within the company, as well as to
outside economic factors such as interest rate rises and
falls, balance of payment figures and the value of the
dollar. External factors, such as the international
economic situations or wars, can also affect share
prices. Therefore, the more you keep informed about what
is happening, the better your chances of making correct
decisions.
Read the annual reports
of all your companies. And, if you can, attend the
annual general meetings. As a shareholder, you are
entitled to attend, to present your point of view and to
vote on crucial issues, such as the makeup of the board.
You'll also be given a
great deal of information about the current and expected
future state of the company, information that you can
use to make informed decisions.
To be able to do all of
this, don't buy stock in too many companies. For most
people, keeping up with more than ten companies will
prove difficult. If you are able to regularly track your
stock, you will also get more enjoyment out of your
portfolio.
Next:
Regularly Review your Portfolio
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