Why I go fishing?

Fishing and the Stock Market

1. Be on the lake when the fish are feeding. (Know what sectors the market likes.)

Opportunity

2. Don't go fishing when the lake is packed with tourists. You probably won't be able to get near your favorite fishing hole, and even if you do, all those churning propellers will scare the fish away. (If everyone is playing the same stock idea, the easy money has already been made.)

Risk is higher when buyers already push up the share.

3. Come prepared with well-maintained fishing equipment, an adequate supply of bait, lures and sharp hooks, and an extra supply of patience. (Give your best ideas time to work, but don't use margin to see them out.)

Do your homework, i.e. have some profit target and action plan.

4. Don't make noise; you will scare the fish away. (Fidelity never speaks; why should you?)


Buy before others rushing in.

5. Don't fish where there are no fish. Know the structure of the lake and the habits of the fish you are trying to catch. Electronic fish finders can help you locate fish, but it won't make them bite. (If no one else is buying, why should you? Catching falling daggers can kill a dip-buyer.)


Don't waste time on those share that Big Boys are not interested.

6. Despite your best preparations, sometimes the fish just won't bite. (Don't be discouraged; go back to shore and enjoy the day, then come back another time.)

Be patient

Even the best traders are only 60% right. (Just make the winners big ones.)

7. Sometimes you find yourself in the middle of a school of feeding fish. Keep your hook baited and in the water. Correct equipment problems quickly, and get the bait back in the water. (When your stocks are running up, stay with the trend.)

8. When a big one takes your bait or hits the lure, set the hook firmly, keep tension on the line at all times and play the fish until it tires. Keep the landing net out of sight. (Don't sell winners too soon.)

Sell 50% first and let the stock run than sell others later.

9. When a really big one breaks your line, take it in stride. He may still be in the area, so always have a backup fishing outfit aboard. (If a market decline washes out a group, get ready when the group takes off again.)


10. Know when to come back to shore, particularly when whitecaps start to appear or there are storm clouds in the distance. (If the market gets crazy, go to cash while you figure things out.)