April Lee Tan gives advice: Don’t fall in love to your stock

Just like relationships, investing in the stock market is difficult to understand and nearly impossible to predict.

There will be high highs and low lows.

On any given day, you may even just want quit or just sit back and reap the rewards of your efforts.

Seasoned trader April Lee-Tan uses an all too familiar metaphor in teaching investors on how to be better market players, drawing from her experience managing portfolios for COL Financial.

Tan cited the smashing IPO of Injap Sia’s MerryMart which debuted in the stock market last week despite the pandemic.

“Although speculating in stocks can be very profitable, it can also be very dangerous… Not all IPOs are successful,” Tan said.

She went on to share key investment principles to generate outsized returns.

Her advice: Remain level-headed and never wear your heart on your sleeve – or in this case, never leave your money out for too long.

“Don’t fall in love. Although many people buy high-flying stocks for the opportunity to make quick gains, many end up falling in love with their stocks and refuse to sell even when prices go down,” Tan said in her June 22 column in The Philippine Daily Inquirer.

“They usually cite the reasons for the stock’s strong performance such as the company’s plans to engage in a lucrative business and huge potential profits that can be earned if plans materialize,” she said.

Tan said it’s best to stick to the plan: if you’re a short-time trader, make sure you stay on that path for best results as the failure to fulfill these could be costly for the company and even the anticipating investor.

“Nobody knows for sure if these companies can execute their plans to engage in very lucrative businesses. Even if they do, the profits are usually not as good as initially expected,” she said.

Guard your heart and your money!

Source: Peso Economics