3 reasons why you can beat the professionals at their own game

Fsp Invest, 03 Sep. 2013

Tags: professionals, retail investor, advantages of being a retail investor, professional trader, market, stock market

You may think as a retail investor you have no chance making decent gains on the stock market. But that isn’t the case. As a retail investor you actually have advantages over professional traders. Read on to find out three reasons why you can beat the professionals at their own game…

As a retail investor, you might think you can’t do better than a professional trader because you have the ‘little guy’ disadvantage.

But that’s not the case, Keith Fitz-Gerald, chief investment strategist at US Money Morning explains…

You can beat the professional traders at their own game precisely because you are the little guy.

The advantages you have as a retail investor

Here are three reasons why you can do better than professional traders…

#1: It's a better playing field than you think
Yes, the big boys have ‘dark pools,’ exclusive trading platforms and more computing power than at any point in recorded history. But so what?

The typical personal computer available to retail investors has more power than the entire NASA Apollo Mission profile and the data you can pull off the Internet is truly stunning.

#2: Be nimble, be quick...
You may not think that your ability to be much more nimble than big institutions gives you an advantage in an era dominated by million-rand - or even billion-rand - trades, but it does.

Think about it: If a major institution, hedge fund or private investor wants to move into a stock, and establish a truly meaningful position, he or she has to trade huge blocks of shares. Even if you're a total amateur on the most basic of trading platforms, you can see anybody who's trading in size from a mile away.

#3: Stay invested...
Many investors feel like running for the hills on day when the markets get ugly. But running for cover is precisely the wrong play to make.

You actually want to do just the opposite: You want to hold your nose and take the plunge.

In fact, you should always maintain a ‘short list’ of stocks that you want to buy on a decline. That way, you can view any downdrafts as a long-awaited chance to get choice stocks ‘on sale’.

The trick is to make sure to have a full repertoire of tactics that you can use to adapt to any given situation.

There you have it, three reasons why you can beat the professionals at their own game.

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