How to Avoid Losing Money in the Stock Market

Mika

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Generally speaking, you don't lose your investment in the stock market until you sell your assets for a price less than what you paid for them. For example, you will encounter a loss when you sell the stocks $10 that you had bought for $15. Interestingly, a lot of people sell when the market is down, that’s usually associated with panic selling, selling because they desperately need money, or selling because they no longer can continue paying the debt that they took in order to make an investment.

If you keep your investment portfolio intact during the bearish run, you will never lose money in the stock market. However, there is an exception. You will lose your investment if the company in which you invested goes bankrupt. You might have a lot of stocks but the stocks will not have any market value, thus, you will lose your investment.

When the company goes bankrupt, the stock price will be zero, even if the value does not become zero, there will be no buyer for those stocks, and you will lose your money.

These are, however, exceptions, in others companies on stock listing rarely go bankrupt. The stock market fluctuates frequently, you will make money only when you invest for a long-term.
 
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