My approach is basically anchored in the knowledge that a large part of what happens with the market is emotional and not based on actual numbers. I watch a sto

My approach is basically anchored in the knowledge that a large part of what happens with the market is emotional and not based on actual numbers. I watch a stock for a while to get a sense of how it moves. By this I mean, how does certain news effect the price, what sort of deals are they making, what are people excited about with the company, what are they disappointed with in the company. I find what their customers are saying about the company, what people think of their competitors, listen to the earnings report. I'll do this along with more technical research of the company until I feel like there's a good entry point, if at all. I'll have a target price in mind and sell once I get there. In some situations if I'm feeling especially good about an opportunity, I'll invest in LEAPS instead, which is about as risky as I'm willing to go. Doing this right is incredibly time consuming, and I don't do it with the bulk of my investments. I will usually focus on three companies max, because that's about all the work I can handle. I've been much more successful since I started taking this approach, and the percentage returns are much better than what I get from my investments in index funds, but the amount gained comes out to about the same because of how I allocate. Trading is only as risky as you make it, but a lot of people will get sucked into the allure of outsized gains. Use all the tools and financial instruments at your disposal to protect your investments, and don't get lazy about managing them.