Investors should never put all their investments in one basket stocks, which is the central thesis on which the concept of diversification sits. The purpose of diversification is to reduce volatility and improve overall performance. Being well diversified can help cushion against losses. In every bear market, there are likely certain sectors and stocks that get hit much harder than others. It’s extremely difficult to forecast these ahead of time. So one preventive means that investors can take now is to diversify within sectors.
A stop-loss limits an investor’s loss on a position when a stock makes an unfavorable move. Most importantly, a stop-loss allows decision making to be free from any emotional influence. This means stop-loss orders can help investors stay on track without clouding judgment with emotion.
So for all the practical reasons and clarification, please approach us on our website www.sharesbazaar.com else call on our toll free number 1800 120 1448 for guidance and advise on how to invest in stock markets