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Trading the stock market is an emotional game. While you may be a logical person and think with reason in the real world all of that goes out the window when dealing with money. Just look at why casinos have made it so big, people just bet without thinking about it. To prevent you from falling into the same shoes as a gambler here are 3 questions you should ask yourself the next time you are buying a stock. 1. Why Am I Buying This StockThere should be some reason that you truly believe the stock will go up in the future. This should not be based on something you hear, a hot tip that you got from a friend, or a gut feeling. Successful traders will buy stocks only if it looks like a good buy based on either how fundamentally strong the company is or how the technicals look.
2. How Do I Limit RiskEven if you believe that your stock is the next Microsoft you may still lose all of the money that you put into it. Because of this it is important to limit your risk, this way you do not end up losing your entire account on one bad trade. Maybe you want to only risk a small portion of your account on that one stock, or maybe you want to place some sort of stop to get you out of the position if the stock falls against you too much. Either way, it is important to limit your risk; otherwise you will lose all of your money on the first bad trade you make.
3. When Will I Get Out?

The last question you should ask yourself is what your exit strategy is. A lot of people don't think about this and that is when they get in trouble and end up holding a stock all the way up and all the way back down again. Before you enter know when you will exit. What is your price target? Do you have a price target?
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