Summarize the following:
You will need to go over your investments and stock holdings regularly to see if any of your investments are performing poorly. Set aside a regular period of time to go over your portfolio. Think about each of your holdings. Evaluate whether or not each holding has any financial risks associated with it. Can you imagine a scenario where you could be wiped out financially? If so, you need to look for where your portfolio is weakest and attempt purchase other investments as safeguards in that event. Is your portfolio over-concentrated in one stock or industry? Seek to have a diverse portfolio that is not concentrated on one type of investment or industry. If you see that your portfolio is overly concentrated in one area, consider buying stock or investments in similar companies and industries. If your company's valuation is predicated on growth, are you certain that growth will occur? If you are uncertain that growth will occur, you will need to watch that investment carefully to see if it is worth holding onto. Are you holding undervalued shares that could result in a permanent loss of personal funds if the economy is in a downturn? If so, you may need to find a way to sell these or work in safeguards to prevent personal financial losses. You will need to constantly do research on new investments, discuss your holdings with stock professionals, and hold some basic stocks and funds to fall back on. Don't fall back on simple analysis of your investments and the idea that these will be easy to sell if you decide to dump them. Don't base your decisions on a simple write-up of an investment in a financial magazine or blog. Stick to investments in companies within your circle of competence. While more exotic stock options such as biotech, alternative energy, and other emerging markets might seem more exciting, you should stick to simple investments in industries you understand. It can be tempting to jump on a technology fad. If you have little understanding of how tech firms and companies operate and are valued, you might not be able to properly evaluate the risks involved with investing in these companies. Always look into the track record of a company's management. A poor management strategy and history of poor management are red flags. You should not purchase investments or stocks in companies with this kind of record. Changes in management structure and financial holdings of a company will be available in the 13F disclosures of the company. If you have lost money, pay attention to why and how. It is important to learn lessons from your investment mistakes. A financial loss may show you where your portfolio is lacking and which of your investments are too risky. Do some research in the history of financial investment to see what strategies have worked in a successful market. There are many books and articles on this subject available from financial news sources such as Forbes and the Wall Street Journal. You need to constantly do research on new investments and opportunities. Even after you have built up a good portfolio, you will still need to research new investments. Doing this will allow you to see how the financial market is changing. Part of being a successful value investor is knowing how the financial market is changing. Read financial newspapers and stock exchange information on a daily basis. Always think about how a changing market will have an effect on your portfolio. You might want to sell some investments or re-evaluate certain holdings in light of your research. On the other hand, you might discover new investment opportunities that can help safeguard more risky holdings that you have. This will allow you also to see what emerging companies are up and coming. This will allow you to make new investments. Follow the blogs of successful investors to see what kinds of unique opportunities and strategies they are using. These can draw your attention to new types of companies or sources for your research.
Manage the risks of your portfolio. Understand that you will need to put much of your time and effort into your portfolio. Be a learning machine.