Fostering Consistent Growth for your Stock Portfolio


Here is a road map of 5 key elements you need to focus on to bring your investing processes up to speed. This plots an easy path for you to take on the nuances of the stock market and generate steady positive returns.

The stock market can reward us or punish us. The choice is yours. It is not hard to do it is a matter of being aware and realistic and it is actually a ‘Just Do It’ exercise. No room for dreamers here – you need a plan.

  1. Set your Objective
    Set 2 objectives – example
    A. Return 15% CAGR
    B. Capture Trends – Trends appear as a constant character of the market. That doesn’t change. Keep a simple focus and don’t make it complicated it will only confuse you
  1. What Analysis Routine will you use?
    The tools you chose and the rules you make for entry and exit decisions. This should take up only a small amount (10%) of your time and should not be a complicated exercise. There are many ways to achieve this, but it requires focus. As all successful traders say – keep it simple. I only use price to base my decisions on and have only 2 entry rules and 1 exit rule. It should be simple and precise.
  1. How will you Manage your Money?
    What are the money management rules that will limit losses and maximising the potential of your wins. Think of it as a budget of profits (income) and losses (expenses).
  1. Setting your Trade Plan
    Every decision you need to make should be rule based such as the stocks you cover, to how you handle takeover situations, or your stop loss rules.
  1. Managing Market Psychology
    Have Discipline, what are your Biases and Expectations? Then implement with Confidence
    Being able to effectively implement you trading plan with the confidence, discipline, understanding your own biases and weaknesses, and having the right expectations of what can be achieved. Discipline is a potential ‘failing’ post for every trader/investor and is the hardest lock to crack open. You have set realistic objectives, strategies and plans to control your trading to minimise losses (stress) that encourage confidence. Proper implementation of your trade plan will then become automatic enjoyable and profitable.

As humans we are not ‘natural’ traders, we have to learn. This means often going against our natural tendencies which are generally not conducive to successful stock market trading, unless we have exceptional powers of self-discipline!