What does it take to be a fruitful stock trader?

신태섭 기자l승인2019.07.15






▲ CEO Seyoung Kim

Warren Buffett said that the average holding period of stock is more than 8 years. He bought the stock of The Washington Post and held for 27 years and the price swelled to 86 times. He bought his first stock at 8 and earned $5. His net worth today is $87 billion. What makes his investment legendary? Experts point out ‘patience’ and ‘long term goal’. 

Why many individual investors lose their money? “Because most of them seek fast profit or move around ‘the thema stocks’ without a study of the company they are buying” says Seyoung Kim, CEO of Red Buy Invest. 

Kim says that ‘principle’ is very important in trading stocks but individual investors are easily swept by short term profit while institutional investors and foreign investors are armed with capital and information. 

“The start of Red Buy Invest came from this awareness. I and my specialist team are determined to provide what it takes to be a fruitful investor who does not day dream a big fortune on a single shot. We have information and we have technique and above all we have experience.”

There is a difference between institutional investors and individuals: the former focuses on KOSPI (Korea Composite Stock Price Index) while the latter on KOSDAQ (Korean Securities Dealers Automated Quotations). So called the ‘thema stocks’ are in the latter to hook novice or unprofessional individuals. Speculation, but not investment, is often made here. 

Below are three helpful tips from Kim:

Do not buy ‘many’ for jab but see at least 3 months. 
Do not buy unless it is ‘the price you want’ so be patient.
Read ‘the cycle’ of economy that rotates quarterly.

Below are six principles of Kim:

Use trading hour wisely. The brisk traffic takes place between 9am and 10:30am and between 2pm and 3:30pm. Sell at the opening of the day and buy at the closing. 
Do not be hooked by rising stock but make your target position.
Again, do not buy ‘many’ but focus on ‘less but profitable’. 
Again, see at least 3 month ahead with ideally 30%~50% earnings rate.
Buy when the price hit the lowest.
Give more attention to the falling than the going up and set the target position.

Kim grew his interest in stock trading on the news that the trade of the day in KOSPI and KOSDAQ reached 8 trillion won. He thought he might find his share in that huge market if armed with knowledge and practice. He started digging related books. He then set up principles and developed his own method. When he felt it was time, he launched Red Buy Invest. 

“Conceit” Kim says “is the most dangerous thing in stock trading because it removes ‘principle’ from your head without you even knowing. The taste is sweet at the beginning but is bitter at the end. Keep this in mind.”

신태섭 기자  tss79@naver.com
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