Basic strategies on the market of shares:
- A strategy of long-term retention of positions ( “buy and hold”) is a simple but effective strategy. It assumes acquisition of first-class shares (necessarily without using credit leverage!). Ideally requires opportunities of regular buying extra securities over a long period. Result (yield) increases substantially if producing “additions” in case of considerable (20 and over%%) declining market. Disadvantages are obvious – extra-long “jam” in positions is possible in case of an unsuccessful point of initial entrance;
- Strategy of investment “in index” – is a kind of previous strategy, with the shares acquired in accordance with their share of the common indexes (USA – Dow Jones, S&P500);
- Portfolio growth strategy – shares are purchased to the portfolio, having (from the point of view of manager) high growth potential. Advantage of this strategy is high profitability in a growing market;
- Strategy of aggressive portfolio management – strategy designed to yield additional profitableness, received because of manager’s professionalism. It is critical enough to behaviour of the market.
