Another main task of investor is to learn how to form and how to manage the portfolio. Managing a portfolio is part art and part science.

The following chapters explain each and every part of investment management, like where to find the stock prospects, how to manage the portfolio, when to sell the stocks, how to manage emotions to profit from stock investing., how to manage risk, and how to use options to enhance return.

Key Points

• You can search stock prospects in the Value Line investment survey, Magic Formula investing, Wall Street Journal, and company and shopping mall visits.
• Enough diversification is required to reduce the risk and volatility of the portfolio.
• Sell a stock after it reaches or is above the calculated intrinsic value of the company. Sell a stock only when the company fundamentals are deteriorating and there are no reasonable management actions to turn around the situation.