Whether you’re getting into the stock market for the first time, or have been a seasoned investor for years, the market can be a tough place to entrust your money. Many people have made and lost fortunes on the market, often far greater than the level of investment that you’ve placed into stocks. Nevertheless, the average investor can feel a bit overwhelmed by the realities of the market and the movement within on a daily basis.

Thankfully, the market is not so overwhelming that the average investor cannot make headway. In fact, there are some general stock trading principles that can guide the typical investor, allowing them to make money within the investment markets and protect the principal that they’ve invested should the market take a turn for the worst.

One principle that an investor should pay close attention to is what many professionals refer to as churning. It is one of the largest stock trading principles that an investor can heed. A trader with online account access can oftentimes feel the tempted to actively trade their investments on the tiniest up and down, in an attempt to profit from each move while avoiding losses. In the long run, a strategy like this will not pay off as the unseasoned investor cannot time the market well enough. Therefore, trading in this manner is ill advised.

Due to the commissions that brokerages charge for trading stocks on your behalf, churning will often eat away at any profit you might have made. Small profits will vanish with the commissions charged on every trade when someone churns their portfolio, leaving the investor who could have made money with a loss rather than a gain.

An important stock trading principle that every investor should heed is to always remember to do one’s homework prior to purchasing stock with a company, even if the purchase is with a company that the investor deals with regularly. The stock trading tools available on the internet should be taken advantage of, as with only a few clicks they allow the typical investor to keep their eye on a company’s financial conditions, outlook and movement.

Additionally, tools like stock trading charts and financial summaries can allow the experienced investor (or the investor looking to learn) to make comparisons between companies and industries to do a deeper intrinsic analysis on companies to see whether or not a firm can make it for the long haul. Often, even a shallow analysis of a company versus its competition or industry can yield a wealth of information and allow an investor to make a more informed decision.

A third of these important stock trading principles is to actively follow, but not obsess, over the performance of your portfolio. Many investors have the \”leave it alone\” attitude that they can simply buy stock, let it sit over time, and make money. Often, this can be the case given the average long term return of the stock market, but earning money in the market is never assured.

Make sure that you are up to date on the general news that is coming out of the companies that you hold stock in, and take note of any major developments in the industry or in the economy that could impact the company in the short term or long term. If you are fairly current on the news that comes out about these companies, you can be better prepared to pull the trigger on a trade and follow one of the best stock trading principles ever stated: Buy low, sell high.