His C and GM picks were very successful and that got him to look for other stocks similar to them. He found a couple of microcap stocks, LJPC and CTIC, that looked like they may break through with big gains. These stocks were bigger risks but they also appeared to have even greater potential for reward.

That ended up being the case as both CTIC and LJPC ended up being huge gainers.

He thought that he may actually be onto something big with the way he was choosing these stock picks so he decided to try and make a stock screener which would find more stock buys like them right before they were about to “pop” with big gains.

The reason I’m writing this blog post today is because his first stock pick with this new screener reached a high 40% above it’s open today and that certainly impressed the heck out of me. Obviously my imagination is off and running with the kind of gains I could make by following his penny stock picks.

I definitely don’t expect every stock pick he makes to have big gains. No way. And it’s key to remember that a gain isn’t “official” until the point where you actually sell the stock. Making the decision of when to sell is equally as important as deciding when to get in. The really cool thing is that he also makes a post on his blog (and on Twitter) when he sells his holdings.

He does not share the precise way he screens for these winning stocks as I guess he’s too selfish to share all of his secrets but he definitely shares more about what he’s actually doing on the market than most so called “gurus.”

He’s clear that he is definitely not giving investment advice never giving investment advice. It’s always recommended that you do your own investigating before buying stock.

While it’s tempting to sign up for The Day Trading Robot or The Forex Autopilot System, I definitely think I’ll have better results just by following what he’s doing. And of course the really cool thing is that it’s free.

One final note: It’s definitely a good idea to make “imaginary trades” before you start using real money when trying a new stock picking strategy.

There are two basic ways to trade the share market – shooting in the barrel or using strategies to determine which shares to buy, when to sell, and how to protect your investment dollars. Needless to say, strategies outperform barrel shooting by a large margin. There are, however, hundreds of trading strategies to choose from. Of all of these there are a couple of tried and trued methods that have worked well for investors over many years. The beginning investor is advised to investigate some of these basic strategies and see for himself how they perform. New strategies can be explored once the basic ones are well-understood.

Hedging
Hedging is a way of protecting an investment by reducing the risks involved in holding a particular share. The risk that the price of the stock will drop can be offset by buying a put option that allows you to sell at the share at a particular price within a certain time frame. If the price of the stock falls, the value of the put option will increase.

Buying put options against individual shares is the most expensive hedging strategy. If you have a broad portfolio a better option may be to buy a put option on the stock market itself. This protects you against general market declines.  Another way to hedge against market declines is to sell financial futures like the S&P 500 futures.

Dogs of the Dow
This is a strategy that became popular during the 1990s. The idea is to buy the best-value stocks in the Dow Industrial Average by choosing the 10 shares that have the lowest P/E ratios and the highest dividend yields. The companies on the Dow Index are mature companies that offer reliable investment performance. The idea is that the lowest 10 on the Dow have the most potential for growth over the coming year. A new twist on the Dogs of the Dow is the Pigs of the Dow. This strategy selects the worst 5 Dow shares by looking at the percentage of price decline in the previous year. As with the Dogs, the idea is that the Pigs stand to rebound more than the others.

Buying on Margin
Buying on margin means to buy shares with borrowed money – usually from your broker. Margin gives you more return than if you were to pay the full cost outright because you receive more stock for a lower initial investment. Margin buying can also be risky because if the stock loses value your losses will be correspondingly greater. When buying on margin the investor should have stop-loss orders in place to limit losses in the case of market reversal. The amount of margin should be limited to about 10% of the value of your total account.

Dollar Cost and Value Averaging
Dollar cost averaging involves investing a fixed dollar amount on a regular basis. An example would be buying shares of a mutual fund on a monthly basis. If the fund drops in price the investor will receive more shares for his money. Conversely, when the price is higher, the fixed amount will buy fewer shares. An alternative to this is value averaging.  The investor decides on a regular value he wishes to invest. For example, he may wish to invest $100 a month in a mutual fund. When the price of the fund is high he puts a higher dollar amount in the fund and when the price is low he spends less money. This averages out his investment to the original $100 per month. Value averaging almost always outperforms dollar cost averaging as a percentage return on the money invested. When used as part of a broader trading strategy it can help secure the growth of your investment fund.

For more please see make a living trend trading and how to get free life insurance quotes.

One of the alluring myths that surrounds the stock market is the prospect that a certain stock may split, giving stock holders twice as many shares as before. What is poorly understood by the outsider, though, is that although the investor has more stock after a split, the value of each share is reduced. For example, if a corporation decides to split its share 2-for-1, it issues one new share for each outstanding one. At the same time, the value of each share is cut in half. So the stock holders now hold twice as many shares but the total value is the same as before the split. A stock split is like receiving 2 five-dollar bills for a single ten-dollar bill.  Same value – twice as much paper.

Why would a company do this?

A lot of it has to do with investor psychology. The price-per-share of a share may be so high that the average investor feels it is out of his reach. A stock split reduces the price so that it may be more affordable to smaller investors. In reality, the small investor could have bought a smaller number of pre-split shares for the same price, but the appeal of buying a $20 share as opposed to a $60 may be strong for some investors.

Stocks can be split by a number of ratios but the most common are 2-for-1, 3-for-2, and 3-for-1.  stocks can also be reverse-split – the company reduces the number of outstanding shares so that each stock holder has fewer shares than before. Reverse stock splits are less common, but can be used for several reasons: the price per share may be so low that it appears as a poor investment; the company may be attempting to stave off possible de-listment on the share exchange; to push out minority stockholders; or as a way to go private.

Advantages

Lower prices per share can result in greater liquidity – stocks are easier to sell at lower prices and there is less of a bid/ask spread. This is especially true for shares that are priced in the hundreds of dollars – small investors view them as out of their budget and the high bid/ask spreads (the difference between buying and selling prices) can put off bigger investors.

Other advantages have to do with investor psychology. A split is usually seen as a bullish indicator – share prices are increasing and the company is doing well financially. There is usually a short-term rally around a share which splits, but the market tends to normalize after a short period.

On the downside, a split may cause investors to expect more about how the company performs. If these expectations are not met investor confidence may be shaken and the result could be a drop in share prices.

The bottom line is a share split does nothing to affect the worth or performance of a company. It may be nice to own more shares, but in the end your 2 five-dollar bills are still worth the same as your ten-dollar bill.

For more please see What Is Trend Trading? and 3 Free Credit reports.

The investor has many tools at hand when making decisions about which stocks to buy. One of the most useful of these is fundamental analysis – examining key ratios which show the worth of a share and how a company is performing.

The goal of fundamental analysis is to determine how much money a company is making and what kind of earnings can be expected in the future. Although future earnings are always subject to interpretation, a good earning history creates confidence among investors. share prices increase and dividends may also be paid out.  

Companies are required to report earnings on a regular basis and share market analysts examine these figures to determine if a company is meeting its expected growth. If not, there is usually a downturn in the stock’s price.  

There are many tools available to help determine a company’s earnings and its value on the stock market. Most of them rely on the financial statements provided by the company. Further fundamental analysis can be done to reveal details about the value of a company including its competitive advantages and the ratio of ownership between management and outside investors.

Financial Statements
Every publicly traded company must publish regular financial statements. These statements are available in printed form or on the Internet. All statements must include an income statement, a balance sheet, an auditor’s report, a statement of cash flow, a description of the business activities and the expected revenue for the coming year.

Auditor’s Report
The auditor’s report is one of the most important sections of the financial statement. The auditor is an independent Certified Public Accountant firm which examines the company’s financial activities to determine if the financial statement is an accurate description of the earnings. The auditor’s report contains the opinion of the auditor concerning the accuracy of the financial statement. A financial statement without an independent auditor’s report is essentially worthless because it could contain misleading or inaccurate information. An auditor’s report, although not a guarantee of accuracy, at least provides credibility to the financial statement.

Balance Sheet
Another important section of the financial statement is the balance sheet. This is a ‘snapshot’ as it were, of the financial condition of the company at a single point in time. The balance sheet shows the relationship between assets (cash, property and equipment), liabilities (debt) and equity (retained earnings and stock).

Income Statement
The income statement shows information about the revenue, net income, and earnings per share over a period of time. The top line of the income statement shows the amount of income generated by sales, underneath which the costs incurred in doing business are deducted. The bottom line show the net income (or loss) and the income per share.

Cash Flow
The statement of cash flow is similar to the income statement – it provides a picture of a company’s performance over time. The cash flow statement, however, does not use accounting procedures such as depreciation – it is simply an indicator of how a company handles income and expenses. A statement of cash flow shows incoming and outgoing cash from sales, investments, and financing. It is a good indicator about how the company is run on a day-to-day basis, how it handles creditors and from where it receives growth capital.

For more on financial topics please see etf trend trading and Trans Union credit report.

A mutual fund is a diverse holding of stocks that are managed on behalf of the investors that buy into the fund. A mutual fund allows an investor to take advantage of a diversified portfolio without having to invest a large sum of money.

What is the advantage of a diversified portfolio? It offers protection against rapid market losses of any one particular stock. If a portfolio is spread across 20 stocks, if any one of those stocks quickly loses value the effect is less than if the portfolio consisted of that one stock by itself.

When investing it is always a good idea to diversify. The problem for small investors is that they often don’t have the funds to buy a variety of stocks. Mutual funds allow small investors to benefit from diversification with a small amount of money.

Besides shares, mutual funds can be made up of a variety of holdings including bonds and money market instruments. A mutual fund is actually a company and investors that buy into a fund are buying shares of that company. Shares in a mutual fund are bought directly from the fund itself or brokers acting on behalf of the fund. Shares can be redeemed by selling them back to the fund.

Some funds are managed by investment professionals who decide which securities to include in the fund. Non-managed funds are also available. They are usually based on an index such as the Dow Jones Industrial Average. The fund simply duplicates the holdings of the index it is based on so that if the Dow Jones (for example) rises by 5% the mutual fund based on that index also rises by the same amount. Non-managed funds often perform very well – sometimes better than managed funds.

There are downsides to mutual funds. There are usually fees that must be paid no matter how the fund performs, and the individual investor has no say in which securities can be included in the fund. Also, the actual value of a mutual fund share is not known with the same precision as shares on the stock market. 

Mutual funds are often a better choice for the small investor than either stocks or bonds. They offer the diversity that provides cushion against sudden stock market movements and usually provide a greater return than bonds. Of course, mutual funds can also lose value, especially in the short term, so short term investors may be better off with bonds which offer a set rate of return.

There are three main types of mutual funds: money market funds, bond funds and stock funds. Money market funds offer the lowest risk – they consist solely of high quality investments such as those issued by the US government and blue chip corporations. Money market funds have rarely lost money, but they pay a low rate of return.

Bond funds aim to produce higher yields than money market funds and therefore carry a correspondingly higher risk. All the risks that are associated with bonds – company bankruptcy, falling interest rates – also apply to bond funds.

stock funds usually have the greatest potential for profitable investment but also carry the greatest risk. The risk is more for short-term holders of mutual funds – stocks have traditionally outperformed other investment instruments in the long run.

There are different types of stock funds including ‘growth funds’ that attempt to maximize capital gain and ‘income funds’ that concentrate on stocks that pay regular dividends.

Mutual funds are an ideal investment for those with limited funds or investment experience. Choosing the right fund is a decision on how much risk you are willing to take against your expected return on your investment.

For more please see trend trading systems and http://free-credit-reports-site.com/how-to-get-your-free-experian-credit-report/.

While there are many different types of investments that one can make, there are really only three specific investment styles, and those three styles tie in with your risk tolerance, these are conservative, moderate, and aggressive.

Naturally, if you find that you have a lowish tolerance for risk, your investment style will most likely be conservative or moderate at best. If you have a high tolerance for risk, you will most likely be a moderate or aggressive investor. At the same time, your financial ambitions will also determine what style of investing you use.

If you are saving for your retirement in your early twenties, you should use a conservative or moderate style of investing, but if you are trying to get together the funds to buy a home in the next year or two, you would want to use an aggressive. Being an active stock market trader would be considered an aggressive style for most people.

Conservative investors want to make sure that they maintain their initial capital and make very modest gains per year, they want to sleep well at night. In other words, if they invest 00 they want to be sure that they will get their initial 00 back. This type of investor usually invests in blue chip common stocks and bonds and short term money market accounts. But remember trading stocks, even if they are blue chips can still be very risky as we have seen in the 2008/9 bear market.

An interest earning savings account is very common for conservative investors.
A moderate investor usually invests much like a conservative investor, but will use a small portion of their investment funds for higher risk investments. Many moderate investors invest 50% of their investment funds in safe or conservative investments, and invest the remainder in riskier investments.

An aggressive investor is willing to take risks that other investors won’t take. They invest higher amounts of cash in riskier ventures in the hopes of achieving larger returns – either over time or in a short amount of time. Aggressive investors often have all or most of their investment monies tied up in the stock market.

Again, determining what style of investing you will employ will be determined by your financial goals and your risk tolerance. No matter what type of investing you do, however, you should always carefully research the investment and never invest without having all of the facts.

If you think you are an aggressive investor and intend to trade stocks activily, make sure that you learn how to trade by taking a good trading course such as Top Dog Trading before making your 1st stock purchase.

A767321456

1. Scalping Trader, if you scalp the market this means that you are only looking for a few ticks profit per trade and you may only be in the trade for a few seconds or a minute at most. trading. Some people will also call this day trading but it’s really micro day trading, buying the bid and selling the offer, it’s high speed trading and you might end up doing 10-50 trades a day. This can be quite a stressful way of trading.

2. Day Trader, the true day trader opens and closes their trade within the same trading session, usually this mean the same day, but unlike a scalper the trade may be held for a few minutes up to several hours. Usually day traders make about 2-6 trades a day and most of them will be in the 5-30 minutes range. This is a less stressful way of trading than scalping but it still requires a lot of attention and quick decision making.

3. Swing Traders, swing trading usually means that a position is held for between 1 to 5-10 days, although some swing traders may keep a trade on for longer most are within this time period. For many this is the idea way to trade because it allows you to review your trade overnight, at the very least you have several hours to make your trading decisions.

4. Position Traders, this just means that you are going to hold onto your trade for longer than 5-10 days, maybe even as long as a few months.

If you are still working out how to day trade then it may be better to go with the longer time frames as it gives you more time to think.

A1528561

Statistics show that in a bull market approx 75% of the stocks will follow the general trend and go up, and in a bear market 75% will also go down. Trading with the trend is the best way to trade as 8 out of 12 stocks will follow the trend and give you the best chance of making gains on your stock purchases.

But what if you own some good stocks and don’t want to sell when the market is clearly going down, or about to go down?. There are a couple of tactics that you can consider, both of which involve the use of options, CALL options and PUT options. There is the widely known strategy called Covered Calls, and the much lesser known one called the Married Put.

If you are going to trade options it is important that before you start trading you get the best option trading education that you can. You should also practice stock trading until you are comfortable with the process. This is a very important point that must be taken seriously, if you don’t understand the terminology and the theory then you should not be trading options. If the terms Put option, Call option, Married Put and Covered Call are new to you then don’t trade until you have studied sufficiently.

Selling call options against your stock in 100 share increments is the basis of the covered call strategy and it can provide about a 2-7% buffer against the loss in stock price. However a bigger drop in the stock price will not be compensated for using the covered call strategy, in general.

Stocks in a bear market, and even in a bull market, can drop quickly on news or earnings releases, as much as 15 to 40% within a month. Using covered calls to protect your stocks will only provide limited protection of less than 7% at best and so will not save your account if the stock takes a 40% tumble.

The better solution to providing downside stock protection is the option strategy called the Married Put. As the name suggests the PUT that you buy is used to provide protection when the stock goes down because Put options increase in value when the stock decreases in value. The term married is used because the option that is selected has to be a good fit with the stock, in other words a good match, if the strategy is to work.

The selection of the best Put option is not straight forward and involves several criteria which are listed below:

1. The strike price of the option

2. The current stock price

3. Choice of options, in/out of the money

4. Put expiration time

Even though the married Put protection only has a limited life span if offers much more protection than the covered call. It can provide as much as 95% loss recovery in the event of a significant drop in the stock price.

The downside of the good protection is that you have buy the Put which is a debit whereas the covered call is a credit. But there are ways of off-setting this expense and there is much more to this strategy when executed correctly. The Married Put can be made to pay for itself and used to generate very good gains if the market, or stock to be specific, moves a lot.

The general idea of the Collar Trade is to combine the covered call and married Put strategy into one, this is what is called the Collar Trade. In effect you put a collar around the stock, sell a call and buy a PUT. If you do this correctly most of the cost of the Put can be offset by the credit from the covered call so you can protect your stock at almost no cost. Yes this is a great strategy which the general public is unfortunately ignorant of, and most brokers don’t understand.

The strategy that I have outlined above is unknown to the average stock market trader but is one of the best trading systems you could have.

A675438906

While there are many different types of investments that one can make, there are really only three specific investment styles, and those three styles tie in with your risk tolerance, these are conservative, moderate, and aggressive.

Naturally, if you find that you have a low tolerance for risk, your investment style will most likely be conservative or moderate at best. If you have a high tolerance for risk, you will most likely be a moderate or aggressive investor. At the same time, your financial ambitions will also determine what style of investing you use.

If you are saving for your retirement in your early twenties, you should use a conservative or moderate style of investing, but if you are trying to get together the funds to buy a home in the next year or two, you would want to use an aggressive. Being an active stock market trader would be considered an aggressive style for most people.

Conservative investors want to make sure that they maintain their initial capital and make very modest gains per year, they want to sleep well at night. In other words, if they invest 00 they want to be sure that they will get their initial 00 back. This type of investor usually invests in blue chip common stocks and bonds and short term money market accounts. But remember trading stocks, even if they are blue chips can still be very risky as we have seen in the 2008/9 bear market.

An interest earning savings account is very common for conservative investors.
A moderate investor usually invests much like a conservative investor, but will use a portion of their investment funds for higher risk investments. Many moderate investors invest 50% of their investment funds in safe or conservative investments, and invest the remainder in riskier investments.

An aggressive investor is willing to take bigger risks that other investors won’t take. They invest higher amounts of money in riskier ventures in the hopes of achieving larger returns – either over time or in a short amount of time. Aggressive investors often have all or most of their investment monies tied up in the stock market.

Again, determining what style of investing you will employ will be determined by your financial goals and your risk tolerance. No matter what type of investing you do, however, you should always carefully research the investment and never invest your cash without having all of the facts.

If you think you are an aggressive investor and intend to trade stocks activily, make sure that you learn how to trade before making your 1st stock purchase.

A767321456

Like all investments it is important to learn about what you are investing in, and certainly don’t just take the advice given to you by a bond seller without checking it out 1st yourself. The three most important points that must be considered when purchasing a bond include the par value, the maturity date, and the coupon rate.

The par value of a bond refers to the amount of cash you will receive when the bond reaches its maturity date. In other words, you will receive your initial investment back when the bond reaches maturity.

The maturity date is of course the date that the bond will reach its full value. On this date, you will receive your initial investment, and the interest that your money has earned.

Corporate and State and Local Government bonds can be ‘called’ before they reach their maturity, at which time the corporation or issuing Government will return your initial investment, along with the interest that it has earned thus far. Federal bonds can not be “called”.

The coupon rate is the interest that you will receive when the bond reaches maturity. This number is written as a %, and you must use other information to find out what the interest will be. A bond that has a par value of say 00, with a coupon rate of 5% would earn 0 per year until it reaches maturity.

Because bonds are not issued by banks, many people don’t fully understand how to go about buying one. There are 2 ways this can be done.

You can use a broker or brokerage firm to make the purchase for you or you can go directly to the Government. If you use a broker, you will more than likely be charged a commission fee. If you want to use a broker, you should shop around for the lowest commissions!

Purchasing directly through the Government isn’t nearly as hard as it once was. There is a program called Treasury Direct which will allow you to purchase bonds and all of your bonds will be held in one account, that you will have easy access to. This will allow you to avoid paying a broker or brokerage firm.

More advanced traders may try to buy and sell bonds to take advantage of the price movements, you can even swing trade them. But this is a very risky business if you don’t know what you are doing, you will need to take a swing trading course if this was something that wanted to, but again most people just buy and hold.

A890578432