WealthTrader: Your Forex and Stocks Market Trading Advisor!

What Are Hedge Funds?

2009-09-06T06:30:00.000-07:00

With Strategies Designed to Produce Positive Absolute Returns, hedge funds have become attractive members of the investment world. However, hedge funds carry the same investment risks as traditional investments, so it’s crucial to know your way around hedge funds to avoid making a big investment mistake.

Hedge funds are similar to mutual funds in that they consist of funds pooled by a collection of investors, and fund managers make money on the stock market using a specific investment strategy. However, unlike mutual funds, Hedge Funds don’t attempt to produce relative returns by outperforming market indexes; they seek positive absolute returns, regardless of how the overall market is performing. While mutual funds engage only in long positions, hedge funds employ speculative strategies, such as short selling and derivatives trading.

Hedge funds are aggressive, engaging in many active investment strategies to maintain a constant profit. In the long/short hedge fund strategy, short positions offset potential losses if the market declines, while long positions yield profits if the market trends up. Arbitrage hedge funds tend to engage in straight forward price exploitation strategies, such as purchasing a futures contract when current prices are low, translating to an immediate profit. These hedge funds are considered to be fairly low-risk, comparatively speaking, but they are not risk-free, and their low-risk approach means only moderate returns.

One of the more aggressive hedge fund strategies monitors current events that are likely to affect the Marketplace. Managers for these hedge funds may react to an acquisition, a distressed company or small, inefficiently organized companies. Hedge funds may buy up shares of a company in anticipation of marketplace reaction, or they may buy a large chunk of ownership in a small company and use the position to force changes. These hedge funds are difficult to predict, and their agenda may not always be transparent.

Since Hedge Funds aim for a positive return in all conditions, that ambitious goal comes at a price. To get into a hedge fund, you need to be willing to invest a high amount up front, sometimes as much as $1 million. There are hedge funds for investors who don’t have as much cash on hand, and funds of hedge funds are also an option, but many hedge funds are for big-league investors only. Then, once you are in, many hedge funds charge a high 2% percent fee and 20% percent of profits, so, even if you enjoy a good return on a hedge fund, not all the money will find its way into your pocket.

Hedge Funds and The Bear Market

While mutual funds may outperform hedge funds in a Bull Market, hedge funds are a popular investing strategy in a Bear Market. Because hedge funds focus on absolute positive performance, successful hedge funds may be one of the few ways to show a profit during a bear market. For example, hedge funds that engage in long/short strategies may be better insulated from overall market performance. But they’re still a risky investment, so keep hedge fund risk management in mind when you’re shopping around for a bear market investment vehicle.

Funds of Hedge Funds

Because hedge funds themselves are subject to volatility depending on market conditions and Investment Strategies, investing in funds of hedge funds has become a way to offset some of that volatility. With funds of hedge funds, investors come together to invest in a pool of hedge funds—anywhere from a few funds to dozens of hedge funds. By investing in many hedge funds instead of a single fund, investors minimize volatility and risk through diversification. However, if funds of hedge funds invest in too many hedge funds, performance is likely to be comparable to overall market performance, and that defeats the purpose of investing in hedge funds.

When looking at funds of hedge funds, be aware that these funds are basically subject to a double fee structure. The underlying hedge funds charge a management fee and a portion of the profits to every investor, including investors from funds of hedge funds. You then have to pay the fund of the hedge fund’s management fees and any profit sharing—which are already high—so you’re basically paying fees twice.

The Risks of Hedge Funds

Hedge Funds are lauded as a sound investment strategy even during a bear market, but the reality is that hedge funds carry just as much risk as any other investment vehicle. While many hedge funds have traditionally turned modest profits even in times of market decline, the 2008 economic issues and stock market volatility made a drastic impact in Hedge Fund performance. Some hedge funds showed a loss of over 17% in 2008, and, while that number isn’t necessarily out of proportion to overall market performance, it’s a far cry from the modest profits that hedge funds boast even in a bear market.

To Practice Effective Hedge Fund Risk Management, look for funds whose investment style is relatively low-risk. Overly aggressive hedge funds that engage in risky market strategies are more likely to cause investment losses. Because hedge funds are pools of private investors, hedge fund regulation is pretty much nonexistent. Hedge funds are not required to report to the Securities Exchange Commission (SEC) or produce any of the normal performance-related documentation required from other investments. You may not be able to get an accurate idea of hedge fund performance, and some hedge funds are reluctant to reveal fee structures and investment strategies. This is one area in which funds of hedge funds are beneficial; like mutual funds, many funds of hedge funds are registered with the SEC and provide investors with an annual prospectus and quarterly reports.

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A Professional Stocks and Forex Market Trader

Dan A.

Online Trading: Is It Art or Science?

2009-09-06T05:16:00.000-07:00

Does the average trader just need to backtest and automate a strategy to find that golden road to the land of profits? I doubt it, but there’s something there for the new trader to consider.

I’ve encountered many traders with all different approaches. Some are rules-based traders who want to see conditions A, B, and C in place before they act with orders 1, 2, and 3. Other traders seem to have no written Trading Rules, but they do very well consistently with their instincts. Take my good friend Wes across town, for example. He’s day traded for over a decade, spending countless hours watching tickers and order flow. He’s a high-volume scalper who frequently will trade 200,000 to 300,000 shares daily. He watches only a few of stocks, trades each of them many times a day and does quite well. That’s trading that can’t be taught. That kind of trading is an art.

So Where Should One Begin?

While I am not a proponent of backtesting Trading Strategies and retro-fitting the past to the future, I do think that trading by way of specific rules early in a trading career is a good idea. When a trader is first getting into the markets, there’s so much to see and learn and do. You have no instincts. Everything you read seems like a great idea and should quickly become your new approach. Having a bad day at the office must mean you need to make a drastic change, right? Surely there’s something out there that works ALL the time! No. Not even close.

The reason I like the idea of following a game plan, especially early on, is that only by being consistent can you truly measure your results accurately. Suppress those urges to fade a rally or buy a selloff, and stick to your rules. Only when you are taking the same kinds of trades consistently can you truly know over time if they are working or what needs to be adjusted vs. thrown out the window entirely. One day does not a trend make! Therefore, one day does not make or break a Trading Approach. In the beginning, it’s important to go slow and learn which approaches can prove valuable and which approaches will prove useless for you. In short, the beginning trader ain’t seen nothin’ yet, and those gut feelings he thinks he has are nothing but indigestion.

As Time Goes By, your trading style will evolve. Gut feel gradually becomes a part of your approach. You learn when to follow your rules and when to break them. It’s a matter of patience and experience, and learning to let your intuition play a role. No longer does that rally ahead of the economic release mean you should get long. Something just seems to tell you to watch for a sell-the-news reaction. That’s gut feel. It doesn’t mean that once you have it, it’s always right. Quite the contrary. Learning to trust your instincts means letting them play a legitimate role in your decision-making process, while not letting them take over and dominate.

So, take inventory of where you are. Have you done well during all kinds of markets? Have you been around long enough to know when to break your rules? If not, hang in there and follow your Trading Checklist for now. Start with making it a science, and you'll develop the feel that makes it an art. You’ll get there eventually, but trying to take shortcuts will be costly. Just remember, capital preservation is the key from day one, so starting with an approach that is quantifiable is a good idea!

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To Your Online Trading Success,

A Professional Stocks and Forex Market Trader

Dan A.

The Way To Understand The Oil Trading Market !!

2009-09-02T17:06:00.000-07:00

Oil Trading is an Opportunity for People to Make Money Behind the Computer Screen! Investing in oil takes place through one of the oil brokers, who provide the trader with trading software and market analyses. Although the oil market may look like a very complex market, there are ways for you to learn the market by heart. We will explain some simple ways to look at the market, so you get a better understanding of the basics.

You Trade Against The USD! Oil Trading is buying or selling oil contract with US dollars. In fact you are doing the same when standing at a gas station, and you trade fuel for money. But in order to buy barrels of crude oil, you need mediation from Oil Brokers. They will supply you with the virtual oil contracts so you can make a trade.

You want to become a profitable trader. Winning traders know what they are doing and always have a trading plan in mind. The most important thing is that you can forecast market highs and lows. Oil brokers can help you analyze the market and make probability estimations of the future direction of the market. In general it is wise to follow the trend, and Gain Profits from movements in the market.

You will be paying commissions for every trade. Even winning traders have to pay a price for their trading, you have to pay a premium on every trade executed. Oil Brokers will offer a slightly different price between buying and selling, which is their profit margin. This is one of the facts you will have to except as these brokers are not established to make you money. They are their to make a little money themselves and they do it by trading commissions.

You will have loosing trades. Oil trading is by some considered gambling. This is for the simple reason that you can never be a hundred percent sure which way the market will be heading. For this reason you will have to accept that there will be loosing trades, but this is not a problem as long as your winning trades offset the loosing trades. Financial management is important, and you can ask your oil broker to help you manage your funds.

Remember that this is a global market. The Oil Trading Market involves a large number of countries worldwide, if not all. Lower oil prices will lead to cheaper production prices, thus cheaper selling prices. For this reason every trader influences the global economy, but you should especially keep an eye on the bigger ones out there who can influence markets significantly. Ask your oil broker who the bigger players in the market are, and ask them for up to date economic releases.

The Oil Market Prices are just one of the determinants of the state of the global economy. Lower oil prices will lead to economic growth, which will lead to higher prices on the oil trading market. Profit from those movements via your oil broker and you might become a millionaire overnight.

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To Your Oil Trading Success,
A Professional Stocks and Forex Market Trader
Dan A.

Techniques for Advanced Online Forex Trading !!

2009-09-02T16:26:00.000-07:00

FOREX is a Potential Platform for Earning Substantial Profits! In fact it is one of the largest trading markets of the world. Featuring an average daily trade of $2 Trillion USD and above, this market is best known for its high scale trading volume and intense liquidity. Adding to this, today with the advancement of technology it can be done from anywhere of the world. Backed up by world-wide web, you can easily trade in the forex market at the comfort of your own home. However, it is important to understand that FOREX Trading is based hugely on speculation. You must be smart enough to guess exactly when the rate of a certain currency pair will rise and go down, and then buy or sell based on that. Indeed it is said that if you learn to study the speculation of this market, you will have a better chance of getting profit.

Today, it is more advanced and turned into an active investment arena, where only a factual understanding of the intricacies and complexities can make your capital grow every day. Moreover, like any other business, it also involves some amount of risks. There is no short FOREX Trading technique for success in the currency trading market, but there are some well-known techniques that can assist you formulate a good advanced foreign exchange trading strategy.

Here Are Few Essential Techniques that Can Help You Cut Your Losses and Increases Profits:

Forex Scalping:

It is a latest technique of trading where profits are taken after relatively small moves in the forex market. It is a technique where trading is done over small time frames, and smaller profits are taken more frequently. As the position exposed to the market is shorter, it automatically reduces the risk of adverse market events causing the price to go against the trade. It is a different approach to most other Forex Strategies, but still requires you to analyze the market to ensure that the set up for a trade is present. This type of trading greatly appeals to day traders and those who look to reduce the risk involved in trading currencies.

Forex Hedging:

It is a technique that helps in reducing some of the risk involved in holding an open forex position. It decreases the risk by taking both sides of a trade at once. If your broker allows it, a simple way to hedge is just to initiate a long and a short position on the same pair. Advanced traders sometimes use two different pairs to make one hedge, but that can get very complicated.

It is important to understand that much of the risk involved in holding any forex position is market risk; i.e. if the market falls sharply, your losses may escalate dramatically. So if you have an open Forex Position with fine projection but you think the currency pair may reverse against you, it is advised to hedge your position.

Forex Position Trading:

Forex position trading approach is yet another trouble-free technique to boost your position size without increasing your risk. This trading tactic is very effective with mini lots. The major highlight with this technique is that - with forex position trading your exposure to the market is less and so therefore is no need to monitor the market continuously. Moreover, you may even earn profit with negligible loss that can further boost your trading confidence. For Example- you might make a short trade on EUR/USD at 1.40. If the pair is ultimately trending lower, but happens to retrace up, and you take another short at say 1.42, your average position would be 1.41. Once the EUR/USD drops back below 1.41, you will be back in overall profit.

Today Forex Trading is all about watching your options when you make a trade. Aside from using effective risk management and extreme vigilance, advanced trading can be an alternate way to make profits and control losses. Nevertheless, these above mentioned advanced trading techniques are more about using the market behavior to your advantage. Utilizing these advanced techniques can give you the edge from other average trader.

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To Your Forex Trading Success,

A Professional Stocks and Forex Market Trader

Dan A.

Stock Market: Restricted Stocks Are Better Than Stocks Options !!

2009-09-02T10:54:00.000-07:00

Many companies are concerned by the Financial Accounting Standards Board (FASB) recommendation that Stock Options be shown on the company's expense sheet. Especially high-tech and start-up companies are concerned because they fear losing one of their great motivating tools. They needn't worry. There is already a better compensation choice, Restricted Stocks Options.

Motivation Through Restricted Stocks Issuing restricted stock is a better motivating tool than granting stock options for two reasons. First, many employees don't understand stock options. They don't know that they have to take action to realize any gain. It is far easier for them to understand a vesting period on restricted stock. Second, restricted stock can't become worthless like stock options. Even if the stock price falls, restricted stock retains some intrinsic value.

A Stock Option grant with a strike price of $10 has no value when the stock trades at $8. Restricted Stock awarded when trading at $10 is still worth $8. A stock option has lost 100% of its value. The restricted stock has only lost 20%.

Employee Ownership Through Restricted Stocks

One of the advantages restricted stock has from a management perspective is it is better at motivating employee to think and act like owners. When a Restricted Stock Award vests, the employee who received the restricted stock becomes an owner of the company. He or she has to take no further action to make it happen. The employee is now part owner and can vote at the annual meeting.

Actual ownership of part of the company is a powerful motivating tool in trying to get employees to own the company's objectives. This makes them more focused on meeting goals.

Stock Options, on the other hand, do little to instill a sense of ownership. They are viewed by most as a high risk gamble that has a potentially great reward. An individual may very well invest a couple of years helping a company grow and prosper when compensated for that time by stock options. However, their loyalty is to raising the stock price so the can cash out and make a bundle. They have no loyalty to the company and its goals. Often, they will choose actions which raise stock price in the short term, thus increasing their potential gain, rather than taking a longer-term view that will help the company.

Restricted Stocks Supporters

The LA Times reports that Microsoft plans to replace stock options with restricted stock grants. Amazon.co.uk notes that all their employees are allocated a number of Amazon.com restricted stock units when they join. The Altria Group, Inc., points out in their annual report that "in 2003, we made equity awards in shares of restricted stock rather than fixed-price stock options". Dell Computer Corp., Cendant Corp., and DaimlerChrysler AG are also reported to be moving toward restricted stock in lieu of stock options.

Manage This Issue

Restricted Stocks awards are a better tool for motivating employees than stock options. Restricted stock awards are better than stock options for motivating employees to think and act like owners. Restricted stock awards are better treated on the financial statements than stock options. That makes restricted stock awards better for the employees, management, the investors, and the regulators. There is no reason to not make that choice.

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To Your Online Trading Success,

A Professional Stocks and Forex Market Trader

Dan A.

Stock Market: What Are Mutual Funds?

2009-09-02T09:48:00.000-07:00

A Mutual Fund is a company that pools investors' money to make multiple types of investments, known as the portfolio. Stocks, bonds, and Money Market Funds are all examples of the types of investments that may make up a mutual fund.

The Mutual Fund is managed by a professional investment manager who buys and sells securities for the most effective growth of the fund. As a mutual fund investor, you become a "Share Holder" of the mutual fund company. When there are profits you will earn dividends. When there are losses, your shares will decrease in value.

Mutual Funds are, by definition, diversified, meaning they are made up a lot of different investments. That tends to lower your risk (avoiding the old "all of your eggs in one basket" problem).

Because someone else manages them, you don't have to worry about diversifying individual investments yourself or doing your own record keeping. That makes it easier to just buy them and forget about them. That's not always the best strategy, however -- your money is in someone else's hands, after all.

Since the fund manager's compensation is based on how well the fund performs, you can be assured they will work diligently to make sure the fund performs well. Managing their fund is their full-time job!

Mutual Funds can be open-ended or closed-ended. But many people consider all Mutual Funds to be open-ended, while putting closed-ended funds in another category.

"Open-Ended" means that shares are issued in the fund (or sold back to the fund) whenever anyone wants them. With closed-ended funds, only a certain number of shares can be issued for a particular fund, and they can only be sold back to the fund when the fund itself terminates. (You can sell closed-ended funds to other investors on the secondary market, though.)

Load refers to the sales charges added to a mutual fund when you purchase it. The load charge goes to the fund salesperson as a commission and payment for their research services. Load charges can be up to 8.5% percent of the selling price and can be figured in as a front-end load (meaning you pay it when you buy the mutual fund) or a back-end load (meaning you pay when you sell the mutual fund).

Many Mutual Funds are no-load funds. Yes, that means there is no sales fee charged and the fund is direct-marketed so you can buy it without the help of a salesperson. With the wealth of information on the Internet today, it is certainly easier to make smart choices yourself to save money.

In addition to "No-Load Funds", there are also funds that charge up to 3.5% percent as a sales fee. These are called low-load funds and can still be a good deal.

Mutual Funds Fall Into Three Categories:

Equity Funds - are made up of investments of only common stock. These can be riskier (and earn more money) than other types.

Fixed-Income Funds - are made up of government and corporate securities that provide a fixed return and are usually low risk.

Balanced Funds - combine both stocks and bonds in the investment pool and offer a moderate to low risk. While low risk may sound good, it is also accompanied by lower rates of return-meaning you risk less, but your investment won't earn as much. You have to decide how much risk you're willing to take on before you invest your money.

If you have invested in a College Savings Fund (529 Plans - Next to saving for retirement, your biggest financial challenge is probably saving for your kids' college education.) or a 401k Account (In 1978, Congress decided that Americans needed a bit of encouragement to save more money for retirement! The plan got its name from its section number and paragraph in the Internal Revenue Code - section 401, paragraph K), chances are good that already own a few Mutual Funds. Mutual Funds are great for long-term investments like these. You can also buy mutual funds directly from a mutual fund company.

Most of these offer 'No-Load Funds' (or sometimes low-load funds). You can find lists of mutual fund companies on the Internet and purchase shares by simply filling out an application and mailing a check. Once you are a shareholder, you will receive statements telling you how the fund is doing as well as how much your own investment is growing. You can also set up monthly bank transfers to automatically buy more shares every month.

Remember to do your research and select a Mutual Fund that fits the level of risk you are willing to take with your hard-earned cash. Then just sit back and hope for the best!

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To Your Online Trading Success,

A Professional Stocks and Forex Market Trader

Dan A.

Introduction to Commodities and Futures: What are Commodities?

2009-06-02T23:25:00.000-07:00

The terms “Commodities” and “Futures” are often used to describe commodity trading or futures trading. You can think of them as generic terms to describe the markets. It is similar to the way “Stocks” and “Equities” are used when investors talk about the stock market. To be more specific, this is what they really mean: Commodities are the actual physical goods like Corn, Soybeans, Gold, Crude Oil, etc. Futures are contracts of commodities that are traded at a futures exchange like the Chicago Board of Trade (CBOT). Futures contracts have expanded beyond just commodities; now there are futures contracts on financial markets like the S&P 500, T-notes, Currencies and many others.

Examples:

Commodity: Grains

Many of the grain commodities have been trading on futures exchanges have been around many decades and they are some of the most active markets to Trade. They tend to be most volatile during the summer months as whether can be a big market mover.

1. Corn
2. Soybeans
3. Wheat

Commodity: Energy

Used to power and fuel the country, the energy commodities are very popular futures markets to trade as many witness their uses and prices daily.

1. Crude oil
2. Gasoline
3. Heating oil
4. Natural gas

Commodity: Metals

The metal commodities maintain a couple of roles. The precious metals are used as an inflation hedge. They are also used for industrial purposes, construction and even photography.

1. Gold
2. Silver
3. Copper

Commodity: Softs

The soft commodities consist of many food products and also some industrial materials.

1. Coffee
2. Cocoa
3. Sugar
4. Cotton

Commodity: Livestock

The livestock commodities consist of meat agricultural products. They can often develop some reliable trending patterns as breeding and herd statistics give you a good idea of production numbers months in advance.

1. Cattle
2. Hogs

Futures Contract:

December 2007 Corn, which is a contract of 5,000 bushels of corn that trades at the Chicago Board of Trade with a contract expiring in December 2007. A hypothetical price for this contract might be $3.60 per bushel.

How do Futures Work?

Futures are standardized contracts among buyers and sellers of commodities that specify the amount of a commodity, grade / quality and delivery location. Commodity Trading with futures contracts takes place at a futures exchange and, like the stock market, is entirely anonymous.

For Example: the buyer might be an end-user like Kellogg’s. They need to buy corn to make cereal. The seller would most likely be a farmer, who needs to sell his corn crop. They create a contract of December Corn futures at the current market price. A contract of corn at the CBOT consists of 5,000 bushels. Therefore, the farmer would have to deliver 5,000 bushels of corn to Kellogg’s in December at a designated location.

Making Money in Futures!

A speculator is someone who invests in a business with the goal of turning a profit. In the case of commodities, speculators are traders who try to buy futures low and sell them high to Make Money. The reason why speculators can do so with futures is that traders aren’t required to hold the futures contracts for the duration of the contract; they can buy or sell anytime they want. So, to use the Kellogg’s example above, a speculator could buy the corn contract from the farmer at a certain price, then wait for the price of corn to go up before selling the contract to Kellogg’s, even if the contract won’t come due for another couple of months, turning a Profit in the process.

Players Involved in Commodities Trading!

There are three different types of players in the commodity markets:

Commercials: The entities involved in the production, processing or merchandising of a commodity. For example, both the corn farmer and Kellogg’s from the example above are commercials. Commercials account for most of the trading in commodity markets.
Large Speculators: A group of investors that pool their money together to reduce risk and increase gain. Like mutual funds in the stock market, large speculators have money managers that make investment decisions for the investors as a whole.
Small Speculators: Individual commodity traders who trade on their own accounts or through a commodity broker. Both small and large speculators are known for their ability to shake up the commodities market.

How to Start Trading Commodities?

In Order to Trade Commodities, you should educate yourself on the futures contract specifications for each commodity and of course learn about trading strategies. Commodities have the same premise as any other investment – you want to buy low and sell high. The difference with Commodities is that they are highly leveraged and they trade in contract sizes instead of shares. Remember that you can buy and sell positions whenever the markets are open, so rest assured that you don’t have to take delivery of a truckload of soybeans.

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To Your Online Trading Success,
A Professional Forex and Stock Market Trader
Dan A.

Lights of the Stock Market!

2009-06-01T14:55:00.000-07:00

There Are Red Lights, green lights, blue lights and spot lights. There are orange lights, pink light and flash lights. There are search lights and micro lights. And the one you must obey is the stop light.

If you don’t stop when the light is red you could easily have an accident and lose everything you have, even your life. These different types of lights alert us to possibilities and dangers. Is there a light that goes on that tells us whether the Stock Market is going up or down; one that is green to invest or red to sell? They aren’t very obvious, but they are out there. You only need to become aware and learn when the signal flashes.

It doesn’t take long to learn to drive an automobile, but it does require much more skill to handle an 18-wheeler. The professional driver has taken to time to learn his profession. He knows what all the lights mean. Not only the red and green, but the yellow and blue as well. There are also many light signals inside the cab that he must be aware of all the time if he is to have a safe passage.

Stock Market Signals may not be red or green or any color at all, but they are there and are obvious to one who wants to learn. The one who wants to learn is the investor who wants to protect his capital from loss and to make enough money to retire in a comfortable life style.

The most obvious signal is the 200-day moving average! You can find one of the best market signals printed every day in the Investor’s Business Daily Mutual Fund Index. When the index is above the 200MA line you are in the green and should to be invested. When it is below the 200MA line you the red light is on and you want to be in a Money Market Fund. When those signals flash and you learn to act you will become very wealthy over the next 10 to 20 years. You will not lose your money when the market is going down.

It you take the time to go back in history, say 20 years and treat the S&P500 Index as a dollar value you will quickly see that buying and selling on this simple method would have made you a ton of money. No, there is not very much trading involved. You will only be buying or selling about once each year. It will not take much of your time and you will sleep better, especially when the market is crashing and your money is safely tucked away.

Currently the green signal is on to be invested according to the IBD Mutual Fund Index. The red signal will come on that tells you it is time to sell when the index plunges below the 200MA line. Pay attention to the signals. You don’t want to lose everything!

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To Your Online Trading Success,

A Professional Stocks and Forex Market Trader

Dan A.

Day Trading Risk Management !!

2009-05-31T17:58:00.000-07:00

Not Risking Too Much Money on any given trade is essential to succeeding as a day trader. Unfortunately, when most people start Day Trading, they do not think about the risk that they are taking - only about the potential rewards. Every day trading strategy must take into consideration the maximum percentage of the total trading capital that should be risked in any one transaction.

In fact, a day trader's ability to limit his losses is just as important (or even more important) as his success in managing winning trades. Think about it. If a trader losses a small amount on every transaction, won't he stay in the game a lot longer? Taking huge losses is one of the primary reasons why so many traders don't survive in this business. Why do traders commit financial suicide this way, you may ask? If all big losses start small, shouldn't it be easy to prevent a small loss from becoming unmanageable? The answer is ""YES.""

Limiting losses when day trading involves a lot of common sense. To begin with, no trader should risk more than 2 to 5% of his trading capital on any given trade. Why? If a trader sticks to a 1% to 2% maximum loss rule, his chances of succeeding are greatly increased because it will take many consecutive losses to wipe him out and he will have more opportunities to make winning trades. If a trader would be trading a $10,000 account, he should not lose more than $100 to $200 (1% to 2%) on every position taken. Using the same reasoning, if we are dealing with a trading account that's $100,000 in size, the maximum allowable losses can be increased to $1,000 or $2,000 per trade. Based on these percentages and on the amount the price can move against the trader (determined from the charts), he can calculate the maximum size his position should have. This becomes much clearer with an example:

Position Sizing Example using Currencies:

Assume that an investor can trade a lot of 100,000 USD with a 2,000 USD deposit (50 to 1 leverage) and that he has $10,000 in an account. With this account size, he can trade a maximum of 5 lots (5 x 2000 margin deposit = 10,000), but is this a wise thing to do? Let's look into this a little further. Let's say that based on his Trading Strategy, the day trader analyzes the chart and determines that in order for him to take a long position with a potential reward of $800 per lot, he must be willing to lose $200 per lot. He realizes that if he takes a 5-lot position and all goes well, he could have a gain of $4000 or 40% (5 lots x $800 per lot = $4,000).

Using a position size of 5 lots would also require that he be willing to lose $1,000 (5 lots x $200 per lot = $1,000). Should he take the trade? Not with 5 lots! A loss of $1,000 represents 10% of his Trading Capital! How long will anyone be in business after a few consecutive 10% loses? In this example, his maximum position size should only be one lot. With one lot, he would be risking $200 (2% of his account size) to make $800 (8% return). While it might be tempting to try to make the $4,000 in one trade, it is not a smart thing to do so. Trading is all about your probability of survival. To survive, you cannot risk more than you should. Risking too much is not smart money management.

* In general, day traders with less than $10,000 should consider trading with a mini account. A forex mini account can be opened with as little as a few hundred bucks.

Position Sizing Example using Stocks:

(remember that to day trade stocks you need at least $25,000 in your account by law, so I will use an account size of $30,000 in the example below)

Assume that an investor has a $30,000 account to Day Trade Stocks. He wants to trade Intel (INTC) stock, which is at $30 a share. Based on his strategy, he determines that the stock can appreciate $1.00 during the day, but to take advantage of the appreciation, he must risk $0.50. Since he has an intraday margin of 25% (4 to 1 leverage) he can take a $120,000 maximum position in INTC with his $30,000 (4 x 30,000 = 120,000). Should he do it? Let's do the numbers. With $120,000, the trader can buy 4,000 shares of INTC (120,000 / 30 = 4,000).

If INTC moves up 1 point, the trader gains $4,000. If it drops $0.50 (his stop loss), he loses 2,000. A two thousand dollar loss represents 6.7% of his trading capital - much too big a risk for him to take. Consequently, a 4000-share INTC position is too large for his account size. Based on a 1% ($300) maximum loss, the Day Trader should not buy more than 600 Intel shares (300 / 0.50 = 600). Based on a 2% ($600) risk, the maximum trade size becomes 1200 shares.

Risk in Day Trading (or in any other form of speculation) must be controlled. One effective way of managing risk in trading is by not taking on a position larger than an account of a given size could handle. While some authors and ""experts"" have complicated ways of determining position size, these methods tend to confuse traders and slow them down. The 1 to 2% rule will keep traders out of trouble and it is simple to apply. It is common sense more than anything else. Don't become another day trading statistic - limit your losses all the time with protective stop orders!

Learn How A Retail Forex Trader, Who Never Traded For A Bank, Stumbled Onto The Simple Secrets Of "Fundamental News Trading" That Gives Any Trader Instant Profit Makeover! Click Here!

To Your Online Trading Success,
A Professional Forex and Stock Market Trader
Dan A.

Recommended Ebook: "The Forex Trading Course - A Self-Study Guide To Becoming a Successful Currency Trader" !!

2008-12-22T19:21:00.000-08:00

A pioneer in Currency Trading Shares his Vast Knowledge!

The Forex Trading Course is a practical, hands-on guide to mastering currency trading. This book is designed to build an aspiring trader's knowledge base in a step-by-step manner-with each major section followed by a thorough question-and-answer section to ensure mastery of the material.

Written in a straightforward and accessible style, The Forex Trading Course outlines a practical way to integrate fundamental and technical analysis to identify high probability patterns and trades; and reveals how to develop a trading plan and appropriate strategies for different size trading accounts; how to control emotions and use emotional intelligence to improve trading performance; and much more.

Filled with in-depth insight and practical advice, The Forex Trading Course will prepare readers for the realities of currency trading, and help them evolve and achieve success in this dynamic market.

About The Author:

Abe Cofnas (Orlando, FL) has been the forex trading columnist for Futures magazine since 2001. He formed Learn4x.com - one of the first Web-based interactive training sites devoted to forex trading in 2001 as well. Cofnas is also founder of CurrencyGames.com, a forex education and entertainment company.

From The Back Cover:

"In addition to satisfying those with a healthy obsession to work on improving their professional skills, The Forex Trading Course will force readers to think outside the box and to develop an appetite for the pursuit of knowledge about trading."

- From the Foreword by Dr. Steve H. Hanke, Professor of Applied Economics Johns Hopkins University

"Abe Cofnas puts his outstanding credentials to work as he shares with readers a solid educational program in The Forex Trading Course. He delivers a straightforward explanation of the fundamentals that drive FX markets. He gives a detailed description of vital technical analysis tactics, including what set-ups to look for, trend line breaks, Fibonacci analysis, and my favorite, pivot point analysis. He ties it all together to teach traders various trading styles, from a scalper to a position trader, who want to capture longer-term trends for maximum profits. His strategies on stop-loss placement and profit targets are mandatory components that all traders will benefit from . . .immensely. Study this book. Read it and practice these principles. This book delivers the steps to success for all serious FX traders."

- John Person, author and President, nationalfutures.com

"I believe The Forex Trading Course is the best single resource available if you are serious about learning how to be successful in the forex market, whether you are a short-term trader or a long-term speculator. In this book, Abe Cofnas does what few can, he fuses together the key fundamental and technical analysis tools into an understandable framework that will allow you to develop and apply a comprehensive trading methodology that works over time. And as most real-life traders will tell you, that's the best you can do."

- Jack Crooks, President, Black Swan Capital

...Download The "Forex Trading Course - A Self-Study Guide To Becoming a Successful Currency Trader" FREE Now! ($45 Value!). CLICK HERE.

To Your Online Trading Success,
A Professional Forex and Stock Market Trader
Dan A.

P.S: If You Want to Learn More About Successful Ways for Trading In Forex, Take The First Step!...By Visiting HERE.

Stocks Trading: Finding Solid Companies to Invest In !!

2008-12-07T03:02:00.000-08:00

Before You Start Reading Stock Charts Upside Down -- to determine which are accumulating or distributing, and when to buy or sell them – there is the issue of finding solid companies to invest in.

You may have heart about "Fundamental Analysis", which just like technical analysis could be made so overwhelming that you rather give up than start taking investing seriously…Some investment managers and writers about investing would argue that it is essential to learn to read the balance sheets and income statement of companies; to assess the quality of management; to call or meet with management, to correctly estimate the intrinsic value so as to know when a stock is undervalued…Tons of books on fundamental analysis could put you back into study mode for years.

Fortunately, a lot of that has become unnecessary since the publication of "Investors Business Daily". In the newspaper that William O’Neil pioneered you can find a lot of analytical data (notice I wrote "data", not "intelligence") that narrows down the number of companies you should investigate. In fact, the IBD 100 list, published every Monday in IBD, reduces some 10,000 companies listed on the exchanges down to one hundred worth your time.

How do you then pick out of these 100 a watch list of 10 to 12 stocks from which you select two to four to buy when your Chart Reading tells you it is time to buy them? I’ll spell out my approach, which does not entirely follow what Mr. O’Neil wrote in his books or tells in his workshops, but as any guru in the field he has a tendency to make things more complicated than necessary. Why else would so few women attend his workshops?

Let’s start with Earnings Per Share (EPS). IBD provides a ranking of companies based on EPS. If a company does not rank in the top five or ten percentile (meaning a score or 90 or higher), it should not belong in your watch list. The EPS rankings of all stocks can be found daily in IBD.Next, look at relative strength (RS) and group RS ranking. The RS should be bigger than 80 and increasing and the group RS ranking should be at least 85.

Next look at sales growth and earnings growth per quarter. Without sales it is impossible for a company to make earnings; so both sales and earnings growth better be growing more than 25% quarter to quarter. Earnings growth over time and return on equity should at least be 20% or higher. Management should still have a significant stake in ownership (20% or more), and an increasing number of institutional shareholders is also something to look out for.

Finally, my personal preference goes to companies that produce a product or service you understand. As I am not a chemist, biologist, pharmacist, material specialist....I shy away from companies that produce services or products that I do not understand. This does not mean I stay away from all technology. For example, I understand what a GPS system is, how useful it is for navigation and many other applications, so Garmin (GRMN) is a stock that fits in my criteria.
If you apply these simple criteria to the IBD 100 list you will quickly reduce the list down to a watch list of a dozen or so. Out of these the ones the two or three to buy are the ones that are accumuatling and come within 5% or less of their buy point, which you find through your chart reading, When there is a spike in volume and a significant price increase you buy the stock right at its Buy Point.

In spite of all the efforts by Bill O'Neil and company, not many people following this approach. Lots of investors who are just starting out take the IBD 100 list, pick the Top Ten Stocks and invest in several stocks from that shortlist. This is the worst possible use of IBD 100. Remember, IBD provides "data", that only you can transform into intelligence for your best advantage.

To Your Investments Success,
A Professional Stocks and Forex Market Trader
Dan A.

P.S: I hope that 2009 is a breakthrough year for you in every aspect of your life - including trading! Sign up for your FREE trial to our Stocks Trading Newsletter and see if you aren’t closer to reaching your goals in 2009! Go Here.

Investing In Gold! How To Go About It?

2008-12-07T01:26:00.000-08:00

GOLD continues to be a popular form of investment right for a very long time. People prefer to invest in gold because the returns are usually high and above all gold is a very famous ornament. Even if they don't get good returns they wont face losses because their cosmetic purposes will be served. Some tend to posses gold even as a matter of prestige. It is regarded to be a good source of investment as it controls inflations and even helps you to raise finances in the future.

Gold Markets!

Gold is traded in many markets around the globe. London and New York are supposed to be large markets for gold and they function through the day. It is worth mentioning that Kong Kong and Zurich market are also open to trading for 24 hours. The gold market functions like a stock exchange in l aspects of buying selling and determination of prices though the fact remains that different factors influence the price.

World Gold Council!

World gold council is a forum of gold producers around the globe. The basic objective of this body is to disseminate information regarding investing in gold and also to create an awareness among the masses. They also lay down lot of guidelines for small scale producer's traders, consumers and other stakeholders. The association is headquartered in Geneva.

Is Investing in Gold a Good Idea?

If you are thinking of returns or results in the short term then gold is probably not the right option. Investing in gold is no doubt a profitable option as it can be quickly converted to cash. It is a convenient as you can carry it easily wherever you go unless the quantity is very high. Since the performance of gold market s directly proportional to stock market it becomes easy to make calculations.

Gold - A Precious Metal as Investment!

Gold enjoys innumerable advantages over other metallic forms. Platinum investment is very risky and moreover it is not easily convertible to cash. If you take the case of silver, it does not enjoy huge prospects in terms of financial gain. Moreover silver occupies lots of space when compared with gold and so you it can cost you more for transporting. This should sound out to be worthless propositions given the monetary benefits are not promising.

Factors to be Considered Before Investing in Gold!

You need to be very careful about investing in gold because unlike stock or other markets you don't have the option of investing a small amount. You must do lot of research and have a strong knowledge about the market information. You must decide how you are going to allocate it in the portfolio. Some investors choose to invest only in gold and not in any other sources. However this practice won't be suitable for all. Therefore you must first check up if you are falling under this category. Some other issues that are to be considered are as follows:

Factors that Influence Gold Price!

Like any other resource the supply and demand constitutes to be an important factor in determining the price of gold. Since gold is a precious asset people even hoard it and its demand and price could increase drastically during inflation and even when there are wars. The price of gold shows an upward trend in most cases irrespective of the consequences due to the sentiment which people owe to the metal. They are prepared to pay any price for it.

Gold Investment Strategies!

Some of the investors prefer to buy gold when the price increases because of the popular belief that it will increase further more and they can make profits by selling them thereafter. Other investors choose to buy gold when prices decline so that they can sell them at a higher profit when the prices increase. Another group of investors will make their decisions by testing if the current trend in pricing changes or not.

...Sign-up Now to Our Weekly Penny Stocks Newsletter to Get out the Newest Stocks Recommendations Portfolio Additions Emailed to You, Before the Public Knows the Stock is Moving up and Wants in! GO HERE.

To Your online Investments Success,
A Professional Stocks and Forex Market Trader
Dan A.

Stocks Investment: What Is a "Retained Earnings" Account?

2008-12-07T00:42:00.000-08:00

A Special kind of account, called "Retained Earnings" is an interesting and important account. Most business people know it better as "Net Profit". Net Profit is, of course, your total income less your total expenses. For example:

Sales: $1600.00 USD

Cost of stock: $1200.00 USD

Operating expenses: $300.00 USD

Net Profit: $100.00 USD

So, after this series of transactions $100 profit is made. Since net profit is usually the same as retained earnings (they are not always exactly the same and this point is discussed later) and retained earnings is a liability, then it would seem net profit is actually something we don't want...Of course, this liability is a special case. It is not money owed to our suppliers, but money owed to "us" (since the company must issue its profits to its owners). In this case, from our perspective, this is a "good" liability. In reality of course, the company may decide to keep the profit as a reserve because its managers are expecting additional expenses next month, and so on. The Net Profit or retained earnings may be eaten up before the firm gets a chance to issue it to its owners.

From an accountant's perspective, operating a general ledger involves shuffling numbers between sets of asset and liability accounts. Obviously, the higher the numbers on the assets side, the better. These types of accounts are referred to as balance sheet accounts.

One of the key concepts that accountants use to ensure that they don't miss anything when updating account totals is that of balance. Every monetary transaction involves the interaction of at least two accounts. Let's write the above example out again in a form that an accountant would be slightly more happy with:

Sales: $1600.00 + (increase by)

Stock levels: - $1200.00 (decrease by)

--------

$400.00 -

Operating expenses $300.00 (deduct expenses)

--------

Net Profit: $100.00

In the above all the amounts that make up the transaction have been accounted for. Sales have been increased by $1600. We therefore need to offset this $1600 against other accounts that balance to $1600 also. This was achieved by deducting $1200 worth of stock (or increasing the cost of the sale by $1200 depending on how you look at it), increasing operating expenses by $300 and Net Profit the remainder. The principle of balance will be discussed in greater detail in the next section when we get to debits and credits. For now, lets continue to look at retained earnings.

The major problem dealing with only asset and liability accounts is that while they tell us how much we owe and how much we own, they don't tell us how we arrived at this situation. If the retained earnings account holds $10,000 what did we do right to arrive at this figure or if the balance is negative $3000 what did we do wrong?

In order to determine how the final total was made up, it is common accounting practice to expand the retained earnings accounts into income and expenses. Income, revenue or sales are usually thought of as assets and expenses, overheads or costs are thought of as liabilities. However, they are not quite the same thing. We don't really owe money to the "vehicle maintenance" expense account, we owe it to Joe's garage, for example. Likewise, we don't strictly speaking, get money from a sales account, we get it from a customer's account when they pay their bills.

...To find out More how You can Become a Profitable Trader on a Consistent Basis, Please VISIT HERE! - You Will Learn Valuable Ways and Tips to help You Make Money Trading the Stock Market !!

To Your Online Trading Success,
A Professional Stocks and Forex Market Trader
Dan A.

How to Become a Trader - Initial Tips !!

2008-10-12T21:08:00.000-07:00

How to Become a Trader Depends on YOU!

It depends on how much you want to invest in time, money, learning and frustration until you are eventually satisfied with your efforts. Nothing beats the sense of achievement every time you trade successfully and the more consistently you trade profitably the 'better' you become at it. Success often breeds success and this is especially true in the forex market.

Anyone can be a trader but what about a profitable trader?

A Profitable Trader is therefore, what you want to become. Well, as with most things in life, profitable trading does not come through luck and 'Fancy Systems' - although these sometimes help! It comes from perseverance, trial and error and most of all a belief in ones abilities.

This is not some 'revved up pep talk' but a fact. I have never known a successful (profitable) trader that didn't believe in his/her own abilities. Please don't confuse this with arrogance - it's not, what it is is 'self confidence'. If you are not confident in your own abilities then how are you going to be confident in the trades that you make let alone anything you do in your life.

The First Tip:

The first step therefore is to look at yourself truthfully. Ask yourself these vital questions.

I. How do you cope with failure? Each position where you lose money on is a failure and you will have many of these.

II. Are you a risk taker? If not then don't trade, as you will be taking risks every day and some will involve the loss of you own money.

III. Are you a fast learner? You will need to be otherwise you will run out of money and lastly are you in this for the long haul and truly want financial independence?

...You Need to Answer these Questions First!

I apologize if I appear to be a 'devils advocate' in this article but is essential if you want to become a successful trader.

There are other skills that you must learn on how to become a trader - you will need to sharpen your edge such as acquiring a detailed knowledge of the forex market, for example, pips, spreads, technical analysis, trading platforms, trading signals and fibonacci retracements and so much more. You should immerse yourself in joining forums and 'preparing' yourself for success. Do not dive in at the deep end before learning to swim!

...To find out More how You can Become a Profitable Trader on a Consistent Basis, Please Visit Here! - You Will Learn Valuable Ways and Tips to help You Make Money Trading the Forex Market!

To Your Online Trading Success,
A Professional Forex and Stock Market Trader
Dan A.

Economic Recession and How To Deal With It!

2008-10-12T20:39:00.000-07:00

Economic Recession may be a new term in your ears but in essence, it is actually a common economic term used to refer to the slowing down of economy. You see, a country's economy follows a natural cycle. Sometimes it's up and sometimes it's down. You just don't realize that it's happening because it has not gone this bad since the wall street crash decades before. Now, United States is feeling the heat once again with the rising costs of living and transportation as well as the crash of the real estate industry and just recently the crash of the top banks in the US.

During these times, all you can do is to hope and pray that you will still be able to keep your job and survive the recession until everything is ok again. To do this, you need to save up and make sure that you are ready for every eventuality. Here are some tips on how to deal with every American's concern right now.

1. Be Prepared

What you know cannot kill you. There is nothing wrong and being prepared for potential problems. Even if right now, you don't have any problems financially, it pays to get ready for the coming challenges. You can do this by saving up some money and putting them in the bank. That way, you can use something for the rainy day.

Think of other ways that you can be prepared and plan around it. Look at your expenses every month and check where you can cut off the extras. With them side by side, you will know just where you are overbudgeting. This is also an excellent way to plan and save for future expenses like for instance, your children's tuition fees.

2. Save with Your Consumption

Another way to do this is to make sure that you will be spending less for the household. You can do this by cutting expenses that are not necessary like in luxury items such as clothes, entertainment, trips. If you don't need it, don't buy it. Only purchase the items that you know you will be using.

You should also save with your consumption of electricity, gas and water as these are areas that you may not notice you are overbudgeting but usually you are. For instance, ironing clothes piece by piece and not by bulk consumes more electricity. The same goes with leaving the door open when the airconditioning unit is turned on. Always make sure that you turn off the TV after watching it or to be sure, purchase a unit that has a programmable on and off button that you can use. There are also airconditioning models and heaters that you can buy that have this feature.

3. Don’t Panic!

Economic recession as mentioned to you is a cycle and usually it will have an end. There is no need to feel panicky and feel that all hope is already lost. The more that you feel the panic, the more problems you will have because panic can make you do things without thinking about it or make you so nervous you will be mentally blocked out. So just ride the waves and go with the flow. You'll never even feel that it's there.

Recommended Ebook: 'Recession Survival: How To Profit From An Economic Recession'!...Download it FREE Now! Click Here.

To Your Stocks Online Success,
A Professional Stocks and Forex Market Trader
Dan A.

P.S: Looking to Make Serious Profits from the Stock Market in the Economic Recession Times? Go Here.

Getting Prepared for The Trading Day !!

2008-10-12T19:54:00.000-07:00

With the Great Challenge of Facing the Stock Market each Day and the hope of pulling money out of it on a regular basis, a trader can do few things more important than prepare adequately. It should be no secret that many of the brightest minds in the world are at work to make their living in the stock market, and such competition cannot be taken lightly! Furthermore, while traders should not be in the prediction business, we must certainly have a game plan.

As time progresses, a trader will inevitably learn from his mistakes. This experience is the foundation for laying out a game plan in preparation for the Trading Day. Merely being a student of the market and of one’s own results will teach a trader to react certain ways to market conditions or events. It is this foundation which should be built upon in order for the trader to elevate his game to the next level (and it IS a game).

In order to develop a trading plan, a trader must begin with his personal style in mind. Swing trading involves a plan that may evolve over the course of a few days to a few weeks, while day trading can be faster-paced and more spontaneous. Personality, patience, and profit objectives will play a large role in which style of trading one may wish to employ, but the trader should choose his method as he plans for success.

Once the trading style is known, the trader must take into account current market conditions. Are recent days or weeks characterized by lasting trends, or by narrow ranges and choppy action? Knowing the answer to this question will put you miles ahead of many other traders who walk in each morning without taking current conditions into consideration. The market will catch you off guard as it changes its rhythm or volatility, but recent history serves as a guide until things change. This means choppy, low-volume, range-bound markets should likely be approached with smaller positions and the expectation of taking profit more quickly and in one piece. A trending market with larger range days and greater volume allow the trader to take bigger positions in hopes of scaling out in pieces as the market moves in the trader’s profitable direction.

Whether After the Market Closes or early in the day prior to the market’s open, some time should be spent determining an IF/THEN strategy for the upcoming session. Some traders may subscribe to a swing trading newsletter or converse with other successful traders, while others prefer to do their own research. One excellent way to find the following day’s trading list is to screen for stocks which meet custom criteria for price, volume, volatility, etc. An affordable stock charting software program will quickly narrow a large list of stocks down to a specifically filtered handful of trading candidates. The DoublingStocks Inc. 'MARL' is one such program, and it will scan thousands of stocks in just seconds or sort them by more than 100 included criteria or unlimited custom criteria. By screening for a handful of potential trades, the decision-making process is simplified and a plan is easier to carry out.

Consider finding a list of trade candidates for both the long and short side of the market, setting specific entry and exit prices, and then simply execute that plan. IF the long candidates rise to your entry prices, THEN purchase them. IF the short candidates break the levels of support you see, THEN short-sell them. IF none of your trade candidates trigger their entry prices, THEN do nothing! This kind of game plan will allow you to effectively respond to market conditions without having to predict direction or hope to be bailed out of losing positions. Approaching the market with the IF/THEN mentality also will help the trader to execute a plan, rather than fight the emotional urges to find excitement or force trades. Sometimes things will work exactly as planned and other times the market will whipsaw you right out of positions. Meeting the market with a game plan and sticking with it will undoubtedly allow the trader to work with less stress and emotion, which are two of the worst negative forces that traders face.

Feeling Well Physically is a very important trait which must be present for a trader to profit. Staying healthy and rested allows the trader to work with a clear mind and focus on the task at hand. Additionally, personal relationships can play a large role in a trader’s effectiveness. When life is rocky away from the trading screens, the successful trader must be willing to cut back on trading size or even back away from the market entirely. A prideful ego will not only cause rough waters on the home front with relationships, but it will also damage the trading account! A clear conscience allows quality rest and a fresh start each morning for returning to the market sharp and ready. Make the most of your weekends to catch up on personal to-do’s and relaxation. When Monday arrives, if you aren’t at your best, don’t expect your trading to be!

Finally, as the morning breaks and the market’s opening nears, follow a routine to get into the proper state of mind for following your plan. This may include reading up on current events, reviewing your charts one final time, grabbing your morning caffeine, or listening to your favorite song. Whatever it is, find what works for you when it comes to getting into the best mindset to extract profits from the market. Remember, the competition is serious and fierce, sharp-minded, and most of all, prepared. You should be too!

...I HOPE that 2008 is a breakthrough year for you in every aspect of your life - including Trading! Sign up for your FREE Trial to our Stock Newsletter and see if you aren’t closer to reaching your goals in 2009! Go Here.

To Your Stocks Trading Success,
A Professional Stocks and Forex Market Trader
Dan A.

"DoublingStocks" Review: What Is It and Who's Behind It?

2008-10-12T18:46:00.000-07:00

IF YOU ARE a novice in investing in stocks and don’t know where to start then 'DoublingStocks' is just for you. 'DoublingStocks' is a newsletter that is backed by an intelligent software, which was developed by two computer geeks by the name of Michael and Carl. they had designed a stock analysis software program for Goldman Sachs; a program that nets them $4 Billion profits a year!

The software consists of a stock picking robot program called 'Marl'. This robot program analyzes each and every stock in the market using the technical analysis. The analysis is done on the prices of the stock and the pattern in which the stock prices have risen or gone down and then uses the same analysis to predict the movement of stocks in the future. The bot in the software searches on the net for top stocks worth investing for and shows you the results in a table format. It automatically ranks the stocks according to their returns and gives you an instant idea as in which stocks you can invest your hard earned money.

How 'DoublingStocks' Works?

The 'DoublingStocks' recommendations spell out what stocks to buy and why. They also give you the entry point (what price to pay) and a target price (when to sell). I find that these picks are usually a week or more ahead of anyone else picking them up and recommending them. Which puts those of us who have bought, on very solid footing.

After using 'DoublingStocks' many people have experienced a jump of about 84% in their returns. Now isn’t that really a lot of money? Michael knew that investment derivative companies such as Sachs and other large investments firms manage portfolios worth millions of dollars of firms such as Google and Coca Cola. However their scope of investment in stocks is limited to just a few large firms.

'DoublingStocks' is capable of showing stock trading chart patterns as well which becomes easier to comprehend. For example, when the price of the stock is displayed in the form of a chart you can easily spot the pattern of the stock (instead of merely seeing figures and trying to understand). 'DoublingStocks' uses its own database to scan all the stocks that are listed on the OTC and Pink sheet exchanges.

The software will then narrow down on stocks that look bullish in the near future and display signs of rising prices. All these stocks are added to the watch list of the software so that you can follow these stocks in the near future.

The software has the capability to monitor hundreds of stocks at the same time. After watching the current patterns of the stock, the software automatically develops the capability of the most likely direction that the stocks will follow. 'DoublingStocks' also has the capability of analyzing the average price that a particular stock is positioned at. If it finds any difference in the rise or fall of the stock even marginally (like 50 cents) then it start scrutinizing the stock in detail.

Therefore, you will see how 'DoublingStocks' help people make a perfect decision in investing & trading the stocks and reaping rich rewards from it.

Unlike any other professional stock trader which can analyze one stock around eight to ten seconds, 'DoublingStocks' can analyze up to seven charts per second! Hence the software is extremely selective in choosing only the best stocks to recommend to the investors.

Who Should Not Subscribe This Great Newsletter?

As you know that every coin has two sides and so does 'DoublingStocks'. The software is not for you in case you want to learn more about the share market and want to gain a broader view of it. The software only displays the stocks that perform and provides little information about other stocks. Hence 'DoublingStocks' is not recommendable for people who are still struggling to understand what is stock market.

This has got to be the least expensive newsletter out there. And I am guessing that is why some people think it is a scam of some sort. They can't believe this kind of information can be so cheap without some kind of a catch. But I have found 'DoublingStocks' rivals those costing thousands of dollars a year! And most of the people I know, they get the entire cost of the subscription, plus a substantial profit on their very first trade!

Isn't that Sounds Amazing?

If 'DoublingStocks' has any openings left when you read this, give it a try. If it turns out not right for you, they will give you your money back. So you really have nothing to lose; and that is unique in this business. The expensive newsletters won't give you your money back no matter what.

...YOU Can Try The 'DoublingStocks' Newsletter, Absolutely FREE For 8 Weeks! Start By Signup Today !!

To Your Stocks Trading Success,
A Professional Stocks and Forex Market Trader
Dan A.

Use a Forex Expert Adviser and Put Your Forex Trading on Autopilot !!

2008-09-23T08:01:00.000-07:00

DID YOU KNOW that while you have been trading forex from your home computer, you could have been having a robot do the same exact thing for you? Yes that's right I said a robot but the proper term for them is called an Expert Adviser (EA). These expert advisers are developed to be run within your MetaTrader 4 software which enables them to make trades for you on complete autopilot.

This is where it starts to get good for you. You see, the forex markets are open 24 hours a day Monday through Friday. This gives many people the chance to trade at any time of the day that they have the chance to. While this may be convenient for most, it doesn't leave that much time for someone to make the most money possible while forex trading. This is where the Expert Adviser comes into play.

When you use an Expert Adviser you are able to leave your forex trading software alone and running on complete autopilot. This will let you handle any business you need to attend to throughout the day while you know that you have a robot working for you making you money. It feels good knowing that you can do what you want during the day and you are making money without having to lift a finger.

If you want to get serious with forex trading (there is no reason why you shouldn't), you should look into getting yourself an expert adviser. There are so many to choose from that you will certainly find one that suits your needs.

...I am an experienced forex trader who now uses an Expert Adviser (EA) called The 'Forex MegaDroid' to make my trades on complete autopilot. It has increased my profits dramatically and I recommend you read my review on The 'Forex MegaDroid' (EA) By Going Here.

To Your Forex Trading Success,
A Professional Forex and Stock Market Trader
Dan A.

What Is Penny Stocks Investing?

2008-08-17T21:46:00.000-07:00

PENNY STOCK is low price share with broad range of market capitalisation. Though penny stocks’ prices are the same as small cap stocks, mid cap stocks or micro cap stocks, they are different altogether. If small cap stocks are companies with $300 million to $2 billion market capitalization, penny stocks may have as high as $4 billion worth; although their stock prices are similar. This can happen if high market capitalization companies decided to issue many shares or to split their stocks to maintain its attractiveness to stock market investors and traders.

But most of the time, Penny Stocks are new companies that just get listed in the stock exchange. This makes almost all the small cap stocks are penny stocks indeed. Because of their smaller capital base, these companies are generally more vulnerable than larger companies during economic downturn.

Why Investors Get Hooked to Penny Stock Investing?

Stock market investors like to make quick gains from its price volatility. Moreover, due to its nature of very cheap in price, stock traders often bought them in very large units. Sometimes, one per cent price fluctuations enough to make millions of dollars.

...That's how profitable it can be.

However, most of penny stocks are under researched and received very low media coverage. Due to not having much publicity, these stocks can be easily syndicated by professional speculative investors. Moreover, it is not easy for average stock investors to verify if the rumours or some ‘Insider Tips’ are true. And because it was heavily syndicated, regular trend from technical analysis won’t work that easy. Due to these very high uncertainties, penny stock investing can be very risky for novice stock investors. Nevertheless, you can still make money from penny stocks from the following approach.

4 Ways to Pick Winning Penny Stocks!

Fundamental Analysis:
Good stock picks from fundamental analysis should consider earnings potential, revenue growth, debt loads, positive cash flows and other important financial ratios. Extensive study of the company’s financial statements is inevitable to discover the best medium to long term stock investment opportunities. To make money in penny stock investing, you must buy the one that have the most effective management and making the most money at the same time.

And don’t forget to compare the standard financial ratios with other stocks in the same industries to predict which companies are destined to be successful. Good fundamental analysis of penny stocks can unleash the two per cent companies with superior stock investing opportunities. They are so profitable that can give better return than 90 per cent of the blue chip stocks.

Undervalued Stocks:
It is not uncommon to see share prices slide dramatically. This has a lot to do with weak market sentiment than the underlying fundamental values. And today’s seamless communication through the internet, information from China can travel to US as fast as a blink of eyes. If this happen, you shouldn’t avoid the stock market, but take advantage on the undervalued stocks instead. Calculate its intrinsic value and buy the stocks if the share prices where within its margin of safety.

Technical Analysis:
Under normal situation, technical analysis able to discover repetitive price trending of penny stocks. These patterns can reveal profitable penny stock trading by buying stocks with high probabilities of moving upward. With all the available technical indicators, you can make money even if the stocks are flat but are traded within some trading range.

Promotional Stocks:
Promotional stock is a common penny stock that is heavily promoted by promoters who have substantial holding in the stock itself. The promoters generate market interest for the stocks in an attempt to drive the price higher. Once the stock prices are at the desired level, they sell their holding and generate substantial personal profits. Then, they simply move on to another stock and leave the original stock and its investors behind. Without any further promotion by new shareholders, the stock price will soon collapse.

The promoters are frequently moved in a group. They form a syndicate with other interested wealthy speculators as well as other professional hedge fund managers. To make money from this type of stocks, you need to participate early in the stock cycle and ride on their promotional effort. Otherwise, you’ll lose fortune against them!

...Find Out What The Secret Weapon of The 'Penny Stocks Market' is and How You Can Use it by Visiting HERE.

To Your Stocks Trading Success,
A Professional Stocks and Forex Market Trader
Dan A.

Forex Trading: Why You Should Invest!

2008-08-15T10:22:00.000-07:00

FOREX TRADING is an extremely lucrative investment option where money can be made 24 hours a day via investing in foreign currencies. The forex marketplace is simpler in terms of product (currencies) you can invest in when compared to other investment options such as the stock market.

As mentioned the foreign exchange market is constantly trading - as the sun sets in one country, it rises in another. What happens to one currency, directly affects another - and the gains are not always inherently good or bad.

Banks are most commonly the source the source of currency trading, as millions of dollars are traded daily. So the question must be asked, should you get involved in forex trading? If you are already trading in the stock market, you would have a reasonable grasp of concepts you need to trade successfully.

Trading on the stock market essentially involves investing money in companies and watching how they consequently perform. In Foreign Exchange you are basically buying and selling foreign currency, and monitoring swings and trends giving you signals when it is profitable to buy and sell. Using forex trading software is a great way to get a feel for the marketplace. You will almost always be supplied with a demo account which will allow you to be involved in the market without risking any of your own money.

Software such as 'Forex Killer' allow you to create such demo account's, but also supply users with credible trends and signals, which literally tell you when to buy and sell on the stock market. You can see the software in action via the demo option, to see if your trades are going to be profitable. Further to forex trading software, broker's most certainly have a place in currency trading.

To be involved in the foreign exchange market as an individual you require a broker or institution to represent you...Individuals are also called spectators, as the amount of money they invest is tiny compared to governments and institutions. Having only a small amount of money is not a reason to not invest, a forex broker can assist in determining what your best options for investing are. Specifically in the US there are strict guidelines as to who can operate as a broker. Always be wary and careful of scams- specifically on the internet.

Conclusion:

The Foreign Exchange Market is a fantastic investment option from every angle. The main reason being there are not too many options for investment on the market, simplifying the process of making profitable decisions. Further to this the use of forex trading software and broker's can greatly assist trading, and further increase profitability.

...Want to Learn an Amazing Breakthrough Forex Trading System Which Will Help Skyrocket Your Trading Profits? Please Go Here.

To Your Forex Trading Success,
A Professional Forex and Stock Market Trader
Dan A.

Recommended Book: "How I Made 2 Million In The Stock Market" - By Nicholas Darvas

2008-08-15T09:56:00.000-07:00

Why? You must, absolutely MUST, read, re-read, study and think about every line in the book "How I Made $2 Million in the Stock Market".

Well let's start with the fact that Nicholas Darvas (the author) turned $25,000 into $2,25 million by scanning the newspapers in just five minutes during the late, night early morning, period. He him-self said it wasn't so much the amount of money he made that pleased him but the ease and peace of mind it was achieved. It was SO easy.

Admittedly, he was lucky in that he traded his system during a roaring bull market. But his system makes money in all market conditions. It's just a fact that you'll make a lot more during a run-away bull market. That can be said for most systems.

Nicolas Darvas had the perfect attitude for trading. When he was wrong on a trade he shrugged his shoulders, cut his losses and looked for the next one. No second guessing. No emotion. No ego involved.

Without doubt Darvas' best quality was his ability to question everything. When he was wrong, why? What worked and why? What didn't work in the stock market and why? Question everything and eliminate what doesn't work. He pieced together a system that fitted his personality. The person who can do this will be a big winner in the markets.

Darvas' methods still work and always will work. If it stops so will the stock market. So if your serious about taking control of your investments and are willing to spend the time necessary, Darvas advise will be well worth the effort.

And as an added bonus, not only is this book filled with great infomation but it reads like a highly entertaining novel ' too. It's hysterical when news of his success leaks out and TIME magazine sends three different sets of editors down to interview him before they finally decide he is for real...I won't spoil it for you though!

To Summaries..."Read How I Made $2 Million in the Stock Market". Free Download Here.

To Your Stocks Investments Success,
A Professional Stocks and Forex Market Trader
Dan A.

Foreign Exchange {Forex} - What is it?

2008-08-13T17:07:00.001-07:00

The International Currency Market Forex is a special kind of the world financial market. Trader’s purpose on the Forex to get profit as the result of foreign currencies purchase and sale. The exchange rates of all currencies being in the market turnover are permanently changing under the action of the demand and supply alteration. The latter is a strong subject to the influence of any important for the human society event in the sphere of economy, politics and nature. Consequently current prices of foreign currencies evaluated for instance in the US dollars fluctuate towards its higher and lower meanings. Using these fluctuations in accordance with a known principle “buy cheaper – sell higher” traders obtain gains.

FOREX is different in compare to all other sectors of the world financial system thanks to his heightened sensibility to a large and continuously changing number of factors, accessibility to all individual and corporative traders, exclusively high trade turnover which creates an ensured liquidity of Traded Currencies and the round - the clock business hours which enable traders to deal after normal hours or during national holidays in their country finding markets abroad open.

Just as on any other market the trading on Forex, along with an exclusively high potential profitability, is essentially risk - bearing one. It is possible to gain a success on it only after a certain training including a familiarization with the structure and kinds of Forex, the principles of currencies price formation, the factors affecting prices alterations and trading risks levels, sources of the information necessary to account all those factors, techniques of the Analysis and Prediction of the market movements as well as with the trading tools and rules.

An important role in the process of the preparation for the trading on Forex belongs to the demotrading (that is to trade using a demo-account with some virtual money), which allows to testify all the theoretical knowledge and to obtain a required minimum of the trade experience not being subjected to a material damage.

...For The Most Recommended Forex Trading System, Please VISIT HERE.

To Your Forex Trading Success,
A Professional Forex and Stock Market Trader
Dan A.

Stocks Trading: Beating The Stock Market !!

2008-08-12T22:40:00.000-07:00

"Many people dream about beating the market through their stock investments. However, is this really worth the effort and is it really possible?"

Many have attempted to beat the stock market and only a few have managed. Some pundits have gone a step further to claim systems that guarantee this. Nevertheless, beating the market may not be the best goal that you can set for your stocks. The reason for this is that there are a number of other considerations that should be made.

People are generally unclear about the meaning behind the word “Market”, which leads to its different definitions. Different indexes are used when referred to the stock market one of them being the S&P 500. However, this index fails to objectively present all of the stock sizes.

Beating The Market requires the undertaking of various Stocks Deals that enjoy short term benefits. Some experts recommend that you purchase companies that have high customer satisfaction attached to them. There is logic behind this argument, because when clients are satisfied with the product or service of a particular company they use it and become loyal to the company. As a result, the returns increase as well as the popularity among investors. The price of the stock of the company will be also influenced in an upward direction. If you have managed to invest in the company while its price was still low, congratulations you have managed to beat the market.

If you fail to walk away of the stock market when the right time has come you may put your money at risk. And what actually happens is that instead you beat the stock market you are beaten by it. Beating the market requires you to know when is the right time to enter it and when to exit it. You should learn its indications and not only notice them, but also understand the signals that they send to you.

No matter how good you may be at such things, you should consider whether it is worth risking your money for such a goal. Beating The Market may reward you very well, but you should never forget that its punishment can be even higher. Winning several hundred dollars from the stock market today may result in their loss tomorrow. Because, even if you have done it once, beating the stock market twice cannot be guaranteed for sure. No matter what formulas the pundits have offered and techniques applied, it is a game in which only a few have succeeded.

...For The Most Recommended and Profitable Automated Penny Stocks Trading System, Please CLICK HERE.

To Your Stocks Trading Success,
A Professional Stocks and Forex Market Trader
Dan A.

What Is: Trading Online Stocks?

2008-08-12T20:15:00.000-07:00

ONLINE STOCKS TRADING is becoming a very popular way in which to invest in the stock market. Ordinary everyday citizens such as you and me can now trade stocks like the pros without paying the ridiculous broker fees that are often associated with trading on the stock market.

This doesn't mean there are no fees involved or that you won't be discouraged from capriciously trading stocks. What it does mean is that you will be able to trade stocks, as you may have never been able to do before because the costs involved in trading were so high that only the wealthiest among us could really afford to work the market to any real advantage.

You will find quite a few companies that are going to compete for your business when it comes to empowering you to trade stocks online. It is best to go with a business that offers education and advice in addition to the ability to trade. There are many big names in the Brokerage Business that are getting in touch with the technology of today and offering full service brokers and financial advisors in addition to offering new online services that include Internet Trading.

If you decide to go with some of the bigger names in the business you should understand that you will pay a little more than you would pay going with many of the lesser name firms and trading companies. The good news is that the bigger names have more to loose after working for decades to establish themselves and develop a good reputation among traders. This means that they are not going to be "Fly By Night" and are going to work to make sure you have the best possible service from them for your future in the stock market trade.

Many of these firms in addition to offering the ability to buy, sell, and trade online will also offer financial planning for retirement, future expenses, and advice on how to create a fixed income from your investments. They will offer many tips, hints, and advice free of charge on their website while also promoting the services they offer through discounts in hopes of gaining your business for some of the higher ticket transactions that really pay their bills.

Online Investment Services offer consumers the opportunity to invest with lower commissions and fees which means you bring more of the money home when all is said and done and spend far less on fees and expenses associated with investing. By saving these fees you may be doing yourself a huge service but keep in mind that the invaluable advice of a broker can often mean the difference between mild successes and wild successes. If you can manage the fees it is a good plan to at least consult with a broker or Financial Advisor or planner once or twice a year in order to get the most out of your investment money.

Online trading is great but you will find that it lacks the personal service you can expect from a financial advisor or a Stocks Broker. Very little has such a profound impact on your financial future than the ability to receive and follow expert advice. While there is much to read on the Internet by way of advice on investing in the stock market there is also a lot of conflicting information just as there is a great deal of misinformation. This is something that, when possible, is best left to the experts at least until you manage to learn the ropes and have a few successful trades under your belt.

If you have the heart of gambler however, then it is your money you are playing with and your future you are investing. If you are not spending more than you are willing to lose then there is no harm in trying your hand at investing through Online Brokerage Services. You just might roll the dice and find a nice payout for your efforts.

...For More Information About Trading Stocks Online, Please VISIT HERE.

To Your Stocks Investing Success,
A Professional Stocks and Forex Market Trader
Dan A.

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