Finance Tips

Learning stock exchange secrets in the trading room is truly an awesome experience. Trading is a very lucrative profession but you have to work smart and never rush things. Professionals and experts in a trade room can always provide you with personalized and easily accessible training resources so you can get started right away. They can teach you to buy and sell stocks that are of great advantage for your career as a trader.

The most important thing you do as a trader is selling though it is the hardest thing to do. Some traders do not sell because of the so-called ego thing, others are simply too sentimental and attached to their possessions which makes them unable to close a good sale. You invest then trade and sell to earn more profits.

Successful traders always try to understand that there are the available exit strategies to their advantage. They formulate their own techniques that will prevent or minimize losses, if ever. Bear in mind that there are only two finales for every trader after every session. They either gain or loss and that is business. However, a wise trader can minimize his loss if ever this is inevitable. Continue reading ‘Accessibility of the Trading Room’ »

I recently received an e-mail from a relatively new trader. He was trading a system he purchased, based on its alleged stellar performance. “I’ve been using this system for a few weeks, and sometimes I just KNOW the signals it gives will be wrong. What do you think if I’d take the signals, and combine them with work of my own, to get modified signals?”

Here is what I told him…

Obviously, since you bought the system, you can do whatever you like with the signals, since the final decision to trade or not rests with you. The signals are only a recommendation – you control what happens in your trading account. Don’t underestimate the magnitude of this fact.

I can tell you that in systems I develop, I use the signals AS IS, with zero modifications. I trade most of my systems fully automated, where it is almost impossible for me to interfere. I’m not smart enough to know when the automated signals will be good or bad, so I’ve taken myself out of the equation. It is funny, but the days I think “why did the system go short/long TODAY?” usually turn out the best – the system is typically right, and my “hunch” is usually wrong. Continue reading ‘Override That Signal’ »

I often come up against forex robot sellers on the various forums out there and I am always amazed how far they will go to prove they have a profitable system. They will often post multiple metatrader demo accounts, quote the “outstanding” strike rate and continuously post spam comments across the various forums.

The most notable problem I have with these people is that they, nine times out of ten, do not trade the robot for real. It’s all based on demo accounts. Even my attempts to get these people to provide real trading accounts by offering a financial incentive or free advertising on this site have all failed.

The problem with not using a real account to test these system is that there will be issues with fills that you won’t get on a demo especially on forex trading. Ultimately you are trading through a broker and on an open market and you order will not get filled at the price you would on a demo where you get automatic fills. Continue reading ‘Problems With Forex Robot Trading Systems’ »

It is important to note that every smart investor wants to minimize risk while maximizing profit potential. Yet conventional investment theory tells us that in order to increase returns, you have to increase risk.

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You may be surprised to find that this conventional wisdom is not always true.

When I was a professional stock trader, I made most of my profits from appreciation in my portfolio, not in short term trading. In other words, I was a position trader. Any losses in my stock positions were taken out of my paycheck at the end of the month – in fact, I had to pay back any loss. If you are in this position, you desperately want to learn all the techniques to make large profits without risking much. I became an expert out of necessity. So while my trading account had virtually no losing months, my gains were as much as 300% per year.

In my stock picking, I first looked for stocks that were so cheap they could not go down. If they did go down, I was happy to buy more because at those prices, you could buy the whole company and sell off the assets for a profit.

From this group of “safe” stocks, you select the ones most likely to have large appreciation.

A stock is cheap in my book if it sells below the liquidation value of its assets, and most cheap if it sells anywhere near the net amount of cash it has on hand. So the first two measures of value I looked for were book value per share and cash per share.

Book value is the value of the shareholders equity carried on the books of the company. Generally, since you are buying a share of stock, you will want to know the book value per share.

The one caveat to looking at book value is that companies often have intangible assets on the books, goodwill and the like. You have to take these intangible assets with a grain of salt. The safest thing is to look for “tangible book value.”

Book value per share is often calculated for you in the various Internet financial stock search programs available. Continue reading ‘Stocks: Reduce Risk Yet Maximize Profits’ »

Every successful trader has a winning system. There are of course, as many systems out there, as there are traders. Some systems get you to buy on strength and sell on weakness others do the opposite.

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Some investors succeed as value investors , a la Warren Buffet ; others make their millions in momentum trading . I have even heard of an astrologist who uses the stars to trade profitably. Although, there are a variety of methods, the point I am trying to illustrate here is this: there are many ways to profit from the markets, but you ultimately must devise a system that is your own, because the personalization will act as a motivational discipline to stick with the plan.

There is however, one common element amongst all successful traders…they have a systematic way they approach the market. This approach is unique. In reality, no two people have exactly the same amount of money, tolerance for risk, personality, time or experience. Therefore, the key to success is to design a system that is suited for you.

Many traders fail because they do not assess how well a trading system matches their temperament. Instead, they chase fads, searching for the “Holy Grail” of trading success; or they waste their money on the latest investing software or buying up the tapes of the latest self-proclaimed stock market guru.

The fact is there is no perfect system. Successful investors succeed because they choose a system that they feel comfortable with, not one that claims to be the current trend. A cool, disciplined trader will make money with an “average” system, while a nervous, arbitrary trader will wreck a “brilliant” system.

The key is to develop a methodology that maximizes your strengths and minimizes your weaknesses. Nevertheless, how do you do that? First, define your objectives.

Click HERE to Visit the Successful Traders Guide

Ask yourself these questions:

1. Am I designing a trading plan for cash flow or capital growth?

2. Do I want to trade part time or full time?

3. How much money can I work with?

4. What annual rate of return do I want? (Note: the higher the return, usually the higher the risk).

Decisions such as these will have the largest impact on the style of your trading system.

For example, if your goal is cash flow and low risk, buying or selling at extreme levels (overbought/oversold) is an unlikely style. If your goals center on quick capital growth, high returns and high risk, then bottom picking strategies and gap trading may be your style.

I had one client that was a wiz at buying and selling on eBay. This person was a beginner so I suggested buying the trade closer to the 52-week low, then selling the trade when it foresaw a profit.

Entries and exits must be precise and must follow a strict set of rules.

Styles range from aggressive day traders looking to scalp few point gains to investors looking to capitalize on long-term macro economic trends. In between, there are a whole host of possible combinations including swing traders, position traders, aggressive growth investors, value investors and contrarians.

Moreover, your style will depend on your level of commitment and experience. Day traders are likely to pursue an aggressive style with high activity levels. The goals would focus on quick trades, small profits and very tight stop-loss levels. For this, the trader uses intraday charts to provide timely entry and exit points. A high level of commitment, focus and energy would be required.

On the other hand, position traders are likely to use intraday charts and pursue 1-8 week price movements. Focused goals on short to intermediate price movements and the level of commitment, while still substantial, would be less than a day trader.

With this in mind, be sure to define your trading objectives as best as you can. Unless your system matches your own criteria, you will never make big profits. You need to ask yourself the simple question: “I am trading in the market because I want to __________”…

Answer this and you are well on your way to setting your portfolio objectives.

Click HERE to Visit the Successful Traders Guide

More Stock Market Trading System Tips:

Trading Pro System is a complete video training course and teaches the traders to trade with confidence. The comprehensive 24 hours video training provides a bunch of strategies and tactics and a lot of content about trading in the stocks and options market. The system uses simple language and is created by businessmen which imply that the secrets of winning are at your fingertips.

Stock Market Index Secret is by Karl Dittman, a 30 year veteran of stock market trading. Karl maps out a really simple ’secret’ formula that can point you at a method of targeting a stock or an index on any day and make a profit. If you follow his patterns, you can can see opportunities to take good profits.

The Secrets of Sucessful Traders Guide was preferred amongst our team of researchers. It offers the most practical stock trading advice for beginners looking to find success in the stock market without losing their house. It is a step by step instructional guide which clearly explains everything you need to know about the industry and is patiently explained in detail to ensure that you are fully aware of how the stock market works before making your first investment.

One of the things people are always asking me is how can I find a good stock. The answer I give does not please them. I say, “You are not qualified to pick stock. You don’t know how so don’t try. Put your money in a no-load mutual fund that is going up”.

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The next cry is, “I don’t want to buy mutual funds. What do I do?”
OK, so I’ll tell you. It is easy. You will have to do less than an hour of work. None of that Wall Street mythology about research which is all horse hockey. The way Wall Street does research is worthless. And don’t listen to any broker. Advice from a broker is a eulogy for your money.

They want you to look at the company prospectus. This document isn’t worth the paper it is printed on. It was not written for the investor; it was written to pass inspection by some Dilbert lawyer in Washington to see that it meets all the regulations. You can take a prospectus of a very good company and one of a company that has gone bankrupt and you will see they are almost identical. Throw them away.

Read the Annual Report. Another bit of smoke and mirrors. The title should tell you – Annual. Much of what is in it is a year old. Worthless. And let’s hope it doesn’t have a case of Enronitis. Continue reading ‘How to Find Good Stock Investments’ »