Posts Tagged ‘stock’

Stock Picking Software Is There To Assist You In Making Safer And Wiser Trades

Monday, February 27th, 2012

Stock picking software has become very popular as can be seen by the plethora of infomercials extolling the virtues of such software. In fact, if you switch to any TV station (financial) you are going to be inundated by infomercials telling you how, with the help of certain software, you will be able to make a lot of money on the stock market. What’s more, there is a seemingly endless supply of such software that makes them very hard to ignore.

This is because the software can capitalize on the capacity of machines to observe many billions of transactions on the stock market and determine patterns that normal humans just will not be able to see for themselves.

Your computer screen, these ads will promise you, will fill with data that the software system is able to use to pick the best stocks that have the best chance of earning you a lot of money. The trouble is that if you do not pick the software judiciously you could easily end up with quite a few legal hassles that will only end up causing you more problems than you can handle.

So, it pays to be a bit wary about using do-it-yourself software packages. And, don’t be tempted by any software that guarantees that you are going to make a lot of money by using particular software.

At the same time, there is no denying the fact that certain software systems are worthy of trying out as they will certainly help you in making a wiser investment and also help you pinpoint stocks that stand out from the rest. These software systems generally come with screening software that will analyze the different stocks and then picks one that is a winner and also one that can be expected to appreciate in the future.

In fact, to do the things that modern stock picking software is doing would have cost (just five years ago) five hundred thousand dollars plus twelve different people working simultaneously. Today, thanks to such software it is possible for a trader to execute between fifteen hundred and two thousand different trades on a daily basis and also monitor another fifteen hundred stock pairs.

In fact, the software only takes about twenty milliseconds to execute a trade which is five times less than the time it takes to tap a button on your computer keyboard.

Another interesting fact regarding use of such software is that in one year in the United States about one third of all stock trading was done with the help of automated algorithms which in turn has led to an explosion in trading activities on the stock exchanges. And, at the same time there has been manifold increase in volumes of shares traded. So, it is hard to ignore these software systems and it is in fact a good idea to purchase one and put it to use. You never know, you could make some serious money out of its use.

Are you tired of scraping by at your day job? Why not get into the stock trading and make some money the easy way… with the guidance of artificial intelligence! More info about trading for a living… You can also check the best way how to make money day trading fast.

Knowledge Is Power When Trading For A Living

Monday, February 27th, 2012

Any experienced trader knows that trading for a living is not cheap. The capital needed to start trading is $100, 000. If you are thinking about starting the business with a lower amount, the returns earned every year will need to be considerable in order to be able to live. It will also be more tempting to take big risks that will eventually backfire on you. When you enter the business, consider yourself lucky if you make 20 percent after costs for an entire year. If 20 percent in returns is not enough to support yourself then you need to raise more capital first.

Small trades are okay if you can show an unswerving return along with excellent money management. Presenting this proof to a trading firm that you wish to join is beneficial. With adequate proof, the company is more likely to help you with the capital necessary to start your business. Doors will close on you if you cannot provide this information. Nothing replaces experience or skills.

Trade in various market conditions and cycles before quitting your current job. Think about it like this: if someone approached you with only a little amount of experience in trading, would you give that someone money to trade for your account? I do not believe that you would. Develop a good record of profits and risk management long before you take the plunge to full-time. Get your mistakes out of the way and learn from them in the process.

The fact of the matter is that you are going to struggle the first year or so just to cover costs like many businesses do. Commission, equipment and software alone is going to require a decent return on your investment. Make sure to have at least one year’s worth of backup funding available for you to live off of. Second income from a spouse will be extremely helpful. Knowing that you are covered will take some stress off of you and allow you to focus on smart trades rather than paying bills.

You are going to be an entrepreneur when you first start out in the business. The same rules that apply to businesses will apply to you. Know your market. Have a solid plan. Make sure you are well capitalized. Approaching your venture with a good work ethic, good mindset and creativity you have a chance of making it.

Here is some advice to keep in mind when entering the trading arena.

Trading is a team activity. Most entrepreneurs recruit friends, family or classmates to help with starting the business. The relationship between team members and the quality of the team are needed for success. At some point, venture capitalists join the team because of connections and funding. Develop networks for access to information, to toss around ideas and for social support. Professional firms have the benefit of providing risk managers and experience from traders. If you are married, you need your spouses support.

Expect to work long hours to get your products out. Motivation to build a business from scratch is often the reason for working these hours. You have to love the market. Working set hours is not going to make you successful in this business. Understand that your work is never done.

Falling short on funding and hitting a wall are all part of business. Be tough and you will make it through like others have.

Remaining strong while dealing with adversity, being hard-working, passionate, a visionary and collaborative are required traits to be a successful entrepreneur.

When you think you are ready to move to the next level of venture capitalist, ask yourself some questions first. Would you provide funding to you? Can you develop a creative strategy in the market and make it happen regardless of the obstacles you may encounter? Are you simply trying to leave the 9 to 5 or do you really have the traits listed above?

If you’ve just told someone that you’re going to start trading for a living with stock picking software they may have responded like you just told them you were going to start breeding rats in your attic. Why would anyone go into trading during a recession?

Is It Possible To Start Trading For A Living In Today’s Economical Upheaval?

Monday, February 27th, 2012

Trading for a living in today’s economy has a two sided agenda. You can either find great opportunities to make a killing or you can find ways to flush all potential profits in a relatively short period of time. Sometimes it can be hard to develop a whole new way of earning a living when you’re unsure of whether there will be a stable market to get through. There are several relative and unique aspects when it comes to the potential for using trading as an income source.

First, it should be noted that while it might be taking longer than we would like, there is an economic bounce back happening that is once again starting to show signs of future stability. This is not the same as saying that the market is stable and you should run in with your wallet wide open. It means that with the right moves the market is regaining stability.

There has always been a certain amount of risk when it comes to trading for a living. These risks are just more obvious these days since the market took such a hard fall not that long ago. This simply opened up our eyes to the reality of the risks. It has always been a game of losses, wins, and lateral compensation. The more comfortable you are with that concept the better you will do.

The trading lifestyle is one that comes with responsibility and freedom. You have the freedom to make all of your own choices. You have the freedom to succeed just as you have the freedom not to succeed. Of course, you also have the same concepts when it comes to your responsibility. You are the only who can make your own choices and you are the only one who can take credit for success and failure.

There are actual strategies that you should know and employ when you start trading. There are different ways to ensure that you can’t lose too much money just as there are assurances that you can opt in and out of a trade at will.

The concepts that make for a good trader are also as important as the trades themselves. Don’t trade emotionally. Learn what your risk tolerance is. Don’t invest more than you can stand to lose. All of these concepts and more offer you a chance to trade while helping you keep your wits about you.

It is true that the shaky economy has kept some traders out of the black. Many traders moved on after the market nearly crashed. However, the current state of the market can provide good opportunities for profit if you choose wisely. Research and analysis will help you get over the hump and decide what is best for your current strategy and your current level of comfort.

There are risks and there are rewards. There are many ideas to study and concepts to learn. However, you can’t spend forever just doing market analysis if you actually want to be trading. If the analyzation of the market intrigues you, then you should look into just being an analyst. If you’re into trading for a living then you’re going to have to take that first leap into the market.

If you’ve recently told someone that you’re planning to start trading for a living with stock picking software they may have responded like you just told them you were planning to start breeding mice in your attic. Why would anyone go into trading in this economy?

Helpful Features And Services Found In Stock Picking Software

Sunday, February 26th, 2012

You can use stock picking software to help you with finding out what stocks you should use. When you are using it you will need to be sure it works with many things. This is so that you can get a better idea of what the best stocks on the market are.

First you should see how well the program is updated. Programs can work in many ways for reporting values but it helps to see if real time updates are used. The ability to retrieve data on prior values helps too. If more prior data is available then it can be easy to see what trends a stock has. That will help to give you a better idea of what stocks you should pick.

It will be important for the stock ticker the software uses to be accurate. Some programs can use tickers that are linked directly to major stock indexes. These can work to help with giving you exact real time data as it comes along. With this you will be properly informed about where stocks are going on the market.

Charting services are handled by stock picking software programs. You can see through various charts how stocks change in different ways. These charts include intraday charts, long term charts and even charts listing multiple factors. These can include factors like daily high and low values. Being able to use charts can make it easy for you to see what you can use.

Being able to find stocks by certain parameters is important. Software should feature the ability to search for stocks at specific price ranges. You can then keep track of these stocks you find. If you are looking to spend on a certain amount of stocks this is a feature to check out.

Having a good idea of where a stock’s value can go is important. Many programs can work to project future stock values based on prior data. After this you can tell what stocks may be more profitable than others. Each individual program will work with a different type of projection formula though. These projections are not guaranteed to be perfect either.

A portfolio feature can be great to use too. Some programs offer portfolio services where you can save stocks for tracking. You can use this to see how stocks change over time and if you are still interested in them. You can even keep track of stocks you already own with this feature.

Finally you should see what alert services a program uses. You can get alerts by email for when stocks get to certain price ranges. At this point it will be easy to see when the right time for buying or selling something is.

These are things to check out when you are looking for a stock picking software program. You can get information on different stocks available on the market with ease. With many programs you can also see where stocks can go. It helps to find a program that can give you other services like alerts too.

Are you tired of scraping by at your day job? Why not get into the stock trading and make some money the easy way… with the guidance of artificial intelligence! More info about trading for living… You can also check the best way how to make money day trading.

Guide To Day Trading

Wednesday, February 8th, 2012

Day trading requires a trader to close all positions taken that day before the markets close. It has attracted a whole new breed of stay at home traders who are thriving inspite of starting without any previous experience or background in financial markets. To be noted that it needs more knowledge and market data than conventional trading.

Day trade volumes tend to be larger, owing to the shortened time frame and small fractions in price movement that are taken into consideration. This makes it critically important for traders to be careful. For example, traders using margin accounts and leveraging can enter trades worth several multiples of the account value.

The point here is that there has to be a fallback mechanism. This is why traders need to have a clear and pre-planned trading strategy, use only a portion of the funds in the trading account, and not get carried away by emotion. There are systems in place where day trading can be done precisely and impersonally, where orders get placed when the market hits a specific level, and the software can help execute trades.

While there are many order types that a broker might offer, there are only a handful of trades that most traders will ever need. The most basic and easy to deal with order type is the Market Order. Here the buy or sell order is guaranteed to be filled, but it may not be at the price wanted by the trader because the market can shift in the interim.

A Limit Order is where the order is placed only at a specific better price, or not at all. A Stop Order works the same as a Market Order, but only after a specific price has been reached. Stop Limit Orders are placed at and after a specific price.

The first thing a trader needs is a computer with broadband. The next thing to do is setup a trading account with a brokerage firm. Choose wisely, based on what kind of fees and commissions the broker charges. Also to be considered are the markets the broker can provide access to and the kind of tools available.

Before getting started, it might also be a good idea to look up some trading strategies such as arbitrage, swing trades and trading news. While it isn’t exactly necessary to spend on paid trading tools until the trader has some first hand experience, it is also true that institutional and professional traders have access to a lot of stuff. Day trading can really pick up momentum with the help of tools like trading software and market data.

Finding a solid forex broker is not easy, check Canadian investment guide for more info.

Partial Conversions on Your Investment and Stock Strategy

Sunday, January 29th, 2012

Our debate so far on bank conversions has focused on banks that do a full conversion and sell 100% of the available shares to depositors. There is a second type of conversion known commonly as a ‘partial conversion’. Some mutual banks form what is sometimes known as a ‘Mutual Holding Company’. Banks with a mutual holding company structure own the great majority of shares (bigger than 50%) of stock in the subsidiary bank. When a Mutual Holding Company converts to stock ownership it sells a minority (less than 50%) of the available shares to its depositors in a partial conversion. Minority shares that are sold to depositors are publicly traded on the NYSE or NDX stock exchanges.

As an example, TFS Financial Company operates as the holding company for Third Fed. Savings Bank. The TFS Money holding company retains 74% of the major shares of Financiers Savings Bank. 3rd Fed Savings Bank conducted a partial conversion and sold 26% of the exceptional shares to depositors of Third Fed Savings Bank. The shares are traded on the NDX under the symbol TFSL. I had a high-interest account at 3rd Fed. Savings Bank and was able to purchase shares in the partial conversion.

The latest trend in conversions suggests that the Mutual Holding Company structure is beginning to become more popular and now accounts for the majority of conversions.

The Net Worth of the Bank Can Double Overnite

Speculators Bancorp is still a Mutual Holding Company (“MHC”). Many MHCs decide at later to sell the shares held within the holding company in what is referred to as a ’second stage offering’. In a second stage offering the majority of the shares held in the MHC are sold to depositors in a ’second step ‘ IPO.

When this happens the current minority shareholders nearly always receive an important price appreciation in the cost of the minority stock. This price appreciation happens as a consequence of the increase in the net worth of the bank that may double or even treble on the day a second stage offering is completed. The net worth increases as the cash received from the sale of the majority shares is added to the bank’s treasury.

MHC second stage offerings are not the same type of offerings that result when a public company permits an increase in the number of its major shares and then completes a secondary offering in which additional shares of stock are sold. This leads to a dilution of shareholder’s equity. The MHC second stage offerings are accretive to shareholder equity as cash is received for the sale of the majority stocks in the second step IPO but the total number of exceptional shares isn't increased.

In a MHC second stage offering minority shareholders normally receive two to four shares of the new stock issue for each minority share owned so as to maintain their original proportion of ownership. ‘Second stage ‘ offerings increase the capital base of the bank which permits the bank to extend its loan portfolio which in turn can increase the revenues potential of the bank

90% Return with Low risk

For example, in my son Ryan’s education account, I purchased 500 shares of Bank Mutual Establishment the Mutual Holding Company for Mutual Savings Bank at $23.50 per share for a total investment of $11,750 (see brokerage confirmation that follows).

Bank Mutual MHC subsequently conducted a second stage offering and sold the majority shares held by the holding company to depositors at the bank. As minority shareholders, we were given 3.668 shares of the new Bank Mutual stock for each minority share we owned so now we own 1,834 shares of Bank Mutual. The present cost of Bank Mutual is 12.20. Our 1,834 shares are now worth $22,374 which interprets to a $10,624 profit and a 90% return.

The 90% return demonstrates the potent profitability of making an investment in the minority stock of Mutual Holding Company and the proceeds from selling this stock may even cover one year of university costs for Ryan!

Chuck Hughes Stock trading Money Flow Trader

Little Company Stocks Are the Best Performing Asset Class

Friday, January 27th, 2012

Small company stocks are usually overlooked as a viable investment asset sector. But with this lack of attention comes opportunity. You are about to discover that tiny company and particularly micro cap stocks are the best performing asset sector compared with almost any other kind of investment.

Simply owning tiny and micro cap stocks seriously out performs every other kind of stock investing strategy. I've been making an investment in little and micro cap stocks over the past seventeen years and I am definitely a firm believer that micro cap stocks should be part of each investor’s portfolio.

OBA Money Has a Market Cap of $61.4 Million

I now own shares of OBA Money stock. The valuation or capitalization (cap) of a stock is worked out by multiplying the cost of the stock by the amount of shares notable. For example, OBA Finance stock is currently trading at $14.36 per share and has 4.28 million shares exceptional. To work out the market cap we multiply the price per share times the quantity of shares exceptional. OBA Financial has a market capitalization of 61.4 million greenbacks.

4,280,000 Shares x $14.36 Per Share = Market Cap of $61,460,800

My research using market funding as an investment method explains th e size of a company is the most trustworthy indicator of future investment returns. Normally small corporations have higher investment returns than large companies. My historic research shows that the littlest companies supply the highest investment returns.

The smaller a company is. The more likely it'll produce a higher investment return. Historic return info shows that average investment returns increase as one moves down the size range from the biggest companies to the smallest companies.

Size Range

Generally utilized terms to describe capitalization size from largest to smallest:

Mega Cap (largest)

Huge Cap

Mid Cap

Tiny Cap

Micro Cap* (smallest)

*Micro Cap is generally accepted to be stocks in the 10th Decile (littlest 10%) vis market capitalization of stocks traded on NYSE/AMEX/Naz.

70 Years of Historic Investment Returns

Size vs Return

Micro Cap stocks produce greater returns than Tiny Cap stocks

Tiny Cap stocks produce larger returns than Mid Cap stocks

Mid Cap stocks produce larger returns than Giant Cap stocks

Giant Cap stocks produce larger returns than Mega Cap stocks.

Chuck Hughes Understanding stock trading

Using Top Canadian Discount Brokerages

Wednesday, January 25th, 2012

Investors who have accounts with major banking firms, and have experienced a down turn in their stock investments, should consider the options available with some of the Top Canadian Discount Brokerages. As the stock market steadies its feet in the financial world once again, stock traders can now benefit from the investor controlled accounts of an online discount brokerage.

Discount brokers provide an online environment for clients to visit at their own convenience. They act as an agent for people to distribute their funds according to their own person needs. As the term discount brokers suggests, trading this way is a cheaper alternative to using a major banking institution.

Based in Canada, Scotia i-trade, allows their clients to trade investment stocks on an international level. They provide great value to the client and have a user friendly interface, with many different financial products available. Clients of this brokerage have experienced top of the line customer service, both online and in person.

The international group of Interactive Brokers has a popular branch available to Canadians. This company provides a classic trading system for both Canadian and US money. They have accounts to suit experienced clients and research tools that allow clients fast and up to date access to stock market figures. Clients can also experience 24 hour access to advice and advanced online training tools.

Questrade is a Canadian owned and operated broker. It is suitable for both the beginner and experienced buyer, and show cases top of the line technology. With low fees, a live help desk and a facility to help beginners learn more about the trading market, this company has everything you need to purchase sound financial security. Here, the modern consumer has the ability to remotely interact with the system via social networking sites like Facebook and Twitter, as well as the latest Apple iphone and ipad applications.

There are many aspects that an individual must consider before signing up with any online discount brokerage company. Firstly the cost and fees involved in setting up an investment account is important. Be aware of any hidden fees and special requirements, such as minimum trading amounts, that might be involved with a specific product. An investor should carefully consider all the terms and conditions that are associated with each of these companies before committing any hard earned money.

With modern technology it is very easy to be part the dynamic world of international stock trading. Choosing the right discount broker will help you to build equity quickly and make saving for your future effortless.

Want to know more about what is inflation, go to this gold guide for more options.

Why Work When You Can Trade Options All Day?

Wednesday, January 18th, 2012

When most people begin to invest they start with mutual funds or ETFs (exchange traded funds). Perhaps advancing into stocks after a while. Finally, with some experience and confidence under their belt, they try options. Options trading is not for the feint of heart. They can be quite volatile. There is a chance to double your money in a short period of time, but there is also a chance of losing it all. But with some education under your belt and a disciplined approach you can do quite well.

There are two kinds of options: calls and puts. In both cases they have a ’strike price’ and an ‘expiration date’. But a call option represents the right to buy stock, while a put option represents the right to sell stock. In both cases the buyer has the right, but not the obligation, to exercise his or her option. Likewise, the seller of the option has the obligation, but not the right, to deliver (in the case of calls) or receive (in the case of puts) stock if it is above (calls) or below (puts) the strike price.

The most common reasons for options trading are: (1) as insurance (puts), (2) as speculative tools to take advantage of near term rising prices (calls) or falling prices (puts), or (3) as an income oriented strategy that takes advantage of the time decay.

Options are different than stocks in the sense that for every dollar someone makes in options, some other person loses a dollar. It is possible to make money as a buyer or a seller of options if you are correct on timing and direction. However, the fact that most options held until maturity expire worthless tips the scales in favor of the sellers over the long term.

The most popular option-based strategy is called “covered call”. In fact, Charles Schwab has stated that 84% of their option enabled accounts will trade covered calls. For every 100 shares of stock you own you can sell 1 call option and receive premium (money) today. If the stock finishes below the strike price by expiration day then you keep that money (and your stock) and can sell another call for the following month. If the stock finishes above the strike price then you have a choice: either buy the option back (if you want to keep the stock), or let it get called away and receive the strike price per share for your stock.

Selling a call option on stock you already have puts a cap on your upside. You will never receive more than the strike price per share (although you can set the strike price to whatever value you like). The plus is that you receive premium (money) the day you sell the option, and that premium can be used to offset any decline in the stock. So you get some downside protection in exchange for putting a cap on the max you can make. In many cases you can make money even if the stock declines, as long as it goes down less than the premium you received.

Investing with covered calls is not difficult. It is usually the first strategy people learn when they begin with options. It can be time consuming, though, if you don’t have a good covered call screener to help you. A good screener will scan the universe of possible trades and alert you as to where the high yield opportunities are. The alternative of using a spreadsheet to calculate possible trades is, at best, incomplete and laborious.

Born To Sell, www.borntosell.com, is a web site about covered call trading. Use this link to go to Born To Sell’s web site on covered call trading.

Options Work Exactly as Comfortably in a Depressed Market

Saturday, December 31st, 2011

Options work just as well in a down market. The option quote table below contains precise put option costs (courtesy of Yahoo Finance) for Hewlett Packard (HPQ). Buying put options is a bearish technique as the value of a put option increases as the price of the base stock decreases. Hewlett Packard stock is at present trading at 32.78. Let us assume that HPQ stock declinesin price 10% from 32.78 to 29.50. Let’s target the March 30-Strike put option (circled).

Chuck Hughes Proved 10% Stock Price Decrease = 900% Option Return

Purchasing the 30-Strike put option gives us the prerogative to sell 100 shares of HPQ at 30.00. If we were to purchase the 30-Strike put option we'd expect to pay the ‘ask ‘ cost of .05 cents or $5 per option (.05 x 100 shares = $5). Let’s assume HPQ stock decreases 10% in price from the existing cost of 32.78 to 29.50. With a stock cost of 29.50 the 30-Strike put option would be worth .50 points or $50 (strike price of 30.00 minus 29.50 stock price = .50 option value). When you get options you can sell them anytime prior to option expiration. So that the option we bought for .05 points might be sold for .50 points. Selling the 30-Strike put at .50 would produce a 900% return (.50 sale price minus .05 cost = .45 profit divided by .05 cost = 900% return).

Option Profits Derive From Stock Price Movement

You'll recall from our previous discussion that options are derivatives that derive their value from the cost of the base stock. The inbuilt price of a call option will increase one point for each point its underlying stock increases above the strike price.

A lot has been printed about option techniques that invest in options based mostly on whether a choice is under valued or over valued according to the Black-Scholes Pricing Model. These option secrets are very complicated and need high level mathematical calculations to determine an option’s Alpha, Beta, Delta, Gamma, Theta for example. I never accepted the logic of investing in an option as it was just below valued at the time of purchase. Under valued options can get even more under valued. The price movement of the base stock determines an option’s price and the ensuing profit/loss. When you get a call option your profits are determined by the price movement of the base stock.

Let’s refer again to the example for the Hewlett Packard 35-Strike call acquired at .10 points so you completely understand this crucial concept. The table below obviously demonstrates that the cost of HPQ stock determines the profit/loss of the 35-Strike call option. If we are able to select a stock moving up in price, getting a call option on that stock can produce enormous profits and will allow us to harness the amazing leverage provided from option investing.

Recent MVP Call Option Purchase Example

The Trend Line Strategy measures the selling and buying pressure for a stock which can enable us to know in advance the most likely future price direction of a stock. Combining the Trend Line Technique with the New High and Price Level Trend Confirmation Signals ends in a good system for purchasing call options on stocks that are moving up in cost.

The brokerage confirmation below shows that I purchased 9 of the Precision Castparts (PCP) 115-Strike call options at 5.20 and sold them 5 weeks later at 18.50. This led to an $11,945 profit with a 254% return after allowing for commissions. I selected this trade utilizing the Trend Line Strategy in combination with the MVP Trend Confirmation Signals. Precision Castparts was in a Trend Line Strategy buy mode and was in a leading industry group. It was also making New 52-Week Highs and was trading above 70 at a Price Level Confirmation.

MVP Option System Produces

$1,044,065.26 Profit with No Losing Trades

My trading account statements that follow show $1,044,065.26 in profits with no losing trades. The average return was 88%. I made use of the MVP Option Method and Option Spread System to generate these profits. We'll cover option. Spreads in Chapter 7.

Note: The profit for a spread trade is figured out by mixing the profit/loss for the long and short position to derive the net profit for the spread

The Appendix contains copies of my brokerage statements that confirm my $1,023,174.93 profit in 26 days utilising the MVP Option and MVP Option Spread Strategies. There are also copies of brokerage statements and tax returns for an extra $1,936,445.72 profit John and I made trading the MVP Option and MVP Option Spread Methods.

Chuck Hughes Stock Trading market