How To Appraise Gold And Silver In A Changing Market

With the aim of cashing in on the rising prices of gold and silver, people are bagging up virtually every scrap of precious metal that they own and flocking to shops that are willing to buy them. Knowing how to appraise, or get the value, of your gold and silver is vital if you are to get a good deal.

The simplest way in which you can appraise the value of a gold or silver item is by considering its bullion value. This is the value of the raw if it were to be melted and recycled, based on its weight and purity. There are a few basic determinants, however, that can tip the scales. Consider the following points on how to appraise gold and silver.

Gold Appraisal Tips

First, check the weight of your gold item, preferably with a pair of digital scales. The heavier the item, the more valuable it is.

Second, use a jeweler's lops to examine the gold for a hall-mark. This is usually found on the reverse of jewellery, and in some cases on the inside of trinket boxes. Most often, gold is mixed with another metal such as copper, depending on its purpose. Purity markings that determine the carat will help you appraise the value of your gold. It is generally expressed either in parts of 24 or in parts per 1000. In either case, the higher the marking, the higher the value of your item.

Third, consider the item itself - if it is a collectible or a coin, it might have more value than a piece of jewelry. For example, a gold watch by a renowned watchmaker will be appraised above its bullion value.

Silver Appraisal Tips

Start off by weight your silver items using a digital scale. The current market value of silver is multiplied by its weight to give you its current spot value.

Silver, too, has a purity marking and most silver items will be clearly marked. For example, Sterling silver is said to be of 92.5% purity, and will be hall-marked as.925. The general appraisal of silver is in parts of 1000. The higher the number, the purer the item, and greater its value. If your silver is not clearly hall-marked, test it with an acid tester. This involves rubbing the silver on a stone rubbing slab and then wiping the stone with nitric acid. The colour of the stone changes based on the purity of your silver.

Finally, do a lot of research on the silver item in question. The rarity of the object determines its final price, which could turn out to be much more than the melt value of silver. In the case of old coins, their age can give you a price much higher than the silver they are made from.

In summary, the above points provide a basic outline on how to appraise gold and silver. Keeping these points in mind will help you get the right appraisal and get the best value for these precious metals, irrespective of whether you are buying or selling. It is important to keep in mind that the current market values are constantly changing. Therefore, keep up to date with these changes so that you will be able to get the correct appraisal

By: Djelloul On 3:22 AM

Continue Reading

Stock Market 2015 2016: Best Investment Opportunities

A lot of big money managers have an eye on stock market 2015-2016 looking for the best investment opportunities because that's their job - to make money in the stock market. The problem is that after six straight years of rising prices investment opportunities in the market are hard to find. Where might money managers, and you, find them?

Believe it or not, it's probably easier for you to take advantage of the best investment opportunities in 2015 and 2016 and make money in the stock market than it is for a money manager with billion of dollars to deal with. All you need is money in a brokerage account with a discount broker and you're in business at a cost of about $10 per trade. Your trading activity does little to affect the market price; your trades are executed swiftly and are merely a blip on a screen. Big trades (for millions) can affect the market price, can be cumbersome, and can be traced like footprints in sand.

You are not at a disadvantage, and you have a lot more potential investment opportunities and ways to make money in the stock market in 2015 and 2016 than you may be aware of. The question is: are you going to keep buying mainstream stocks that move with the market and hope that prices will continue to rise indefinitely into the future? Or, are you going to look elsewhere for opportunities in preparation of a change in market trends? Let's look elsewhere.

By early 2015, two sectors or industries were moving contrary to the market in general and both hint that a change could be in the wind: oil and precious metals (gold and silver). Stocks in both of these industries are a popular and simple way for the average investor to make money in the stock market IF the timing is right. Keep your eyes open as the markets unfold. Oil and precious metals stocks have been falling in price while the market in general was hitting new all-time highs going into 2015. If trends change they could be some of the best investment opportunities around in 2015 or 2016.

Now, let's get a bit more creative. The future could see rising interest rates and slower economic growth. Both could hurt future corporate earnings. Since good growth in corporate earnings has been the cornerstone of this 6-year rising market, what would happen if interest rates rise significantly and/or earnings fall? You guessed it. The major market indexes like the Dow, S&P 500 and NASDAQ could become volatile and tumble. If this happens, where are the best investment opportunities and how do you make money in the stock market?

Can you, as a small investor, make a bet in the stock market that interest rates will go up? Yes, you can by simply buying the appropriate ETF (exchange traded fund) in your brokerage account. Can you bet that the market will become more volatile? Same answer as above. Can you bet against the market in general or against specific sectors in the market and make money in the stock market if you are correct? Yep, all with ETFs.

The vast majority of investors will lose money when things change, because they don't really understand the dynamics. Markets change, and you must keep this in mind. The best investment opportunities often occur with a change of trend. The past six years have been unusual to say the least. It is not normal for interest rates to be this low. Nor is it normal for the stock market to go up for six straight years.

The difference between the average investor and the big money guys is that the latter know that the years leading up to 2015 were unusual, and they understand market dynamics. That's why they're racking their brains in search of the best investment opportunities for 2015 and 2016 - just in case trends change.

It's true that it's always possible to make money in the stock market, but it's certainly not easy to do when the market indexes are tumbling. Be prepared, because change could be in the wind. The best investment opportunities are always out there. Now you have some ideas as to where to look to find them in 2015 and 2016.

By: Djelloul On 7:46 AM

Continue Reading

Several Valuable Online Stock Trading Tips For Inexperienced Traders

If you want to make a ton of money as an investor, it is important to learn all that you can about working in this market. This means that you have to know how to balance the allocation of your assets, diversify and limit risk among other things. The online stock trading tips that follow will give you some of the guidance you need when just getting started.

Choose a good broker and trading platform. The brokerage you work with will have a significant impact on your bottom line. The best companies offer great support and an array of learning resources. They also have platforms that are intuitive and easy to use. Some of the top companies even have mobile trading apps.

Licensing and regulation are also important considerations to make. Regulated brokers maintain transparent operations and they keep your money separate from their own. This is a very important consideration if using stock pairs through binary options companies.

Make sure to read through the conditions and terms of account bonuses before accepting them. A lot of brokers will give you extra funds to trade with as an incentive to working with them. These come with both benefits and drawbacks. There are times when bonuses might lock your own funds up until you fulfill all required conditions.

Stick with platforms that will allow you to take advantage of a demo account before facing actual risk. These are accounts that mimic actual market conditions. You can make a variety of investments and see how these might pan out in the real world. This is great practice for short-term investors. Demo accounts are actually some of the most important learning resources that you can have access to.

Focus on trading with companies that you have a keen understanding of. You will be better able to predict the direction of a company's value if you understand the market that it services and the goods it produces. People who experiment with companies that they know little about have a higher likelihood of loss. It is also important to determine your level of risk tolerance. This is your ability to tolerate financial loss, both in a financial and emotional sense. Understanding your level of risk tolerance will help you to avoid making decisions that cut your profits short or create loss.

Think about working with binary options brokers so that you can trade stock pairs. There is a lot of money in these financial instruments and you can learn how to trade them in almost no time at all. Your goal is to see which of two stocks is going to perform the best. If you put your money on the underdog, the profit potential of a transaction could be 400%.

Make sure that you are reviewing the allocation of your assets on a regular basis and that your portfolio is balanced accordingly. There should not be too much risk in any area of your portfolio. This way, if you do implement a losing transaction, you will still have enough investment capital to bounce back. Planning is essential for succeeding in these endeavors.

By: Djelloul On 9:49 AM

Continue Reading

How To Profitably Sell Gold Jewellery

So you wish to sell some of your gold? Luckily, there are numerous companies and outlets out there, even online, that would be more than glad to pay you for that old jewellery. However be very careful when doing it. You require to be extremely market savvy and alert whenever you try to sell! Yes, it is possible to receive plenty of good cash for your gold, but it requires that you go in with both your eyes wide open.

How Can I Do It?

When dealing with online companies, first you request for their free pre-paid wrapper or envelope that you will utilize in sending your gold to them. A majority of these company envelopes or wrappers come pre-insured in the event of loss or theft during transit. You may opt to secure extra insurance should your gold amount be worth more their cover or alternatively just split it into a number of smaller pre-insured packs.

Most of these online gold companies will subsequently email or call you with their valuation, which you either could reject or accept. Some others will simply automatically dispatch to you a cheque worth what they valued the gold. You should return this cheque within a specified time normally ranging from 10 to 12 days if not pleased with their appraisal. Ensure that you verify their policy on returns prior to selling or sending your gold to them, because policies do vary.

Are These Companies Trustworthy?

A number of these companies have been trading for years and as such you may be confident that being established jewellers they are bound to be trustworthy when dealing with you. However, it is possible to have a handful of companies out for that quick profit and unsurprisingly; such are unlikely to give much heed to fairness. Neither are they concerned with their company's reputation or customer service. They are just out for a quick buck and then run.

It therefore pays to make use of your common sense as you sell gold. Do they have positive media coverage and dependable testimonials? For how long have they engaged in the business? Do a Google search on them and check various online forums and chat rooms to see what about them turns up.

The Jewellers Association of Australia Limited (JAA) came into being to represent and protect the combined interests of jewellery consumers and the jewellery industry. The JAA website contains a full list of all members. This website also has information that could assist you in selecting a jeweller and other such useful information.

Are They Offering You a Decent Option?

If your gold jewellery is still in fair condition, it is worthy to get assessments from several local jewellers. This is because they are likely to take into consideration the craftsmanship that went into the jewellery itself and not merely the amount of gold contained. You then could contrast the quotes from the jewellers with the online listed gold prices, which had not taken the jewellery retail value into account

Be particularly cautious of online companies which are not revealing their gold price list. It pays to compare the prices and if they are displaying their prices lists, probably they are not even worth your effort and time. The members of the Jewellers Association of Australia Limited have nationally voluntarily adopted the Jewellery Industry Code of Conduct with the objective of putting in place principles for jewellery industry fair trading. The Code additionally aims to promote ethical competition among gold retailers.

By: Djelloul On 2:18 AM

Continue Reading

How to Quickly and Confidently Spot a Fake 1893-S Morgan Silver Dollar

1893-S Morgan silver dollars are so renowned, that more exist today than were originally minted. Most Counterfeit 1893-S Morgans consist of altered versions of existing genuine Morgan dollars.

The majority of 1893-S Morgan silver dollars are certified, so why would I need to know how to tell a fake one when I see it? Hasn't NGC and PCGS already done that for me?

I've seen fake 1893-S Morgans both graded and raw. I have to assume PCGS and NGC graders both know how to spot a fake 1893-S Morgan, so when I see an example of a counterfeit slabbed in a legitimate looking holder, I have to figure the holder is as fake as the coin.

I also run across fake coin denial. Owners of these coins don't want to admit they were fooled into buying a counterfeit coin. That's a hard pill to swallow, especially when the owner paid top dollar for a graded coin with the confidence of it being blessed from a major third party grader.

The 1893-S date/mintmark is the most valuable of the Morgan designed dollars. Because of this, most counterfeit versions have been made by altering either the date, or the mintmark.

Learning to tell a fake 1893-S Morgan is simple, because ALL 100,000 coins were made from the same obverse die and two reverse dies. That makes the diagnostic really easy.

They all have the same obverse characteristics and not terribly different reverse characteristics. Any coin that doesn't possess the telltale diagnostic characteristics is a fake. Learn what to look for, and you can spot a fake raw coin AND a fake graded coin.

The date is probably the easiest thing to pick out. Unlike other dies from the S, O, or P mints, the date has a flaw and a certain characteristic the altered coins won't possess.

First, look closely at the 1. Does it line up exactly with the dentil directly under it? Can you draw a line right through the center of both?

Next, study the last numeral. As the date progresses, it slopes upward to the right, in relation to the edge. The 3 is noticeably higher than the 1 at the beginning. This is the easiest way to quickly spot a fake.

There are things to check in the "T" and "R" on LIBERTY, but they would need a microscope to detect. There's a tiny die scratch in the "T" and a detail that resembles "rabbit ears" in the base of the "R". ALL genuine 1893-S Morgans have this detail, if you happen to have a microscope check out this diagnostic detail.

You don't really need to turn the coin over to make any more diagnostics on it.

Further diagnostics will only tell you how the alteration was made. The genuine "S" mintmark is clear and rounded. It isn't a mushy blob. The top serif on the "S" is a vertical line, while the bottom serif is more like a triangle.

The next mintmark giveaway is the alignment of the "S". It should be perfectly aligned. I've seen the "S" mintmark noticeably slanted, and it shouldn't be. Also, the "S" is slightly filled in between the upper curve and the slant of the "S" as well as the lower curve and the slant.

Since most counterfeit 1893-S dollars are altered, continue to study the coin with a 10X glass. Rotate the coin and look for tooling marks around the 9 or 3 for signs of a date alteration on the obverse. Altered coins are usually the 1898-S, 1883-S, or 1893-P.

As collector values continue to increase with the 1893-S, the fakes will get even better. With emerging technologies, counterfeits will become almost perfect replicas of the original. My hope is that as technologies to accurately copy a coin advance, technologies to detect such copies will also keep up.

By: Djelloul On 8:10 AM

Continue Reading

Option Trading and Record Keeping

I often think about other people who trade options as much as I do all day. I wonder if they use the best discount brokers that area available and most importantly, how do they keep records of all their trade?

The point of record keeping in the complex profession of option trading in my opinion is just about the most important thing there is. How can you know if you're successful in trading options if you don't know your profits and losses per stock, per trade type, per day, per month for a whole year? For me the answer has always been a combination of 3 methods. The first method of course would be to use a spreadsheet to keep a current total of all stocks I own. I keep another spreadsheet to record all my expenses for every month, and this is vital to know the grand total of all income sources and expenses including trading fees.

The most important tool I use for all my stock and option trading is Microsoft Access. Using the Access database is the perfect tool for recording each stock or option trade. For options I have a column that represents the number of contracts for each option trade and for options one contract represents 100 shares of stock. If I buy and option contract then the contract number would be negative and if I sell then the contract number would be positive. The other columns in the table would be for the price of the option and the trade fee, so to calculate the total for any option trade would be (100*Price*Contract) - Trade fee. Using SQL (Structured Query Language) has allowed me over the years to display very important statistics and reports to let me know how I am doing for any stock or option trade type or strategy and summarizing performance by stock, option, month, day or year has been very easy to accomplish.

The most important point is how can you really know how you are doing if you don't keep records? You might get a stock put to you and then sell it at loss, but then know that overall because of the option premium you received for selling the PUT that actually you made a profit on that trade overall. Without keeping records, you would never know how you really did for any specific complex option trade.

With any profession record keeping is vital to know how you are really doing, but with the difficult profession of option trading, keeping records is just about the most important thing you can do.

Option Trader, Biographer, Screenwriter, Retired IT professional.

By: Djelloul On 5:58 AM

Continue Reading

The New Investor Vs Stock Market 2015-2016

I write this as a "heads up" to the new investor, especially those who intend to start investing money in the stock market in 2015 or 2016. We're all a new investor sometime and all subject to the same misconceptions, illusions and mistakes when we start investing money in the stock market. Here's a simple guide to investing money as the market unfolds in 2015 and 2016.

If you start investing money in the stock market before you have a handle on such things as P-E ratios, dividend yields and past market cycles consider yourself a new investor. Ditto, if you don't feel that you really understand the big picture - even if you have been an investor for several years (like millions of other folks). I write this as a former financial planner who worked with many uninformed (new) investors... because most people who start investing money in the stock market do it uninformed.

Many new investors get excited when the market makes new highs. If you were excited by the new highs in the market in 2014, take a deep breath and push your emotions (like greed) aside before investing money in the stock market in 2015 and beyond. Don't be afraid of "missing out" because stocks are NOT cheap (P-E ratios are not low) while dividend yields ARE low. There are few bargains around. After more than five consecutive good years the "herd instinct" has taken over on Wall Street. If you became a new investor since the financial crisis ended in early 2009, you have probably been misled by what you've seen.

You may now be a member of the herd and overly optimistic about the future. That's what often happens to new investors who start investing money in the stock market at or near a market low. Those who "luck out" with timing their first time out are vulnerable to future market shock. "It's better to be lucky than good" is likely to work for the new investor only once. Don't push your luck in 2015 and beyond.

Market cycles have always been a major part of the game, and few new investors really have a perspective on market trends. The newbie who gets lucky often credits his or her success to stock picking. The simple truth is that it's easy pickings if you start investing money in the stock market when a new uptrend sweeps prices higher. On the other hand, if you start investing money when a major downward trend takes hold, your odds of taking big losses are about 99%.

To succeed over the long term you need to take emotion out of the picture and keep an eye on the horizon in search of EXTREMES. For 2015 and beyond, there are a couple of extremes that could signal a change in trend from up to down. How long can interest rates be stuck at record lows while the stock market rallies to new highs? Lower interest rates have traditionally been the key to stimulating the economy and sending corporate sales, profits and stock prices higher. Presently at near record lows, rates can't go much lower. This might not be a good time to start investing money in the stock market.

Forget about optimism and pessimism. Rising interest rates hurt corporate sales and profits; and lower profits can make P-E ratios skyrocket overnight. In other words, stock PRICES vs. EARNINGS (P-E ratios) can rise quickly when profits fall, making stocks expensive. If you are a new investor beware: now is probably not a good time to start investing money in the stock market. It is a good time to learn.

Today's extremes: extremely low interest rates, and almost six straight years of rising prices without a major change in trend. A significant uptrend in interest rates will make new investors out of all but the old heads (like myself). That's what makes 2015 and 2016 scary. That's why you might want to think twice before you start investing money in the stock market in 2015 and beyond. Learn now. Later, when prices are low and the uninformed herd is selling, is when you want to start investing money in the stock market.

By: Djelloul On 5:55 AM

Continue Reading

The New Investor Vs Stock Market 2015 2016

I write this as a "heads up" to the new investor, especially those who intend to start investing money in the stock market in 2015 or 2016. We're all a new investor sometime and all subject to the same misconceptions, illusions and mistakes when we start investing money in the stock market. Here's a simple guide to investing money as the market unfolds in 2015 and 2016.

If you start investing money in the stock market before you have a handle on such things as P-E ratios, dividend yields and past market cycles consider yourself a new investor. Ditto, if you don't feel that you really understand the big picture - even if you have been an investor for several years (like millions of other folks). I write this as a former financial planner who worked with many uninformed (new) investors... because most people who start investing money in the stock market do it uninformed.

Many new investors get excited when the market makes new highs. If you were excited by the new highs in the market in 2014, take a deep breath and push your emotions (like greed) aside before investing money in the stock market in 2015 and beyond. Don't be afraid of "missing out" because stocks are NOT cheap (P-E ratios are not low) while dividend yields ARE low. There are few bargains around. After more than five consecutive good years the "herd instinct" has taken over on Wall Street. If you became a new investor since the financial crisis ended in early 2009, you have probably been misled by what you've seen.

You may now be a member of the herd and overly optimistic about the future. That's what often happens to new investors who start investing money in the stock market at or near a market low. Those who "luck out" with timing their first time out are vulnerable to future market shock. "It's better to be lucky than good" is likely to work for the new investor only once. Don't push your luck in 2015 and beyond.

Market cycles have always been a major part of the game, and few new investors really have a perspective on market trends. The newbie who gets lucky often credits his or her success to stock picking. The simple truth is that it's easy pickings if you start investing money in the stock market when a new uptrend sweeps prices higher. On the other hand, if you start investing money when a major downward trend takes hold, your odds of taking big losses are about 99%.

To succeed over the long term you need to take emotion out of the picture and keep an eye on the horizon in search of EXTREMES. For 2015 and beyond, there are a couple of extremes that could signal a change in trend from up to down. How long can interest rates be stuck at record lows while the stock market rallies to new highs? Lower interest rates have traditionally been the key to stimulating the economy and sending corporate sales, profits and stock prices higher. Presently at near record lows, rates can't go much lower. This might not be a good time to start investing money in the stock market.

Forget about optimism and pessimism. Rising interest rates hurt corporate sales and profits; and lower profits can make P-E ratios skyrocket overnight. In other words, stock PRICES vs. EARNINGS (P-E ratios) can rise quickly when profits fall, making stocks expensive. If you are a new investor beware: now is probably not a good time to start investing money in the stock market. It is a good time to learn.

Today's extremes: extremely low interest rates, and almost six straight years of rising prices without a major change in trend. A significant uptrend in interest rates will make new investors out of all but the old heads (like myself). That's what makes 2015 and 2016 scary. That's why you might want to think twice before you start investing money in the stock market in 2015 and beyond. Learn now. Later, when prices are low and the uninformed herd is selling, is when you want to start investing money in the stock market.

By: Djelloul On 3:29 AM

Continue Reading

Simple Tips for Making a Killing in the Stock Market

Trading on the stock market is a great way to achieve financial independence but the road is littered with obstacles and hurdles that will most certainly see you lose your investments. Yes you can make money on the stock market but without the right advice as I say will make you a stock market loser no doubt. We don't want you to be a loser, so here are some simple tips to becoming a winner.

First of all, it's best to employ a broker to handle all your trades. A broker can execute all your trades for you, and nowadays you can find a broker online. Some people still prefer to have a broker via telephone and that's fine. The problem with online trading is that it can be too easy to make a bad trading decision. Worth mentioning it is best that you never take stock tips from a broker. You are the trader and your decisions are your own and not the brokers.

Although you can employ a broker to do all your analytical work for you, that is perform some technical analysis, I find it is best to use charting software. Such programs have databases that can analyse historical data at the click of a mouse and it will save you countless hours of having to trawl through newspapers every day to find the information you need. I won't recommend and particular software here although the one I use is called Sharescope. With it I can filter new market highs and lows as well as draw trend lines.

It's all good having the right software on your computer and sound fundamental and technical analysis but without an exit strategy you are sure to close trades just before they become profitable. Far too often the trader will base the closing of his trades on pure emotion. It's emotion that causes the market changes but when it comes to making an exit, you must have a strategy set in stone before you make the trade. This way you can cancel out any bad decisions based on your emotions. And even stories on the news can see you make bad decisions and therefore losing trades.

Trading isn't easy, and the road to success with it can be long and sometimes you can feel like you are going to lose your entire investment because of one or two losing trades. Stay strong, stay focussed on the long term and you will eventually find your way in the world of stock market investing.

By: Djelloul On 3:22 AM

Continue Reading

Best Stock Investment Strategy for 2014

In putting together the best stock investment strategy for 2014 you can concentrate on finding the best stock investment or you can try to come up with the best strategy to deal with a market hitting all-time highs. Unless you have a real flare for stock picking, I suggest you focus on investment strategy.

There are two traditional ways to view the stock market: the fundamental approach and the technical school. The first approach tries to come up with the best stock investment or strategy by analyzing all kinds of economic and financial data like economic growth, unemployment and trends in corporate sales and profits. The technical school focuses only on the action in the stock market itself, like volume of shares traded and price trends.

I've followed this stuff for 40 years, sometimes in search of the best stock investment and sometimes (in my later years) paying more attention to investment strategy. Here's what I see in 2014 and beyond, combining both schools of thought.

The fundamental data is luke-warm at best. We've recovered from an economic crisis and a deep recession, they say. But economic growth is weak and unemployment is still in the 7% range. Corporate profits have grown, while sales growth has been lackluster. The stock market has been hitting all-time highs, as our government has gone deeper in debt while keeping interest rates artificially low to stimulate the economy. This looks nothing like the best stock investment environment compared to past recoveries. Things just don't look right from a fundamental viewpoint.

Technically, the stock market has been in an upward trend for about 5 years, showing gains of over 150%. This has happened before. But there's something to consider when trying to put together the best stock investment strategy for 2014 and beyond. If the fundamental data does not really improve to support these gains by 2015, stock investors who jump in now might be showing up at the party late. The upside action could be coming to an end.

Here's what else has happened before. Many investors missed this market and have just recently jumped on the band wagon in search of the best stock investment to make up for lost time. This is not new, nor has it normally worked out well for the average investor. If you missed out, I have a suggestion for you.

Don't play "catch up". Sometimes it's best to stay safe and liquid - waiting for a future opportunity. In other word, your best stock investment strategy for 2014 and beyond could be a passive strategy. As I once heard Warren Buffet say, "every 5 years or so the stock market runs into trouble". This could be one of those times.

By: Samory Borry On 11:12 AM

Continue Reading

Trading and Investing As a Process

All too often traders and investors get caught up in popular strategies such as "red light/green light," "buy on the dip," or "stop and reverse SAR." They start trading and investing as soon as they have learned the new strategy taught at a seminar, trade show, or webinar. If they are lucky they may make modest profit during the first few trades, then suddenly they have a series of losses. They struggle and work harder, trying to force the strategy they learned to work. They become frustrated or angry at the market, market makers, Wall Street and anyone else they bump into.

Their losses go from a string of losses to chronic loss syndrome. This syndrome is a series of losses with an occasional profitable trade which continues to encourage them to keep trying. They go to more free weekend seminars, watch more free webinars, and wander around more trade show searching for answers. They are sure that it is some magical trick, or something they are missing that is causing the losses.

However the problem is much deeper than that, and it starts with the notion that a strategy is all that is needed to trade and invest successfully. Strategies are taught first because they are all in public domain, meaning they are free for anyone to learn. Also they are an easy subject to present at a free seminar. They are short, to the point, and make it seem as if the retail vendor, broker, or speaker is has the answer to their trading and investing problems.

The real culprit is the lack of a trading and investing process. A trading and investing process is not difficult to learn and in fact, makes trading much easier and simpler than struggling to use several strategies and guessing all the time, or waiting for some news event to try and jump into a stock to scrape perhaps a dime of profit from all that work.

What is a trading and investing process?

It is a set of rules with parameters and a complete process that you follow every time you trade and invest. This begins with how you find stocks, analyze stocks, select the best stock to trade, risk analysis, point gain potential, and risk to reward ratio. It includes using the proper order, the proper stop loss, the proper trailing profit stop, to exiting the trade with the most profit possible. It is about having a trading style first with a complete process, and an understanding of the 6 market conditions. Then it is applying the appropriate strategy for the particular market condition that is currently underway, and the strategy most suitable for the stock selected.

A trading and investing process is not just watching the major indexes, but also determining market conditions. The indexes only include a small number of the thousands of listed stocks. What happens beyond the index component stocks is far more important because index stocks are bought for charters, mutual funds, and by smaller investors, whereas the underlying stocks that are best for short term retail trading tend to lead the big blue chip stocks.

Indexes are a part of the overall analysis but they do not provide a complete analysis of what is going on in the markets. Using news, indexes, and guru opinions is what causes most of the losses for retail traders. Using a trading and investing process eliminates the problems that result from insufficient trading preparation and inadequate analysis.

By: Samory Borry On 11:03 AM

Continue Reading

Growth And Value What S The Difference

While the majority of American investors understand the importance of diversifying across growth and value investments, few are able to achieve a passing grade on a test of their knowledge of the differences between the two, according to a new American Century Investments survey.

Test your knowledge with the Growth & Value IQ quiz below:

1. Which best describes a growth stock?

a) Stock that offers guaranteed rate of growth tied to consumer price index.

b) Stock in a company specializing in agriculture, lumber, landscaping, and other organic products.

c) A stock in a company demonstrating better than average profit and earnings gains.

d) All of the above.

2. Which best describes a value stock?

a) Stock in fast-growing company specializing in high-value, low-cost products, like a discount retailer.

b) Stock in a company specializing in valuable goods, like precious metals and jewelry.

c) Stock that has a low price-to-book ratio.

d) All of the above.

3. Which statement is true?

a) Value stocks outperformed growth stocks between 1927 and 2001.

b) Smaller company value stocks outperformed larger company value stocks between 1927 and 2001.

c) Maintaining a portfolio with a combination of growth and value stocks generally is considered a prudent investment approach.

d) All of the above.

4. During periods of strong economic expansion, which fund generally performs better?

a) Growth.

b) Value.

c) Neither.

d) Both.

5. Generally speaking, value funds outpaced growth funds in 2000 and 2001.

a) True.

b) False.

6. Generally speaking, growth funds outpaced value funds during the 1990s.

a) True.

b) False.

7. Which type of fund is more likely to invest in stocks paying a significant dividend?

a) Growth.

b) Value.

c) Neither.

d) Both.

8. Higher price-to-earnings ratios normally would be associated with stocks in which type of mutual fund?

a) Growth.

b) Value.

c) Neither.

d) Both.

9. What kind of stock is described in this example: “Established baked-goods company with strong balance sheet and good cash flow experiencing temporary drop in reaction to changes in senior management.”

a) Growth.

b) Value.

c) Neither.

10. What kind of stock is described in this example: “Software company, enjoying steady sales increases, is in the process of rolling out an eagerly anticipated update to a popular software application.”

a) Growth.

b) Value.



Key: 1(c); 2(c); 3(d); 4(a); 5(a); 6(a); 7(b); 8(a); 9(b); 10(a). – NU

By: Samory Borry On 3:15 PM

Continue Reading

Stock Market Window Dressing The Art Of Looking Smart

As investors, and we all are investors these days, it is important that we understand the idiosyncrasies of the Stock Market pricing data we use to help us in our decision making efforts. On Wall Street, investing can be a minefield for those who don’t take the time to appreciate why securities prices are at the levels that appear on quarterly account statements. At least four times per year, security prices are more a function of institutional marketing practices than they are a reflection of the economic forces that we would like to think are their primary determining factors. Not even close… Around the end of every calendar quarter, we hear the financial media matter-of-factly report that Institutional Window Dressing Activities” are in full swing. But that is as far, and as deep, as it ever goes. What are they talking about, and just what does it mean to you as an investor?

There are at least three forms of Window Dressing, none of which should make you particularly happy and all of which should make you question the integrity of organizations that either authorize, implement, or condone their use. The better-known variety involves the culling from portfolios of stocks with significant losses and replacing them with shares of companies whose shares have been the most popular during recent months. Not only does this practice make the managers look smarter on reports sent to major clients, it also makes Mutual Fund performance numbers appear significantly more attractive to prospective “fund switchers”. On the sell side of the ledger, prices of the weakest performing stocks are pushed down even further. Obviously, all fund managements will take part in the ritual if they choose to survive. This form of window dressing is, by most definitions, neither investing nor speculating. But no one seems to care about the ethics, the legality, or the fact that this “Buy High, Sell Low” picture is being painted with your Mutual Fund palette.

A more subtle form of Window Dressing takes place throughout the calendar quarter, but is “unwound” before the portfolio’s Quarterly Reports reach the glossies. In this less prevalent (but even more fraudulent) variety, the managers invest in securities that are clearly out of sync with the fund’s published investment policy during a period when their particular specialty has fallen from grace with the gurus. For example, adding commodity ETFs, or popular emerging country issues to a Large Cap Value Fund, etc. Profits are taken before the Quarter Ends so that the fund’s holdings report remains uncompromised, but with enhanced quarterly results. A third form of Window Dressing is referred to as “survivorship”, but it impacts Mutual Fund investors alone while the others undermine the information used by (and the market performance of) individual security investors. You may want to research it.

I cannot understand why the media reports so superficially on these “business as usual” practices. Perhaps ninety percent of the price movement in the equity markets is the result of institutional trading, and institutional money managers seem to be more concerned with politics and marketing than they are with investing. They are trying to impress their major clients with their brilliance by reporting ownership of all the hot tickets and none of the major losers. At the same time, they are manipulating the performance statistics contained in their promotional materials. They have made “Buy High, Sell Low” the accepted investment strategy of the Mutual Fund industry. Meanwhile, individual security investors receive inaccurate signals and incur collateral losses by moving in the wrong direction.

From an analytical point of view, this quarterly market value reality (artificially created demand for some stocks and unwarranted weakness in others) throws almost any individual security or market sector statistic totally out of wack with the underlying company fundamentals. But it gets even more fuzzy, and not in the lovable sense. Just for the fun of it, think about the “demand pull” impact of an ever-growing list of ETFs. I don’t think that I’m alone in thinking that the real meaning of security prices has less and less to do with corporate economics than it does with the morning betting line on ETF ponies… the dot-coms of the new millennium. [Do you remember the "Circle of Gold" from the seventies? Isn't GLD, or IAU, about the same thing?]

As if all of these institutional forces weren’t enough, you need also consider the impact of tax code motivated transactions during the always-entertaining final quarter of the year. One would never suspect (after watching millions of CPA directed taxpayers gleefully lose billions of dollars) that the purpose of investing is to make money! The net impact of these (euphemistically labeled) “year end tax saving strategies” is pretty much the same as that of the Type One Window Dressing described above. But here’s an off-quarter buying opportunity that you really shouldn’t pass up. Simply put, get out there and buy the November 52-week lows, wait for the periodic and mysterious “January Effect” to be reported by the media with eyes wide shut amazement, and pocket some easy profits.

There just may not be a method to actually decipher the true value of a share of common stock. Is market price a function of company fundamentals, artificial demand for “derivative” securities, or various forms of Institutional Window Dressing? But this is a condition that can be used to great financial advantage. With security prices less closely related to those old fashioned fundamental issues such as dividends, projected profits, and unfunded pension liabilities and perhaps more closely related to artificial demand factors, the only operational alternative appears to be trading! Buy the downtrodden (but still fundamentally investment grade) issues and take your profits on those that have risen to inappropriately high levels based on basic measures of quality… and try to get it done before the big players do. To over simplify, a recipe for success would involve shopping for investment grade stocks at bargain prices, allowing them to simmer until a reasonable, pre-defined, profit target is reached, and seasoning the portfolio brew with the discipline to actually implement the profit taking plan.

Yeah, I do miss the days when there were just stocks and bonds, but maybe I’m just a bit too old fashioned. Interesting place Wall Street…

By: Samory Borry On 3:13 PM

Continue Reading

How the Stock Market Saved My Life

Most people know the stock market to be a rough and challenging world but in reality it is a savior. For many people the only experience they have with the stock market is staying away from it but I guarantee you that you can make money as long as you put in a little bit of effort. What most people don't understand about the stock market is that it isn't the most experienced that are making the most money, it is the people who take the time to do the proper research.

Why the stock market saved my life

A while back I went making a lot of money every month to making nothing because of the changes in the internet and my local businesses but the stock market was the only thing that was still there I could adjust quickly enough to make money that very day. What I learned from the stock market is to trade when others are trading and take a firm position.

What did this mean for me

What this meant was while so many people where looking at the casino business from afar I wanted to get up close and dive right into my favorite stocks. I chose to buy 2 different casino stocks that own more than 6 hotels and casinos in Las Vegas because I knew that the Las Vegas tourists would be flocking the city very soon.

What happened next

The next thing I knew I was sitting on more than $5,000 of pure profit from my 2 stocks and that was only within 4 weeks of buying them. The thing about this money was that I traded the stocks over and over again until I got as much money as I could out and now I am just holding the stocks as a long term gain.

The stock market is more than just a way to make money, it is my savior because I know there is nothing else out there that can make me that much money that fast without doing anything. Do you know of anything that will make you $5,000 in less than 1 month without doing anything? Probably not and that is why the stock market should be there in case you need it too.

By: Samory Borry On 11:41 AM

Continue Reading

Real Forex Traders Learn To Like Losses

As a forex trader you have to learn how to take losses. Period. Don’t be a crybaby. Learn how to take losses.

Learning how to take losses is one of the most important lessons you must learn if you want to survive as a trader. Nobody is 100% right all the time.

Losses are inevitable. Even Michael Jordan and Tiger Woods lose sometimes and they’re considered the best in their field.

There will be trading streaks where you’ll have a number of successful consecutive trades, but that will eventually come to an end you will take a loss.

As that point it’s very important not to lose your head, you must remain in control of yourself. Don’t have a cow man.

Take a break. Calm down and relax. Take a chill pill dude.

Until you’ve regained a clear mind and an ability to think logically again, stay out of the market.

Don’t whine about your loss and never carry a prejudice against a loss.

The key to manage losses is to cut them quickly before a small loss becomes a large one.

I repeat. The key to manage losses is to cut them quickly before a small loss becomes a large one.

Never ever think that you will never lose. That’s just ludicrous. Losses are just like profits, it’s all part of the trader’s universe.

Losses are unavoidable. Get over the loss and move on to the next trade.

By: Samory Borry On 12:33 AM

Continue Reading

Forex Currency Trading

You can develop into a better and more profitable trader by applying some of the more imperative forex currency trading rules consistently with an appropriate amount of discipline. There are few principles that can help to perk up your chances of success if they are understood, practiced, and implemented in your trading on a regular basis and these rules have been learned in the trenches, mostly through testing and scrutinizing the common mistakes nearly every trader makes when starting out in the forex currency trading business. The first step is to set up and apply specific goals and objectives.

The majority of forex traders who often find themselves on the losing end of a trade make the same common and recurring mistakes. Most forex traders don’t have a clear direction, never take the time to develop a sound business plan and lack a formal written strategy for putting a well thought out plan in place. In forex currency trading, the primary goal is clearly to make money, but it’s important to have goals that are not strictly money related as well. Your personal objectives and ambitions should be very specific and measurable to you, but they should include the characteristics that are needed for the trading.

Having a clear-cut idea of what you want to accomplish in your trading and the precise time frame you want to achieve it, make your efforts more focused. In order to establish a track record of winning trades, you need to develop discipline and a personal forex currency trading system that makes sense for you. The spread generally referred to as the bid/ask spread is what brokers charge instead commission fees. Forex brokers are typically linked with large banks due to the large amount of capital that is required to operate in the forex market. Leverage is a ratio of total capital available to actual capital which is the amount of money a broker will lend you for trading. Finally you should select a trading account that fits your budget.

Basic Forex trading strategy begins with fundamental and technical analysis. Fundamental analysis is mainly used to anticipate and better understand long-term trends in the currency market. Technical analysis is widely used to examine the forex because it identifies and measures sustained trends. Successful traders use a combination to make more accurate predictions. Once you have the knowledge of how the forex currency trading works open a demo account and paper trade to practice until you have what it takes to make a consistent profit. It’s important to take the time to build, test and implement a sound trading plan before you put capital at risk.

By: Samory Borry On 12:30 AM

Continue Reading

Free Stock Picks: A Proper Perspective

Remember the good old days of investing? Days when you would call your stockbroker, ask his advice and then invest accordingly? Those days are long gone thanks to the Internet and self-directed investing apps. Today a good many investors rely more on free stock picks than sound advice from investment professionals.

Do not misunderstand; free stock picks have their place - just like advice from paid professionals. However, any investor able to think for himself uses every investment resource with proper caution. No single source of advice or information is foolproof, nor should it be trusted without question. That includes free stock picks.

Why They're Good

The good thing about free picks, and particularly U.S. stock picks, is the fact that there are so many experienced people out there doing the legwork for you. That means the investors writing the daily stock articles will be right from time to time. They also have some market insight that the casual investor lacks, providing them a better glimpse into the future of a given stock.

Free picks are useful inasmuch as they give you more information to work with. A good strategy is to take picks from several different analysts and compare them against one another. If all of them generally agree on a specific stock, that's something to seriously consider when making investment decisions. If they are all over the board regarding another, it tells you to stay away.

Why They're Not Good

The problem with free stock picks it that the analysts offering them have no real incentive to make sure they are as accurate as possible. They can advise according to any criteria they set for the day; criteria that can include, among other things, whether or not their favorite team won the game last night. Casual investors rarely track the records of those offering U.S. stock picks for free, so they do not really know how well an analyst performs over the long haul.

That said, the number one rule of investing in stocks is to pay attention to long-term performance. Making good money off the stock market is a pursuit that is generally not achieved overnight. So when investors don't know the historic performance of a stock analyst, they also don't know if the analyst picks are worth anything.

What It Means to You

Self-directed investing is a great opportunity to take advantage of what the stock market has to offer. By all means, take into consideration the U.S. stock picks offered by analysts for free. Nevertheless, do your own homework on any stock you think you are interested in purchasing.

At the end of the day, self-directed investing comes down to the casual investor learning and understanding for himself. Free stock picks are just one tool in that process. As long as they are viewed with the proper perspective, such picks can be helpful. But if an investor bases his entire strategy on what analysts are putting out for free, he is just asking to lose his shirt.

By: Samory Borry On 5:42 AM

Continue Reading

Penny Stocks Explained

A "penny stock" isn't a literal term, but compared to the prices of higher stocks, it may seem like a bargain. Common stocks that cost less than $5 are usually called penny stocks, and while they have a lower individual price, investing in small stocks can be just as risky as any of the higher priced variety, if not more so in some cases. There are some misconceptions about penny stocks that should be cleared up:

·Penny stocks are not a "get rich quick" stock.

·Penny shares are not a guaranteed profit.

·Not every tiny stock is a bargain.

With that in mind, let's look at how to invest in penny stocks for the absolute beginner.

Getting Started

The first step is to do your research. There are a lot of stories about penny shares helping investors to get rich overnight, but you need to figure out what makes the most sense to you. There are brokers that actually specialize in handling penny stocks. These brokers may be able to point you toward some stocks to watch, but do your own research before you make an investment through the brokerage. Learn how to read the company financial statement.

Also, think about investing in a small stock that is listed on the NASDAQ. If you have absolutely no experience in investing in the stock exchange, then these are the stocks that are going to have the most "security," although it is still not a sure thing. Stocks that have been de-listed are usually indicative of a company that is going through some financial turmoil, and what you want is something that is a little more stable, whether you're investing in tiny stocks or larger offerings.

Keep Researching

After you've made your investment, stay on the lookout for other good tiny stocks and how they're performing on the market. Because penny stocks should account for 1/10th of your investment portfolio or less, these aren't going to be your prime performers. Instead, they're a way to diversify your investment strategy and get in on some unique and affordable investment opportunities. The more research that you do on the subject, the easier it'll be to find the best penny shares for your investment strategy.

Awesome penny shares aren't usually obvious to the new investor. Your broker can most likely point you toward some options that are worth considering if you want to get the best bang for your buck.

By: Samory Borry On 5:33 AM

Continue Reading

Stock Market Investing Is Not Trading

There is a huge difference between investing and trading in the stock market. Although both involve owning stock, the effect on for market participants is very different. As an educator for investors, I get annoyed at all the people who talk about investing and then discuss or teach only short-term trading.

First, the time involved to trade requires much more time than investing. Short-term trading is a full-time job. Day trading requires you to be at your computer screen during market hours. It is very difficult to hold another job that pays the bills while you do short-term trading. Even if you are swing trading, it is still very time intensive. However, with my investing I monitor my holdings for about 20 minutes per week.

Next, trading is extremely time-consuming and difficult to learn in the first place -- it is the hardest thing I have ever done in my life. Many successful day and swing traders took 3-5 years of at least full-time work and study to learn. I have heard of people doing it faster than that, but that is the exception and not the rule. Whereas you can learn to be an advanced investor in a few weeks in my courses. In 30 minutes you can learn a technique that offers 5-50% a few times a year when a special situation presents itself.

Next, the money involved to learn. Trading is a very high-risk, low-odds-of-success activity. The vast majority of traders lose some or all of the money in their accounts trying to get good at it. (If you don't believe me, look it up on Google. There is plenty of research supporting this claim, including the Johnson report, the Hieronymous study, and the Odean study.) I have listened to several successful traders blow out several large accounts before finally getting it right.

On the other hand, owning stocks for the long-term has a built-in likelihood of making a profit -- stock prices typically go up over time. There are ways to lose money investing, and there are ways to make more than buy and hold (I have spent the past 25 years researching what those strategies are), but even if you do not know them, the odds are with you at least for the long-term.

The essential problem with short-term trading is that you must first determine the direction of short-term stock prices, which can be very volatile over brief periods of time, then make a big enough profit to cover commissions and all the other times when you guess wrong. Believe me, it is not easy to do.

In the end, most Americans need to learn how to invest, not to trade. Make sure you go to the right place to learn better investing strategies.

By: Samory Borry On 5:30 AM

Continue Reading

Basic Trading Rules for Beginners

There are six basic rules that set the foundation for successful investing and trading in the stock market. Use the simulator and be reluctant to trade live in the market, don't trade too often, stay with a trading style that works for you, develop your own trading style, listen to your inner voice, and trust yourself.

1. Endeavor to have at least a 75% paper trade success rate on a simulator before you start trading live in the market. Most traders make good profits then turn right around and lose the profits because they are too eager to trade. Be reluctant to trade. Trade only when you are completely confident and comfortable. Do not trade because you have an electric bill to pay. Pressure of that sort will make you go with an emotional decision rather than a logical one. If you take a big loss, well you MUST go back to paper trading on the simulator. Don't cheat yourself and think it is okay to just ignore the problem. Something went wrong and you need to redirect your discipline and skills.

2. Most Traders trade too often. Traders are so obsessed with making money that they throw their hard earned profits away on weak trades or weak market days. The less trading you do, the more you will base your selections on only the best. This will create higher returns since you will have fewer losses.

3. Once you have a trading style and strategy that works for you, don't change it until it stops working. Don't fix what isn't broken and don't chase fads. Those traders who try to take short cuts to wealth are the ones that lose in the end. Wealth takes time, and it takes effort, and CONTROL. Most people who win the lottery lose all of it in less than a year because they haven't learned how to control that kind of money. Ask yourself if you are ready emotionally for larger profits. Do the financial self-worth test once in a while. Making money isn't the problem, it's learning how to manage it.

4. Do not compare yourself to other traders. You are an individual and you can develop your own unique trading style that is yours alone, and focus on trading successfully every time.

5. Pay attention to small details, maintain focus, and ignore the constant noise of the market and other traders. If you spend too much time listening to the media, news, and other traders, you will lose your ability to hear your inner voice. The Traders who say, "I knew I should have done this or that, but I didn't" have lost the ability to listen to their inner voice.

6. The most important lesson is to trust yourself and your ability to do this job. People sabotage their own dreams and goals all the time and never realize it.

By: Samory Borry On 7:33 AM

Continue Reading