Archive for the ‘Investing’ Category

How to get the best bang for your buck when investing in the stock market

Monday, June 13th, 2011
Charles Schwab, founder of Charles Schwab Corp...

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No matter how you choose to invest your money, investment costs count. The more you spend on commissions and costs, the less you will have left to invest, so it is important to choose your brokerage firm with care. There are a number of large online discount brokerage firms, but not all of those firms will be right for everyone. In order to get the biggest bang for your buck, it is important to do your homework and understand your own priorities.

Keep Your Costs Low

One of the most important considerations, of course, is the cost of each trade you make. When you make the right choice you can keep your costs as low as possible, so it is important to look at the costs you will face each time you make a trade. When evaluating the costs of each trade, it is important to look at the entire cost of trading. Some firms will charge a flat fee for up to 1000 shares of stock, with an additional charge for each share above that level. Others will charge a flat fee no matter how many shares you transact. It is important to look at these costs and make a decision based on your own trading needs.

Research Minimum Balances

If you are new to investing, you may not have a great deal of money to invest. If that is the case, you will need to choose a fund that has a low minimum balance requirement. Some online discount brokers will charge a maintenance fee if your balance is below a certain threshold, so it is important to ask about those fees if your initial balance will be a low one. In some cases the brokerage firm may waive fees for investors who set up an automatic investment program, so be sure to ask about that as well.

Real World vs. Online Only

Even though investing online is easy and convenient, there may be times when you want to actually sit down and talk to a real live person. If the ability to consult in person with an investment advisor is important to you, it is a good idea to seek out an online discount broker that also has a presence in the real world. A number of large online brokers, including Scottrade, TD Ameritrade and Charles Schwab, also have a presence in the brick and mortar world. If this is important to you, be sure to research the location of these real world offices before you make your final decision.

If you plan everything correctly and follow the above tips, you can easily trade in stock markets without spending huge amounts of money on the operations themselves.

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How to build wealth in mutual funds using dollar cost averaging

Monday, June 13th, 2011
Mutual fund

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Dollar cost averaging is one of the most effective ways to build long-term wealth in mutual funds. While it may seem complicated, dollar cost averaging simply means that you invest the same amount of money on a constant plan, regardless of what the stock market is doing. Making those regular investments on a weekly instead of a monthly basis can help you build your mutual fund holdings even faster. You can use this weekly investment strategy to build a portfolio in a number of different mutual fund categories. Each of those categories is described in greater detail in the sections listed below.

Index Funds

Index mutual funds hold all of the stocks in a given index, such as the Standard and Poor’s 500 or the NASDAQ 100. When you buy such a fund, you become part owner of all those companies giving you a greater level of diversification than you could achieve on your own. Making weekly investments into your favorite index mutual fund allows you to build up a greater number of shares more quickly, helping you grow your portfolio for the future.

Growth Stock Funds

Investing money weekly in a growth stock fund allows you to profit from the inherent volatility of the stock market. The net asset value of a growth stock fund can bounce around quite a bit in response to the daily gyrations of the stock market. By making weekly purchases, you can accumulate more shares during periods of stock market weakness, and that can give you a good profit when stocks pick back up again.

Bond Funds

If you need to beef up your bond portfolio, you can do so with weekly transfers from your bank account to the bond mutual fund of your choice. You can choose from a variety of bond funds, from safe government bond funds to corporate and high-yield funds. The type of bond fund you should choose depends on a number of factors, including your risk tolerance and your need for current income.

Exchange Traded Funds

While exchange traded funds are not technically mutual funds, they do have a lot in common with those financial instruments. For instance, the ETF that trades under ticker symbol SPY tracks the performance of the Standard and Poor’s 500 index, just like an index fund does. Many brokerage firms now allow customers to make commission-free trades in the ETFs they offer, and that allows investors to buy ETFs as often as they would like. You can set up a weekly transfer from the cash account at your brokerage firm, or your bank account, into the ETF of your choice.

Investing consistently over time is one of the best ways to build long-term wealth for the future. By implementing a weekly strategy of saving and investing, you can reach your financial goals that much more quickly.

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6 perks that many stock brokers can offer you.

Monday, June 13th, 2011
Image representing E*Trade as depicted in Crun...

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When choosing a discount stock broker, you probably compare commission fees and opt for a broker who offers low-cost trades. But commission fees aren’t all there is to choosing a discount stock broker. In addition to low-cost trades it’s worthwhile to compare the perks offered by various discount brokers. If all else is equal, then choosing a discount stock broker who offers tempting perks can help make trading a cinch and save you money. Here are a few cool perks to look for.

Sign-up Perks. Some discount brokers will fully or partially refund your transfer charges when you switch your account from another broker. Others will offer a certain number of free trades for new accounts. If no sign-up promotions are currently running, tell the broker you’re considering giving them some business but are reluctant to switch. They just might make you a special offer.

Online Tools and Calculators. Some discount stock brokers offer nifty tools to help you calculate your target prices for your trades. These types of tools are useful and can save you loads of time and energy.

Multiple Customer Service Gateways. All discount brokers offer some form of customer service, but those that provide several options can make your life a whole lot easier. Look for instant live chat, onsite email, 1M, and easy 800 numbers with no long delays. Also check the working hours—it’s frustrating to call customer service only to find that they closed the doors at 4pm.

Referral Bonuses. If you like your discount brokers, you’re going to want to refer your friends and family to them anyway, right? Getting paid for doing so is a nice touch and makes you more motivated to keep sending along referrals.

Free Trades. Free trades are sometimes hard to come by unless you’re opening an account with a good-sized chunk of money. Look around for a discount broker who offers free trades at a minimum you can handle. If you have limited financial resources to start with, you can also look for a broker who offers free trades as a reward for being a frequent trader. For example, some discount brokers offer 10 free trades for every 25 trades you make each month.

Help with Taxes. April 15 can be the most stressful day of the year for some people. If you are one of them, you’ll be glad to know that some discount brokers offer extra help with your taxes. They provide all the information you need to accurately include your stock trading information in your tax return.

No Sneaky Charges. This isn’t really a perk, but it’s worth mentioning because the additional charges and invisible fees that some brokers tack on can be a real headache. Look for a discount broker who promises not to smack you with a hefty commission fee every time you need extra help, and who doesn’t charge inactivity fees if you don’t trade regularly.

Does your current discount stock broker offer any of the above perks? If not, it might be time to explore other options.

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The Secret Formula To Portfolio Diversification

Thursday, January 20th, 2011
Asset Allocation on Wikibook
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Portfolio diversification is more than just a tough phrase to say, it is the most important part of long term stock trading. Stocks aren’t always kind and because of this diversification was formed. If you want to earn a profit off your trades then it is highly advisable to diversify your portfolio using a winning system.

Do you know what it takes to diversify your portfolio properly? Most investors have no idea what it takes to properly diversify their portfolio and because of that their stocks drop and their net worth plummets all because they didn’t bother taking the time to learn how to diversify their portfolio the right way. Do yourself and your family a favor and diversify everything from the companies you trade in to the CEO’s growth strategy.

When it comes to stock portfolio diversification there is many things that can get in your way and make things complicated, but don’t let things out of your control. The most important thing about investing is that you have a handle on everything that you do and every trade that is made. Never make a trade if you aren’t certain of how that company will fit into your diversified portfolio because this will spell disaster.

Secret formula to portfolio diversification

Company growth – Do you know what the growth plan of the company is? Does the company release reports at least twice per year to tell you their current plans and what significant changes have taken place since the last report? If you don’t know what the company plans to do then you really know nothing about the company and because of that you have no idea how they plan to grow. Some companies will grow slower than others and you want to make sure you have your portfolio packed with both fast growers and slow movers.

Industry –There are many different industries that you can trade inside of and that is exactly what you need to do. If you are trading in real estate and nowhere else then you are in a world of hurt. You need to make sure you are trading within no less than 5 different industries that way you can maximize your profits while cutting back your risks. Always remember what industries you are in that way you don’t make a trade that will blow up your entire portfolio.

Price – What is the normal price that you are trading in? Most people will get themselves in a rut of price and never work their way out of it. For instance people who first start out trading online or for themselves will find they like to trade stocks that are less than $15 because they can always buy more than they could if the price was $100 per share. Stocks that are priced around $100 more up and down in quicker but they are normally fairly consistent.

Location – Another great way to diversify your portfolio is to make sure you don’t have stocks that are all headquartered in one location. For instance if you wanted to get some great stocks and you chose to buy Boing, Microsoft, Startbucks and Costco you would be in just one location, Washington State. Buy stocks that are spread all over the globe that way you aren’t getting effected by local economies.

This is the secret formula that you must follow in order to diversify your portfolio enough that you will never run the risks of losing money. The most important part of trading stocks is managing your risks so the first thing you want to ensure is that you are well diversified throughout every part of the market.

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The Millionaires Guide to Trading Stocks Successfully

Thursday, January 20th, 2011
The Wall Street Journal
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Everyone wants to be a millionaire and lots of people choose the stock market to help make this dream a reality. If you want to become a millionaire then you need to learn from a millionaire, not the average trader off the street.

Becoming a millionaire is probably pretty high on everybody’s list these days and rightfully so. Who wouldn’t want to be a millionaire and have the luxury to do what they want when they want to. Millionaires all have one thing in common, they trade stocks successfully whether they do it daily or for long term growth is irrelevant. The reason trading stocks successfully is because where else do you know of that you can take a little amount of cash and turn it into something substantial? Nowhere I know.

There are a few things that millionaire traders do that not everybody does. The first thing that millionaire stock traders do is they always stick to a single strategy and do it without flaws over and over again. What most novice traders do is jump around from certain stocks and from different strategies just trying to find something that works. Don’t do this, stick with one method and perfect it, this is the only way you are ever going to become a millionaire through the stock market.

Another thing that millionaires do better than anybody is pay themselves first. What this means is that instead of taking the cash out of the account and blowing it on something they take out a very small percentage while leaving the bulk of the money inside the account so that they have more cash handy. Don’t make the mistake of taking money out when you don’t need it, money in a trading account is more valuable than you know. Money in the right hands is like water in the desert, it is always useful.

Did you know that most millionaires don’t trade stocks daily, they almost always make a trade one week and come back the next week to see where it has gone? The reason millionaires aren’t too curious about what their stock is doing is because they know that the market will change dramatically overnight and they don’t want to stress themselves out with the daily price changes. The reason it is best to wait is because spending all your free time worrying about your trade will just make you waste your day and possibly make a shotgun decision to pull out early.

Millionaire trade tips

Always read the paper – Whether it is the Wall Street Journal of the local newspaper, you should always read it. If there is any hot story then it will be in the paper no matter where in the world you are. Remember that.

The Wall Street Journal is your bible – If you are a trader then you already know this, the Wall Street Journal is your bible and it always will be as long as you are an active trader. Not many people will wake up and read the Wall Street Journal unless they are serious about stocks and the market in general. Be more than just a novice trader, use the tricks that all big time traders use and read the paper that has all the answers.

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Stock Strategies For Profitable Investing

Thursday, January 20th, 2011
The New York Stock Exchange, the world's large...
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When it comes to stocks the most important part about turning a profit is your strategy. Do you have a strategy that you are following to make money? Investing is like having a baby, you have to have a plan for everything that you do. Don’t think that the stock market is going to treat you well, if you don’t have a strategy in place then the stock market will hurt you.

Do you have a strategy that works for investing in stocks? Something that is hard to figure out is what strategies others are using and the reason is because most people don’t want anybody to know. If you have a strategy that you have been using and modifying to meet your needs you should hold onto that and not leak it to anybody.

The following 3 strategies are basic strategies that are used by many big time investors, it is up to you to modify each strategy to meet your goals and financial expectations. One thing that I just want to make sure you understand is that with stock strategies everything will progressively change so you need to watch out for that. If you have been using a stock trading strategy for a while then it might be time that you re-evaluate where it is at and how profitable it has been to you recently because it might be time to make a change.

3 Stock trading strategies for profitable investing

Gap trading – Gap trading is very simple, all you are doing is buying into a stock that is about to hit a gap (normally the next day opening). The reason this works is because you sit around looking for stocks in the news or stocks that have just rose in price substantially and didn’t stop at the closing bell. The reason these work so well is because stocks that are rising and didn’t stop before the market ended almost always increase in price even more overnight. The one thing you will want to make sure you have happen is that you sell the stock at the opening bell without restriction. If you wait for an hour or even less the stock price could drop below your buy-in price and you will be out money. Don’t let this happen, once you have made the trade for the stock put a sell on it for the open of the next trading day. Also never do this strategy over the weekend because there are still people who will trade and 2 days is much too long to wait to see what happens.

Shorting stocks – Shorting stocks is something that has got a bad name in recent years and it is a real shame that it has because it’s a great way to make money. Shorting is simply where you bank on the stock dropping in price. The great part about this strategy is that you can short almost any stock as long as you have the deal in place, but you only want to short stocks that you know are about to go down. The biggest thing you need to watch out for is that the stock doesn’t go under because then there will be no buyer to take the stock over so you can profit on the deal.

Dividend stocks – This is pretty straight forward. This strategy is just where you find stocks that pay a decent sized dividend and hold them for the guaranteed income. It is always good to have these in any portfolio, just make sure you aren’t too involved with dividend stocks

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Advantages of Trading Penny Stocks

Thursday, January 20th, 2011
Penny
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What is a penny stock and why are so many people talking about them? First of all a penny stock is being talked about so much because of all they have done to help investors portfolios. Something many people don’t understand is just how easy you can make money investing in penny stocks.

The biggest reason anybody ever trades in the stock market is just for the pure money to be made. How many people do you know that trade just for the sake of trading? Everybody wants to make money from the stock market and that is why penny stocks have become so popular these days. What most people don’t know about penny stocks is they aren’t really worth a penny and they are so volatile that you can easily turn a profit within a couple hours.

Penny stocks are considered any stock that is trading under $5 but some people think penny stocks are any stocks under $10. Whatever you want them to be they will be, just know that the lower a price of a stock is, the more you can buy, and the less the price has to move in order to make money. Don’t listen to others that have no idea about penny stocks and say they are a poor investment because they aren’t. The only poor investment is no investment at all.

There are many great advantages of trading penny stocks both for novice traders and the seasoned professional. Have you ever traded penny stocks and if so what was your initial reaction to them? What about now, do you still feel the same way you did when you first traded them?

Advantages of trading penny stocks

Cheaper – The first thing anybody will notice about penny stocks is the fact that they are cheaper than anything else. Most people will stay away from penny stocks because of this but I see it as a good thing, you can buy more for less money. Another reason it is an advantage to buy cheaper stocks is the fact that you can easily tell where is the low and the high because decent stocks will only fluctuate so much before taking off one way or the other.

More volatile – Penny stocks are very volatile which for a trader that is always watching the market is very good news. The more volatile a stock is the more you can make off each trader each day. Don’t think that volatility is bad because it is only bad if you buy at the high and sell at the low, not the other way around.

Could be next Starbucks – If you know anything about stocks then you know how many people though Startbucks was going to be a dud early on and they proved almost everybody wrong. Do you know what would have happened if you spent a mere $10,000 on Starbucks stock when they first came onto the public market? You would be a multi millionaire now and that is only with the share price, not to mention the dividends each year.

Still great companies –  The last thing is that penny stocks are often still great companies. There are many stocks out there that are trading well below the $5 mark but I would never consider them bad companies are run by terrible leaders, they are just hitting rough spots in the road and need time to rebound. Always give a company a chance and you will see what they can do when they are being supported.

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Stock Investment Software: How much effective for your investment return

Tuesday, September 7th, 2010

Stock market software is a good part of any investment plan. Indeed, for any serious trader is a must use this tool for investment instruments. There are different types of software that allows you to place the main trends. Maybe it’s time to plan activities in a period of Graphics Design. Maybe it’s time to show momentum or trend up or down trend. Different applications often come with time warning. Entries can be significant amount of turnover or changes in equity prices. If you track the effectiveness of the time the software can send email when there is a serious action, while lowering or raising. This helps you quickly make decisions or actions can save you happiness. If you price range of shares is almost impossible to be aware of all stock movement. Let automated software to work for you.

Everyone wants to be successful in its efforts to stock market investments. Since the fund investments in software, no need to have analytical previously had to make real profits in trade. This software is designed after the same model that professional use of outlets, but now it is available for private traders who want to participate right in their own homes. With this modern technology, even the first time, traders can look to make trades that individuals can apply. If you want to try to give shareholders an investment or you are looking for a way to be more successful in trade, there are several reasons to choose software fund investments to achieve your goals.
The problem of forecasting stock movement by hand, the market has such a wide range, it is virtually impossible to do with great accuracy. Stock investing software, have ability to predict market behavior and also trying to floor on stock behavior. Stock movement is very unique, as compared with the previous duplication is happening now can give you a good idea of what stocks will do in the future. Share Investment Software is able to look at these signs 24 hours a day.
Consider human emotions. This is the number one factor that traders, even those with experience end up losing money in the stock market. Emotions are known for clouding of the solution, but when you have a software spell, your next step should be the likelihood that you will overcome the emotions is much less likely. This impartial trade is much more efficiently received and in getting where you need to maximize their profits. Thus, stock investment software acts as an intermediary holding you by the hand through this process, but avoids expensive fees when using the software instead.
The most characteristic feature of fund investments in software is that you can appreciate the efforts of trade. You do not need any previous investment experience to use in stock market investment software! Also, if you do not have time to devote to analysis of the trade, you can invest in our own time, without sacrificing more time than you or more money from your wallet. Some fund investments more famous than others, so it is important that the choice you make in the software you use caution.

Which factors makes you more confident as stock investor

Tuesday, September 7th, 2010

Stock investment is one of the largest sectors of investing in modern conditions. From the layman to see all the rich invest in shares of different companies. But that means that the stock market is an easy place to make money…
You may be surprised to learn that only 10% of investors in real growth in market share, while 70% and the rest are indifferent huge losses. Yes, many others closed and wait for a happy ring a bell. But this is not a professional.

Stock quotes are nothing more than images of human emotions. Painted on canvas emotions are greed, fear, hope and euphoria. As a disciplined trader, you can use psychological demons that pursue other ventures. So your psychology plays an important role in their profits and losses in the market. Taming the mind first of all, you should know before investing in the market. And mortification phrase comes from the best business plans.

If you’re going to invest, we want to do as a professional. Make a plan and stick. Time makes small changes many times, but investors fear that disaster minors and selling them with great loss, just because they have no plans.

Analysis and how to choose the best broker for your needs is no easy task. If you are new to the market than not to know that online brokers are divided into two main groups, their function is different from one another.

Full service broker offering the best deals on their investments and retirement plans to be better. So if you plan long-term investment than is necessary to fully service broker.
In addition to the commission for the transactions may be charged. Other expenses may include charges of market data. It can be charged for access to data link program.
Money management is an important part of the securities market. Investing in stocks and management of income from market prices is that every investor should know. If you are new to trading stocks will help you stay alive, and learn. This money management strategy will help maximize profits while minimizing their losses.

Without sufficient information of the company’s financial position, we recommend to avoid investments. The information contained in the financial statements show the financial sustainability of the company, also evidence in the capital reserve, revenue, invested sectors debit and credit columns, liabilities and assets, etc., some important factors that affect the market value of the company.

In addition, goodwill and reputation of the company owner and CEO should be noted, before investment in time. This applies to brokers can be done, and you even friends who are on the market over time can help you.

Political state of the nation is directly related to market shares in the stock market because not only make money, but also a place defined Nations development and economic stability. No riots, strikes or terrorist activities of the main problems can give impact on server market.

Thus, before invest everyone must do more in-depth analysis of state and government or political party in power, so that the plans and strategies brought the ruling party may prevent or facilitate action.

Step by step procedures for the new stock investor

Tuesday, September 7th, 2010

The moment you get on stock investments your mind, associated with the risk you take your hard earned money. It is certainly difficult for anyone to invest in any business without improving the prospects of return. Nevertheless, investment needs to fund more road and settlements. So, here are some investment steps that can certainly add to the investment vehicles.
Set goals to be achieved, from setting goals, we do not mean daily money goals for any investor, as a whole can be divided into many parts.
First you set your financial goals. These tasks relate to estimates of a profit relies on his investment. Setting short-term goals and money chasing them is meaningless.
The second way to achieve these goals must be resolved. Believe me, that investment fund is a daily miracle, so it takes time, patience and consistency to thrive. Therefore, there are no short cuts to follow.
Then, the definition of objectives includes money one would save. Each investor needs to assess how much will be saved and how much will be invested.
Define your taste in stock investment. It is important to determine what type of investor are you. Your approach to investing and what attracts you is inevitable characteristic. For example, a day trader may be long or short a player temperature and so on. In addition, opportunities, promotes risk associated with the type of investor. It is often said that “no pain, no gain”, it refers to the stock market too. Investor who is unable to sound risk attitudes can not increase much in this area.
Next stage involves isolation of investments. We all know that there are hundreds of options for investment in the stock market. The choice of the investor is to get a bunch of investment companies. Thus, any day trader may choose any truss or another type of investment, and work accordingly. Select complex type of investment which will not only help to increase income, but also maintains a balanced portfolio investor.
Tracking your investments is very important. Once took a particular combination of investments and the amount will be integrated in various stocks of various companies, here is a basic task, tracking them. Accounting signs investment of time buying and selling stocks that meet their process. In addition, tracking investments determines profit or loss for any investor.
Always remember that investing steps start and end with clear objectives and useful information. Any stock trader, who has clearly defined goals in mind, will make each and every possible effort to achieve them. In addition, good information allows the investor to plan his contribution to the necessary and practical purposes.

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