Finding A Good Stock
One of the things people are always asking me is how can I find a good stock. The answer I give does not please them. I say, "You are not qualified to pick stock. You don't know how so don't try. Put your money in a no-load mutual fund that is going up".
The next cry is, "I don't want to buy mutual funds. What do I do?"OK, so I'll tell you. It is easy. You will have to do less than an hour of work. None of that Wall Street mythology about research which is all horse hockey. The way Wall Street does research is worthless. And don't listen to any broker. Advice from a broker is a eulogy for your money.
They want you to look at the company prospectus. This document isn't worth the paper it is printed on. It was not written for the investor; it was written to pass inspection by some Dilbert lawyer in Washington to see that it meets all the regulations. You can take a prospectus of a very good company and one of a company that has gone bankrupt and you will see they are almost identical. Throw them away.
Read the Annual Report. Another bit of smoke and mirrors. The title should tell you - Annual. Much of what is in it is a year old. Worthless. And let's hope it doesn't have a case of Enronitis.
Get a report from Morningstar. They know all about every financial statistic for a company that you can think of. You might even find out how many sugar lumps the CEO has in his coffee, but there is one thing you won't learn. If you buy this company's stock will it go up? What I am saying is that all the conventional wisdom methods of doing research are worthless. So what do you do?
On the Internet you can find a list of the best performing mutual funds. Go to www.smartmoney.com or www.yahoo/finance.com . There are other places also, but these 2 are very good. List the top 5 mutual funds (write down their symbols). Now go to www.bigcharts.com .Put in the symbol for one of the funds. A chart will come up giving you a picture of the price performance of that fund. If it is going up at a 25-degree angle or more it means the fund manager is doing a good job of picking stocks. At the top of the chart picture there is a legend for Morningstar. Click on that. The new page will show near the bottom the major holdings of this fund. Again you need to get the symbols for his top 5 stocks and look at the chart picture for each one. If that stock is going up in a nice steady price over a period of time of 6 months or longer you have found a winner. Do this with several funds until you have found some stocks you like.
You have let a professional stock picker do all the work for you and now can piggyback his expertise at no cost. Please remember that when that stock turns down you want to sell it. You may be able to ride one up, but you can never tell when it will turn into another Enron. Always be ready to sell.
Al Thomas' book, "If It Doesn't Go Up, Don't BuyIt!" has helped thousands of people make moneyand keep their profits with his simple 2-stepmethod. Read the first chapter athttp://www.mutualfundmagic.com and discover why he's the man that Wall Streetdoes not want you to know.
There are formulas for just about everything,but it has been shown that the simpler theformula or method of doing a particular taskthe better it works. It has evolved down toKISS ? Keep It Simple Stupid.
Stock Valuation using the SMP Model
Disclaimer:Please note that I do not necessarily purchase, own, or partake of any of the securities or other financial instruments mentioned in this article. I also do not take any responsibility for any actions resulting from any actions taken by anyone who reads this article. You are responsible for your own finances - no one else. Do your yown due diligence when researching financial matters.
My Neighbor Got A New Car
I don't know what kind it is, but I saw iton TV running full speed along the shore (I don'tlive near the shore) throwing up spray or maybeit was that one climbing up the steep mountaintrail thru the mud, rocks and snow. Veryexciting. (I don't live near the mountainseither.) WOW! Just what I need.
How To Be A Winner
Everyone who invests in the stock market wants to be a winner. Each person's definition of a winner will be somewhat different, but there is hardly one who isn't looking for that stock that will double in price within one year.
What is Involved in Peak Performance Trading?
There is so much involved in developing peak performance, that I recommend that all traders have a business plan. We recommend that the business plan cover all of the following areas.
No, this is not a symbol for some Latin number. The Wall Street mavens talk about this market timing device as if they knew how to use it to determine which way the stock market is going ? up or down. It is pretty obvious that brokers, analysts and financial planners have not learned the language.
Stock Options Trading Strategies - Lean
Professional stock options traders use the term lean to refer to one's perception about the directional strength of the stock. When you own a stock option and intend to hold it for a period of time, you are aware that you will probably be holding it while it goes up and while it goes down.
Stock Trading Success
The ABC's of Stock Trading Success
Tips to Finding Other People?s Simple Trading Plans
Did you know you can make money (and a lot of it) by simply modeling someone else's trading plan? Yes, it is true. Unbelievably, there are many of trading gurus doing it RIGHT NOW.
Bad News is Good News
For weeks, no, months we have been bombarded with nothing but negative news about the economy in general and thousands of individual companies. The stock market has dropped thousands of points and more than $8 trillion in paper assets have disappeared.
Trading Baskets II: The Crapolio, A Roll of the Dice in the Stock Market
In a previously written article, we expanded the use of the term "Trading Baskets" to include stocks from different sectors or industries. Now I want to share with you an approach to day trading or swing trading that I had some success with back in the wild and woolly, pinnacle days of day trading that may still work today. Unfortunately, this basket of stocks was dubbed "The Crapolilo", a name it just could not shake. You'll see why.
Play another Day
Money management starts with protecting your capital, realizing profits and cutting losses. As I have stated in the past, without cash, you can't invest. Cash is king and learning to manage your money is the most important aspect to investing in stocks. The game is won by lowering your risk by properly turning the numbers in your favor. Cutting losses is the best insurance to keeping your cash.
Long-Term Investment In Todays Market?
The stock market is very unstable at this time going up and down while interest rates are so low you want to be a borrower and not a lender. Would you like some suggestions on how can you get the most out of low interest rates while being assured your principal will not disappear while you are trying to make some money? Of course, there is always the danger of borrowing the money and then spending it just because it is there.
10 Tips For Creating Wealth From the Stock Market
1. Do not spread your money too thin.
The Secret Art of Backtesting
If you have not back tested your trading system, you might as well trade with your eyes close.
When you stand on the ocean shore and watch the waves breaking you might become aware that the tide is coming in or going out. It is a slow process to watch the water retreat and when it finally gets to its lowest point it is almost impossible to tell if it has stopped or will retreat further. Plenty of wave action, but going nowhere.
Psychology ? How to Reduce Negative Thoughts Relating to Trading?
The thinking process of the brain relating to the psychology of trading involves:
The Shadow knows. There used to be a radio program called The Shadow where the hero, Lamont Cranston, the Shadow, would overcome the shadowy forces of doom by clouding the vision of those around him. "Who knows what evil lurks in the hearts of men" was their intro line. They were great shows and you can still find them on the Internet.
Option Spread Trading
Spread trading is a technique that can be used to profit in bullish, neutral or bearish conditions. It basically functions to limit risk at the cost of limiting profit as well.
How to Pick Winning Stocks
There is nothing more exciting than finding an undervalued stock and seeing it explode out of nowhere rising in value 100% or more in a few weeks. Some stocks can move as much as 1000% in a year and?. Even after the stock market crashed in 2000, some stocks still have gone up 500% or more in a year.
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