Keeping both long and short term trades can benefit you in many ways. It can give you all the benefits of short term trading with some of the safety from long term trading.
Many experienced traders will keep both long term investments and short term trades out at the same time. This allows ... Views: 577
Leadership stocks and lagging stocks are two things you can look at when trading the market. These are stocks that are performing above average and below average.
A leadership stock is a stock that has done better then the market average for a set period of time. This period depends on your ... Views: 1066
It is very important to learn from your past mistakes in anything you do. This way you can be continuously improving your life. The same goes with trading, it is a very wise decision to keep a trading journal and update what you have done periodically.
Anytime you start to lose money it ... Views: 817
Letting your winners ride is a stock market strategy that we can all learn from. This simple way of thinking has proven its effectiveness time and time again in the stock market.
Many trading strategies out there call for you setting a profit target to meet. Once it meets that target then ... Views: 929
It is amazing that everyone talks about getting the huge returns in the market, but not many people focus on protecting yourself from taking huge losses which is the most important part of trading.
Think about it if you buy a stock at $30 and it falls and crashes to $10 you have just lost 66% ... Views: 672
With all the different ways to view stock charts today it can get kind of confusing. Figuring out whether to use a line chart, bar chart, or candlestick chart is the first step.
Let’s compare them. Bar charts and candlesticks give you much more information than the simple line chart. They ... Views: 1329
I consider myself a short term trader, but that does not mean I can’t invest ever now and then. Sometimes the conditions are perfect for investing and you can’t overlook it. This occurs when.
1. There is a “Fire Sale”
A fire sale is just another name for when stocks are cheap. When stocks ... Views: 635
Trading some low probability trades isn’t always a bad thing. It can help you to make a huge return if you are right and you can always manage your risk when you are wrong.
By a low probability trade I am talking about trades that will probably not be profitable. Even so it can be a good idea ... Views: 725
Low volume stocks can make it much more difficult to trade profitable. For that reason it is better to stay out of these stocks regardless of how the set up looks.
Volume should be looked at every time you place a trade. What volume does is tell you exactly how much of a given stock was ... Views: 1273
Investing in the stock market has a large number of great benefits and can help you achieve your goals. Everyone can be better off by investing at least something into the stock market because of these 4 reasons.
1. Better than Putting it in the Bank
The stock market has the ability to ... Views: 7329
Buying leaps can be a very effective long term way to leverage your money in the stock market. Buying a leap can produce greater gains than just buying the stock and holing it.
Let us look at an example of how it works. We find that stock XYZ is currently trading at $45. It is a strong ... Views: 596
The Markets have been falling fast lately and most people either believe it is the end of the world or the markets are at a bottom. Both conclusions are probably wrong.
First of all it is not the end of the world. Stocks go up and down that’s what they do. That said, even though the markets ... Views: 860
Sideways markets are always harder to trade then trending markets. Trying to hit every swing can be difficult for a trader. Instead of trying to predict the movements you can make money in a sideways market by using a strategy called an iron condor.
This is how it works. Say a stock is ... Views: 879
In the investment work you can either learn to trade yourself, or listen to whatever the analysis tell you and follow their advice. Unfortunately too many people chose to follow the analysis instead of taking it into their own hands.
There are 4 reasons why it can be a wiser to make your own ... Views: 633
In this market everyone is looking for the market turning point. The point where investors come in and say, stocks have been crushed enough, everything is on sale, it is time to buy. But how can you tell when that time has come? Is there some magical device that will give you the exact bottom ... Views: 807
Now traders who try to make money using technical analysis often make many mistakes. Some of these mistakes are.
1. Risk Management
Risk Management is the most important part of trading. If you do not control your risk you will feel the pain eventually in your account. Many new traders will ... Views: 658
Selling options is a great way to make consistent money trading the stock market, but there are a few mistakes that many option sellers will make, especially when they have just started out.
1. Risk Management
It is really easy to forget about risk management when you are winning the majority ... Views: 1904
Trading the stock market is a very abnormal way of making money. There are so many ways for you to make or lose money, and you have to keep on your toes and be cautious to avoid losing your money. Here are the top 3 mistakes traders will make.
1. Only Looking at Profits
Newer traders are ... Views: 714
Naked Puts are supposed to be one of the riskiest strategies out there. But if done right selling naked puts can be even safer, and more profitable than buying stocks.
When you sell a naked put you take on the obligation to buy a stock at a certain price on or before a given date. For this ... Views: 864
Did you know that it is possible to have stocks in your account that you have already made a profit on before you sell it? It is rare, but it can happen.
Here are some tips help you pull out some money from the stocks you already own, and possible even pull out more cash flow from the stock ... Views: 3590
It is very tempting to move your stops down during times of panic. It becomes even harder when you believe the market is overreacting to bad news. But holding your ground is absolutely critical when trading.
When you buy a stock you need to have a stop level. This is a level that is the ... Views: 686
I never sell naked calls, because there is just too much risk involved. How much risk? Infinite! That is right there is no limit to how much you risk on a naked call.
When you sell a naked call you are giving someone else the right to buy a given stock at a given price on or before a given ... Views: 1204
Option selling can be one of the most consistent ways to pull money out of the stock market. It can bring cash flow every. I’ll show you how powerful option selling can be.
First you have to understand what an option is. When you buy a put option you buy the right to sell a given stock, ... Views: 699
Option Spreads can be very helpful for anyone who want to enter the world of short term trading but is having problems finding stocks that will do exactly what they are expecting. Spreads use creative ways to make it easier to make a monthly income from stocks.
The best thing about spreads is ... Views: 663
Option trading is a great way to increase your potential returns in the stock market. But even with options there is room for risky traders and less risky traders.
If you want to be a more conservative option buyer you can always buy in the money stock options. If you feel like taking on a ... Views: 1198
Stock market crashes aren’t always bad. In fact sometimes they can be unbelievable profitable. During a big crash there is the opportunity to make a large amount of money in a short period of time, if you play it right.
So what do you need to do to play a market crash successfully? Well ... Views: 957
Unsystematic risk is the risk you take on when investing in a stock. Basically it is the risk of some new announcements, or earnings reports coming out that could affect the price of the stock.
So if you buy a stock thinking it was a good buy and all of a sudden the company comes out with ... Views: 894
It can be tempting to get into stocks that are offering high dividends. In fact for an investor the dividends can make up a huge amount of your total profit from that investment.
But there are a few things you are going to want to consider looking at if you are investing for the ... Views: 726
Selling a put can be a very effective way to increase your profit in the stock market. It helps to bring some income to the account while at the same time letting you get into longer term positions.
The pros to this strategy are
1. You Get Money Upfront
The best thing about deciding to ... Views: 1034
Protective puts and stop orders both allow you to limit your loss in the stock market. Each has its own advantages and disadvantages.
So say we bought the stock at $54 and want to limit our losses to $4. We could do this by buying the $50 put for $8. Now if the stock goes down the most we ... Views: 920
Protective puts allow you to protect yourself from huge losses in the stock market when times are uncertain. So what are they?
When you buy a protective put you are buying the right to sell a stock at a given price on or before a given date. So say you own a stock that is trading at $60 and ... Views: 551
Put options and short ETFs are two ways you can look at profiting from the downside, so which one is better. What provides the least risk and highest reward?
Well at least when you compare it to your total investment put options probably give you a higher risk then short ETFs do. But all ... Views: 4195
Reacting to the market is a lesson every trader should learn. It is much simpler and much more profitable then to just react to the market then to try to understand it.
Too many traders try to explain a big move. For instance most people will say that stocks fell because of the unemployment ... Views: 611
Drawing a trend line is just like connecting the dots. By drawing a line at the highs of a stock you get a resistance level. By drawing a line at the lows of a stock you get a support level.
The theory is that stocks will bounce up from support and bounce down from resistance. Also when a ... Views: 710
Everyone believes that buying options is the riskiest thing you can do in the stock market. While they are risky in a sense that you can lose money they are no more risky then buying stocks. The main reasons people think others are.
1. Short Term
People look as short term as risky. I have ... Views: 641
All options eventually expire. But there are many times when you still want to use the option contract to profit. In this case rolling your option into a later date can be a good idea.
When you roll options you simply close the option position you are in and open up another option position in ... Views: 751
Most people decide that the stock market is just too risky for them to put their hard earned money into. I know many savers out there who would rather put their money into a savings account then into the markets.
This way they can go for the sure thing, the government insured return, but what ... Views: 837
One very effective strategy of getting into a strong stock is to not just go right out and buy the stock, but to sell a put on the stock instead. This does give you some advantages that you would not have had you simply entered the stock.
The advantages are.
1. Money Up Front
One of the ... Views: 903
Selling covered calls is a very effective strategy in the stock market. It lets you make continuous cash flow from a stock that you already own and can have a huge effect on your annual return. So how do you set up a covered call trade?
There are three steps you have to take.
1. Find A ... Views: 1016
Selling covered calls is a great way to make money in the stock market. But as an exit strategy it has it’s ups and downs.
First let’s look at the benefits of selling covered calls as an exit strategy.
1. It allows you to make consistent cash flow
If you are constantly selling covered calls ... Views: 926
Buying options can be a great way to make huge returns in the stock market. But they can also work against you in many different ways. Selling options, however can give you the same ability to make a good return, but with less risk.
Here are some reasons why selling options can be better than ... Views: 632
There are a lot of benefits to selling options in the stock market. Some of the things selling options lets you do are.
1. Make Money In A Confused Market
When stocks are volatile and have no clue which direction they want to go selling options lets you make a profit. Instead of trying to ... Views: 638
One way to increase your returns in the stock market is to sell options n stocks that you already own. This can also give you another way to receive a monthly income from your positions.
When you sell a call you receive money up front. The only downside is that you give someone else the ... Views: 1029
In a situation like we have now in the market there are many stocks that are way undervalued. You may be looking into buying some of these undervalued stocks and waiting for the market to recover. If so selling out of the money covered calls on those stocks is an excellent way to generate ... Views: 875
Selling puts can be a wonderful strategy at times. And it definitely can build up after you have been doing it for a long while.
Most new traders want to make the big returns. They want to buy that option that is going to shoot up 300% in 2 days. While that can happen every once and a ... Views: 952
Two strategies for making money as an option seller are to either sell naked options or spreads. Selling spreads are often
time the much wiser choice for the following reasons.
1. Lower Risk
You assume a much lower risk when you sell a spread as opposed to selling a naked option. For ... Views: 1642
Everyone wants to find the bottom of the stock market so they can make huge returns and be looked at as a genius. But often times the only way you can tell when a bottom is, is after the fact. There are some signs that you can look at however to determine if the bottom is coming.
1. No one ... Views: 763
I hear a lot of people talk about finding the bottom of a crash or finding the top of a rally, particularly this rally we have recently been having.
There is always news out there somewhere that a trend will not continue for one reason or another, but sometimes it is best to ignore all the ... Views: 669
There are 6 critical mistakes that all traders in the stock market make. These mistakes are made by amateurs and experienced traders alike. They can be devastating and make one lose all of their money in the stock market. These are mistakes you definitely want to avoid. That is why I have put ... Views: 690
I am a huge stock market geek and a huge poker geek as well. I remember seeing not too long ago a world poker series; they were interviewing a guy from the semi finals who said he was an option trader.
That made me think, trading which is one of my biggest hobbies is very similar to one of ... Views: 1249