Trading stocks especially of the penny stocks is a highly transitory gamble. In fact, the instability of these stocks can sway from 4 times gains to 100 percent loss within a day. Hence, you must only invest money in stocks that you can meet the expense to lose. You can’t make money instantly as you start the trading. It requires sometime to learn the trading. After you gained the right experience, you should risk investing more money.

Don’t be greedy enough to make huge money quickly investing in a single stock. Otherwise you can loose a lot of money because the potential stock may not result according to our expectation. You can pursue a well-planned entry and exit strategy for each of your trades. It will help you to control your loss. You can have different entry and exit strategies. In any circumstances stick to believed strategies instead of following your emotions of greed, hot tips, and supposed insider information. Persistently, let your head with its store of reliable information make your decisions.

Such as, if you make your mind up that you will sell the penny stocks once it reaches a 60 percent profit margin walk away as soon as that target is reached. This also goes for losses. Likewise set a loss limit and do not surpass that limit. And if your loss has reached that point, don’t go for further investments. Or else, you will face more disappointments when you try to recover the initial losses. You can become skilled at many things about stock trading by making research yourself.

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The first and foremost important thing is to educate yourself. You should read about the stocks as well as the market. You should consider taking several seminars or even take a class that teaches investing. You can also go online to a variety of different online financial websites that can provide you with a wealth of information.

You will also need to create for yourself some financial goals and an investment and stock picking strategy. You will need to take time to research different stocks by reading their annual reports, their quarterly reports and any other information there might be on file with the Securities and Exchange Commission. You can also look these up at various websites (Tip: Google freedgar)

Make sure that when you invest that you only invest in the stocks that you have studied and feel that you know. You might want to start by looking into the stocks of companies in your area, companies that you are somewhat familiar with and ones that you might have a little bit of confidence in.

Another thing you need to do is to make sure to check the holdings of some very successful mutual fund companies and if they appear to be doing well with certain stocks then it might be that you could do well with those same stocks.

Make sure that you try to be diversified. You want to try to stay away from investing your money in just a couple of stocks. It’s better if you have a handful that you have investments in. When you do start buying your stocks you need to try and find a discount broker to buy the stocks for you, however, if you feel confident in yourself then you might want to just do the investing yourself and you will save yourself from having to pay out any commissions.

Make sure that the stocks you buy you are going to feel comfortable holding onto for 3 to 5 years, you need to try and resist dumping your stocks the minute you see them dipping in price a few points. You need to give the stocks a chance to do something.

Another way you can invest and it’s a lot easier for you in the long run is if your company offers any 401(k) plans, retirement plans or Keogh plans consider investing in those. Here you don’t have to worry about picking the stocks yourself and there are different tax breaks that come with these types of investments.

Note: Avoid thinking that when you invest your money today that you are going to become an instant millionaire. You need to be thinking of the long term picture not the immediate picture. Besides very few people become millionaires off the stock market, if that were the case everyone would do it. You can however, if you are patient and invest wisely, make a good nest egg for later in life.

Amy Myer – About the Author:
For more Free Personal Finance Information download Amy’s Free Personal Finance Information Pack at http://www.free-finance-info.com and join thousands of other people who are taking control of their Personal Finances.

For other free information on a variety of issues please visit www.free-info-site.com

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The yen soared against the dollar on Thursday in chaotic trading as a break of the previous 1995 peak triggered a host of stop-loss and option-related selling, setting off a cascade of algorithmic sales.

The surge, which has significantly raised the risk of intervention by Japanese authorities, forced domestic retail investors to unwind long positions they had built up against the dollar in the past few weeks, driving the yen as far as 76.25 per dollar.

“Nikkei investors are watching the dollar/yen rate closely. The absence of rapid currency moves in the Tokyo session is helping the Nikkei calm down and hold above Tuesday’s low,” said Yumi Nishimura, senior market analyst with Daiwa Securities Capital Markets in Tokyo.

“There’s still a possibility of more speculative selling of the dollar tomorrow if we don’t hear any news about the intervention overnight.”

The dollar was at 79.31 yen, rebounding from the low in illiquid trade as traders covered their short dollar positions and tried to make sense of the moves.

The Nikkei share average was down 2.3 percent at 8,883.64 points .N225, recovering slightly from intraday low of 8,639.56 as the yen weakened from its highs.

The index on Wednesday bounced as hedge funds led a short covering rally on the second highest day of volume ever, but few investors had expected the gains to last. Trading on Tuesday generated the highest trade on record.

Nikkei futures listed in Osaka were down 3.0 percent to 8,730, trimming some losses after falling as far as 8,400 at the start of trade.

The broader TOPIX was down 2.4 percent to 798.15 .

All eyes were on what action authorities would take to contain the yen, with some expectations Group of Seven countries would give Japan the OK to intervene against a stronger currency.

“With G7 scheduled to hold a conference call on Japan late Thursday, it seems inevitable that the yen will be part of a broader discussion on stabilizing global markets. It would be nothing short of amazing if they fail to at least make some veiled threat of intervention,” Alan Ruskin, currency strategist with Deutsche Bank in New York, said in a note.

With panic setting-in about radiation leakage from the stricken plant north of Tokyo and more governments warning their citizens about the dangers, the cost of insuring against a debt default in Japan through credit default swaps has been rising and now stands higher than South Korea.

Five-year CDS on Japan was quoted at 117 basis points on Wednesday after widening to as much as 124 basis points Tuesday, compared with 105 basis points for South Korea.

Ten-year Japanese government bond futures were up 0.16 point to 139.94, giving up some initial gains.

via

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The benchmark Nikkei index fell 398.83 points, or 4.39 per cent, to 8,694.89 in the first 25 minutes of trading as jittery investors again offloaded shares amid fears about the unfolding crisis at the Fukushima No.1 nuclear plant.

It later improved back to a drop of 2.25 per cent, just after midday (Melb. time)

The Bank of Japan has pumped five trillion yen ($A65.95 billion) into the financial system to soothe money markets shaken by Japan’s biggest ever earthquake, a devastating tsunami and a nuclear emergency.

It helped send the Yen back to levels better suited to Japanese exporters after the currency had earlier hit the highest level since World War II against the US dollar of 78.87 yen.

Today’s Bank of Japan move raised its total funds injection to 33 trillion yen ($A435.27 billion) as the central bank aims to help stabilise the short-term money market, making good on an earlier pledge that it would unleash “massive” funds following the disasters.

The fall-off on the Nikkei reverses a rebound of more than five per cent yesterday on bargain-hunting.

Shares saw the biggest two-day sell-off in 24 years at the start of the week in the wake of Friday’s massive 9.0-magnitude earthquake and tsunami, which has left nearly 13,000 people confirmed dead or missing.

Source

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So, the question is, are all these software real promising products or they are just some kind of scams?

In my years of trading experience, I have come across many automated stock trading software, my answer for the question is both Yes and No.

Yes: There are software that make the real deal as they are able to provide reliable and insight review of stock market and are able to pick the potential profitable stock. Some of the quality software have created high income traders that claim stock trading software as their living tools.

No: There are also some piggyback products that share the reputation of the good one; Some even become the scapegoat to destroy the trust of consumers on automated stock trading software. This is very irritating to me who benefited from trading software.

Hence, I will share some tips for those who still want to give trading software a try, in order to identify the good automated stock trading software and make the real money from utilizing them.

First, I recommend that you should go for those Stock Day Trading Software which allow traders to trade in different markets, and integrated with sound winning real life stock trading strategies. I am aware that many people recommend those software targeting penny stocks. I do not doubt that instruction but I prefer to try on different stock markets and find out which market one is more comfortable with. Penny stock maybe more lucrative but it may be more risky than normal stock market.

Second, the software should be designed and created by experienced stock traders who encountered various circumstances in the volatile stock market. This ensures the formulas and advices programmed will be more proficient than those provided by those novice programmers.

Third, the most important point is that you are recommended to try on the Stock Day Trading Software with money back guarantee. You are able to test run the software by following the instruction. Try to trade some stock picks recommended by the software and see whether you are convinced by the results before you really purchased it. This guarantee also allow you to trade in different stock markets and get the most comfortable feeling among all. All you need to do is to follow the instructions and advices prompted by the software and judge the results yourself.

Finally, if the results are astonishing, purchase the product and utilize it to boost your portfolio. Try to evolve and master in various markets after you are familiar with one. This allows you to diversify your trading options and maximize your chance of earning.

Download the free information about Stock Trading Software that changed my life and future!

I have learned from the hardest way to invest in stock markets, tried to invest in stock with conventional methods for years and the results are disappointing. I have done all those necessary technical calculation and spent lots of money in buying those materials, but it seems that I failed.

I nearly gave up my investment life until I got in touch with Stock Day Trading and Trading Software. At first I do not know how to utilize them until I figured out the way, and the profit I have gained from it is astonishing.

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My reasoning for investing in companies with high dividends is that these stocks are stable. They might not experience the same high level of capital gains that you could get by picking the next big thing, but they offer a steady return on investment as the company pays you a regular 4% on the share’s value. What’s more, they may also show some growth in stock price, giving you a double gain of dividend payouts and capital gains.

When getting a dividend, it’s great to reinvest it in the company, thereby increasing your dividend holdings in the company even further. Through this, you will find yourself holding more shares of the company’s stock and thus, receiving more dividends. Because of this, dividend stocks can act as a circular growth of profit. Buying dividend paying stocks gets you more dividends which gets you buying more dividend paying stock and so on.

However, one major warning when looking into dividend stocks is to make sure the company has a reasonable earnings per share. Some companies artificially inflate their price with high dividends that are not sustainable. As such, you will be misled into buying the company’s stock, only to find that the dividend gets cut by the next quarter.

Steven Fister is a published author on a variety of web sites. Working freelance, he has contributed articles to sites including Nikon S640 and Integrated Washer Dryer. In his spare time, he is a sports fan and likes to follow the New York teams.

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Commodities like gold, silver,oil, copper,uranium, wheat, cotton and other are experiencing an all time high historical prices. Gold prices recently breached the unheard of historical barrier of $1200 per troy ounce. Gold prices have retraced somewhat, but the market is poised for another rally in gold prices in the next few months. Other commodities are also experiencing a all time high demand. Crude oil is expected to reach close to $200 per barrel in the next few years with the global economy finally out of recession. What we are watching is a secular bull market in the commodities. This secular bull market may continue for many decades in 21st century. That is why it is being said that 21st century belongs to commodity trading. The fundamentals behind this secular bull market are strong.

But this does not mean that the commodity bull market will go up in a straight line. There will be times when the commodities market will no perform very well. This is simply the nature of the commodity cycle. No market ever goes up in a straight line.

What are the fundamentals that are driving the bull market in commodities? These are the factors like the rapid global population growth that started in the last half of 20th century and is expected to continue in 21st century. This rapid population growth is taking place mostly in the developing continents like Asia and Africa. Recent studies done by UNDP, an agency of United Nations indicate that the time for the global population to increase by 1 billion people has decreased from 50 years in the early 20th century to something like 13 years in 21st century.

Now this rapid increase in the global population is going to put a lot of pressure on natural resources. It is natural for people to eat and built homes where they can live and sleep. These homes need heating in winters.All these things need natural resources.

Couple this population growth factor with the largest urbanization movement that the world is experiencing. In early part of 20th century only 15 of the world population lived in cities. Now this figure has jumped to more than 50%. More and more people are moving to cities around the world in search of jobs and better living conditions. Urbanization means a high demand for natural resources as city dwellers consume a lot more natural resources as compared to village dwellers. This phenomenon is more pronounced in Asian countries.

Then there is rapid industrialization that is taking place in countries like Brazil, Russia, China and India which is putting a lot of pressure on the global supply of natural resources. As energy resources get depleted, more and more competition will develop between these countries to develop direct access to global energy markets.

Mr. Ahmad Hassam is a Harvard graduate. Learn Commodity Trading! Get the ULTIMATE SWING TRADING SOFTWARE FREE.

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What can cause this USD crash. Warren Buffet gave a hint of this when he said that the frentic spending that is going on coupled with massive money creation will cause the USD to face a crash of historic proportions. This crash may even be more severe than what happened in 1970s. Now in 1970s too, USD had crashed due to the massive inflation caused by the government overspending during the Vietnam War. This time too, the US government is taking refuge by printing massive amounts of greenbacks to bailout bankrupt banks and insurance companies. This massive money creation is eventually going to make inflation uncontrollable for many years to come. Inflation could not be controlled during the 1970s decade. It was only controlled when Paul Volckar became the FED Chairman. He increased the interest rates so high that the economy went into recession. But it also ended the inflationary cycle. This time, the FED Chairman wants to save the financial system and ward off recession by increasing the money supply. Eventually, he will have to deal with high inflation later on. He knows it. The market knows it. This makes the market nervous and is putting a lot of pressure on USD.

There is a danger that the US Treasury Bonds will sharply fall in value driving the long term interest rates high and delaying the US economic recovery with it. The long term interest rates are still low. So, if this does happen, there will be come time lag before the medium and long term interest rates start rising.

As said before, the major cause of the US Bond market crash can be heavy borrowing by the US Treasury. This heavy borrowing can be due to huge bailouts dished out to big banks, corporations and insurance companies. To attract more borrowers, FED will have to increase the interest rates. But right now, the economy needs low interest rates to start the economic recovery process. This makes borrowing difficult and if the foreign lenders stop lending, the bond market can collapse.

In the same vein, pressure is mounting on the British Pound (GBP) as the British economy is still struggling hard to come out of recession. GBP is steadily losing value against other major currencies. GBP did show a retracement sometimes back when the British government tried hard to stimulate the economy. But this retracement was short lived.

USD and GBP in the downtrend with the bond market crash likely meaning market timers getting ready for action to make their killings in the market. This is what Market Timing is all about. Watching the different markets. Timining your trades with the start of a new trend in the market and riding it till the end for maximum profits.

Now, riding the trend at the right time is what market timing is all about. Many investors and traders keep on waiting. They join the trend when it is already underway losing major part of the profit. The days of the buy and hold investing are over. 21st century will belong to the market timers!

Mr. Ahmad Hassam has done Masters from Harvard. Get these 3 FREE Investing Report, The Ultimate Investing Test, The Best Investing Lessons and A Hedge Fund Manager’s Best Advice & discover a Stock Trading Course that can make you rich in 2010. Get these FREE Forex Scalping Cheatsheets!

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What is a Covered Call?

In it simplest terms, it is where you own some stock and sell an option to someone else to buy that stock at a specified strike price to generate some income.

What is Buy-Write?

Buy-Write is another name for Covered Call. The transaction is slightly different in that you are buying the stock at the same time you are selling an option to sell the stock.

How Does it Work?

To make it easy to explain in the following let’s say that you already own 1000 shares of company ABC stock and its current price is $25.76 per share, you have no plans to sell the stock, but I am not overly concerned if it does get sold out from under me.

You will look at the options chain for a strike price above the current stock price, usually in the next month and sell the option.

I prefer to look at the next $5 increment to see if it will generate enough income somewhere in the range of .75 – 1.25. Here’s a bit of caution. The closer the strike price you pick to the current stock price, the greater the chance of the stock getting sold out from under you if the stock price starts moving upward very fast.

For arguments sake; say we found a September 30 that is paying .75 per contract. We own 1000 shares of ABC stock so we can sell up to 10 contracts against it.

How do I Make Money

If you sold 10 contracts of ABC stock for 75 cents, you would generate an income of $750 within the time frame of the option you sold. Usually 1-2 months. This is approximately a 3% return on investment. Ex: $750 / (1000 shares x $25.76) = .03 or 3%.

On expiration Friday, you do nothing, just let the expiration expire. This way you keep the entire $750 (excluding any commissions and fees).

Providing the stock price never exceeded the strike sold, or the option was not exercised, you can now repeat this same trade for the next month and so on.

What Happens If the Stock Price Rises Above the Strike Price Sold?

The option will be exercised (stock sold) at the strike price of the option sold and you will keep the amount gained from the option sale plus the difference between stock entry and exercise. Here is an example:

* Bought 1000 shares of ABC for $21.62 ($21,620)
* Sold 10 option contracts of Sept/$30 for $750
* 1000 shares of ABC exercised at $30.00 per share ($30,000)
* Your gain: $30,000-$21.620 + $750 = $9,130

Remember at this point, you no longer own the stock.

What Happens If the Stock Price Starts Dropping?

You do nothing, let the option expire and keep your premium from the option sold. Now you have decision to make, do you still want to keep the stock?

Over the years I have traded covered calls many times and use this as one method to generate income. If you own stock you might as well make some money from it, particularly if you are not married to it. (Don’t want to risk selling it.)

Happy trading…

Chuck Ainsworth
http://articlesbychuckytrader.com

For more information on a great product to help you with online options trading visit my website at http://www.chuckytrader.com/wizetrade/. With Wizetrade Options you will have the charts and manual control to support all your trading needs.

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Personality Fit

Just as much as not all penny stocks are created equal, not all personalities are created equal in the arena of penny stock trading. You must determine your personal and professional investment goals and then assess if the penny stocks are the right fit for you. Well, of course, money is money. You must understand, however, that these stocks have the highest amount of risk amongst other investment options. If you cannot handle the emotional roller coaster of extreme ups and downs of penny stock trading, then you are well advised to stay away from it.

Understanding of Stock Markets

Speaking of extreme movements, you must understand that the stock markets are highly volatile. You might experience a resounding rally today and then watch it nosedive tomorrow.

In most ways, when you engage in penny stock trading, your millions will suffer the same fate. As such, you must be sufficiently equipped, both in the intellectual and emotional sense, to handle the extreme volatility. As many successful traders will tell you, always make decisions with your head and your instincts borne of years of experience. The emotions are more than likely to lead you astray.

Basic Research

It cannot be overemphasized. You must always do your research about the products, the company, the industry it is operating in and the general outlook on the economy. Often, it will take just a few hours of your time but the rewards will be greater when you gather the right quality and quantity of information about the penny stocks. Indeed, wealth is made carefully, not harvested carelessly. Just keep this in mind and you will do alright.

Trade Execution Strategy

In penny stock trading, the ability when to hold, buy and sell can mean the difference between profit and loss. You have to develop this ability over years and years of experience and exposure to various trading situations. And even then, you will still miss the mark almost half the time, thanks to the volatile nature of penny stock trading. As such, to make a fortune out of your trades, you must be patient in learning all that you can, in making your moves and in earning your profits. Otherwise, you will be prone to make rash judgments.

Most important of all in making your millions, you must have an investment plan. Said plan must cover both short-term and long-terms periods to be truly viable, not to mention that you must have a plan for diversification of your investment portfolio.

Ultimately, your penny stocks must only comprise 10 percent of your total portfolio. The greater your dependency on penny stocks, the greater you expose yourself to risks. And then you have to start all over again.

There is a little more to becoming a penny stock millionaire. Visit http://www.stock-trading-made-ez.com/ to learn more.

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