Day Trading Forex

If the stock market is rising and giving you solid gains, chances are it is what’s known as a Bull Market. And it is the dream of most investors to be fully invested when a new bull market has just begun.

At first glance it may seem like a silly thing to try – especially when there are perfectly qualified people like financial planners or stock brokers telling you it is impossible. But what if there was a way to know, with a high probability, that a new bull market was starting?

Ken Fisher, in his book “The Wall Street Waltz”, discovered that unemployment was the key. Why? It’s simple: when the economy and the stock market are riding along nicely and moving upwards as they should, unemployment will never rise too much. This means that people are working, companies are making profits, and both of them are spending this money and stimulating the economy.

But as companies make less profits, employ less people and both spend less, the economy and stock market declines. Most recently, 2008 is a perfect example.

Therefore Ken says, if you are watching the news and unemployment figures have risen by more than 1 percent, then the start to a new bull market might be right around the corner. It won’t pick the exact bottom of the market down to the day, time and value, but a rise of over 1 percent will get you in the ballpark to be ready when the next bull comes along.

There is one more part to this story – cyclical stock market lows, and their subsequent bull markets, haven’t ever happened without a 1 percent rise in the unemployment rate. It happened most notably in 1970, where the stock market had been falling for 2 years. Unemployment rose sharply as 1970 began, and the stock market bottomed out in May.

There is one caveat however – the unemployment rate is not as reliable when it comes to predicting peaks in the market. This is because the stock market actually leads the over economy anyway in that regard. But Ken did find that a major peak in stock markets rarely happened without unemployment falling (jobs up) for two years.

There are many ways you can use this information, but at the very least the next time the market is falling and a bear market is in place, look out for rate of unemployment to rise by over 1 percent. When it does, you will be ready to take advantage of that bull market that’s on its way!

Get your free course on stock market investing, and free research on stock trends at Dave’s site www.asxmarketwatch.com .

That’s right – I’m going to show you what thousands of economists, financial planners and analysts the world over struggle to find: How to know when the economic recession will end, and how to know it in advance.

Times during an economic recession always seem tough, but there comes a time when they come to an end. Imagine if you or your business were ready to take advantage of the new economic times because you saw it coming? Or maybe you could have your resume ready for that new job offer, just as more jobs become available.

“Enough already – how do I tell when the recession will end?” I hear you ask. Let’s find out – it may be simpler than you think.

And your children will probably tell you it is easier to do than a night of homework!

For the answer we look to Ken Fisher in his book “The Wall Street Waltz”. It’s actually where the stock market comes in to play, because the stock market, believe it or not, has a magical way of leading the overall economy. In fact, the stock market will go down well before we ever hear word of a recession, and the stock market will go up long before we get confirmation that the economic recession is over.

Don’t believe it? Let’s look at our most recent example: the 2008 recession. The market started going up in March 2009, and the economic recession was announced over in October 2009 – a lead time of around 5 months. Or perhaps the recession before that – 2001 to 2003. The market started rising in March 2003, and the recession was announced over in July – 4 months later.

Or further: in late 1952 the market topped out. Half way through 1953 the recession was declared. The stock market had done it again!

We can see the same pattern in 1957, 1960, 1967, 1970, 1974, and then in more recent recessions like the early 1990’s and 2002. The average time-frame that the stock market leads the economy by is 6 months. Of course some will be more, and some will be less, but as a general rule 6 months is a good one to go by.

So what does this mean for you? Well, the next time a recession hits (and it will), keep a close eye on the stock market. When it starts to rise, in 6 months time you’ll be ready to take full advantage of a booming economy!

Get your free course on trading and investing, at Dave McLachlan’s site ASXmarketwatch.com. Dave also offers independant stock market research to help people just like you.

Today we thought we would take a look at forex trading. There’s a good deal of people that have heard about forex and wonder how they can earn some money, so hopefully this article helps.

There’s been a large increase in the amount of people that trade currencies online. It’s an exciting manner to earn extra money and as opposed to the stock markets, the currency markets are open throughout the whole day.

Just like stock trading, the idea is to buy when the cost is low and sell high. Currencies are constantly changing in value, so if you can sell a certain currency for a higher price than it was acquired for, money is made.

Let’s take a look at why certain currencies will shift in price. There are several components, but I want to quickly look at a couple of the key ones.

One of the biggest factors in defining exchange rates is rates of interest in a country. If a country steps-up interest rates this will cause more investors to make investments in that country. This causes a boost in demand for that currency and it appreciates in value. If you can predict when a country will raise their rates of interest and purchase the currency prior to it is announced, it is likely that you will gain a a good deal of money.

Prices of commodities will also play a sizeable role on certain currencies. Canada is an producer of oil and other natural resources. If oil prices rise, this causes a greater demand for the Canadian dollar as more individuals require the currency to finance the purchase. If oil prices rise, it is extremely likely that the Canadian dollar will rise.

If you are crious in trying forex trading, please consider buying a currency trading computer program to grow your earnings. These softwares are designed by pro traders anduse information from the forex markets in order to determine the currencies to buy. These programs on their own can earn you a considerable amount of income and even though they are used by pro traders, they give the perfect way for beginners to get started.

People can generate a great deal of income with currency trading. Once you have the proper tools, forex trading is a fun way to generate extra cash..

If you want to know how to trade forex, you will be able to find lots of information online. Click Here to get a free trial of one of the top forex trading programs which can make you money right away in the forex market.

Although we typically write about the stock market, we thought to have a look at a different area of the investing world. There’s a good deal of people that have heard about forex and are curious about how they can make money, so hopefully this article is useful.

There’s been a big increase in the amount of people that trade forex on the net. It’s an exciting manner to earn cash and unlike the stock markets, the currency markets stay open 24 hours a day.

Like stocks, you need to buy when the price is low and sell when the price is high. All currencies are constantly changing in rate, so if you can sell a certain currency for a higher price than it was acquired for, cash is made.

What is it that makes a currency change in value? There are several factors, but I want to quickly look at two of the important reasons.

The prevailing interest rates in a country has a big affect on the price of their domestic currency. The greater the rates in the country, the more foreign investors seek to invest in the country. These new investments lead to an increased demand for the country’s money and it rises in value. When you have the ability to predict when a country will boost it’s rates and buy the currency before the increase, it is very likely that you will earn a tidy profit.

Commodity prices will also have a huge affect on certain currencies. For example, Canada is a large producer of oil and other natural resources. If oil prices increase, this leads to a bigger demand for the Canadian dollar as more of the currency is required to make purchases of these resources. If oil prices rise, it is extremely likely that the Canadian currency will grow.

One of the strongest tips I can offer for those wishing to be involved in forex trading is to get a computer forex trading software. There are pieces of software that have been assembled to examine the forex markets based on market information and then find lucrative trades. There are plenty of currency traders make use of only these types of programs to earn their cash, however I like to utilize them in addition to trades based on my own research.

Currency trading is not only thrilling, but there’s a lot of money to be made by using the right tools.

If you want to know how to trade forex, you will be able to find lots of information on the internet. Click Here to get a free trial of the best forex trading programs which can make you money right away by picking out profitable trades.

The Forex market has expanded into the private sector and that means that everyday investors can take advantage of the income stream that can be made with one of the fastest growing home business opportunities in the US. All you need is a willingness to take the leap into the market.

The Forex market relies on the fluctuations of currency in regards to their purchasing power. This means that there are a great number and variety of factors has an effect on the fluctuations. Things like the rates of bonds, the political bills even the action of buying and selling currency can affect its value.

Consider this, if you were purchasing the Euro as part of your Forex trading and you purchased it at $1.25 meaning that a Euro is worth this much and you sold that Euro for $1.27 you made 2 cents on the deal for each dollar you have invested. This works out to only about 1% of the transaction.

While this may not seem like much, but if you are making 1% on each transaction and conduct a number of transactions in a week you can earn a substantial income stream.

Successful traders play the fluctuations in the market and know which currencies to buy and sell at a given time.

What Does a Forex Trader Use To Determine a Good Trade

There are things that a trader knows to use in order to determine what currencies to trade by watching what affects those currencies. For example, if you were looking at trading the Canadian currencies and understand it is tied to oil and wood – you can then know that when demand for wood changes the currency is going to adjust as well. The US dollar is tied to both treasury bills and the interest rates of the Federal Reserve so when these rates change the value of the dollar changes as well. These are just two examples of what people look out for.

There is a wealth of information on the web and through private resources about Forex trading and knowing the market, what drives it, and how to play it, can provide you with a good foundation as well as helping you to weather any declining curves.

You will also see some traders zone in on just a few currencies so that they can become “experts” in certain currencies.

Many traders subscribe to research services that can help to provide you with information on the various aspects of the market. However, doing this can also leave you reliant on the judgment of other people.

One of the first things that experienced traders look at is using what is known as a “robot” – this is a computer application that is used to assist in providing valuable information to the trader such as up to date market information and signals to let them know that a potentially profitable trade is available.

For those considering Forex as an income stream it is important to look into these types of programs and the benefits that they can provide to the trader – especially in the initial learning phase.

When looking at programs for the Forex market there are a few things to consider that will help you determine the program that will work best for you.

The first step is to make sure that there is a demo program or option available to allow you the chance to check out the program out prior to placing an actual cash investment. Usually this should run a week or two weeks in order to get a good view of how the program operates.

Money back guarantee is the second thing to look for. A company that trusts its products will back it.

The best way to choose is to purchase, test and return if it does not work for you.

If you’re curious about how to trade forex, you will be able to find lots of information online. Click Here to get a free trial of the best forex trading programs which make people money right away by picking out profitable trades.

The options market has caught the fancy of many investors and this is not surprising. The beauty of options is embedded in its very name. You have the options but not the obligation to buy or sell stocks at a given price by a given time. Now for options buyers this option unlike futures limits their maximum liability to the option premium they had paid at the time of buying the options contract.

You must have come across the term Index Options. So what are index options? In’78, Chicago Board Options Exchange (CBOE) began options trading on popular stock indexes such as the S&P 500 Stock Index. The CBOE options trades in multiples of $100 per index point. This is much cheaper than the $250 multiple per index point for the S&P futures contract.

Let’s take an example. Suppose the S&P 500 Index is at 1100 points. You have a bullish opinion of the market and are of the opinion that the S&P 500 Index will go further up. An index option allows the investor to buy the stock index at a set point within the given time period.

There are options Greeks that you need to understand. Time and volatility are two very important factors for an options contract. In case of an index options, what this means is that if any time for the next three months you decide to exercise your call option, you will get $100 for each point the index is above 1150. So you decide to purchase a call option at 1150 for three months for 50 points. In other words you paid an option premium of $5000.

Now, 1150 is the strike price of the index option. In case the S&P 500 Index does not rise above 1150, you can simply decide to not exercise your call option. In that case you will only lose the premium of $5000 that you had paid to buy the call index option.

Contrast this with S&P futures. Call options are considered to be bullish. So for you to make a profit with this call option, the S&P 500 Index will have to rise above 1200 point within the next three months otherwise you will lose your premium.

In case the S&P Index had fallen to 1100 point, you would have recouped your options premium. Put options are considered to be bearish. A Put Index Option works in exactly the same way as a Call Index Option except that you make profit when the stock index goes down. If you had bought the put index options instead of the call index option in our example above, every point below the strike price of 1150 would have given you a profit of $100.

Now the option premium that you pay is determined by the market and it depends on many factors like interest rates and dividend yield. But the most important factor is the expected volatility of the market.

Mr. Ahmad Hassam is a Harvard University Graduate. Try these cash printing Forex Signals from heaven. Discover a revolutionary Forex Robot System!

Every investor wants stock prices in his/her portfolio to go up. What would make a stock rise so much? The whole point of investing in stocks is to choose one that has the greatest chance of a rising share value. Don’t we all look for a stock that we could buy for $10 and later on sell for $300 per share? Well, how can we proceed to accomplish such a feat?

Buying a stock is essentially buying a small piece of the company and its future potential for growth and profits. So if the company does well, its stock will go up in price and if the company does poorly its stock will go down in price.

The marketplace is in fact buyers and sellers, individuals and organizations that want to buy stocks or sell them. Now why does the stock goes up and down with the performance of the company. Actually the real force behind the stock rise and fall is the market place.

This buying and selling of stocks can only take place in exchanges like the New York Stock Exchange and over the counter markets like NASDAQ. If there are more buyers of the stock, its value will go up and if there are more sellers in the market, the stock price goes down.

Sometimes you will find that the company does well and is posting good quarterly earnings but still its stock price goes down. What’s the reason behind this? Now it doesn’t mean that if the company does well and is showing good profits and earnings, its stock price will go up.

In reality the price of stock depends on the investor’s expectations. The price of a stock goes down because there are more sellers than buyers. So why is it so? The stock price does not go up or down just based on the company’s present performance. Stock price goes up and down because of what the buyers and sellers expect will happen with the company in the near future.

However, the performance of the stock and the performance of the company over the long term have a logical relationship. In the short term, the behavior of the stock price is irrational and it can behave in crazy and illogical ways.

Stock investing is all about doing good research before you make your final decision to invest in a particular stock. Focus on finding companies that are strong, well positioned in the right industries and have solid fundamentals like a good management, good product, good service, growing industry, rising sales, increasing profits and so on. The bottom line is don’t worry about the short term gyrations of the stock price. Sometimes the industry and the economy matters more than the company. Picking a stock doesn’t happen in a vacuum. Understanding the company’s industry and the overall economic environment is critical to stock picking process. It would be interesting for you to know that Warren Buffet, the world’s greatest stock investor has over the years been a value investor. His famous investments were in insurance and manufacturing. He buys companies that have fallen on bad times but inherently their business model is sound, just maybe need a good management.

Mr. Ahmad Hassam has done Masters from Harvard University. Try these cash printing Forex Signals from heaven. Discover a revolutionary Forex Robot System!

categories: forex,stocks,currency trading,mutual funds,finance,investing,business,wealth,ecommerce,real estate,market news,trading,day trading,money

When we talk of the capitalization of a company what do we mean by it? Capitalization or cap refers to the combined value of all the share of a company’s stocks. The division between large cap, mid cap and small cap are often blurry and not sharp. When you start looking for good stocks, you often come across these terms like large cap, mid cap, small cap, growth and value. Let’s discuss these terms for a moment.

Statistical studies of large cap, mid cap and the small cap stocks has shown that over the years small cap stocks have outperformed. Mid caps are companies with $1 to $5 Billion in capitalization and small caps are companies with $250 million to $1 Billion in capitalization. Anything below $250 million can be considered as micro cap. However the following divisions are generally accepted: Large caps are companies with over $5 Billion in capitalization.

You must have often heard of the P/E ratio of a stock being talked about the analyst on CNBC or Bloomberg. Perhaps the most important ratio is the Price to Earnings Ratio (P/E). Now the most important term that you come across is growth stocks and value stocks. How do you determine this is a growth stock or a value stock?

Now the higher the P/E ratio, the more growth the company is supposed to have. So it can be either the company is growing real fast of the investor have high hopes of its growth. Now these hopes can be realistic or foolish, you never know! Now, if you follow financial news than you must know that the large growth companies always grab the headlines. But do the growth stocks really make best investment? The lower the P/E ratio, the more value the company has. Low P/E ratio companies are not considered to be the movers and shakers in the market.

The lower the P/E ratio, the more value the company has. Low P/E ratio companies are not considered to be the movers and shakers in the market. Now, if you follow financial news than you must know that the large growth companies always grab the headlines. But do the growth stocks really make best investment? According to Fama and French, two famous researchers who did ground breaking research on stocks, over the last 77 years, large growth stocks have only seen 9.9% annualized rate of return as compared to 11.5% for the large value stocks.

The most probable cause seems to be their immense popularity. Since most of the headlines are captures by high growth companies, investors seem to think that they are the best investments. Now intuitively you might have thought that growth stocks are better. What can be the reason for their lower performance over the years?

Think about Google, how its stock price shot up within a matter of weeks after it hit the market. Weeks after that it began to cool off. So large growth stocks tend to get overpriced before you are able to buy them!

Mr. Ahmad Hassam has done Masters from Harvard University. Try these cash printing Forex Signals from heaven. Discover a revolutionary Forex Robot System!

If you have been following the breaking news that you might have come across the news that gold prices have reached historically the highest level! Recently gold broke the price barrier of $1000 per ounce. This might be the best time to invest in commodities. Some expert of the opinion that the secular bull market started in the commodity market a few years back and may continue for the coming decade! If you want to invest in commodities than you have many options like trading commodity futures, commodity ETF, commodity stocks or commodity mutual funds. A mutual fund is a fund managed by an investment professional on behalf of the fund investors. Now, mutual funds by law are constrained to follow conservative trading methods. Mutual funds cannot engage themselves in such sophisticated and risky trading techniques like arbitrage trades, long short strategies and distressed asset investing.

If you want to have a low risk investment in commodities than you should think about buying shares of a commodity mutual fund. There are many different mutual funds like stock funds, bond funds, currency funds and even country specific mutual funds. But there are a number of mutual funds that specialize in investing in commodities or commodity related products.

These commodity mutual funds use different investment strategies. Some of these commodity mutual funds invest in derivates based on commodities such as futures contracts and options based on futures contracts traded on the major exchanges in New York, Chicago and so on.

Other commodity mutual funds may invest in companies that process these raw commodities such as energy companies and mining companies. So how can you invest in these commodity mutual funds? After doing your research on these commodity mutual funds, you can select one that you consider to fit your investment objectives, simply write a check and purchase the shares of that commodity mutual fund either through your broker or directly through the fund providers.

Now I said, after doing your research. The first step in your research should be to compile a list of questions like what is the fund’s investment objective, what securities does the fund invest in, who manages the fund, what kind of strategy does the fund uses, what type of people invest in this fund, what are the risks involved in investing in this fund, what is the funds track record, what is the funds fees and expenses and so on.

Once you have your list of questions, see if the fund prospectus answers these questions satisfactorily. The good thing is that most of the mutual funds send their fund prospectus free! Now the two main commodity mutual funds are the PIMCO Commodity Real Return Strategy Fund and the Oppenhiemer Real Asset Fund. Now PIMCO Commodity Real Return Strategy Fund (PCRAX) is the largest commodity mutual fund in the market with $12 Billion of assets under its management. PCRAX tries to mimic the performance of Dow Jones-AIG Commodity Index by investing directly in commodity linked instruments like futures contracts, forwards contracts and options on futures.

Now as always Morningstar website is a very good resource for doing your research on commodity mutual funds. It can give you a lot of information about these commodity mutual funds such as the latest news, updates, load charges, expense ratios and other useful key data. Morningstar also have got a five star rating system that can be really helpful to you in picking the best commodity mutual fund.

Mr. Ahmad Hassam has done Masters from Harvard University. Trade Dow Futures . Learn Commodity Trading !

If you are interested in investing in commodities than you can invest in a commodity mutual fund! Many people are not aware that commodities as an asset class has a lot of potential especially in the 21st century. It is being predicted that the 21st century belongs to the commodities.

This is the simplest way for you to get involved in investing in commodities as the mutual fund portfolio management will be done by a professional manager and you have to do nothing. Just buy the shares of the commodity mutual fund and let its NAV appreciate before you can sell for a capital gain.

There is another investment vehicle that is really hot right now with the public. ETFs started off some three decades back but became highly popular as investment vehicles in such a short time. Now, you must have heard about the Exchange Traded Funds (ETFs). ETFs are really hot investments these days. There are a number of ETFs that invest in commodities.

Now the good thing about investing in ETFs is that they give you the diversification benefits of a mutual fund with very low fees something like 0.7% as compared to 2-4% of the mutual fund. Driven by the growing demand of commodities by the investors many financial institutions are now offering Commodity ETFs.

So unlike a mutual fund whose net asset value is calculated at the end of the day and the shares of mutual fund cannot be traded during the day, you can go both long or short on ETFs all the time. Something you cannot do with a mutual fund! ETFs have the added benefit of being able to trade like stocks giving you the powerful combination of diversification and liquidity.

Now, you can find thousands of ETFs in the market on different market sectors, stock indexes, currencies, commodities and so on. This diversification plus liquidity benefit makes an ETF a better investment tool as compared to the mutual fund and the stocks.

Let’s take an example of a commodity ETF. The Deutsche Bank Commodity Index Tracking Fund is listed on AMEX and tracks the Deutsche Bank Liquid Commodity Index. This index is based on a basket of six commodities: light sweet crude oil, heating oil, gold, aluminum, corn and wheat. The first Commodity ETF in US was launched by Deutsche Bank in the start of 2006. This ETF is based on the Deutsche Bank Commodity Index and as you can judge

As always what you need is an ETF that tracks an individual commodity. Now, every month a new ETF gets launched. There are a number of Commodity ETFs that track individual commodities like crude oil, gold and silver. Do your research on Commodity ETFs, you may find a good investment. Now the ETF of our example invests directly in the commodity futures contract. If you have trade futures than you must know that futures are highly volatile. Now one of the downsides of investing in this Commodity ETFs is that it can be fairly volatile as it is based on commodity futures contracts that get rolled monthly. Another downside to this Commodity ETF is that it is based on a basket of six commodities only.

Mr. Ahmad Hassam is a Harvard University Graduate. Trade Dow Futures . Learn Commodity Trading !

categories: forex,stocks,mutual funds,finance,investing,business,trading,day trading,wealth,ecommerce,real estate,money,market news,personal finance