Fully Stocked

6 Basic Strategies For Successful Stock Market Investing

2009-10-26T17:07:00.000-07:00

This is a guest post from Jack Benson...

Stock trading is a volatile market with no precise way to continually experience ongoing profits. No investor can yield ongoing growth year after year, with every stock purchased because it is impossible statistically.

The stock market is unpredictable so there is no surefire way to ensure growth with all investments. Other conditions compound the difficulty faced by stock market investors including no consistent winning trend shown for stocks.

Major myths are circulated about the best way to do the stock market. The majority of people believe successful trading is merely the need for an investor to accurately predict the movements of the stock market. An incorrect assumption is made by many that stocks bounce around the range forever, thus they need to be able to predict trends in movement to purchase stocks during the lowest value and sell them at the highest peak possible.

The bottom line about this popular belief is it's simply wrong. The best way to realize a profit in the stock market is to steer clear of approaches that rely on making accurate stock market predictions.

When considered, consciously attempting to predict the stock market is a technique no better than purchasing a stock and holding on to it for a long time. The reason predictions are a poor technique is because there is no absolute way to predict stock market performance with complete accuracy for every investment.

A professional analyst might have the ability to predict a stock's performance in the near future but very rarely in the long term. An analyst may predict stock performance for the next quarter or even for the upcoming year. However, it is statistically impossible to predict stock movement accurately quarter after quarter.

The best way to do stock trading is to develop your own strategy by considering the following:

1. Remain abreast of the latest stock market reports and current news.

2. Make the effort to carefully evaluate the history of a stock's performance prior to making investments.

3. The best stocks to invest in show good dividend and growth.

4. Learn the structure of successful mutual funds and study them to see how they developed their investment strategy. Choose those particular funds to build your own personal mutual fund portfolio.

5. Evaluate the sector the company deals with.

6. Choose to put your money into stocks with a history of progressive gain.

These basic strategies will help you get started on developing your own strategy for stock market investing. There are no proven strategies and specific methods that consistently yield benefits for any investor, no matter how experienced. Strategies that are reliable today may wind up worthless tomorrow, proving the volatile nature of stocks. No guarantee exists when you invest in the stock market.

The best way to do the stock market is to carefully study several stocks and consider them as long term investments, rather than looking for a fast profit. These types of investments may take long to realize profits, but it is definitely more lucrative in the long run than putting all your eggs in one basket.

For more information on how to invest in the stock market -- including a growing collection of stock investing tips, strategy and advice -- visit: http://stockinvesting101.net

Photo Credit: kevinzhengli

Stock Market Going Up?

2009-08-03T23:11:00.000-07:00

In the following video, Mike of WallStreetWindow.com shares his thoughts about the current stock market. He tells us why the stock market is now going up...

What do you think? Do you think the stock market will continue to go up?

Here's an interesting blog post I came across with quite a few comments: Why Does the Stock Market Keep Going Up?

Investing in Tech Stocks: News and Resources

2009-07-13T20:39:00.000-07:00

For those of you who are technology geeks like me, you may be interested in this little news tidbit: Russian Firm Investing Another $100 Million in Facebook.

Oh, how nice it would be to have that kind of money to be able to invest in internet and tech-related companies!

If you're thinking about investing in hi-tech or internet companies, here are a few articles you may want to check out:

Tips and Advice For Beginning Day Traders

2009-06-28T19:01:00.000-07:00

I'm not sure if there are still people out there aspiring to be full-time day traders, but for those of you who still have faith in the stock market, you may be interested in reading this guest post posted at Bargaineering written by Matt of Steadfast Finances: "A Typical Day in Life as an Independent Trader".

As I've said before, I'm one of those long-term investors, however, I'm very fascinated with day-trading and the potential to make a great deal of money quickly. That's been my perception of daytrading anyways.

What I do realize is that day-trading takes a great deal of patience. It also requires a high-level of risk. In essence, if you're a good gambler, you can probably be a good trader. At least, that's what I think.

Dave Manuel offers some sound advice on becoming a day trader that I think is worth reading.

In this video clip, Mark Griffith, a futures and options floor trader at LIFFE (London International Financial Futures Exchange), offers tips on how to become a day trader...

Related Post:
The Dark Side of Day Trading Stocks

Stock Market Investing Tip of the Day

2009-06-15T22:23:00.000-07:00

Searching for stock market investing tips on Twitter today, I came across a tip I'd like to share. Brian Ramaker (@BRamaker) says:

I completely agree with the timing issue. The best time to invest is whatever time you think is right for you.

In a past post, How to Be a Smart Investor, I offer my own tips for stock market investing.

Have any tips to share?

Investing in Summer Entertainment

2009-06-06T22:57:00.000-07:00

I've been reading different articles stating that with the economy the way it is, people are spending less on travel and spending more money on movie entertainment.

The summer blockbusters are starting up this month and business analysts are expecting a decent turn-out at the box offices. Star Trek has been a huge hit and I, like many people, are looking forward to the G.I. Joe and Transformers movies.

In this article over at BusinessWeek, Jeffrey Logsdon, an analyst at BMO Capital Markets (BMO), states that the summer's box office could be flat to as much as 5% higher than last year's record-breaking figures.

Regardless of whether or not people will be traveling less and watching more movies this summer, I think it's still worth taking a look at companies like Walt Disney (DIS) as a short-term trade. Although the company has taken a dip in the past year, my gut is saying that the stock price will climb this summer. Although people will be traveling less, theme parks will still be busy.

I'd love to hear your thoughts or experiences about investing in the entertainment industry. Which sector of the industry do you think would be best? Movies? Theme Parks? Online media?

Article of interest: Investing in the Fragmented Entertainment Industry: Is Safe Better Than Sexy?

Update on the Gold Market

2009-05-26T22:18:00.000-07:00

Adam Hewison, President of INO.com, recently created a video with commentary about the current state of the gold market.

Click here to watch the video...

A couple of interesting notes about the information presented in the video:

Gold could continue to trend up because the dollar index is down
The price of gold has more than doubled in the past five years

So, now you're thinking that you don't want to pass up on this opportunity to make some money by investing in gold. Exactly how do you start investing in the gold market?

According to Investopedia, generally speaking, there are three ways that investors can invest in gold:

Purchase gold in its physical form via gold coins or buillon
Purchase an ETF (Exchange Traded Funds) that replicates the price of gold
Trade futures and options in the commodities market

I think that, like the real estate market, the gold market's bubble will burst sooner or later. It's hard to predict when that will happen, but in the meantime...why not make a few extra bucks investing in gold?

Here's an interesting article that elaborates on that thought: Investors are turning to gold but should you believe the hype?

Photo Credit: Giorgio Monteforti

Good Reads From the Festival of Stocks

2009-05-08T22:21:00.000-07:00

The latest edition of the Festival of Stocks has been posted over at Old School Value, and a few headlines caught my eye...

George over at Fat Pitch Financials did an excellent job of providing links, commentary, Twitter streams, and schedules of the 2009 Berkshire Hathaway meeting.

Investing School points out Investor Mistakes - Constant Refresh.

The author of My Wealth Builder says that the stock market is due for a correction. What do you think?

Photo Credit: freeparking

Investing Basics: Mutual Funds

2009-04-29T18:44:00.000-07:00

If you're the type of investor who is into long-term investing and prefer a diverse portfolio, a mutual fund is a type of investment to look into.

A mutual fund is a company that gathers funds from many investors and invests the money in the stock market, bonds, money-market instruments, and other securities or assets. All of these holdings that the mutual fund owns is known as its portfolio. Each share represents an investor's proportionate ownership of the fund's holdings and the income those holdings generate.

Advantages and Disadvantages of Mutual Funds

MoneyInstructor.com does a pretty good job of listing the advantages and disadvantages of investing in mutual funds...Financial expert Rick Goldfeller also offers advice on investing in mutual funds...

I like the idea that when you invest in a mutual fund, you're not putting all of your money in one nest egg. Money gets spread out to various investment vehicles, thus minimizing the risk.

Investor Beware

Keep in mind that when you do invest in a mutual fund, you are giving your money to a money manager. As I've said time and time again, make sure to do your homework. Make that company earn your trust!

In the video below, the question is answered: Are mutual funds risky?

Will The Stock Market Go Back Down?

2009-04-09T15:52:00.000-07:00

Earlier this week Time published an interview with Mary Ann Bartels, stock market technical analyst at Bank of America/Merrill Lynch regarding the current state of the stock market and gets her opinion on whether or not the stock market will go back down.

I've always thought of the stock market as unpredictable. What analysts say is pure speculation.

Mike over at The Oblivious Investor tells us why the stock market is unpredictable:

Of course, stock prices do change over time. In fact, they’re constantly changing. Why? Because people’s expectations for the underlying companies are in a permanent state of fluctuation. New information comes to light on a daily basis that either improves or worsens the outlook for the companies in which we’re investing.

What are your thoughts?

Trading Stock Options 101

2009-04-01T18:31:00.000-07:00

As I continue research on day trading, I'm learning that there are many different ways to do it. OEXOptions.com is a resource that I've been spending some time on...educating myself about the OEX, stock options, and the various options trading strategies..

For those of you who don't know, the OEX is the Standard & Poor's 100 - a stock index on the Chicago Board Options Exchange.

Options are contracts giving the purchaser the right to buy or sell a security, such as stocks, at a fixed price within a specific period of time. Stock options are traded on a number of exchanges, including:

* American Stock Exchange
* Boston Stock Exchange
* Chicago Board Options Exchange
* International Securities Exchange
* Pacific Exchange
* Philadelphia Stock Exchange

A major difference between trading stocks versus trading options is that stocks give you a small piece of ownership in the company, while options are just contracts that give you the right to buy or sell the stock at a specific price by a specific date.

Floyd, one of the lead traders at OEX Options, explains why index options are like fruit...

You can learn more about how to trade options by visiting the OEX Options website at: www.oexoptions.com.

The Dark Side of Day Trading Stocks

2009-03-30T00:29:00.000-07:00

Day trading is an area of stock investing that I've been a little bit fascinated with because of the possibility to make a great deal of money in a short amount of time...That is, if you start off with a boat-load of money.

I knew a woman who participated in day trading and she told me that yes, there were days that she made tens of thousands of dollars, however, there were days that she lost thousands of dollars.

In this video we get a stock tip that making alot of money through day trading is not possible...What do you think?

A few years ago "Trader Mike" shared his thoughts on day trading where he outlined his personal strategy and offered resources that helped him transition into day trading. Another blog I came across that contains some useful tips on day trading is Traderfeed.

My personal take on day trading is that in essence, it's like gambling. Sure, there is sophisticated software available to help you out, but the bottom line is that there are still no guarantees. Granted, there aren't any guarantees in any type of investment. However, day trading for me just seems very stressful. Not to mention the possibility of becoming addicted to it - as Peter Millman discusses in this video...

Motivational Money Quote

2009-03-25T11:09:00.000-07:00

"In all realms of life it takes courage to stretch your limits, express your power, and fulfill your potential... it's no different in the financial realm." --Suze Orman

What are you doing today to fulfill your potential as an investor? What have you learned from the past and what can you do to make sure you don't make the same mistakes?

Invest In Yourself: Get Debt Advice

2009-03-17T20:37:00.000-07:00

If there's one thing we can learn from the current economic state of affairs, it's that we all could use a little help with managing our debt. Many people have built their lives on debt and it has become an acceptable way of life for them. However, they got in over their heads in debt and now the debt has spiraled out of control.

Some people were naive to the idea of adjustable rate mortgages and now have house payments that have doubled. Then there are other people who felt the need to keep up with the Jones' and simply just started living way beyond their means.

If this sounds like you, here's my advice: Get help. Invest in yourself for once! For the sake of your mental health and your financial future, it's time to come up with a plan to get out of debt. Turn off the stock market news and start focusing on ways to turn your debt into wealth.

What are ways that you can increase your income?

How can you reduce your spending?

Are there psychological issues that caused the debt that need to be addressed?

I recommend moneysupermarket.com as a resource for debt advice. UK residents can compare debt management services and consultants. There is also a guide for dealing with debt problems and other articles to help you manage your debt. You can also find links to non-profit organizations that offer help and support.

Do you have any debt advice to share?

Photo Credit: borman818

"Brawl Street": Jon Stewart vs Jim Cramer

2009-03-15T15:59:00.000-07:00

As a regular viewer of The Daily Show with Jon Stewart, I often see him taking shots at Jim Cramer who hosts the show on CNBC's Mad Money. Last week Stewart finally interviewed Cramer and drilled him about all the "shenanigans" and falsehoods that Stewart created.

Watch the full episode with Jon Stewart and Jim Cramer below...(Email readers may have to click here to watch)

I do agree that CNBC has a duty to expose the truth when it's obvious that CEOs have come on a show or news broadcast and boldly lied to a reporter's face. I believe the media has played a huge part in why our economy is the way it is right now. Many people watch the financial news and take in what's said at face value.

As I've said before, education is key in investing. Stop relying on the financial news and stop relying on people who disguise themselves as financial advisers for your education. Period.

Related Posts:

Using Twitter to Keep Up With Stock Market Chatter

2009-03-09T17:13:00.000-07:00

For me, Twitter has become a great tool to keep up with the "chatter" about the stock market. I already know what the media is talking about: "Doom and gloom". I want to know: What are the people talking about?

If you're not familiar with Twitter, I recommend reading this blog post I wrote over at one of my other blogs, Using Twitter to Make Connections.

For realtime chatter, I often visit the Twitter Search page and type in a word or phrase in order to see what people are talking about on any given subject. Here's a screenshot of what comes up when I search for "stock market":

Twitter is also a great way to connect with other like-minded investors. Ernie Varitimos put together a list of Finance Gurus for Apple Investors to Follow on Twitter. Forex.Edu also has a list of 25 Forex-Related Twitter Accounts Worth Following.

If you're on Twitter, you can follow me @studio747.

March 2, 2009: Stock Market Analysis

2009-03-02T18:13:00.001-08:00

Thanks to AlphaTrends.net, here is a video offering a perspective of what happened/is happening in the stock market right now...(Email subscribers may need to click here to watch the video.

I have to agree that this market is being ruled by emotion and fear. If you're participating in this market and you're a long-time trader, just hold tight!

Do you have some thoughts to share about what's going on in this Bear Market? Would love to hear your thoughts...

If There's Only One Piece of Advice You Should Know...

2009-02-24T10:49:00.000-08:00

Browsing through the latest edition of the Carnival of Investing, an article caught my eye: "Lost Money In the Stock Market, What Should I Do?"

I know there are many of you who are asking the same question, which is why I felt the need to share this particular article.

I do like the advice that was given - to go out and educate yourself. Too many of us rely on "financial advisors" who tell us where to put our money. And it's true, many of these so-called advisers are just people who have been trained to sell rather than offer real advice. (Read more about this topic in a previous post, Beware of the Financial Advisor).

Isn't it interesting that we often resist listening to the people closest to us when they offer advice about money, relationships, or careers, but so quick to hand over our hard-earned cash to a self-proclaimed financial advisor who we've only known for ten minutes?

I'm not saying that there aren't any financial advisors out there who know what they're doing because I'm sure there are. The message I'm trying to relay here is to be careful who you trust your money with.

If there's only one piece of advice that you take away from this blog, that is it!

Gold Futures a Safe Haven?

2009-02-21T15:23:00.000-08:00

You may recall a recent blog post I wrote about gold and whether or not it is a good investment. Well, this article over at Reuters reports that gold miners' shares are up as gold futures shot up over $1,000.

The all-time high for gold is $1,033.90 which came last April.

With the stock market dropping this past week, people are looking at other investing avenues. Gold seems to be a "safe haven".

I've always considered gold to be a safe haven because for one, people will always buy gold jewelry. Many luxury items still use gold as a material to invoke "bling-blinginess". (Please excuse the phrase as I couldn't think of a better one!) There are gold phones, gold pens...Heck, even buildings are made of gold!

However, on second thought, is there an investment that is really and truly a safe haven? Or will people flee back to the stock market if gold futures start to slide?

Photo Credit: Jeremy Schultz

Words of Wisdom From Warren Buffett

2009-02-14T00:34:00.000-08:00

"Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years." --Warren Buffett

One company I've been thinking about investing in and would do so if the market were to shut down for ten years would be Hershey's (NYSE: HSY).

As long as people continue to love chocolate, Hershey's will always be in business!

Stock Trading Tip On Indicators

2009-02-04T20:42:00.001-08:00

For those of you who are involved in day trading and market analysis, you may be interested in this video that offers a stock tip regarding indicators.

I personally have no real interest in analyzing stock charts, so I have to side with the presenter in this video. If I did any day trading, my indicator would be "gut instinct".

Click here to find out more about stock market indicators...

What Business Is a Good Investment?

2009-01-28T17:40:00.000-08:00

Today we're going to take a little break from talking about the stock market and delve a little deeper into a topic that is near and dear to my heart. With all the hoopla surrounding our "unstable" (Has it ever really been stable?) economy, people are starting to open up their eyes . People are now thinking about different avenues besides the stock market in which to invest their money.

I received a great question in my inbox last week:

"What businesses do you recommend investing in during this time of economic challenge?"

I thought that many people could benefit from my answer, so I thought I'd write it up as an article for you to read, digest, and possibly take action. We all could use a couple tips on how to make more money, right?

I'd like to start off by saying that just like any type of investment vehicle, a business requires a great deal of research and due diligence. There are many entrepreneurs who are hungry for money and will woo you with fancy business plans and promises of high returns. Not to say that these are bad things. All I'm saying is that you should tread carefully.

I am personally involved with online media and technology, so I see the potential to make a great deal of money in this area of business. I know that many people have a bad taste in their mouths when it comes to web 2.0 because of the past. Nobody wants to go through another dot com bust. However, we can't deny the fact that people are spending more time online. People are going to online sources for their news and information. There are many start-ups that are specializing in the online media arena whether it be web marketing, graphic design, social networking, etc.

So online media is one type of business that you could look into as an investment. Again, I do advise that you do your research. Read tech magazines and online publications or blogs to stay updated on what's going on in this industry. Keep your eyes and ears open for opportunities that beckon!

But what if you want to venture out on your own?

I always encourage people to invest in themselves. Start your own business! You could start your own brick-and-mortar business, an internet business, or perhaps you may want to become involved with an established network marketing business.

If you decide to go this route, the type of business you start will be based on a product or service that you have a passion for. Which business you should invest your time and money in is something I can't give any recommendations on as it is purely an individual choice. If you stay focused and have a sincere desire to help people, your business should do well regardless of what's happening with the economy. My theory is that if you take care of people, they will take care of you.

What type of business would you invest in? Share your thoughts in comments!

Apple Continues In the Limelight

2009-01-21T21:48:00.000-08:00

There's a great deal of talk in the tech world about the health of Steve Jobs and how or if it will affect Apple (AAPL). Last week Jobs announced that he would be taking a hiatus as CEO due to health issues. He plans to return sometime during the summer.

The SEC has opened up an investigation into disclosures regarding Jobs' health and Apple's stock price ended today at $82.83.

According to this article over at Forbes.com (Apple Lets The Numbers Talk), the company is doing quite well despite all the new about an economic slowdown. The company is expecting to earn about $1.06 to $1.35 per share.

Whether or not Jobs returns to Apple, I believe that the company could continue to excel. Regardless, we wish him a speedy recovery.

Welcome New Readers From MarketClub Trader's Blog

2009-01-15T11:58:00.000-08:00

Yesterday the MarketClub Trader's Blog published my article, What The Volatility in the Markets Taught Me In 2008, so I now have many new subscribers to this blog. For those of you who haven't checked out the Trader's Blog, it's an awesome blog that's full of great information. I highly recommend reading it.

I just wanted to take a moment to welcome everyone to Fully Stocked and thank you for subscribing! I also want to thank those of you who emailed me with questions or comments. I will be answering them soon!

I always welcome feedback or suggestions on content you'd like to read here at Fully Stocked. Feel free to contact me anytime or leave a comment on any post I write.

Photo Credit: Melinda Shelton