| |
| |
|
Investing Information |
|
|
|
Success Trading: Some Basic Terminology for New Traders
The world of trading can get very complex because the financial markets are complex. There thousands and thousands of successful traders out there today. The amazing thing is that they all have carved their own niches and approach the markets in a unique way. This should be wonderful news for beginning traders because it demonstrates that there are thousands and thousands of different ways to proper in the markets. It's just a matter of discipline and finding the approach that suits your style and personality. With all that being said, new traders must begin somewhere, so let examine some basic terms and approaches to the markets. Going Long - This means that you're betting on the instrument (stock, future, option, etc) to go up and that you want to buy. You purchase the financial instrument, watch it rise and then sell it for a profit. Profit are realized when you buy low and sell high. It's also known as taking a long position. Going Short - This means that you're betting on the instrument to go down and that you want to sell or take a "short position". A short position is closed out by buying those shares back or "covering" your position. This concept is very confusing to new traders because you're selling something that you don't even own. The thing is that you're still trying to buy low and sell high, you're just selling high first and buying low later. Think of it this way - you go to a car dealer and order a new car, he charges you $20k and then looks to purchase it for a lower price. That dealer has taken a "short position" on the transaction between you and him. We don't recommend new traders to take short positions until they learn more about the market. One thing to keep in mind about short and long positions is that they're totally different in nature. There are by far more traders out there taking long positions than those taking short ones. Human nature tells us that we buy with the expectation of rising prices. The concept of wanting prices to drop is against human nature and therefore short positions can be more erratic as a result. Chuck Cox is a Technical Writer and Industrial Scientist by professional with a background in statistics. He has used mathematical and statistical methods to invest and trade in the stock, futures, and options markets. Chuck has owned various businesses and presently operates several websites. To learn more about trading the markets, visit his website, http://www.earncashathometoday.com/trading-stocks.htm
MORE RESOURCES:
Investing - Google News |
|
|
|
RELATED ARTICLES
Easily Finding A Good Stock There is a tremendous amount of software, complicated high priced newsletters, radio and TV stock pickers and Internet web sites that will help you find a stock that is going to make you rich.The problem is you don't know if this is talk or are these gurus putting their own money where their mouth is. Do You Need A Financial Planner? No matter how much money you make, it pays to keep on top of money coming in and going out. Even if you do a good job of that, there are important times in your life when talking with a professional adviser makes sense. How Do I Start Investing Online and What Are Some Basic Tips? If you are new to investing online, don't put your entire life savings into an online account. Start with a smaller sum, which will be easier to handle and keep track of. Franchise Opportunity Sellers Beware; franchise buyers lie on forms? It seems completely absurd that franchise buyers lie about their financial position, available cash and abilities in order to buy a franchise. After spending 8 years setting up franchises around the nation and fielding inquiries I am appalled at the lack of integrity of the average business buyer. Super Rules, OK? Do you rule your superannuation or does it rule you?It's easy to fall for some myths about your super unless you do some clear thinking about who is in charge. Virtually all Australian employees now have a superannuation account, many have several, even more than they know about. Chinas Inscrutable Currency Strategy Purpose: Expose Opportunities for Smart InvestorsThe move by China's central bank to drop the yuan's rigid peg to the dollar on the day of my return after a three-week trip to Asia left a host of questions unanswered. The basket of currencies that will allegedly determine the value of the yuan going forward was not disclosed. Everybody Wants to Know How to Invest Those unfamiliar with the process of making and managing investments often have more than a few trepidations about investing in general. They figure that, since they do not know how to invest, they will never learn. The Truth About Real Estate Investing - Is It Right For You? You have probably been hearing, seeing and reading that real estate investing is the best thing since sliced bread. There are many late night cable television infomercials spewing out sales pitches for courses that teach you how to buy residential real estate no money down or for next to nothing. How To Start Investing For Financial Independence, Part 1 Today, I am going to start a multi-part series about how to go from being a beginning investor to being "financially independent" in a steady and predictable way. At our website, we get tons of e-mails about how do I start, how do I start with little $'s, etc. Hedge Fund 101 - Make Money with Hedge Funds Investors are always looking for the best investments that will yield the most profit. Any investor who can afford the extra cost should consider investing in Hedge Funds. Investing As A Sport? I said last week that money doesn't generally buy happiness, but the lack of it can buy absolute misery. This, by the way, is not just my personal observation. Caveat Emptor: You May Owe Taxes Despite 401(K) Losses! One among many ways you lose money in non-indexed mutual funds is the tax trap. You may have to pay taxes even when your mutual fund loses money! To many people this is painfully unexpected. High Volatility Investments Penny stocks and options are high volatility investments that attract both the trader and the long term investor because of the small amount of capital required to make substantial gains as compared with less volatile higher priced stocks. The long term investor buys a stock believing that a company's value will increase over time and the stock price along with it. Keep Stock Market Investment Profits Have you had one of those huge investment winners - a stock that went from $2.00 to $80. To Retire Rich, Save and Invest Early If you want to retire rich, start saving investing early. The most powerful tool when it comes to retiring rich, is compounding your returns on money saved when you are young. Using Divergences to Keep Out of Bad Trades The American Football season just came to an end with my team getting close to the championship but falling short again. I am a big fan of the Indianapolis Colts and we keep having a groundhog day season year after year but it is still fun to watch. Asset Allocation Lessons: The 70% Inflation Solution For investors only.. Real Estate Clubs Hot Among Investors Six or seven years ago, the stock market was booming, Internet companies that no one had ever heard of were valued at billions of dollars, and anyone and everyone was investing their money in tech stocks. Then, in 2000, the stock market crashed, the Internet companies closed their doors, investors lost trillions of dollars, and life went back to normal, more or less. Types of Investment The word 'investments' is one that most of us are familiar with hearing in financial context. For many of us, it may make us thing of big business and vasts sums of money, but there's much to the world of investments than multi-million dollar deals. Moving Average Convergence Divergence ( MACD ) Charts The Moving Average Convergence Divergence charts, or MACD charts for short, are a technical indicator that is derived from the more simple moving average.The MACD charts are oscillating indicators, meaning that they move above and below a centerline or zero point.
|
| home | site map |
| © 2006 |
