Stock market trading in the United States can be traced back to over 200 years ago. Despite times of ?Market Crash? (e.g., Oct 1929) and loss of money, this system still holds the distinction of being able to make you a lot of money over the long term; Baron Rothschild of the Rothschild Family (international banking and finance dynasty) stated in 1871, ?buy when there's blood in the streets?. This simply means that you can buy some REAL ASSETS at bargain ?pennies on the dollar? prices when everyone else is dumping their shares. Just look at the stock market today; ?there's blood in the streets?.
On October 29, 1929, a day infamously known as Black Tuesday, the United States Stock Market crashed. On that day alone, a record sixteen million shares were traded and thirty billion dollars were lost. The value of DuPont fell seventy points and Westinghouse lost two-thirds of its September value; the ?Era of Get Rich Quick? and fast money had come to an abrupt and screeching halt.
During the Great Depression (1929 -1941), the value of stock on the New York Stock Exchange was less than one-fifth of what it had been at its peak in 1929. It would take approximately 25 years for the Dow Industrials to reach pre-crash levels of 1929. Today, there are software programs that can facilitate the detection of buy triggers based on market sentiment and technical analysis (interpreting charts). Due to the internet, small investors now have access to fundamental analysis (financial statements) of a wide spectrum of companies. Historically, the stock market has been the best investment option for the long term and there is no better time than now to start making money trading stocks at home.
This article will show you one (1) way to hedge your risks, while increasing the likelihood of you making money in the stock market. Later on, I'll show you a home business strategy that made me the money to invest and how to DOUBLE THAT MONEY within a year with a proven investment strategy; this is the same strategy that the wealthy upper-class has used for years to make their money work harder for them.
The stock trading strategy that I will discuss is plain and simple; however, I would be remiss if I didn't, at least, start at the basics. This strategy requires that you ?buy low, hold, and sell high?. I know it's not all that exciting. However, just to put things into perspective, if you had bought stock in the General Electric Company (Ticker Symbol: GE) in 1962, you would have realized a gain of 4,500% today!
Furthermore, you could reduce your risk of making a one time ?lump-sum? stock purchase at potentially higher prices by ?dollar cost averaging?. This concept is based on spending a fixed dollar amount towards a stock, mutual fund, or other investment at regular intervals (e.g., monthly). This investing technique tends to result in the purchase of more shares when prices are low and fewer shares when prices are high. In essence, you are averaging out the fewer higher priced purchases with the more frequent lower priced purchases, thereby reducing your risks and ensuring that you buy at low to median levels over the short term.
Now if you need money to invest, I can share with you a strategy that actually makes me money on a monthly basis. I know, I don't consider myself a home business type of guy, as stock and option transactions are my passion, but again, I thought I would be remiss if I didn't at least attempt to spread the word on this business.
I happened to discover this home business opportunity by fluke, while looking for ways to make money online for retirement investment and general supplemental income. What I found though was a simple and structured online home business strategy that actually began to make me real money at home within a reasonably short period of time. The strategy is partly based on the concept of earning residual income off every sale. This means that you continue to make money long after your original sale occurred; it's kind of similar to residuals that actors make every time their show airs throughout the world; they get paid once for their work and then again each time it airs thereafter.
Also, what makes this opportunity so unique is the training and support that the company provides; they've replaced all the books and CDs with a comprehensive video tutorial (located on their website) that walks you through every step of the process. You will literally have your website up within an hour and be making money at home within 24 hours.
You make money by day trading online. So, bullish call and bearish put spreads are two of the very basic option trading strategies. However, it is not guaranteed a 100 % win from the stock market. You still need to learn to predict the stock price direction accurately using technical, fundamental and news analysis.
Your choice of what method to enter and exit stocks plays a critical part in your stock market success. Numerous academic studies have shown that more than 90% of mutual funds failed to beat market over the long run and that more than 90% of individual investors lost money in the stock market. Too many people and too many Wall Street experts or mutual fund managers are buying and selling stocks like madmen, with no sound strategy or any hope of long term success. Ironically, they're the ones who create opportunities for prudent, long term oriented investors.
Are you ready to follow the wealth cycle so that you're earning more when you're ready to retire? Or, do you want to depend on social security and the ever-volatile stock market for your future well-being. You can choose a wealth cycle today. All it takes is the first step.
But be very aware. The NASDAQ or SP&500 averaged about -6% per year for 5 years between 1999 and 2003. Many individual investors who made killing in the internet bubble period got wiped out during those 5 years. Many who trusted Wall Street experts by investing their life savings into mutual funds had rude awakenings after the huge losses and scandals in many of the famous fund names.
I remember reading some years ago that 97 percent of all gamblers lose over time. If you gamble on the stock market then the odds are well stacked against you. However, if you invest in the stock market then you have the potential to do very well.
Also be wary of mechanical trading systems, the thought of having mechanical trading systems you can simply use to generate automatic profits, is obviously very attractive to many traders. Most traders however, end up disappointed with mechanical trading systems, as they never seem to live up to the sales hype, and the performance figures used to sell the system never seem to be repeated in real life.
Another problem is curve fitting or optimization of mechanical trading systems. These systems yield extraordinary performance in back testing because of the tweaking of the system rules to make them fit the data. A trader once likened this to shooting holes in a barn door, and then drawing circles around every hole to make each shot a bulls-eye!
Not all mechanical trading systems are doomed to failure, but if you want to get one that works, be realistic and do your homework first. As mechanical trading systems need historical data inputted into them in order to calculate what might happen in the future. Of course what has happened in the past is not always an accurate predictor of how any kind of stock will behave in the future. If this was true then we would all be rich!
Both Chris310 & Allen Jesson are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
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