Sorry people I’ve been absent for quite a while and I apologies for that.

We are going through a bit of a topsy turvey type market and have been for a couple of months, if you’ve been able to handle it then congratulations. My returns have been quite modest.

Luckily I’ve been able to get into rhythm with some of my favourite stocks. Let me explain. It is an old technique that lots of traders use, but it is so difficult to click in with the feelings of the market towards any one stock. Over the past couple of years I have been concentrating on just two blue chip stocks and let me tell you it is difficult for an addicted market trader to concentrate on just two stocks.

It is so hard not to go looking for that next rising star. I have caught a couple of them in my career but they are infrequent. Lets get back to what I was saying. I have come to the conclusion that most stocks have a following. That’s right just like any celebrity; pop stars authors and the like.

People being what we are tend to make things flavour of the month so to speak and stocks are no different. I have seen by my observations that when stocks are trending the followers of that stock are all thinking with a like mind. All sorts of things influence them, for instance; in Australia just now there is a general election being held this weekend and consequently the market has dropped considerably. That is today being Friday and the ballot is taking place tomorrow.

Of course the general feeling is one of uncertainty, and this is having quite an affect on the market, that coinciding with the DOW falling significantly yesterday. Yesterday I placed a buy order on one of those favourite stocks believing that it would fall to a significant level. I was right it did, but it went a little way past what I thought. At this point in time I am not worried because I feel that the result of this election will be beneficial to that stock. Yes I even have an opinion on that and I am predicting against the incumbent government. The experts say it will be a close call.

There are lots of things that impact on the price of stock and the way the market reacts, and they are not all associated with facts and figures and statistics. Well that’s just my observations.

Can’t do this justice in just one post so will visit it again soon.

Good trading

Cheers

MR Ed.

I’m always being asked about how to start investing. Well you don’t have

to start straight up using the stock market. Following are some fairly

basic and safe ways to start investing for your future.
Start with an interest bearing savings account. You may already have
one. If you don’t, you should. A savings account can be opened at the
same bank that you do your checking at – or at any other bank. A
savings account should pay 2 – 4% on the money that you have in the
account.
It’s not a lot of money – unless you have a million dollars in that account
– but it is a start, and it is money making money.
Next, invest in money market funds. This can often be done through your
bank. These funds have higher interest payouts than typical savings
accounts, but they work much the same way. These are short term
investments, so your money won’t be tied up for a long period of time –
but again, it is money making money.
Certificates of Deposit are also sound investments with no risk. The
interest rates on CD’s are typically higher than those of savings accounts
or Money Market Funds.
You can select the duration of your investment, and interest is paid
regularly until the CD reaches maturity. CD’s can be purchased at your
bank, and your bank will insure them against loss. When the CD reaches
maturity, you receive your original investment, plus the interest that the
CD has earned.
If you are just starting out, one or all of these three types of investments
is the best starting point. Again, this will allow your money to start
making money for you while you learn more about investing in other
places.
That should be enough to get you started for now. Once you get the feel
for investing I’m sure you will want to go a lot further.

MR ed. Expandingwealth.com

My first guess would be that 90% of investors in commodities know almost nothing about it and consequently function below effectiveness. Being smart and a successful investor requires time and dedication.
If you are going to function at all well in the stock market, you must first acquire strategies that are in line with your desires and ultimately what you want from the market. Success is attained through fundamental analysis.

Investing in stocks is a lonely endeavour, it is by general rule something you undertake by yourself with perhaps the help of a broker; some of us don’t use them, with the help of online trading platforms.

To be successful in stock trading you must at all times control your behaviour and the information you are dealing with. There is no way to control the stock market so you must control yourself. All you information should be viewed objectively and you need to ensure that you behave accordingly, thereby promoting your best interests.
You must learn to create rules in how to trade wisely and you must strictly adhere to those rules.

As previously mentioned most stock traders find it very hard to follow rules in order to achieve success. By nature some people also resist societal rules, it could be that it is innate in humans to resist rules, but if you want to be accepted in society then you must adhere to the rules of society, it is no different when trading stock on the market.

If you decide that the stock market is for you then you will enjoy unlimited freedom when it comes to choosing the stocks you want to trade, but you must follow some rules and realize the boundaries.

If you know any stock traders or know of some of the more famous stock traders, you will find that they are consistent, organized and at all times stick to certain guidelines in order to generate the profits they do.
Once you have conditioned yourself to follow the rules and guidelines, it is not beyond you to attain some of that success for your self.

If you are one of those people inclined to resist the rules of life you will surely find it hard to follow the rules needed to attain success in this business. It is not unknown for some to fail and lose huge money trading the stock market. You must take your time and know more about the stock you want to risk your money on. If others can make money and achieve success, so can you.

At Expandingwealth we are about helping you learn, if you are unsure of yourself find a good broker to start with, they can help you understand the market, but it is essential to learn for yourself. Learn the rules and stick  to them.

Invest with knowledge

MR (ed)

“Trading options for profit” is among the most complicated and if you ask any trader, the riskiest type of trading available to you.
However there are some who make lots of money trading this way; to join them you must first do your study and learn the technique.
Option trading usually selects it’s own type of trader, usually the risk takers in the market.

It requires skills and thinking unique only to people who could handle extreme risks. The risk to capital is only as great as the rewards.
By nature, it is also speculative. So if you are a person who doesn’t want to speculate too much, you might as well find another type of
security, which will work best for you. However, rejecting the idea of entering this type of trading right away is as risky as not knowing
anything about it.

It carries with it risks, that’s true, but it is also a very, very, profitable venture. You might as well try to learn something of it, such that you
could decide whether to try you luck on options trading or not.
Though risky , option trading also offers advantages that may not be had with other types of trades. The most primary of these advantages
 is the flexibility it lends its investors. Each lender has the option to trade at a specific price within a predetermined period. So what is an option?
An option is a type of security, perhaps closely comparable to bonds and stocks. It is, in itself, a binding contract, that is monitored by
and through strict terms and conditions. In gist, options are contracts that owners could buy or sell at a certain price prior to or on a specific date.
 An option is typically an added price tag to a certain asset or item because it is a reservation for the purchase or sale of a certain asset.
Options are also sometimes called derivatives. This is due to the fact that the value of an option is derived from the value of the underlying asset.

To give light on this topic, consider the example below: Say you have considered buying a real estate property which is worth several hundred thousand
dollars. However, when you first negotiated with the owner, you did not have sufficient money to purchase the property right there and then.
So you made a deal with the owner to pay an extra $5, 000 to reserve the deal for you for the duration of two months. The extra money you
put in is called the options. In case you don’t want to pursue with the sale, the owner of the real estate can neither force you to buy the property
 nor can the law impose the sale on you. However, you would still have to pay the price of the option.

Having said all that, if a friend of yours offered to teach you how to trade options on the stock market and make money not matter if the market
went up down or sideways, do you think you would be interested?
MR (ed)
www.expandingwealth.com

IMPORTANT OPTION TRADING TERMINOLOGIES.

Forget that there are hundreds of terms that the financial sector uses, all beginners hat to understand first are the most importand commonly used words.

OPTION : This is the right of the buyer to either buy or sell the underlying asset at a fixed price and fixed date. At the end of the contract, the owner of the option can choose to either buy or sell the option at the strike price. Though the owner has the right to pursue the contract he or she is not obligeated to do so.

CALL OPTION: The right to buy the underlying asset.

PUT OPTION : The right to sell the undeerlying asset

EXERCISE : The action where the owner has the choice to buy (if it is a call option) or sell (if it is a put option) the underlying asset or, to ignore the contract and let it expire. If the owner chooses to pursue the contract, they must send an exercise notice to the seller.

EXPIRATION: Is the date where the contract ends. If at expiration the owner does not exercise the rights, then the contract is terminated.

IN-THE-MONEY :  Where an option has an intrinsic value. If the underling asset is higher than the strike price, it is said to be in-the-money. Whereas a Put Option is in-the-money if the underlying asset is lower than the strike price.

OUT-OF-THE-MONEY: If an option is O-O-T-M it has no intrinsic value. The call option is out-of-the-money if the tradin price is lower than the strike price. The Put Option is out-of-the-money if the trading price is higher than the strike price.

OFFSETTING :  Is the act by which the owner of the option exercises his right to buy or sell the underelying asset any time before the end of the contract. This is done if the owner feels that the profitability of the stock has reached its peak within the date of the contract.

WRITER (Option Seller. The writer is the seller of the underlying asset or the option.

OPTION BUYER: Is the person who acquires the rights to convey the option.

STRIKE PRICE : This is the price at which you must sell the underlying stock if the contract is exercised. The strike price is always clearly stated in the contract. As the buyer of the option, to make a profit, the strike price must be lower than the current trading price of the stock.
An example.. if the contract states that the strike price of a certain stock is say $20 and the current trading price at the end of the contract is $25, the buyer can exercise his or her rights to pursue the contract, thus earning $5 per stock.

OPTION PREMIUM : The amount of the contract which must be paid by the buyer to the writer(or Seller). The option premium amount is determined by factors such as the type (call or put), the current strike price of the option, the volatility of the stock and very important, the time remaining until expiration and the price of the underlying asset to date. Taking all these factors into account, the total amount of the option premium is number of option contracts, multiplied by contract multiplier. Example, If you are buying 1 option contract (equivalent to 100 shares lots) at $2..5 per share, you must pay a total amount of $250 as the option premium. That is 1 option contract x 100 shares x$2.50 per share = $250

www.stockmarketoptiontrading.com