Investing Essentials

All of your trading, buying and selling, revolves around money. Therefore money management is about managing your business and maximizing your stock market trading profits. There are five key elements to good trading money management: 1. Trading Capital For every winner in futures trading there is a loser, this being so, you should consider trading as a battle and to fight the battle you need ammunition. Your trading capital (bank of money) is the ammunition you need to fight, if you run out of ammunition the war is over. You should keep your trading capital completely separate from living expenses, don't trade with the mortgage money. Only trade with money you can afford to lose and don't borrow money to trade ... [read full story]

Although there are many things an investor can do wrong in the markets, there are only a few things he or she can do right. We are all well aware of how important risk management, discipline, and a good investment method can be. Yet without a doubt, they are all useless in the hands of a trader who is psychologically inept or self-destructive. It is unfortunate that investors still believe in the myth that a better system will make them better investors. The factors for achieving investment success are primarily psychological or behavioral (see Trading Psychology for more information). Experience taught professional stock market traders that three factors make up about 90 percent of the formula for achieving and maintaining investing success in the ... [read full story]

Terminology used by stock brokers and Wall Street insiders tends to be rather complicated what with jargon such as margins, small cap, and indices, it can be difficult to tell what the devil these people are talking about. Still, the most basic of stock market terms, "bull" and "bear," date back to the 19th century and are not tied to any complicated mathematical analysis. While the origin of the terms might be somewhat vague, their definitions are quite precise. "Bull" refers to an investor who believes that a market or individual stock issue will rise in value. A "bear" is someone who believes the opposite, ... [read full story]

In setting your investment goals, your age is a very important factor. The age of an investor is usually positively correlated (moves in a positive or same direction) with the type of investments they will commit to. This means that as you get closer to your retirement, you will typically move away from investments that have a high degree of risk, require a large amount of capital (money) or have low liquidity (ability to convert the investment easily into cash). This is generally because you are approaching the later stage of your life and wish to spend the money that you have accumulated during it and not risk it for the purposes of accumulating more money. Conversely, if you are at a young age you have ... [read full story]

Investing can be done at any age and during any part of a person's life. However, whether you believe you are too old to start investing is a both a matter of principle and a measure of your risk tolerance and investment goals. Your investment goals are a measure of what you want to achieve from your investment and what these goals will allow you to do if the investment is successful. Short-term goals are essentially just that - short-term financial objectives that you set which are personally important to you in the short-term. These goals may vary from purchasing a house to establishing capital (money) for a new business. Long-Term goals are longer-term financial objectives that will give you financial independence and allow you ... [read full story]

"In the business world, everyone is paid in two coins: cash and experience. Take the experience first; the cash will come later" -Harold Green One of the greatest flaws of inexperienced investors make is to spend too little time planning and monitoring their investments, yet expect a fantastic return on them at a future date. It is important to spend time researching before investing money in any type of financial venture, so that not only do understand what you are investing in, you also gain a greater appreciation of the nature of what you are doing. "If a man empties his purse into his head, no-one can take it away from him. An investment of knowledge always pays the best interest" - Benjamin Franklin It is important ... [read full story]

The journey of a thousand miles begins with one step" - Lau Tzu No matter the current stage of your life, the direction you are heading or what the future holds for you, investing will be a key factor in developing both your financial security and your financial freedom. Whether you are purchasing a house, a car or even beginning a business, investing is inevitably something that everyone should undertake throughout their lives for the benefit of themselves and future generations. There are many factors involved in investing and why it is done. Many of these factors are related to individuals and their own specific personal situation, objectives, the current period their of lives and their investing personality. These factors can be discussed with a financial planner who ... [read full story]