The Best Time to Invest in Stocks

Put away your calculators and software programs if you want to get the feel for stock market timing. You'll never beat the other players if you follow the herd.

Above all else realize that all you need to do to win at the stock game is to stay one step ahead of the competition. You can do this only if you concentrate on understanding human nature and human emotions.

If you honestly believe that on a day to day basis that the stock market is rational, you haven't played the game long enough or been paying attention to the reality of the game. If you actually believe that someone can sell you a program that guarantees success in the stock market, it's time to change your thinking and refocus your train of thought.

The best time to invest in stocks is when there is "blood in the streets", and fear dominates investor behavior. The problem is that as an investor you are human as well, and are subject to the same emotions as everyone else.

What do investors do when overcome with fear? They capitulate ... they sell their stocks. This might have sounded academic before September of 2008, but if you were paying attention to the markets between September 2008 and March 2009, you saw investor fear in action.

So, how do you know when the best time to invest is?

If you are a serious stock investor, you were fearful in the above time period as well. I've been playing the game since 1973, and I felt it. Lucky for me, I had little invested in stocks in September 2008. In the months that followed I was waiting for the right time to start buying.

The best time to buy is when you are scared, but you are firmly convinced that the market (most investors) has truly overreacted to a bad situation. When folks are fleeing for the exits in panic ... selling indiscriminately ... it's time to step up to the plate and start to buy.

Don't go all or nothing. Keep some powder dry and invest in steps. You will probably never in your investing life fire one shot and hit the market bottom.

Think back to early 2009. Stocks had been falling for months on bad (horrific) news. Then, in mid-February, selling intensified and stocks started to fall like a rock. This was your invitation to start buying.

If you have always viewed the stock market from afar with nothing invested and nothing to lose, you've never felt the fear that overwhelms many investors in times of market stress.

Take it from someone who has been directly involved in three scary bear markets (1973-1974 ... 2000-2002 ... 2007-2009). Fear of losing your money is real and greatly influences investor behavior.

In times of great uncertainty think with your head and do not make investment decisions out of emotion. The best time to invest in stocks is when the heavy selling is at a climax. Shortly thereafter, all who were fearful enough to sell already have, and rational investors are starting to rush in to buy at bargain prices.

When buying and greed take control, prices go up and those who are still in the game make money. Then it becomes a matter of someday determining the best time to sell, because every market trend comes to an end. 

A retired financial planner, James Leitz has an MBA (finance) and 35 years of investing experience. For 20 years he advised individual investors, working directly with them helping them to reach their financial goals.

Jim is the author of a complete investor guide, Invest Informed, designed for average investors or would-be investors of all levels of financial background and experience. To learn more about investments and investing and his new financial guide go to http://www.investinformed.com

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Penny Stocks Ready to Breakout - What to Look For

Believe it or not, penny stock trading can be boring. Not all of these types of equities spike sharply up or down as a constant. Some stocks can trade in a sideways trading range for multiple months. Not exactly what people expect from stockstackup.com" title="penny stock">penny stocks right? People expect a boom or bust type result most of the time.

The trick to finding stockstackup.com" title="penny stock">penny stocks ready to breakout (to the upside) is to use technical analysis of the chart, along with some research of message board activity of a specific stock. Let's look at a few points of each shall we?

Technical Analysis of the chart (things to look for):

• Noticeable volume increases over 1-3 trading days
  
  


• Slight closing or intraday price increases over previous highs
  
  


• Buy indicators such as the parabolic sar indicate that an uptrend is starting
  
  


• 20 and 50 moving averages cross upward to confirm an breakout is imminent
  
  


• Look for how the stock performed on other breakouts within the last several years to gauge expectations of where to sell or take profits
  
  


• Down trend lines broken to suggest that new bullish buyers are entering the stock

Message board activity:

• Big increase in number of posts
  
  


• Message board posts lay out bullish arguments
  
  


• Lack of coherent "basher" personalities, since they are detrimental to the confidence of the traders who are bullish
  
  


• Absence of personalities often associated with shady pink sheet stocks that perform poorly

Now I realize I did not go into great detail on some of these points, but you get the basic idea. If you are familiar with some of popular penny stock message boards, whether it be ihub or yahoo finance you will know what to look for. If you are not familiar with the jargon I used to describe the technical analysis of the charts, I would recommend going to http://stockcharts.com and absorbing the free information they have there, it's really not as hard to learn as you may imagine it to be.

I use these strategies and others that I find to be effective when I issue penny stock recommendations to subscribers of Microcapmilloinaires.com. It can be time consuming to monitor the market for these types of breakout setups, but it is worth it when you hit a couple big winners that can yield over 100 percent profits.

Written By Matt Morris, Editor of Microcapmillionaires.com the best penny stock newsletter in existence. I am one of the few penny-newsletter-guys that do not accept compensation to "pump" penny stocks. Sign up for 3 free Penny Stock Picks here.

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How to Invest in Stocks Wisely

Investing is stocks are one of the largest ways that people look to make residual income when it comes to stockstackup.com" title="investments">investments. In fact, many people use stocks as a way to build on their retirement funds and trusts. It is important to know how to invest in stocks even if you are using an investing company or a brokerage to handle your trades.

Knowing how to invest in stocks can keep you informed and help you to make wise investment choices. When looking into how to invest in stocks the first thing to do is look into the various things that are going to affect the market. There are some things that will affect the market on a wide spread basis and there are some that are going to affect only a particular portion of the market. Knowing this information is going to assist you in determining where to invest and how to invest your money on stocks of interest.

Once you have some of the stocks that you are interested in it may be a good idea to get the trends and patterns that are formed by the movement of that particular stock. This will tell you when to purchase the stock, when to sell the stock and how to predict when certain stocks may become more viable investment options.

These patterns and trends require some mathematical computation. As a result these are best done by entering data into an application designed specifically for marketing analysis. These applications are readily available and many stock investment software applications provide reporting functions that can help with these stock analysis.

Knowing how to invest in stocks is the best way to protect yourself as well as your investment. In order to minimize the financial risk at the same time you increase your potential gain it is best to be an active participate in your portfolio. Know what the market is that you are investing in, which stocks and what types of factors have a direct effect on that particular market as well as the market in general this will help to reduce the risk of losing your investment.

You do not need to be an expert in stock investing in order to be actively involved but you will probably need to invest some time in researching terms, trends, and how to spot things that will potentially bring about a greater return for you and your investment.

Whether you are investing as a way to earn extra money, as a job, or to save for retirement being able to actively participate or trade on your own is something to consider seriously. This helps minimize the risk whether you are investing on your own or you are investing through a brokerage firm. Stocks especially cheaper stocks can contain a greater amount of risk due to fluctuations that larger more stable companies. While this does present a less stable trading environment you can see a greater amount of potential and using a reporting of the patterns and trends of the stocks are part of knowing how to invest wisely on the market.

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Investing in Blue Chip Stocks

These are basically companies who have had a proven track record. These are companies who have multi billion dollar turn over and are pretty famous like apple, Microsoft, P&G etc. The blue chip stocks are relatively safe for investment compared to the other options that you have.

Why should you invest in blue chip stocks?

There plenty of reasons why you should invest in blue chip stocks:

o Proven track record: These companies have a proven track record for centuries. They have high management bandwidth so even when the industry trends are on their way down these suffer very little because such companies have been through the same times before and know how to handle such situations.

o Stabilized Growth: These companies have a stabilized growth instead of some new ones which are in profit in one quarter and in loss the other. Due to which the stocks of these companies can easily give you an return of 15% compounded annually.

o Diversified: These companies are mostly not based on one product or one sector. They have widely diversified interests which helps the balance sheet in case a certain sector suffers a slag. Due to their diversification strategy they tend to suffer less during the slag periods because all the sectors are unlikely to slow down at the same time.

o Good long term bets: blue chips stocks are the best bets if you want to invest for the long term. These give great compounded results over the long term. These companies have a solid foundation and over a period of time have only one way to go that is upwards. Hence these should be your first choice when you have to invest for the long term.
How to classify a stock as a blue chip?

A blue chip stock can be identified based on the following parameters:

Strong balance sheet: These companies with strong balance sheets with moderate to low debt. They have consistent dividend paying history.

Market cap: The market cap of blue chip stocks is among the highest in the market. The market of blue chip companies is billions of dollars.
Diversified interests: These companies have diversified interests. They have vested interests in many sectors rather than one.

Strong order book: These companies have strong order books of billions of dollars and ever growing.

Strong order book indicates that their growth is not halted and the company is poised for a growth which is essential factor for an investor while investing in any company.

So now you know everything you need to invest in blue chip stocks, so go ahead and invest in the blue chip stocks to make a killer return.

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Are There Any Good Penny Stocks?

Penny stocks are better known as small cap stocks. These are stocks which are sold at a price which is less than a greenback per share. These penny stocks are typically not listed in the major stock exchanges. They are traded over the counter. Often you can trade small cap stocks on the pink sheet. In spite of its dodgy nature, they are far more prevalent among the backers. Large investment isn't needed to start trading with those speculative investments. But most of the times, believe it or not, tiny investment in this risky vehicles will bring in devastating losses.

The majority of the time new investors bear in their mind that "those hot stock picks" will certainly bring in a large amount of money. This is a misconception among folk attempting to hit the lottery ticket in one investing solution. To earn money in the stock market you must invest in the right sort of stocks and also know how it all works. This naturally is a hard process. The majority of the stock holders are no longer aware as to which are the good growth stocks that may be invested. There are certain tools and correct system to be followed to profit from the stock market.

If you don't have access to these investing tools you needn't worry. I'm going to tell you about some of the tools thru this article. Step 1 for you when you go in for investing in securities is to employ a determined penny stocks preference system, which shows the best stock picks and also show the ones to be evaded. You may seek the support of a certified stock broker, info available in growth stock newsletter and naturally your own discretion. Except for this you'll have to do a particularly careful and good market research work about the expansion stock companies in which you need to invest.

You'll have to give in hours of stock research, payments to good, plausible finance stories sites and a calculator to reveal a profitable penny stock. And believe me if you do find them then remember that your money and time isn't worthwhile. In addition, you as a stockholder be conscious of all potential risks mixed up in the investment of small cap stocks. The financial steadiness of the company, fine quality trading quantity, and well-built business plans are also some of the factors which you can consider for growth stock picks.

It is left to the speculators to recognize as to a way to make a response to it and compose it to work for us. Really, now isn't the time to invest your savings in penny stocks. You can invest in stocks now for a cost, which is less than half the cost of their tangible price, and find great growth stocks. The sole cause for such a slump in the stock market is actually because the confidence of stockholders is also decreasing in the market.

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Learning the Stock Market Game-How to Day Trade Stocks Online-Learn to Trade Stocks

These days there can be a lot of ways to make extra money. Buying and selling real estate, getting a second job or opening up a brick and mortar business operation are among the most popular options.

But many of those traditional business options might require a heavy upfront investment or start up capital on your part, as well as paying an increasingly high interest rate on any loans.

Day trading stocks online on the other hand can offer you freedom and easy liquidation of your funds. You don't have to tie up your initial seed capital for months or years. You can buy and sell stocks on the same day and put your potential profits back into your cash account with out making a trip to the bank and waiting in a long line.

Another good possibility of day trading is that You don't need a lot of money to start stockstackup.com" title="making money">making money, unlike the majority of conventional businesses.

But here is the first thing you MUST DO if you want to aspire success in day trading : You have to PREPARE YOUR SELF, just like you would in order to accomplish goals in other areas of your life.

Day trading is similar to any other business operation in the sense that every successful venture owes its success to the method used to conduct its business. In other words your day trading results depend in large part on your strategies and method. So never attempt to trade stocks with out using and practicing clear strategies on how to buy and sell stocks.

At the end of the day online stock trading is all about picking the best stock opportunities and following your buy and sell signals with ease and simplicity. Once you learn to master your trading decisions, you can aspire to produce consistent profitable results.

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Should You Day Trade Stocks Or Futures Contracts?

It seems most of the articles I read in the article directories suggest day trading exchange listed stocks. This is a bit difficult for me to understand, as futures contracts offers some distinct advantages over trading stock issues. As a longtime trader, I have extensive experience trading both of these equity instruments and understand the way both function. Not that there's anything wrong with trading stocks, as good money can easily be made trading stock issues. In my opinion, though, trading futures contracts, especially the e-mini contracts, have a multitude of individual advantages so as to make them a prohibitive favorite for day trading.

Needless to say, I can hear the stock day traders protesting loudly as many have been very successful in day trading their favorite stock. I can understand this, as a certain amount of money can certainly be earned in the stock business. However, the leverage to maximize your gains simply doesn't exist in day trading stocks. Further, day trading stocks entails a significant capital outlay in order to get started. On the other hand, getting started in the futures trading business requires a far smaller outlay of cash and seems better suited for the smaller investor.

From the onset, though, any futures day trader realizes that the high level of leverage that futures trading involves will maximize your profit; but it's also important to realize that high levels of leverage can also maximize your loss. For that reason alone it is important to practice and learn sound money management practices when trading futures. Contrary to popular belief, trading futures is not like going to the casino. There are very specific methodologies that must be learned and employed in order to be successful trading futures. To be sure, it is my belief that many beginning and poorly trained futures traders habitually over trade their accounts and take unnecessary risks in their trading activities. This approach is a sure way to deplete your futures trading account.

While some stocks can be fairly active, there activity pales in comparison to the financial index e-mini futures contracts. This healthy activity in the financial index e-mini contracts makes them a popular and profitable equity instrument to trade. And traders have flocked to the e-mini contract in droves. To be sure, the ES e-mini contract is the fastest growing financial instrument in the short history of futures contract trading. Currently the average volume on the ES contract has consistently exceeded 1.4 million contracts per day. That is to say, there are no liquidity problems in the e-mini marketplace.

In my trading activities, I trade the financial indexes in the futures market. I do this because all of my prior experience in trading has been centered in the financial arena. There are scads of other e mini contracts to trade, but I have found the financial indexes fit well in my trading plan. Further, I do not employ any fundamental analysis when trading the e-mini contracts. I am a scalper, and find scalping among the most effective methodologies for day trading the e-mini contract.

On the other hand, day trading stocks is a different proposition. While some technical analysis can be employed to trade stocks, there is a healthy amount of fundamental analysis that goes hand-in-hand with trading stocks. For intraday trading, fundamental analysis can be a difficult road to hoe. Many stock day traders may have to wait several days before their analysis results in their fundamental expectations.

As a scalper, I have no trades to hold overnight, and every night at bedtime all of my money is in cash. I can be an impatient person, and detest trying to de-cipher, or predict, which way the market may move. As a scalper I spend no time predicting market moves; I react to what the market is offering and exploit breakouts and breakdowns as they occur on the chart. I find that simply trading the chart in front of me greatly reduces my market risk as my investment horizon is usually between 10 and 15 minutes. I would contrast that to the stock day trader who may wait days before his plans come to fruition.

Of course, when trading futures contracts we run very tight stops to minimize downside risk and try to let our winning trades run. This is often easier said than done, but with practice you can become quite proficient in this technique. In short, scalping allows me to minimize downside risk and take advantage of significant market moves as they present themselves. I spend no time waiting for the market to move in my desired direction, I spend my time discerning potential movement in the market as the chart formation indicates. No, I am not much on predicting the market; I spend my time reacting to the market and hence reduce my potential risk exposure to a very narrow time band.

Especially for beginning traders, I highly recommend learning the scalping method as a way to profit in the market. It does take some time and practice, but the learning curve is not a prohibitively difficult one and I have had many traders find success in as short as 2 to 3 months. It is my opinion that scalping futures contracts is a superior method to trade. Most traders tend to graduate from scalping and move into swing trading or longer-term trading techniques. As for me, I have spent the last 25 years scalping and have no desire to graduate to swing trading. I suppose I am stuck with the simple elegance and efficiency of trading e-mini contracts. Additionally, I covet the peace of mind I receive by not holding trades overnight or committing myself to a certain direction of the market in order to profit

I am a long time institutional and retail trader. I still trade every day, but usually only from 6 AM to lunch break. After so many years of trading, I take pleasure in sharing some of the knowledge I have acquired in sharing it with those in the early stages of their trading career.

You can learn to trade in a system that works, because I trade the same system every day that I teach. I encourage you to visit my site and sign up for the free nightly videos(a $500 value) where I share some of the techniques I have used to make me so successful. This is a great offer for new traders and intermediate traders who are not having the class success they expected. Click here to start receiving your informational and fact filled videos every night.

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