q q q Next Subject q q q q q q q q q q q q q q q q
q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q
New try so it shows up GOOD on phone, in Word
Next - Ariel
Next - Ariel
q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q
_ This "Short Version" skims over all the various topics - they are covered in greater detail later on. They are set in "chronological" day order - morning first.
Market Manipulation - bitmap
Market Manipulation - Gif - original file type
The Basic Basics - In Order to Make a Profit On a Stock Trade, You Need to Overcome Two Things:
1. You need to beat the "Spread" - the difference between the "bid" and the "ask"
§ "Spread" - Let's say the stock you are wanting to trade is trading at about $3 - the buyers "bids" would be at about $2.93 and the sellers "ask" would be at $3.06. So you would lose .13 for each stock in a "round trip" trade - And multiply that by the amount of shares you're trading. Whenever you buy and sell a stock, you have to beat the spread in order to make a profit.
§ This is also why "low volume" stocks should be avoided, because generally, the lower the volume, the bigger the spread. (How to recognize If a stock has sufficient volume explained further down)
· "Spread" definitions -
o http://www.investopedia.com/terms/b/bid-askspread.asp
2. Have to overcome the cost of at least 2 trades (in and out).
§ That's why an excellent online brokerage is recommended - $1 fee for most trades - (see "How To Select An Online Trading Brokerage" section)
§ Also it's best to buy in segments, because you never know the exact best entry point - So, the lower the trading costs, the greater the profits.
q q q Next Subject q q q q q q q q q q q q q q q q
Basic Types of Securities to Trade - Stocks, ETF's & Options:
You Can Also Trade the "Spiders":
_ - Definition is "S&P Depositary Receipts" - Also called the "Q's" - named for stock QQQ
o A "Spider" (or Q) represents ALL the stocks in the market (moves the same speed) - So if you think the market is going to go Up (or Down) you can just buy a "Q". - "Inverse Q's" - such as DOG (Short Dow 30)
§ These stocks also have options. What a lot of people do is - after a bad jobs report comes out, they'll buy a "Put" (option) of a Q
§ Most common Q's http://finance.yahoo.com/quotes/QQQ,SPY,DIA/view/v4
q q q Next Subject q q q q q q q q q q q q q q q q
►►► Find a "Good Market Day" to Trade and Why It Matters:
_ Some days are much better than other days to go long / trade stocks.
Ø If the market's in a good mood, people will be much more apt to go long / take chances
Ø If the market's in a bad mood, lots of times even Good News Isn't a reason for people to buy stocks - and all the "mitigating circumstances" can be interpreted as good news, or bad news depending on the mood of the market
_ It's kinda like asking your boss for a raise when everything's going to hell in a hand basket
_ The reason why Market Direction as a Whole matters - is they say "82% of stocks move WITH the market" - Up or Down - and the saying is "A Rising Tide Lifts All Ships"
_ The best days to trade are when the market was in a bad mood, and then shifts to a good mood - (because of whatever reasons - decrease in unemployment numbers - or the death of Bin Laden, or something) - all the people that put off buying, buy all at once.
_ When the market's ecstatic - stocks with good news will often rocket - and then you look for "crack plays" - where stocks get run up like crazy (like a crack head is making the decisions).
_ On real cruddy days - some stock news that was considered "good" on good days will often be interpreted as bad on bad days - the "mitigating circumstances" type news. Lots of times it doesn't pay to try to trade that day at all - BUT you can buy the "Inverse ETF's" - stocks that go Up, when the market goes Down. It's safer to buy these ETF's rather than to short stocks, because when you short a stock, the stock could go to "infinity" (if you short a stock at whatever price, it could go to whatever higher price) - Whereas If you buy an Inverse ETF the worse case scenario is you lose the price you paid. However, it's best to check this out in the morning, to get in on the bottom of the swing. Inverse ETF's listed in "How to Play and or Short the Market with Leveraged ETF's".
_ When you see a good day shaping up - buy in pre-market where few people trade - get in first
►►► How To Gauge the Mood of the Market - the better the mood, the better the trading:
_ First off all - Bull or Bear Markets can go on for months, or even years. 2013 was a Bull Market, mostly because the FED was dumping 85 billion into the market each month buying mortgage backed securities. The Exact Math of Why this was good for the market is hard to figure, in its entirety - but the part that matters is, the market Really liked it.
Ø The point is, you have to get a little "connected" and find out if it's a bull or bear market, and the overall market sentiment.
_ Also, for those of you that don't already know - the Market is a "Forward Looking Vehicle" - the economy as a whole can be in the crapper and "Main Street" can be having a terrible time - but IF the market can convince itself things are soon to get better - decreased unemployment numbers, etc - they'll be buying the heck out of stocks with "they're going to need that soon" attitude.
Check What the Foreign Markets are doing overnight while our markets are closed - Live Graphs: - Japan, Asia, Germany, France, UK
_ A Big Dip - or Uptrend - in foreign markets can be indicative of BIG News
_ While markets Don't necessarily follow each other, we live in a global economy and markets react to the same news - such as a slowdown in China factory orders, since we seem to buy everything from China
_ Also on the "Indices in Up / Down" link, you can click on it and can find the latest market news, that you can seldom find anyplace else - it's news as it happens
_ Japan's Nikkei starts trading around 8:30 pm New York time - And the graphs are LIVE of their stock markets
Live Charts of Stock Markets in Australia, Japan, Asia, Germany, France and UK - and approximate starting time relative to New York time
***- 5 day graphs (of the above foreign markets) -
- This is the best link to check out, because you can see pictorially what's happening - and then click on the first link to see if there's any news stories. The foreign newspapers are good too - but if there's Big news, you'll usually see it in the first link.
- Indices in Up / Down List Form - Click on for news -
Foreign Markets: - and approximate opening time - New York time (Eastern Time)
^AORD - All Ordinaries (Australia) 7:45
^KS11 - Seoul Composite 8:00
^n225 - Japan 8:30
^TWII - Taiwan about 9:30
^HSI - Hong Kong 10:00
^STI - Singapore
^BSESN - India 12:45
^FCHI - France (CAC 40) 3:00
^FTSE - UK 3:00
^GDAXI - Germany’s DAX 3:00
^IXIC - NASDAQ Composite
^DJI - Dow Jones Industrial Average
^RUT - Russell 2000
^MXX - Mexico
^BVSP - São Paulo, Brazil
q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q
Check Out the Stock Market "Futures":
The Stock Market "Futures" - (or Stock Index Futures, to be correct) are not to be confused with the Forex Futures - they're different. The Stock Index Futures show where the market will open. It's difficult to describe just what the Stock Index Futures are, they're sort of like the Forex Futures, as if you were to trade "Futures Contracts" on the stock market as a whole. (Definition, for reference - http://www.businessdictionary.com/definition/stock-index-futures.html)
Links to MSN Futures - and Bloomberg
MSN Money: http://money.cnn.com/data/afterhours/
Bloomberg: http://www.Bloomberg.com/markets/stocks/futures.html
q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q
Check Out CNN Money "Fear & Greed Gage"
http://money.cnn.com/data/fear-and-greed/?iid=EL
q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q q
Can also check the VIX - the CBOE Market Volatility Index - the Market's Main "Fear Gauge"
_ The ^VIX is CBOE's "Fear Gauge" - It's hard to explain - it's an Index (or Indicator) that's set by the CBOE. It travels in long paths - and when it's up, it stays up for a while. It seems to accurately measure the market's sentiment - and it also has a psychological effect, because all investors know about it.
_ Here's the Yahoo link for it http://finance.yahoo.com/q?s=%5EVIX+&ql=1
§ 5 Day Chart shown below http://finance.yahoo.com/q/ta?t=5d&s=%5EVIX&l=off&z=m&q=l&p=v&a=m26-12-9&a=m26-12-9&a=ss&c=+&ql=1
q q q Next Subject q q q q q q q q q q q q q q q q
|
Starting The Day - at 8am or Before:
It's Real Important To Start Trading Early!!! -
_ The Vast Majority of the Market Action takes place early in the morning - or at Close
_ Pre-Market Trading Usually Starts at 8am (New York time) - the Market opens for regular trading at 9:30
_ By 11am not much else happens - and the market tends to go to lunch at 12:15 to 1:30 - you'll see a lot of stocks being sold and bought back at those times