Four most important trading skills You Won't Learn in Forex School

1 . Thinking long term rather than short term

Most traders starting mistakenly believe the hype that the currency market is a place where you can make a fortune overnight . Good forex school teach their students the fundamental lesson that it takes time to make money. Trying to make a lot of money in both markets can only end in disaster if you're really lucky. Keep in mind that the only way to earn consistent profits in the forex markets is to negotiate the use of leverage, but also significantly increases the amount of money you can lose .

2 . Learn to be patient

It takes time to learn how to trade successfully , rather than thinking that after only a few courses , you will be successful at a time . In addition to the courses that you will learn in Forex school  , will also have to spend hours of practice with demo accounts before real accounts . They say that it takes 10,000 hours to become an expert in something, and you have to put invest all the needed time to develop a successful strategy , because won't happen overnight .

3 . Develop a trader mindset not a gambler one

A trader must accept his losses because nothing is worst than letting running losing trades  rather than closing then when it's against him and hoping that the trade will reverse in  his favor .

4. Managing your risk

Every time you open a trade, there is always the chance that will go against you and you lose your money . For this reason, you must develop skills of risk management that will help you manage your risk so that you will be able to make successful trades . An example of risk management is to trade just the amount of money you are able to loose of your trading capital . This will limit your losses in case you fail to reach your take profits targets . Of course, this does not prevent you increase the amount ventured on your trades in case you feel the market is in your favor.

Top 10 Investment and trading Books every Investor Should Read

Photo by Olesia Buyar on Unsplash

Internet can be one of the best and fastest way to learn to invest. But if you are looking for a historical perspective on investment or analysis of a particular topic, there are several classic books on investing for great reading. Here we give a brief overview of some favorite investment books of all time and put you on the road to investing knowledge.

"Irrational exuberance" (2000) - Robert J. Shiller 
 Shiller's book, published in March 2000, gives a chilling warning of the imminent collapse of the Internet bubble. The Yale economist discredits the myth that the market is rational and explained in terms of emotions, herd behavior and speculation instead. In an ironic twist, "irrational exuberance" was released almost exactly at the forefront of the market.

"Learn to Earn" (1995), "One Up On Wall Street" (1989) and "Beat the Street" (1994) - Peter Lynch 
"Learn to Win" targeted younger audience and explains many business , "One Up On Wall Street" makes the case for the benefits of self-directed investment, "Beating the Street" focuses on how Peter Lynch picked winning (or how he lost them) while managing the famous Magellan Fund.the three books follow the 'common sense approach, which emphasizes on the fact that small investors take time to do their homework, it can perform as well or better than the experts.

"Stocks For The Long Run" (1994) - Jeremy Siegel 
A professor at Wharton School of Business Jeremy Siegel is the case - you guessed it - invest in long-term actions. It is based on extensive in the past two centuries to support not only that actions beyond all other financial assets, when it comes to performance, but also that equity returns are safer and more predictable against the effects of inflation.

"Common Stocks And Uncommon Profits" (1958) - Philip Fisher 
"Actions common and uncommon profits" teaches investors to analyze sectors and companies and its ability to produce profits. Originally published in 1950, Fisher lessons are still true sixty years later .

"The Intelligent Investor" (1949) - Benjamin Graham 
A classic bestseller of Benjamin Graham, perhaps the most influential investment figure of the 20th century, The Intelligent Investor has taught and  inspired hundreds of thousands of people worldwide. Published for the first time in 1949, Benjamin Graham's book still the most efficient and respected guide to investing, due to his timeless philosophy , it is interesting to read based only on the testimony of Warren Buffett "By far the best book ever written on investment."

"A Random Walk Down Wall Street" (1973) - Burton G. Malkiel 
This book popularized the idea that the stock market is efficient and that prices follow a random walk. In essence, this means that you can not beat the market. That's right - according to Malkiel, no amount of research, fundamental or technical, will help you in the least. Like any good academic, Malkiel defend his theories with a lot of research and statistics.

"Rich Dad Poor Dad" (1997) - Robert T. Kiyosaki 
This book explains several lessons about money that are being taught to children by their wealthy parents,
the middle class and poor parents neglect.
Robert Kiyosaki has a very simple message but it's a very important financial lesson that can motivate anyone to start investing: the poor make money working for it, while the rich make money by letting their assets doing their job. We can't find a better book to buy for your children's financial education.

 

"How To Make Money In Stocks" (2003, 3rd ed.) - William J. O'Neil 
Bill O'Neil is the inventor of the CANSLIM system. If you are interested on choosing the best stocks,Reading this book will give you a strong system that you can set to work immediately in your search.

"The Essays Of Warren Buffett: Lessons For Corporate America" (2001) - Warren Buffett and Lawrence Cunningham 
it's actually a collection of letters that Buffett wrote to shareholders in the last decades. This is a work of gathering techniques of one of the best investors in the world.

"Common Sense on Mutual Funds" (1999) - John Bogle 
This book begins with an introduction to the investment strategy before jumping to the mutual fund sector for exorbitant fees they charge investors. If you own mutual funds, you should read this book.

What Are Penny Stocks And How Do They Work?

By Matthew I Arthur

You might have heard a lot of people talking about penny stocks, and by investing in these stocks they were able to gain huge returns. You might be interested in investing in penny stocks to double your money fast. But, before blindly investing in penny stocks, it is very important for you to clearly understand what these stocks are, and how you can invest in them wisely, so that you can make a lot of money through this simple investment.

Introduction To Penny Stocks

The general description or feeling about penny stocks, is that it is a stock that trades for under $1. But, this is not the true definition of a penny stock. They are trading stocks on the stock market, and the biggest difference that you would see in the penny stocks and the blue chip company stocks is in the price of the stocks. Penny stocks are simply share prices of the smaller companies, small technology firms, mining companies and start up companies. The price per share of such smaller companies is very low when compared to multinational companies. Many people interested in doing stock trading invest their hard earned money in these kinds of stocks. All you need is a few hundred dollars to get started with a batch of developing pennies.

Is There Benefit In Investing in Penny Stocks?

Once you get to know what penny stocks are all about, the very next question that would come to your mind is the benefit that you will be able to gain by investing a small amount of money in the shares of small companies. Well, the best thing about these small stocks is that if it experiences a move in the price, this move will often be a huge and dramatic one in terms of percentage. If you are looking to gain good revenue through your investments, then you need to be working the percentages and investing in penny stocks that have a good chance of gaining in percentages.

Best Way To Start Investing

If you have a chat with leading financial experts and stock brokers, then they will all vouch that investing in penny stocks is the best way to step into the world of stock investments, solely for the purpose of learning. You will be learning the tricks of the trade of stocks and shares by investing in penny shares. They are the cheapest way of investing in stocks as you might even find certain stocks that are valued at 40 to 60 cents and you can even invest in hundreds or thousands of shares without needing to break the bank. You can also learn the nuances of stock trading through these tiny stock investments.

Never Worry About Cheap Stocks

The thought that you are trading in cheap stocks should never ever strike your mind when you are trading in shares. These lesser valued investments can change the fate of your life in the shortest possible time as any one of them can easily skyrocket in value very soon. As there are only a few traders who will be investing in these types of stocks due to its cheap value, there is every possibility for it to double, triple or even go up four times its initial value in a space of a few hours, or even sometimes in a few minutes time.

There's Also A Risk Factor

If you can make huge gains from penny stocks, the other side of it is that you could also lose all your money on a cheap stock that you have bet on. There is risk involved in any kind of investment, let alone pink sheet stock investments. Hence, if you are interested in trading in these stocks the safe way, then you need to depend heavily on analytical micro stock choosers. They are the perfect stock pickers who will be able to easily anticipate the behavior of the stock market and their main target is only the cheap stocks.

Invest With Caution

Even though penny stocks offer a large chunk of profits, these shares are quite vulnerable to be manipulated. If you are not very careful and cautious in picking out the right stocks, you can easily lose all your money that you had invested. It is important for you to find the honest and real small organizations to invest your money, as such investments will offer you tons of potential to earn handsomely. If a company seems to be having a bright future and is a promising small organization, then you can very well invest in their small stocks to get a hefty return on your investments. All you need to do is to take time to do research on the internet to spot such promising companies and you are sure to gain good payouts.

Tips To Invest In Penny Stocks

The following are the tips that you can use when you are thinking of penny stock investments.

• Do thorough research and proper planning before investing in pink sheet stocks of a company.
• Start out with small investments and slowly increase your investments on penny stocks.
• Invest in companies that have huge average trade volume.
• As penny stocks are highly volatile, always have an entry and exit plan ready and stick to that plan always.

Advantages

• Trading in penny stocks will be your guide to learning about the stock markets and how they perform.
• It is very easy to start penny stock trading as you do not need to put in a lot of investment.
• You have the opportunity to make more money in the shortest possible time by investing in mini stocks.
• These micro shares can also grow up to be traded in the stock market as mid cap stocks, thereby multiplying its value many times.

What I Think

It is important for you to invest in micro stocks with a little bit of caution and thorough planning. Make sure that you do not invest in stocks of companies that often go up and down, and this is especially important for anyone who is new to small stock trading.

For More Stock Investing Info Visit: http://investorchamp.com

Article Source: http://EzineArticles.com/?expert=Matthew_I_Arthur

2014 Investment in Pennies

By Shawna Frost

You don't need a lot of money to start investing in penny shares in 2014 - but they could make you a potential fortune in less than 12 months...

Penny stock is the only stock class with the power to double your investment, virtually overnight. You don't need to pile tens of thousands into big, expensive stocks like Apple or Exxon to make serious money investing. Many investors who have been successfully investing for over 30 years, say they would not touch lumbering blue-chips with a barge pole. As they believe the best, and most rewarding, way to make money investing is with "penny stocks... "

What makes penny stocks different from other "normal" stocks is that they're cheap. Dirt cheap. Shares can go for as little as half a penny to a few pounds. So even small (or first time) investors can afford to play the market. And don't worry if you've never bought a stock before, it's as simple as checking your email (or making a quick phone call). Anyone can do it.

Rarely featured in the press and "off limits" to most investors, because the big fund managers can't trade them...

Better still, these stocks can deliver truly explosive gains. In fact, they're potentially the most profitable stocks on the US and UK market.

With a big "blue chip" stock it can take years for a $50 share to turn into $100. But with a penny stock, a 20 cent share can become 40 cent overnight. After all, the share price only has to go up by 20 cents!

So with penny stocks you could potentially double your money at lightning speed.

Proven to Outperform Bigger Stocks

The little Known Story of a Penny Stock Billionaire...

In 1939 a young trader called John Templeton bought 100 shares of every company trading under $1 per share. Four years later he had multiplied his money many times over - even though some of the companies he invested in went bankrupt. This is the profitability of penny stocks.

John retired a billionaire, and lived out the rest of his days in the sunny, carefree Bahamas. And renowned investment researcher Roger Ibbotson points out that - "[penny stocks] have outperformed large-cap stocks... over the last 80 years." Eighty years.

As you can see, penny shares have trounced blue-chips for well over half a century. But most investors have no idea of the colossal power of penny shares. It's somewhat of an industry secret, one I'm letting you in on today.

This chart is a reminder of why I love small caps so much. They have consistently beaten the UK market since 1955.

So you see, when it comes to share dealing, I believe there's only ONE way to make serious money. I'm not saying that you're guaranteed anything. I'm saying you have a chance - a genuine chance - of making some real money.

So why Isn't Everyone Doing This?

If penny traits are so great, you'd expect everyone to harness their amazing profit building potential and get rich. But that's not the case at all. You see penny stocks are so small; the "big boys" in the City can't trade them.

This is because big investment firms can buy up millions of shares at a time... but if the company they buy into is a penny trait, the share price flies through the roof with a big order.

Penny shares have outperformed blue-chips, every single year, for the past 57 years

This immediately cuts into their potential profits, so penny investments just aren't a sensible way to play the market, when you're a City fat cat. However they're great for the little guy and first time investors.

Why you won't find these tips in the mainstream media

Because the City ignores them, the mainstream media does too. This is why most people don't know about penny stocks, or just don't trust them. Because they don't get the same media attention big blue chip stocks like Pfizer and Barclays do.

But just because penny traits aren't mentioned on the news or some bobble head's TV show, doesn't mean there's anything wrong with them. In fact it's better this way...

If you're willing to invest some spare cash you aren't depending on in penny shares, I really believe you'll be better positioned to profit. Of course, penny shares are riskier than investing big name companies. But with bigger risks comes the chance of much bigger rewards...

Shawna Frost works as a Financial Analyst with some good US Stock Exchange Consultancy companies. She writes about Penny Stock tips,Stock Market Tips and shares her experience regarding the Hot Stock Tips and US Stock Exchange tips with the readers.

Article Source: http://EzineArticles.com/?expert=Shawna_Frost

Ways of Selling Gold With Maximum Profit

By Tevin A Jones

There are several methods available if you are in need of a large amount of money. The best choice you can make is to sell pieces of gold and silver that you do not need. The steps are easy and they can bring you the amount of cash you need very fast. If you have pieces that may be damaged or broken, you should consider selling them as they are expensive to fix. Also you may have items that come from a finished relationship and it brings back too much painful memories. The best choice is to let them go and get some extra money in the process. Whatever the reason is, the process of disposing them is very simple.

First of all, you have to gather all the pieces of jewelry that you want to dispose of. Separate them depending on the material they are made from. You have to consider that the metals come into combination with alloy which can affect the amount of money you can receive from your items. You can find the information in the internet regarding the prices that correspond to the amount of pure metal in the item.

The next step in the process, is to establish the amount of each precious metal that you own. You can always consult the internet and make your own estimation or you could go to an expert and after paying a fee, he will give you the proper and exact information regarding the pieces of gold and silver. 

This comes in handy if you have a larger amount that you want to sell.

You have to pick your time in order to successfully make the most of it. The previous year has marked a significant increase in the price of gold. It is considered to be the highest in the last thirty years, so the right moment to sell is now. Stocks cannot be accurately predicted, only guessed and not even experts can establish for sure if the price will go up or down. The indicators show that you can receive $1,100 on an ounce of gold this week.

There are two choices when it comes to selling gold or silver, the conventional way (through a jewelry store) or online. The conventional way can be rather tricky as there are many scammers out there that will decrease the price much lower than the actual value. The other solution, which is the online environment, is much better. In any of the cases you should know the exact estimation of your gold or silver, and also you should know ahead how much you can gain from this transaction. Don't hesitate as your money is at stake. If you think that you can gain a larger amount on your items if your don't sell it to them, then go somewhere else.

Tevin Jones is an Expert Author,Visit the #1 Recommended website Cash for Gold or Sell Gold
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Article Source: http://EzineArticles.com/?expert=Tevin_A_Jones

Forex Trading School - How To Find The Best School For You ?

By Simon Aridej

It can be extremely difficult to learn the ropes of forex trading if you try to muddle through on your own. Forex trading is not exactly something an individual can effectively teach his or herself simply because it is complex and real time experience is the only way that anybody could ever be prepared for what the marketplace has to offer! Forex trading school can provide an excellent introduction to the world of forex and is a far better solution for individuals looking to trade currency than self education. Finding a school, though, can be difficult if you do not know what you are looking for. By adhering to the steps below, you will soon find a forex trading school to suit you!

1. Do not take the Internet's word for it - There are just hundreds of them out there, but only one forex trading school for you so it can take time to find it. This is especially true if you choose to believe everything certain schools write on the Internet. A forex trading school may be useless but brand itself innovative and dedicated. Nothing in cyberspace should be taken for gospel and enrolling in the first forex trading school you see could lead to a loss of money. Take everything you read about a forex trading school with a pinch of salt.

2. Only go to an accredited forex trading school - Actual brokers run certain forex trading schools and they are endorsed by numerous bodies because they all value the sanctity of forex trading. However, some forex trading schools will not be endorsed at all so stay away from those.

3. Research the company behind it - It is always worth researching a forex trading school before enrolling to make sure that they are offering whet they say they are, and to make sure that the forex trading school has a good reputation. Reputation is everything in the financial industry so never choose one that has been acknowledged as poor.

4. Assess the teaching methods - Personal preference should play a big part in the forex trading school decision for you. Some people respond well to academic pursuits, which encompass the theory, and some prefer to be practical and want to sit at a desk and try their hand, learning as they go. The choice is yours, but only go for a forex trading school that will help you to learn the best way you can!

5. Assess your own wants and needs - If you do not assess your wants and needs then you cannot find the forex trading school for you. The school you choose should be everything that you want it to be so make sure that you make your own decision without input, based upon what you want and need and you will not go far wrong!

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3 Reasons Why You Should Stick to Your Trading Plan

By Alwin Ng 

 

In the recent week, I have been doing some reflection as I prepare to launch my new online learning hub (Yes, I will be launching an online trading school, so stay tuned:D ) and I have been analysing some trading challenges that are common to traders who are struggling to succeed. As you could have guessed, these are usually related to trading behaviours and habits - also known as Trading Psychology.

I'm sure you realised by now that to become a successful trader, a sheer amount of discipline is required. However, to be very clear, trading success is not just about being discipline, it's about having the discipline to stick to your trading plan irrespective of the outcome.

OK, some of you might find this challenging and I understand that you might have trouble keeping to your plans because of A, B, C and D reasons. While I'm not here to verify if those reasons are valid, I want to remind you that you need to remain focus in doing so. Because if you truly want to succeed, sticking to the plan is extremely crucial for your trading success. To support my point, here are a few reasons why sticking to the plan is important.

1. Validating Your Plan
When you first learn to trade the market, the first thing you need to learn is to stay clam and relax when they are in the market. Let's face it, emotional control is a continuous learning process. So, before you get there, you need a reliable methodology to support your learning. While you should start off with back testing, you will need to validate your plan in a live market condition as well.
For a trading system to be thoroughly tested, (and here's the key) the system needs to capture every set up that meets the rules. This is important so that all boundaries of the system are accounted for. This is important so that you can verify and validate that you trading plan provides you with a solid trading system.
Imagine if you only take the trades that you FEEL right and you THINK is good? And you decide to ignore any trades because you experienced a few losses recently or because a random newsletter gave you a different bias. Do you think you can fully appreciate what your trading plan has to offer? Do you realise, that by not following your plan, you are not able to fully validate your trading plan?
Validating your plan is also important so that you will learn to trust your plan and that leads to an easier and easier trade execution.

2. Accelerate Your Learning
Keeping to your trading plan is also important so that you can improve it. Yes, of course you need to improve your plan. As you continue to trade the market, you are (consciously or unconsciously) learning. Every time you learn something new, you can always use it to improve the returns on your investment and you do that through your trading plan. Above and beyond that, what traders don't realise is that they can actually accelerate your learning if you were to stick to your trading plan.
So my next question to you is this: - How can you accelerate your learning from your plan?
That's a simple but not so straight forward answer. If you were strict to follow to your trading plan irrespective of the outcome, then you will start to learn about yourself and how your plan is interacting with the market. You see, when you keep to your plan irrespective of the outcome, you will be asking questions like:

• Will I be satisfied if I reduced the reward for a higher probable outcome?
• What are the chances of getting similar outcome if I change my entry/exit?
• Is this type of trade suitable for my risk appetite?

Note: You will only know the answers to the questions by following the plan until you have a large enough/decent sample size.
And you will ignore questions like:

• Will the market move higher/lower?
• What's the likely market reaction from Fed announce?

In other words, your focus will be towards making your trading plan better and you will start to learn how to become a better trader as opposed to being a really good market analyst.

3. Detachment from Market
Here's another important lesson that you can take away by keeping to your trading plan. As soon as you start focusing on the plan, you will also learn to detach yourself from the market.
How? Well, I'll try to flip this around see if it makes more sense.
Remember that you have no control over the market and the more you focus on something that you have no control, the more emotional one can get. For example, some traders celebrate because they made lots of money over one trade. This is pretty silly because the fact that they made money over that that is not a representation of the capabilities of that trader. They don't realise that winning or losing one or two trades is merely driven by luck. However, the fact that you overwhelmed by that winning also means that you will likely get very angry or frustrated over a losing trade. Remember that emotions work both ways which includes both winning and losing trades.
So instead of that, putting all your focus on your trading plan will help you redirect your effort and energy at the right place. In fact, the more energy you put on your plan and less on trying to predict the market, the more you are able to detach yourself away from the market. And the more detached your are, the more you can focus on making rational trading decisions.

Conclusion
I can continue with a lot more reasons to why you should stick to your trading plan. However, the 3 reasons mentioned above will be a good starting point as they are enough to get you going.
With that, I do believe every trader should focus on learning to stick to their plans. It is after all, a skill that you can learn.

Thank you for reading and please share any of your comments in the box below.

If you like what you read, do visit us at TradeYourEdge.com

Article Source: http://EzineArticles.com/?expert=Alwin_Ng

How to Trade Foreign Exchange With $100

By Keith S. Ng

The world of foreign exchange or forex trading initially seems slightly overwhelming when first introduced. What many people fail to realize with trading currencies is that success is developed with experience, awareness and strong belief in decision-making capabilities.

 Those interested in making breakthrough trades in personal investment don't need thousands of dollars to make impact. The following information will assist anyone with $100 make informed decisions in the currency trading market.

Getting Started Effectively:
The beginning of the trading experience for the currency market should begin with research and practice. One should choose the appropriate broker which fits their desired investment outcomes.

Reviewing various forex brokers exploring all the benefits offered is the best way to become comfortable and maximize investment results. Once broker selection is complete, testing with free trading software from the chosen broker is the method most new traders choose to learn the currency market.

Gain experience with different currencies, charts and market news as much as possible.

The time frame for gaining enough experience is dependent solely upon the individual, but it's recommended that a month's worth of practice will develop a keen mindset for trading.

One of the most important characteristics of learning how to trade $100 dollars effectively in the forex market includes understanding the power of leveraging money. Leverage is the process of trading on the margin and most forex brokers offer this option as a tool for their traders the chance to earn greater returns. The range of marginal trading offered by brokers is expansive from 50:1 to 400:1 margins on pips or small price changes in currency.

The higher the marginal value, the less money is required to place on the applicable trade.
Trading on margin has great rewards for those who understand leverage well; however the amount of risk associated with marginal trading is just as possible to occur.
The positives of trading on margin allow investors to make high percentage gains compared to the initial $100 balance if the fluctuation of price changes is high, yet if inaccurately judged the same value that could have been gained will be lost over a set amount of time.

The best way for investors to trade cautiously on the margin is having a developed risk management strategy established.

To make a $100 investment stretch further, one must become familiar with forex charts as much as possible. There are established types of charts specific for analyzing the changes in currency value so those patterns and behaviors must be understood. Become comfortable with a certain style chart and the associated time frame assigned to the values the currency displays.

Chart values are effective on the independent variable of time, this is why even if one style chart is understood it cannot be automatically predicted the behavior of the currency unless the time frame for that behavior is also accounted for.

Quick Tips to Remember While Trading:
Forex trading with a $100 investment is an exciting way to learn about world markets, but live trading must be done under the calmest of conditions. One must be removed from emotions when making a decision on the currencies they decide to invest in and understand some losses will happen.

Managing risks effectively will ensure that losses can be reduced. One method to effectively manage risks is splitting the amount invested in halves using a portion to put towards the market and the other as recovery funds. One should watch the charts daily but only trade when the chart shows fluctuations to favor the trader. Above all, paying attention to the news, understanding the charts and strengthening personal prediction through experience will lead to an investor's ultimate success.

Keith Ng writes on topics of foreign exchange and stock trading strategies he learned from a successful forex trading course in Singapore. To learn more about trading with the best, please see www.onlinegurutrader.com

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The Top 3 Myths About Forex Scalping

By Steve Rising

There are a host of common, erroneous ideas about forex scalping that are available to the trader who simply has not done the proper research. Most of these ideas are perpetuated by marketers who attempt to steer a trader to a trading process that may not suit his personality and, more importantly, his risk tolerance, and that may also draw temptations of large profits with minimal capital outlay.

Emotions often override sound judgment when a trader is looking for a way to generate large profits instantly. When reviewing various forex trading processes, a trader must overcome his preconceived notions and approach the selection process with a spirit of detachment.

Here are three of the most common myths about trading the forex with a scalping technique:

1. Forex scalping means that you are only able to take a small profit.

Not true. Market conditions are what determines the size of the profit one can take. The solid forex scalper understands this. A forex scalper can take a 100-pip profit when trading a fundamental announcement or a 10-pip profit when trading a currency pair with small average-size moves.
A scalper is simply a trader who has a predetermined profit target based on the anticipated trading conditions. A scalp trade has zero limitations regarding profit taking. The market conditions create the limitations.

2. Forex scalping is riskier than trend following.

First the trader needs to understand that the amount of available trading capital determines the amount of risk you can take. The smaller the trading account, the less risk one can take.
The forex trader with limited capital needs to trade with a very tight stop.
When comparing scalping to trend following, trend following requires the trader to trade with a very large stop; scalping techniques allow one to trade with a very small stop. Trading with a tight stop means the trader is trading with less risk. You simply cannot trade a trend following technique with a tight stop.

3. Forex scalping requires you to be glued to your computer for hours at a time.

If you are using a solid scalping process, you should be in a trade for less than 30 minutes in most cases. Scalping is actually less time intensive. Trend following requires the trader to be in a trade for extended periods of time.

Because the forex is the world's most volatile market, the trend follower is always checking on his trade. The trend follower never wants to be far away from access to the market. A common practice for a trend follower is to get up in the middle of the night to check on his trade.

The scalp trader can achieve the exact same profit in a fraction of the time simply by trading multiple lots. Get in, take profit, get out. Turn off your computer and go enjoy yourself.

As is often the case, myths and misconceptions are created from erroneous ideas.

Typically when a trader is tempted by the idea of fast and easy profits, these erroneous ideas become the driving force.

Forex trading is an excellent way to generate additional income. Forex trading is not a unique endeavor that does not require proper training to realize consistent positive results. The bottom line is, getting properly trained is mandatory if one wants to realize success.

To learn more visit www.theforextradinginstitute.com.

Article Source: http://EzineArticles.com/?expert=Steve_Rising

Can You Trust Stock Brokers?

By Matthew I Arthur

'Can you trust stock brokers?' Talk about a loaded question. Anytime you're trying to evaluate the trustworthiness of a whole profession or a wide class of people, you might run into the very common problem of stereotyping. One bad apple (or a few dozen) doesn't necessarily have to spoil all apples. Still, many people do think in terms of generalities and this is a reality we have to live with. Here are some important factors to consider when trying to decide whether you can trust stock brokers or not.

Which stock broker?

In deciding whether you can trust stock brokers or not, you have to remember that there are actually many different types of stock brokers. Many people lump all brokers in one class and judge this class. This is not fair considering the different types of stock brokers out there. Here are just a few of the most common classes of stock brokers.

Trading broker

This stock broker just executes your trades for you. This broker doesn't make any recommendations regarding which stock to buy or sell.

Sales broker

This stockbroker actively 'pitches' clients on stocks to buy. By law, such brokers are required to disclose if their company has a vested interest in the stocks they are pushing.

Analyst

While not technically a stockbroker, analysts are very influential opinion makers in the world of stocks. They study particular stocks or industries and recommend stock buys or sales. Like sales brokers, they are required by law to disclose whether the company they work or they themselves have an interest in the stocks they are recommending.

As you can tell from the descriptions above, it would not be fair to say trading brokers are 'untrustworthy' because they merely execute trades on behalf of their clients. It would be fair to ask, however, whether you can trust an analyst or a sales broker. While most of these brokers are on the up and up, there are quite a number of shady operators who give the whole industry a bad name. Many of the more aggressive shady operators use boiler room operations and pressure sales tactics to victimize investors. What follows is a quick guide on how you can protect yourself from shady stock brokers and stock sales operators.

Protecting yourself from shady operators: a basic guide

This guide is not meant to be an exhaustive guide on how to avoid being victimized by shady stock brokers. Instead, this guide lays the basic groundwork you should follow to minimize your chances of being ripped off. As always, if something is too good to be true, it usually is.

how to find brokerage companies to trust with your money

Trust only legitimate companies

Companies spend a lot of time and money building a solid corporate brand. A solid brand is the result of many satisfied customers and a very minimal level of customer complaints. Not all businesses and firms in the financial industry can lay claim to a solid brand. If you get solicited by a stockbroker, either over the phone or through an email or physical mail, your eyes should quickly search the message for the logo of a company you can recognize. If you don't recognize the company, research it quickly online. If it is a solid company with a solid reputation, you should be able to quickly dig up many mentions of the company as well as possible awards or big projects. However, you shouldn't limit yourself to what search engine results say about the company of the broker that contacted you. Thanks to search engine optimization (SEO), bad reviews, bad reports, and other damaging information regarding companies are fairly easy to 'push down' in search engine results.

If you want maximum peace of mind, visit the SEC's website and do a search on the name of the firm of the broker that contacted you. Public complaints, enforcement lawsuits, and other enforcement actions by the SEC are put on the public record. It should be fairly easy to see if the firm of the broker who is soliciting you has had lawsuits filed against it or if the company or its members faced fines or other serious penalties.

Ask to see the research

Assuming that you're dealing with a legitimate company, don't let this fact lull you into thinking that you should do business with the broker. You need to be vigilant. Just because you are dealing with a company with a good reputation doesn't necessarily mean you won't get ripped off. There is always a first time for everything. Ask the broker for research materials and other objective information you can research which backs up the broker's conclusion that the stock he or she is recommending is due for a 'breakthrough.' Pay attention to earnings, earnings growth, industry ranking, market share, and industry growth so you can make a truly informed decision. Don't just take the broker's word for it.

Take what you read online with a grain of salt

Your next step is to do research on the individual company being recommended to you. Take a look at what other people have to say about the company. At this stage, you have to remember that there is no such thing as 100% favorabilitiy. There will always be negative stuff online because there are haters all over the Internet. In fact, many negative blog posts and articles are actually written by competitors of the company. This is not the problem. The problem is if you see a constant negative pattern. Where there is smoke there is fire, after all. If you see such a pattern regarding the company you're researching, stay out of the stock. When in doubt, stay out.

Be on your guard when researching stock forums

Another resource you should check are stock forums. You'd be surprised at the nuggets you can unearth using stock forums when researching your stock picks. With that said, keep in mind that there are many people engaged in 'pump and dump' scams on stock forums. Be on your guard. Always look for secondary information besides what the promoter or poster is saying regarding a certain stock.

Can you trust stock brokers? The answer, of course, is it depends. It depends on the type of stockbroker, and it depends on the nature of the investment opportunity the broker is pushing. By following the tips listed above, you can increase your chances of avoiding victimization by boiler room operations and pump and dump schemes.

For More Investing Tips Visit: http://investorchamp.com

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How Much Money Do I Need to Begin Trading Forex?

By Johnny Mitch

Forex trading has become very popular and one of the main reasons is that it can easily be accessed by almost anybody due to the very low entry barriers, compared to other forms of investments.

Whilst still a beginner, instead of considering what amount you need to invest, make sure you know at least the basics of trading. This can be easily done by opening a demo account where you can practice with virtual money and do trades as if in a real life environment. Although you will learn the basics keep in mind that live trading and trading within a virtual environment is a whole different experience. The reason is that, as real money is not involved your psychology is very different and the way you think and respond to your feelings can have a great impact on the outcome of your trades.

So practice first a great deal and begin to form your private trading strategy and day by day complete more and more successful trades. It's also essential to learn the fundamentals of forex techniques to analyze fluctuations in currency prices by utilizing technical and fundamental analysis within a your demo account. It takes some time to fully comprehend the use of such tools and use them to your advantage. Only when you believe you are ready I would recommend to open a micro account. Following that, should you begin to generate profits on regular basis go ahead in opening a mini account.

Even though you can begin trading with as low as one dollar the most common minimum entry amounts are from one hundred to ten thousand dollars. There is no magic number to enter the Forex market but I always recommend beginning with a small deposit and one that does not entail very high risk in case of temporary losses. Gradually as you gain more experience and complete more and more successful trades you can increase the numbers going for larger profits and risks.

Many traders get carried away and believe they will invest a small amount and turn to be millionaires in no time but let me assure you that this is a pure misconception. Should you decide to misuse the high leverage advantage within the currency exchange you are more likely to be doomed right from the start. Newbies must realize that experts often generate less than fifteen percent per year. Investors with small deposits usually presume they are able to earn double, triple or quadruple their money within a year's trading.

You need to remember that you should avoid trading more than two to five percent of your total deposited amount in one go. Controlling your losses is what will make you a successful trader and not winning the most trades. This is the most common mistake that novice traders do and they end up losing too much too soon and quickly abandon the Forex market extremely disappointed.

Therefore to recap, first you need to acquire the basic knowledge through studying, and then make sure you practice till you gain a certain confidence of your training methods and finally gradually enter the market with a conservative investment which you will systematically build up once acquiring more experience and steadily increase your profits.

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Some Of The Benefits Of Automating Forex Trading

By Saich M Kate

When it comes to forex trading, experts use two major methods. The first one is the traditional method whereby a forex trader picks a broker, fixes trading schedules, sets funds, analyzes price variations and finally makes investments. The second method involves the use of a forex trading robot. This robot is in essence a type of software that automates the entire system of forex trading. It is able to perform tasks such as data collection, analysis and setting schedules. This method is very popular today in forex trading since it offers the following advantages:

Works 24/7
A typical forex trader works for about 8 or 12 hours a day then goes home or to other business. On the other hand, forex robots are able to function all day and night without tiring out. This means, it will not miss any great opportunities that might present them after you have left the office. In turn, you will be able to maximize your profit.

A complete automatic system
These software tools are truly automatic and do not require your assistance in anyway. The only time you will need to help them is during the set up process. Once they are up and running, you will only need to check on the progress occasionally. It is as if your forex trading will be on autopilot. You seat back, relax and watch your profits grow.

Emotional control
Unlike humans, robots do not have any feelings, unless it is in some fictional science movie. This means, they are able to make decisions based purely on logic without any emotional influence such as greed. Therefore, they are able to make the best decisions possible during trading, which work to your own good.

Suitable for repetitive actions
If you are a forex trader, you are well aware of the numerous, tedious, repetitive tasks such as data analysis, comparison and numerical computations, which you must perform every time there is an opportunity. This is plenty of hard and tiring work, and at times you can make errors because of the magnitude of the work. Forex robots are able to perform these actions swiftly, accurately and efficiently.

All Knowing
In forex trading, you must acquire sufficient and accurate knowledge of techniques and strategies if you want to optimize your profit levels. Nevertheless, if you are using these software tools, you are able to make a trading decision even with little or no knowledge since the robots make that decision for you.

We provide the best info about free forex trading robot. For further details please visit the provided link.

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7 Secrets to Forex Successful Trading

By Larry L. Taylor

Some people are able to make a killing on the foreign exchange market. Others end up losing everything and quitting totally. If you want to find yourself in the former group, not the latter, you need to do your research. This article has seven amazing secrets which can help you find great Forex success.

1. Set Goals

The most important thing you can do is set goals. No matter what you are trying to accomplish, from losing weight to quitting smoking, goals are what keep you focused and determined. Set goals for every part of your progress, from start to finish. Reward yourself when goals are met and then set new goals to keep yourself motivated. If you continue to best those goals, you will only find success in the future.

2. Set Time Frames

As you figure out what your goals are, you need to set time frames for when they need to be reached. Short-term goals will keep you motivated from week to week, giving you standards which are easy to reach. Long-term goals will remind you of what you strive for and what the little goals will lead to. Make sure your rewards match the goals, smaller treats for short goals and big treats for long-term goals.

3. Select the Right Broker

Choosing a broker has to be done with care. Select someone who comes recommended from traders you trust. Look online for reviews to determine the quality of the broker's services. Also be sure to select a broker who offers the amount of leverage you need.

4. Open Demo-Practice Account

When you know which broker you will use, open a demo account and start practicing. As you learn how the software works, you will also be able to hone your strategies. Treat it as if it is a real account so that you are building techniques which will work with real money as well. Don't move to a money-based account until you are completely comfortable.

5. Begin With a Small Mini Account

When you are ready, start with a mini account. This allows you to trade in small sums without using leverage, which is very risky. You can build your comfort even further as you see that your strategies are beginning to work. This builds your research skills and ensures that you will be able to start trading with larger sums without any anxiety.

6. Trade With Home Currency

The best bet when beginning to trade is to start with the currency of your home country. You will know the situation locally as far as the economy is concerned, meaning you can avoid the research necessary if you were to invest in a far away currency. You will also be able to understand better how the currency compares to others, allowing you to choose pairs which offer the greatest rewards. Once you are able to master your own currency, you can move on to others around the world.

7. When Comfortable - Slowly Expand to Other Currencies

These ideas may seem like common sense, but many traders ignore them and fail as a result. Be sure to use them all as you craft your Forex strategies. You will be left with large profits, small losses and an overall income boost.

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Important Things To Consider Before Buying Bitcoins

By Umer Waqas Mehar

When the central bank in Cyprus froze bank accounts and limited the amount of cash that could be withdrawn from bank accounts it created a huge uproar that was felt around the world. If consumers did not have access to money how could they buy and sell the things needed to carry on in our modern world? The reality is they cannot so consumers around the world started to look for safer alternatives to fiat currency. Fiat currency is currency that has no tangible value aside from what the government assigns to it.

Consumers are looking for a way to store their buying power to protect themselves from having bank accounts frozen for indefinite periods of time. Many people started trading in Bitcoins. This is a crypto-currency which means it cannot be easily counterfeited but before anyone starts buying into this new currency it would be prudent to understand the risks.

Bitcoins are not issued by any central bank or government so there is no accountability whatsoever. If you are dealing with Dollars,Euros or Pounds you have the assurance that the government behind it will honor the debt while Bitcoins do not provide any guarantees at all. The fact that no one truly knows who made this currency so there is no way of knowing whether it could be stolen right from under our eyes.

These Bitcoins are stored inside a digital wallet that can be encrypted on your computer. While this should provide a sense of security if your computer is lost your Bitcoins are gone as well. It is not like a credit card where you can get a replacement and carry on like nothing has happened.

While the security of this currency is a concern by far the biggest worry is the value of it. The perceived value of a Bitcoin can change in a moment and unlike fiat currencies that are backed by hard assets owned by a country if a Bitcoin value drops you have nothing of value at all.

There are a few exchanges around the world that sell and buy Bitcoins, but you should not buy them thinking they are going to rise in value. They are a digital commodity which some would classify as a "fad". Tomorrow it could lose all its real value and never recover.

So to recap the risks, you do not have any real security with Bitcoins since they are not provided by a government. The value if highly volatile and could be reduced to zero in a heart beat and the simple fact that the currency has only been around for a few years shows it is not proven to be reliable.

If you are looking for a way to preserve value then precious metals like gold,silver and platinum may be more beneficial since they have been used for centuries as a medium of exchange.

When it comes to investing you should never make rash decisions but weigh the risks and potential payoff and remember that there is no sure things when it comes to digital currencies like Bitcoins so approach at your own risk.

If you are interested in buying or selling Bitcoins you can visit this site https://mtgox.com/ which is one of the most popular exchanges for these highly sough after coins.

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High Frequency Trading Explained

By Martha Stokes, CMT

Proponents argue that High Frequency Traders provide needed liquidity while opponents raise the flag of the "little guy" aka the small lot investor or retail trader, as being harmed by HFTs. The question is whether the average investor is truly a victim of HFT activity when most investors buy mutual funds, in addition the largest mutual funds do not use the exchanges for their large lot orders and are therefore rarely impacted by intraday HFT trading on the exchanges.

The question of whether High Frequency Trading is good or bad for the financial markets is not as simple as the news would have everyone believe. The problem and any solutions are as complex as the world of HFTs, which trade across all financial markets around the world.

The roots of High Frequency Trading came from the Day Trading Floor Traders of the 80's and 90's. The market makers of that era decided to try squeezing out the growing nuisance of rogue floor traders, who broke away from their prior employers on the exchanges to trade independently with the brand new PC computer that allowed them to trade at home. These independent day traders ushered in a new era of quick in and out trades, that took advantage of the wide spreads between the ask and the bid of the fractions pricing structure of that day.

Market makers lobbied for decimal pricing structure believing that a tighter bid and ask would squeeze out the professional independent day trader and the newly minted retail day trader. These traders could see the huge lot orders of the institutional clients moving through exchanges, and would jump in ahead of the huge lot order forcing price up. This infuriated the institutions and the market makers who managed those large lot orders on behalf of the giant mutual and pension funds.

Decimal pricing replaced fractions in 2002 and did for a short period of time reduce the day trading activity, however this was only a short reprieve.

By 2005 computers had evolved to provide much faster speeds, and more sophisticated software provided algorithms and formulas that could track orders moving through the system. Without the large spreads, day trader professionals turned to faster speeds. Faster speeds meant that they could trade more frequently with even a penny or half penny spread and still make profits.

HFTs quickly caught on and the huge liquidity that these firms provided became a highly lucrative opportunity for exchanges, that had seen a steady loss of revenues as more of the smaller exchanges emerged along with more ECNs. The Dark Pools also started taking more and more of the order flow away from the exchanges. Dark Pools were a direct result of HFT trading on exchanges. Now instead of the large lot orders moving through the exchanges, large lots were being filled in Dark Pools. This caused the exchanges to lose more money.

Then also exchanges went public and as public companies, their goals and business structured changed dramatically. The NYSE and NASDAQ needed to make their shareholders happy instead of simply providing an excellent exchange trading experience for their clients. They sought out more HFTs to fill the void caused by the loss of the large lot investors, who no longer used the exchanges for their millions of shares of orders. HFT activity increased as exchanges offered these firms maker-taker rebates to provide liquidity for the exchanges.

HFT activity peaked in 2009, with an SEC confirmed 56% dominance of all orders on the stock market at that time. It has been stated in several internet sites that it was as high as 77%, but that was ALL automated orders and not just HFT order flow.

Because the HFTs offered liquidity and could trade anywhere, exchanges offered a maker-taker contract with many of the HFT firms. A maker-taker acts at times like a market maker, however the maker-taker is not required to "make a market" as a market maker is obligated by regulation and law.

A maker-taker is a rebate program designed by exchanges that pays a rebate back to the HFT whenever they provide liquidity to the exchanges. The exchanges needed the HFTs to provide liquidity because there was an unexpected negative side effect to changing from fractions to decimals.

With the tighter spreads, more and more market makers discovered they could not make sufficient profits and compete with high-speed computers. Slowly market makers on the NYSE floor disappeared leaving only a few from what had once been a busy, crowded trading floor. Across the US in every exchange and every financial market, market makers began disappearing.

The exchanges lost more liquidity as HFT dominance in the stock market rose between 2005-2009, driving giant lot institutions to Dark Pool venues known as Alternative Trading Systems ATS.

The decimals that everyone believed would make the markets more efficient had resulted in less efficient markets, a huge need for maker-takers to fill the role of the declining market makers and the ever increasing speed of transactions.

Now the argument about how to regulate and control the HFTs is gaining political popularity and once again, the financial markets face a crossroads moment. Any change to how the financial markets operate from something that seemed as simple as changing from fractions to decimals, does create reverberating impacts that can't be foreseen, projected, or even comprehended at the time.

No one in 2002 thought that decimals would give rise to a new form of high frequency day trading. No exchange in 2005 really understood how HFTs would alter not just intraday activity, but the overall volatility of the markets. No one could predict the demise of market makers who had been an anchor for the market that held it steady, stable, and strong for decades.

Solutions that have been presented are lacking in a thorough understanding and comprehension of how a small change can have massive repercussions for not only the stock market, exchanges, ATS, and every market participant but for every other financial market globally as well.

HFTs do need to be regulated but their true roles, benefits, problems, risks, and areas open to fraud must first be identified. So far none of these have been empirically documented by anyone.

Martha Stokes, CMT Chartered Market Technician and CEO of TechniTrader® The Gold Standard in Stock Market Educationhttp://technitrader.com learn "How To Invest For Consistent Success" (c)copyright 2014 Decisions Unlimited, Inc. dba TechniTrader a registered trademark.

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Day Trading - Why 98% of People Lose Money in the Markets

By Ray Plummer

Almost all people that venture into the world of Day Trading do so with grand thoughts of wealth and easy money. 99% of these people will wind up handing their hard earned money to myself and others which have figured out the game. Yes, it is a game that is extremely hard to master and has endless dead ends. It can begin to feel as if you are a mouse in a never ending maze. You can spend years running around the maze working on endless ideas and methods all of which lead to the same inevitable end.. Losing money!

You might be wondering, who is this guy writing this article? How did supposedly he, and others learn the secret to the game. I would like to claim that I have superior intelligence but that would not be true. Like Edison the inventor of the light bulb, once you have done things wrong long enough, lost enough money, and have been beaten down to the point of giving up, only then, if you can muster the fortitude will you finally begin to see through all of the hyped claims of the failed systems and unyielding methods from your past.

The plain truth is, the sooner you stop looking for the easy money the quicker you will begin to understand why and how those that do win the game take an unfair advantage over those that don’t.

Each person's first introduction into the game of trading is always because someone has been sold on the idea that trading is simple and easy if you purchase the “right system” or methodology from the guru of the hour.
These marketers are relentless at taking your money. They are system/methodology designers which understand exactly how to manipulate the various system components to fit anyone‘s taste and temperament. How many times have you been told that you simply need to find a system that fits you and your personality. This is a half truth as no system will fit you for very long if it is not consistently profitable.

Most systems being sold on the internet today clearly explain a entry set-up, but are so vague in regards to exit that they are completely useless. I can’t tell you the number of systems/methods that I have personally purchased that are nothing short of out right fraud in regards to their advertising. Most systems have been back-tested and optimized to the point that on paper they look unbelievable, but in real time they simply fall apart. It seems that people are willing, even anxious to hand over their hard earned money to anyone claiming to hold the key to easy riches.

Now that you have been warned about the fraud and false claims within the industry lets discuss one of the primary reasons that most people lose money. It is the bid/ask spread of entering and exiting the market along with the cost of commissions that stack the deck heavily against those that use methods which try to scalp small profits out of the market. These costs can easily cost you any chance of being profitable. Let me explain, if using the S&P 500 e-mini contract, the minimum tick size is .25 point or $12.50. When you enter and exit a position you will be giving up 2 ticks or $25.00 plus commissions to the spread. Lets say you are using a method in which you are trying to achieve a 2 point target or $100.00 with a limited risk of also only $100.00. Your spread give-up and commission will run you at least $30.00 per contract. This means that the position is already deep in the hole before you begin. The market will have to move and extra $30.00 before you will achieve your target. Theoretically in price movement terms, a win is worth $70.00 and a loss will cost you $130.00. You must win almost 2 times to every loss just to breakeven.

The first thing that you must realize is that there is no way around these costs. The only thing that you can do is minimize them as much as possible. The only way to do this is to only use trading methods in which the profit targets are large enough to reduce these costs to a small percentage.

Example:
$30.00 Cost and a $100 Profit Target = 30% Cost of trading.
$30.00 Cost and a $300 Profit Target= 10% Cost of trading.

All things being equal, lets say that you have discovered a method which is 60% accurate after covering the spread (a very healthy system). It has a 1 to 1 risk-to-reward ratio. (That is the risk and reward are equal.)

Winner: +$100.00 Loser: -$100

Win: 60% times $100.00 = +$60.00 less commissions of $5.00 = +$55.00 Gain
Loss: 40% times $100.00 = -$40.00 plus commissions of $5.00 = -$45.00 Loss

This very healthy and difficult to develop system will net you on average $10.00 per trade. Is it any wonder that most people fail. As the system that I am describing is much better than most available on the market today.

If you have been trading for a while, you know the saying “Let your profits run and cut your losers short”. This is the basis for many trend following systems which have profitable trades which are much larger than their losers. This is done at the expense of the win-to-loss ratio though. Meaning the larger the profitable trades the lower the percentage of winning trades. Most of these types of systems have winners in the 30% range.

An example of this type of system:

Winner: +$400 Loser: -$100

Win: 30% times $400 = +$120.00 less commissions of $5.00 = +$115.00 Gain
Loss: 70% times $100 = -70.00 plus commissions of $5.00 = -$75.00 Loss

This is another example of an extremely healthy system which will gain +$40.00 on average per trade.

The systems discussed above, are both hypothetical and would be considered top in their class and worth millions of dollars to a system buyer.

The bottom line is, do not be fooled by false claims from system designers that promote unbelievable results and then offer their products to anyone willing to pay them a few hundred dollars. If they actually had a system which performed as promoted they would not share it with anyone because within a few short years, they themselves would be extremely wealthy without any of your money.

If a systems "hypothetical" performance record seems to good to be true, it probably is. Don’t be the next person to be suckered into giving away their hard earned money.

Lets suppose that you have been really lucky and have discovered a decent system that has a positive expectancy regarding profits in the long-term. You still have a problem and it’s a big one. In the next article, I will discuss the next reason why you will inevitably fail. If you don’t understand this next road block you are just as doomed to defeat as those which still hold onto substandard systems.

The author, Ray Plummer is a long time trader and investor with over 20 years of hard knocks in the markets. Ray lives in Charlotte, NC along with his wife and two children. Ray day trades index futures contracts and position trades stocks and options. He is the developer of several private equity trading systems which are not available to the public. His only public system can be found at Collective2 a independent website which tracks the real time live performance of trading systems. A free trial to his system is available to serious traders.

It can be viewed at: http://www.collective2.com/go/onetradeaday

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