Online Sock Trading

Asian Stocks Fall in U.S. Trading, Led by BHP, Commodity Shares (Bloomberg.com)
Dec. 21 (Bloomberg) — Asian stocks fell in U.S. trading as reports showed U.S. economic growth slowed and manufacturing in the Philadelphia region contracted by the most in more than three years. BHP Billiton and other commodity shares led the decline.

A Beginners Guide To Stock Indexes

By: Derek Marsh

The definition of a stock index is a statistical average of a particular stock exhange. An index is basically a group of stocks that have something in common. Perhaps they are all part of the same industry or they represent companies of a certain size or geographic location.

1. Available Stock Indexes

- Dow Jones Industrial Average
- NYSE Composite index
- S&P 500 Composite Stock Price Index

2. Calculating Indexes

A price weighted index is solely based on the price of the stock. It doesnt take into consideration the size of the company. An index that is market value weighted, on the other hand, takes into account the size of the companies. That way, price shifts of small companies have less influence than those of larger companies.

3. Using Stock Indexes To Plan Your Investments

If you base your mutual fund on an index, it will consistently outperform ones that arent. Mutual funds based on an index simply duplicate the holdings where the index is based on. Thus if the Dow Jones rises by 1% the fund based on the Dow Jones also rises by the same amount. This has the advantage of lower costs for research and transactions - savings that can be passed onto you!

4. The Major Players

The Dow Jones Industrial Average is based on the top 30 companies in America and is price weighted. The S&P 500 Index is based on 500 United States corporations. It is second in influence after the Dow Jones and is felt to be an accurate predictor of the state of the United States economy. Outside of the United States the most influential index is the FTSE 100 Index.

5. Types Of Indexes

Stock market indices may be classed in many ways. A broad-base index represents the performance of a whole stock market and by proxy, reflects investor sentiment on the state of the economy. The most regularly quoted market indices are broad-base indices including the largest listed companies on a nation’s largest stock exchange, such as the American Dow Jones Industrial Average and S&P 500 Index, the British FTSE 100, the French CAC 40, the German DAX and the Japanese Nikkei 225.

More specialised indices exist tracking the performance of specific sectors of the market. The Morgan Stanley Biotech Index, for example, consists of 36 American firms in the biotechnology industry. Other indices may track companies of a certain size, a certain type of management, or even more specialized criteria one index published by Linux Weekly News tracks stocks of companies that sell products and services based on the Linux operating environment.

Article Source: http://www.noviceinvesting.com/Article

For more great stock index related articles and resources check out www.stock-advisor.info

Trading

Stock Investing Mistakes That Make A Difference

By: Bill Dufrane

The process of investing is a great way for you to earn potential income. Hardly any people have the knowledge to be able to suceed, however, so many people rely upon brokerages to manage their portfolio for them. There are, however, some common investing mistakes that people make that can result in huge losses and missed opportunities. Here are a list of the absolute worst mistakes to avoid when investing in the stock market.

Mistake #1 - Invest When You Are Old

You are never too young to start investing in the stock market - in fact, it’s recommended to get started sooner. The perception of investing is that it is reserved for older, financially established people who can invest large sums of money. This is a misconception that is limiting people from tapping into the power of investing. Waiting just ten years can make a huge difference in the total gains that one can make over their lifetime. For example, investing just $2000 a year (thats just $170 a month) starting at the age of 26 can yield $2,114,379 by the time you are 75. This is with an Annual Return Rate (ARR) of 10% per year steady through the life of the investment. The same investment, with the same ARR, made ten years later at the age of 36 will result in a return of only $802,895 at the age of 75. That is a 1. 3 million dollar difference. If you are not able to invest as much as $160 a month, set aside $25 per month. Even this small amount can have a large impact over time.

Mistake #2 - Not Understanding The Company

It is shocking that many people will put more time and research into choosing an MP3 player or home theater system than they will researching the stocks they will invest in. It is imperative that you take the time to understand the financial history of the companies you wish to have shares with. Make sure that you understand what you are buying and how it will benefit you in the long run. It is also important to keep in mind that you must remain objective when choosing stocks. Stocks that you have researched well and carefully selected are more likely to increase than ones you choose based on a feeling. Put your emotions aside and consider your options carefully. Taking time to research and investigate is also important when choosing your financial advisor. Consider meeting with a few candidates and evaluating their approach to investing. If you are meeting with someone on a recommendation, make sure that the person who recommended the advisor is someone who is qualified to do so.

Mistake #3 - Gambling On Stocks

Another common mistake is confusing gambling or speculating with investing. Investing in stocks is part of a long- range financial picture and not a get- rich- quick scheme. While there certainly are high yield quick return programs out there, it is wise to limit your participation in those programs. Day trading is one of these types of programs. When someone is involved in day trading they trade very rapidly in and out of stocks in order to profit daily from marginal changes in the market.

This practice may seem easy to profit from but it actually results in more losses for investors than gains. Similarly, some try investing over a short period of time in very risky stocks. A short- term investment of six months to a year in a hot stock does not belong in a well- thought out financial plan. True investing should be done in quality companies over a period of several years. Finally, listening to someone who has a hot tip is a quick way to lose a lot of your investment. Research any tips you get carefully and only invest if the numbers pan out, no matter how much others insist that this is the stock to have.

Mistake #4 - Putting All Your Eggs In One Basket

Don’t underestimate this old addage. In any portfolio, you will want to diversify your holdings. Additionally, having too much stock in one specific industry can also be a recipe for disaster when the market changes. Spread your money over several different companies and different industries. That way there would have to be some catastropic disaster in order for you to lose all your money.

Article Source: http://www.noviceinvesting.com/Article

For more great stocks related articles and resources check out mutualfundadvice.info

Trading

Fox Broadcasting Company :: Trading Spouses
Official network site. Offers show recaps, family information, forums, and photo galleries.

Online Trading Academy - Online Trading - Trading Education - Trading …
Online and on-site day trading seminars and courses utilizing software, CDs, videos and manuals.

The Complete Lowdown On Savings Bonds.

By: Nick P. Bentley

With a financial plan in place you can start to invest in your childs future! These days, saving for your childs education is harder than ever. The price of an education has sky rocketed over the past two decades. So what are your options when considering how to save for you childrens education? Savings bonds might be your answer.

United States Savings Bonds can rightly add to your childs education savings. There are various other investment opportunities and a lot of of them may promise higher rates but as of late seen in the market you have to be doubly careful when investing in anything let alone your childs future. Savings bonds offer diversification to your savings plan and tend to be safer than several of the other options.

Most education savings plans contain a combination of stocks, mutual funds, certificates of deposit, education IRAs, as well as cash. The reasoning for this is that the more places you have the money spread out the higher your return should be. This diversified approach is one that most financial advisors recommend. Savings bonds can provide a reliable, steady-growth option with significant tax advantages if they are invested correctly.

They are considered a safe, secure investment because the United States government backs them, however with a growing national deficient there has been some debate on this front. It is vital to sit down with a good financial advisor and talk about what investing in U.S. Savings Bonds means.

Another benefit to this type of investment is that they are designed never to reduce in value. Unlike other investments, savings bonds appear to be a solid investment. The other advantage touted by several is that savings bonds also have tax advantages. Interest on savings bonds is always exempt from state and local income taxes and allows some or all interest to be excluded from federal income tax, this in an incentive for many as opposed to interest bearing savings accounts and other investments.

Income limitations such as age and other restrictions apply to the person claiming the tax exclusion and eligible education expenses that are considered are tuition and fees paid to colleges, universities and vocational. A parent who doesnt meet the income limits for this tax exclusion can and should consider buying savings bonds in the name of the child.

Consider that they can be a wonderful addition to your education fund for your child. For more information on how to invest in savings bonds and what is involved in making such an investment contact your local IRS office or seek out a skilled financial advisor.

Article Source: http://www.noviceinvesting.com/Article

Nick P. Bentley provides readers with up-to-date commentaries, articles, and reviews for investment, business as well as other related information.

RIMM is in motion after hours
Filed under: After the bell, Major movement, Good news, Research in Motion (RIMM) Research in Motion (NASDAQ: RIMM) has traded up a nice 6.0% in early…

New Trading Contest Starts Today (12/21)
Storage Markets started a new contest today, December 21th. In an effort to help new comers and those who have fallen on hard times, we will again…

Trading

Momentum and Greed
Momentum is great. In fact, spotting early positive momentum in stocks is a critical part of my trading strategy. However, I always seem to get in…

Stocks little moved in light trading (AP via Yahoo! News)
Stocks showed little direction in light trading ahead of the holiday weekend as investors tried to reconcile a handful of robust corporate profit reports with news that the economy grew at a weaker-than-expected pace in the third quarter.

Friedman, Billings, Ramsey settles trading charges (Market Watch)
WASHINGTON (MarketWatch) — Broker-dealer Friedman, Billings, Ramsey settled charges that it engaged in insider-trading and other activities while working on behalf of CompuDyne Corp., securities regulators said Wednesday.

Why are Bonds Losing Value?

By: Thomas Mullooly

We know that bond prices, like anything else with a price, can be tracked on a point and figure chart. We can also monitor the relative strength of bonds, just like we do with stocks. Also, when bonds in general gave a relative strength sell signal over two years ago, we knew that this group would likely perform poorly, when compared with the rest of the overall market.

Its important to know that a large rise in rates can be just as devastating or catastrophic as a stock market crash to many investors. Especially investors who blindly follow computerized asset allocation models. But WHY is this all happening? And why NOW? Lets face it; the Fed has been raising rates for well over a year now! Why didnt bonds start collapsing back then?

Could it be there is no confidence in the new Fed Chairman? Could it be a proxy on the current Presidents administration? Could it be a resurgence of inflation? Could it be the ongoing struggle between the dollar and the other currencies around the world? Could it be the fact we are getting mixed signals about the economywhere the man on the street sees no improvement, but yet, economists see signs things are picking up?
Maybe it is a combination of all of these reasons!

Perhaps it is something so very simple and basic that market pundits just keep missing it! Maybe it is simply the fact that more people are selling bonds than buying bonds, which pushes prices down.

Look, when too many sellers appear, in any market, prices must fall. That is true whether you are selling fruit on the corner, selling all your baseball cards on Ebayor if you are selling bonds.

Butmost importantly, it DOES NOT MATTER why bond prices are falling and interest rates are climbing. Ill say that again, it DOES NOT MATTER what the reason is for these price changes. What matters is what you will need to do about it.

You see, the bond market, compared to the stock market, can sometimes be like the Wild West. The stock market has trading collars and curbs put in place since 1987 to avoid meltdowns like we saw on October 19th, 1987. The bond market has no such limitations. And dont forget, there are no stop orders or limit orders to help dry up the outstanding demand or supply.

Its a lot like that scene at the end of the movie Trading Places when Dan Ackroyd and Eddie Murphy are trading futures on frozen concentrate orange juice. When everyone wants to sell, it becomes frenzywith no end in sight. With little or no stability in prices.

A lot of people just dont understand this! Selling a bond can be like selling your home. When you want to sell a bond, there is rarely a listed market. So you need to contact a broker. They will come up with an offer price to buy your bond from you. This price has to work for you, or you wont sell. But it also has to work for themthey will often turn around quickly and offer it elsewhere, in an effort to make a profitable trade.

There are times when firms will not want to buy a bond that is being offered around by another broker. So they will enter an extremely low offer to buy the bond, not a serious offer. But when a firm really needs to unload a particular bond, it has to take these bids, just to move a bond. So, once the word is out that XYZs bonds just traded at a severe discount, all bonds of that issue will often begin to slide as well. This is how chaos begins in bond markets. The moves can be sudden, and they can be violentboth up and down!

Its been a while since the bond market has experienced some real volatility. Hopefully we will not experience that, but we need to be prepared for the chance that we might.

Article Source: http://www.noviceinvesting.com/Article

Thomas Mullooly, President of Mullooly Asset Management, works one on one with individuals so they can regain control of their investments. Tom’s popular email alerts help folks to reduce the risks in their portfolios. To learn how to stop making simple investing mistakes and to sign up for Tom’s email alerts, visit www.mullooly.net, today!

Stocks decline in late afternoon trading (AP via Yahoo! News)
Stocks pulled back Thursday after economic data pointing to a slowing economy and weakness in regional manufacturing weighed on investor sentiment in light trading ahead of the holiday weekend.

Trading