A trader with a mediocre system and great money management skills will fare better than a trader who has a great system but no handle on his money.
Money management is indispensable to the Foreign Exchange trader.
Regardless of how strong a trading system you have, if you do not apply good money management controls, you will find yourself in trouble.
Dustin Pass, one of the foremost experts on Forex trading says, “An individual trading with proper money management skills will do better in a mediocre trading system than a person trading an excellent system who lacks money management skills.” In his ebook, Guide to Forex Live-on-the-News Trading, Pass lists five essential components to an effective money management program:
1. Currency selection
2. Lot size (how much margin will you use)
3. Stop placement (how much margin will you risk)
4. Entry level (when to enter a trade)
5. Limit (how much money will you make)
Currency Selection
Currency selection is important because it dictates how long your margin will be tied up in a particular trade. If you enter a trade on a slow moving currency, understand that your money will be tied up for a longer period, thereby increasing your risk. You may also hinder your ability to enter another trade since your capital is tied up in the first one.
Set Your Stop Placement
The amount of money you place on a trade is a vital factor, too. If you put too many of your eggs into one basket, you will decrease your ability to diversify properly. In order to choose your lot size, you must identify your maximum allowable risk and your maximum risk per trade. Once you have determined these factors, you will need to set your stop placement.
Stop placement is the act of predefining your level of loss tolerance on a given trade. The successful Forex trader will learn to cut his losses and move on. In the overall scheme, it will save you money…and increase your gains.
Entry Levels
Entry level is based on all of the above. Knowing how much you have to play with on a trade and where the nearest resistance level lies will inform you whether to enter or pass on a given trade. Often, the best trades are the ones you didn’t make!
Allocation
One simple principal must guide your limit level: the possible profit must at least be equal to the accepted risk. Allocation is key. Suppose your system is 75% accurate and you lose on the first 25 trades out of 100 total trades? You will need enough margin to hang in there for the next 75 trades.
Good Risk Management
As Dustin Pass so aptly noted, a trader with a mediocre system and great money management skills will fare better than a trader who has a great system but no handle on his money. There is no substitute for good risk management.
Showing posts with label Business. Show all posts
Showing posts with label Business. Show all posts
Wednesday, May 7, 2008
Forex 101: Managing Risk
How to Find Good Stocks That Will Survive 2008 Market Crash
Finding good stocks that are able to survive stock market crash is really tough. However, these simple financial ratios can help you to discover these tough stocks. The stocks are so tough, that will only grow stronger after the recession. Make sure you stick with it if you want to be rich from stock market.
Earnings per Employee
You can calculate the staff productivity by dividing the total earnings by the number of staffs. As different industries have different ratios, you should compare staffs' ability to bring value to the company in the same field. Compare yourself a bank with $12k profits per staff with another bank of $98k profits per staff, I bet you can notice the difference.
Good employees maintain the business operation, but great workers will sustain the business growth. And in stock investing, earnings growth does matter, especially during depression. Though times never last, but tough people do.
Return on Asset
ROA can be calculated by dividing the net profits by the number of assets that the company owns. It indicates how efficient the management is in turning the assets into profits. Compare with other stocks on how they do is something you should consider. Lower ROA can be attributed to not having enough expertise to manage the assets or not having the right assets in the first place.
During recession, companies with the lowest return on asset (ROA) are prone to be acquired by stronger companies. Unfortunately, not all low ROA stocks hold the value they want in the eye of larger companies. Therefore, better avoid this type of stocks.
Liquidity Ratio
Liquidity ratio measures if the stock is able to meet the short term obligations. It can be calculated as current or quick ratio. Either way, it is about the liquid asset over its current liabilities. This ratio is critical during recession as the interest rate will increase substantially that time. Although Federal Reserve maintains the interest rate recently, there is no guarantee it will be the same in 2008.
Recently, I noticed some good companies holding substantial liquid assets like never before. This indicates the stocks are preparing themselves of any possibilities of higher interest rates next year, or having enough cash to buy profitable asset at cheaper price in 2008.
Either there is market crash, recession or economic depression in 2008, make sure you get ready yourself. Market crash can be bad to some, but offer great opportunities to smart investors. So, make sure you are one of them.
Earnings per Employee
You can calculate the staff productivity by dividing the total earnings by the number of staffs. As different industries have different ratios, you should compare staffs' ability to bring value to the company in the same field. Compare yourself a bank with $12k profits per staff with another bank of $98k profits per staff, I bet you can notice the difference.
Good employees maintain the business operation, but great workers will sustain the business growth. And in stock investing, earnings growth does matter, especially during depression. Though times never last, but tough people do.
Return on Asset
ROA can be calculated by dividing the net profits by the number of assets that the company owns. It indicates how efficient the management is in turning the assets into profits. Compare with other stocks on how they do is something you should consider. Lower ROA can be attributed to not having enough expertise to manage the assets or not having the right assets in the first place.
During recession, companies with the lowest return on asset (ROA) are prone to be acquired by stronger companies. Unfortunately, not all low ROA stocks hold the value they want in the eye of larger companies. Therefore, better avoid this type of stocks.
Liquidity Ratio
Liquidity ratio measures if the stock is able to meet the short term obligations. It can be calculated as current or quick ratio. Either way, it is about the liquid asset over its current liabilities. This ratio is critical during recession as the interest rate will increase substantially that time. Although Federal Reserve maintains the interest rate recently, there is no guarantee it will be the same in 2008.
Recently, I noticed some good companies holding substantial liquid assets like never before. This indicates the stocks are preparing themselves of any possibilities of higher interest rates next year, or having enough cash to buy profitable asset at cheaper price in 2008.
Either there is market crash, recession or economic depression in 2008, make sure you get ready yourself. Market crash can be bad to some, but offer great opportunities to smart investors. So, make sure you are one of them.
Revenge of the Penny Stocks
There has been a lot of talk about how 2008 will turn out financially. The word recession has been thrown around a lot perhaps for shock value but maybe not. Lets pretend for a moment that these predictions of s recession are accurate. How would that effect the stock market? Well, the stock market will always be there even if the numbers change. However, in a recession, everything is relatively a penny stock. So even though penny stocks have received bad press they will always be there during good and bad times.
Recessions are times when all companies are struggling to make a profit right. Yet that does not stop people from investing. People are more desperate and then to exercise more faith in a company and hence willing to take more risk when economic times are tough. During times like these people can afford to be more picky and avoid the more risky stocks. Penny stocks are risky no matter how the economy is but are a great investment if done wisely.
If there was a recession then penny stocks would get a lot more attention since people would have less money to spend and would not be as picky. There would be less negative talk about a stock that would present more people than ever before with an opportunity to invest. People would see it as more of an opportunity than a gamble. You see its all about perspective and approach. Anybody can lose money doing anything if done incorrectly. Penny stocks can make you a lot of money if invested in correctly.
All the people who talk bad about penny stocks are either the ones who have got burned investing in them or the ones who know nothing at all about them except what others have told them. It makes for interesting stories but the truth is that the gains of penny stocks will kick butt against any other stock type. Other stocks can make great gains but definitely not as quickly as penny stocks.
So will 2008 be a recession? I do not think so. Will it be a good year to invest in penny stocks? Well of course it will be. Just invest cautiously. Penny stocks have never represented a bad investment just one that should be approached with caution. Its easy to take the advice of others without really knowing the truth but including penny stocks as a part of your portfolio is a smart move any day of the week.
Recessions are times when all companies are struggling to make a profit right. Yet that does not stop people from investing. People are more desperate and then to exercise more faith in a company and hence willing to take more risk when economic times are tough. During times like these people can afford to be more picky and avoid the more risky stocks. Penny stocks are risky no matter how the economy is but are a great investment if done wisely.
If there was a recession then penny stocks would get a lot more attention since people would have less money to spend and would not be as picky. There would be less negative talk about a stock that would present more people than ever before with an opportunity to invest. People would see it as more of an opportunity than a gamble. You see its all about perspective and approach. Anybody can lose money doing anything if done incorrectly. Penny stocks can make you a lot of money if invested in correctly.
All the people who talk bad about penny stocks are either the ones who have got burned investing in them or the ones who know nothing at all about them except what others have told them. It makes for interesting stories but the truth is that the gains of penny stocks will kick butt against any other stock type. Other stocks can make great gains but definitely not as quickly as penny stocks.
So will 2008 be a recession? I do not think so. Will it be a good year to invest in penny stocks? Well of course it will be. Just invest cautiously. Penny stocks have never represented a bad investment just one that should be approached with caution. Its easy to take the advice of others without really knowing the truth but including penny stocks as a part of your portfolio is a smart move any day of the week.
Saturday, May 3, 2008
Tips For A Smooth And Successful Garage Sale
Do you find yourself lost within the clutter of your home? Or do you always feel that a few extra bucks could help you make ends meet? Then why not have a garage sale, after all one man’s trash is another man’s treasure.
You don't have to have a lot of stuff to start selling. You could ask for handouts from neighbors, family, or friends, something they think they can part with, this way combined with your things you are sure to provide your customers with a variety of purchasable items.
When you think you have all the things you need to get started, then you should begin planning, starting with the sale date. It would be most effective to schedule the sale on a weekend far from any holiday or any special day within your community. You should probably also anticipate the weather for that day so that you can adjust if the weather is uncooperative. Regarding the time, it would be best to hold it in the morning.
The next step is to make the event official by having it announced in the most popular periodical in your area, or by putting up posters, or both. If possible, maybe you could also have a local radio station mention the affair. Publicize the event on bulletin boards.
Buy several stickers, post-its, and different colored markers, and use them before the day of your sale. This would help you organize your products. You may need to borrow some tables and racks so that you can better display your merchandise. Also, prepare smaller bills and coins for change. If you have a container with several compartments then you should place the money there, keeping in mind that this should be something you could carry around. Clean and remove some of the stuff from the garage if you are having the sale there and mark items in the garage that you are not planning to sell. Also make sure that the garage is well lit on the sale date. Place electrical equipment that are for sale near an electrical outlet or set up an extension cord. Check signage ordinances in your neighborhood and set some of them up on nearby street corners, make them noticeable with big and bold letters, and eye-catching colors.
Put your goods in order one or two hours before you open. Lastly, don't be afraid to bargain with customers. You are expected to put a reasonable price on your stuff but that doesn't mean that you should submit to the buyer, unless of course if you really want to get rid of that object.
You don't have to have a lot of stuff to start selling. You could ask for handouts from neighbors, family, or friends, something they think they can part with, this way combined with your things you are sure to provide your customers with a variety of purchasable items.
When you think you have all the things you need to get started, then you should begin planning, starting with the sale date. It would be most effective to schedule the sale on a weekend far from any holiday or any special day within your community. You should probably also anticipate the weather for that day so that you can adjust if the weather is uncooperative. Regarding the time, it would be best to hold it in the morning.
The next step is to make the event official by having it announced in the most popular periodical in your area, or by putting up posters, or both. If possible, maybe you could also have a local radio station mention the affair. Publicize the event on bulletin boards.
Buy several stickers, post-its, and different colored markers, and use them before the day of your sale. This would help you organize your products. You may need to borrow some tables and racks so that you can better display your merchandise. Also, prepare smaller bills and coins for change. If you have a container with several compartments then you should place the money there, keeping in mind that this should be something you could carry around. Clean and remove some of the stuff from the garage if you are having the sale there and mark items in the garage that you are not planning to sell. Also make sure that the garage is well lit on the sale date. Place electrical equipment that are for sale near an electrical outlet or set up an extension cord. Check signage ordinances in your neighborhood and set some of them up on nearby street corners, make them noticeable with big and bold letters, and eye-catching colors.
Put your goods in order one or two hours before you open. Lastly, don't be afraid to bargain with customers. You are expected to put a reasonable price on your stuff but that doesn't mean that you should submit to the buyer, unless of course if you really want to get rid of that object.
Wednesday, April 30, 2008
A Simple Introduction to Forex Trading
By : Ian Armstrong
Short for Foreign (currency) Exchange, Forex is the world's biggest market for trading in currencies. As much as 2 trillion US dollars worth of currency are traded on the Forex on a daily basis. Compare this with the approximately 25 million US dollars traded on the NYSE and you'll get the picture - Forex is huge.
So what is Forex all about? Simply put, Forex entails buying one currency, let's say Turkish Lira, and selling another, say US Dollars. In Forex, currencies are always traded and quoted in pairs. The exchange is made through a broker.
Just like the stock market where you are investing in a company, with Forex you are in a way investing in a country. If your company is a success, the value of your stock goes up. Much the same principle is at work in Forex. If the economy of the country whose currency you are trading is robust, the value of that currency will also go up - and you can then sell it for a profit.
Unlike stock markets, there is no "trading pit" in the world of Forex. Forex operates through the internet and other electronic communications and runs 24 hours a day, 5 days a week.
It has only been in the last several years that the Forex has been open to the average person to invest in. The Forex market itself has been around since 1971, but for most of its history only large companies and a few very wealthy individuals possessed the resources to be able to trade in foreign currency. Today however, anyone with a high speed internet connection and a small initial investment (as low as 50 US dollars) can get in on the Forex market.
The seven most commonly traded currencies on the Forex market are U.S. Dollars (USD), Euros (EUR), Japanese Yen (JPY), UK Pounds (GBP), Swiss Francs (CHF), Canadian Dollars (CAD) and Australian Dollars (AUD). Foreign currencies are identified by means of a three letter code. The first two letters stand for the country, while the last letter identifies the nation in question's currency.
For example:-
USD: U.S. = United States, D = Dollars.
GBP: GB = United Kingdom (Great Britain), P = Pounds.
At any given time, business is going on somewhere in the world. Global business never sleeps, and neither does Forex. This can be beneficial to you - you can trade on the Forex market any time that is convenient to you.
There are seven currencies on the Forex which are called Major Currencies, due to their being the most heavily traded currencies on the market. The biggest four are, in order: U.S. Dollars (USD), Euros (EUR), Japanese Yen (JPY), and UK Pounds (GBP). The remaining three are Swiss Francs (CHF), Canadian Dollars (CAD) and Australian Dollars (AUD).
Advantages Of Forex Trading
There are a few advantages which the Forex trader enjoys which those who trade in the stock market do not.
1.Unlike with stock brokers, the investor does not pay commissions, per se, to the broker. Instead, the dealers in Forex trading receive part of the "spread" (that is to say, the difference) between the buying and selling price of currency. This is generally a very small amount per trade; a fraction of a percent.
2.You can trade on the Forex market any time which is convenient for you, unlike the stock market - it is closed only on weekends, from 5pm Eastern time on Fridays to 12AM on Mondays.
3.As opposed to the stock market, it is nearly impossible for companies or individual investors to manipulate the Forex market. The volume of Forex trading each and every day prevents any one actor from having undue influence. We all know of instances of the stock market being artificially influenced by unscrupulous persons and companies however.
4.Forex trading can be done with borrowed capital, meaning that you need not have hundreds of thousands in liquid assets to trade currency in large numbers. This concept is called Margin Trading. A small amount of your own capital (less than 5 percent) can be used to leverage a large chunk of borrowed assets, which may then be invested. Forex is traded in what is called lots, the normal size of a lot being 100,000 US dollars. Depending on the dealer with whom you deal you may be able to trade is smaller amounts, these are known as mini-lots or micro-lots.
Short for Foreign (currency) Exchange, Forex is the world's biggest market for trading in currencies. As much as 2 trillion US dollars worth of currency are traded on the Forex on a daily basis. Compare this with the approximately 25 million US dollars traded on the NYSE and you'll get the picture - Forex is huge.
So what is Forex all about? Simply put, Forex entails buying one currency, let's say Turkish Lira, and selling another, say US Dollars. In Forex, currencies are always traded and quoted in pairs. The exchange is made through a broker.
Just like the stock market where you are investing in a company, with Forex you are in a way investing in a country. If your company is a success, the value of your stock goes up. Much the same principle is at work in Forex. If the economy of the country whose currency you are trading is robust, the value of that currency will also go up - and you can then sell it for a profit.
Unlike stock markets, there is no "trading pit" in the world of Forex. Forex operates through the internet and other electronic communications and runs 24 hours a day, 5 days a week.
It has only been in the last several years that the Forex has been open to the average person to invest in. The Forex market itself has been around since 1971, but for most of its history only large companies and a few very wealthy individuals possessed the resources to be able to trade in foreign currency. Today however, anyone with a high speed internet connection and a small initial investment (as low as 50 US dollars) can get in on the Forex market.
The seven most commonly traded currencies on the Forex market are U.S. Dollars (USD), Euros (EUR), Japanese Yen (JPY), UK Pounds (GBP), Swiss Francs (CHF), Canadian Dollars (CAD) and Australian Dollars (AUD). Foreign currencies are identified by means of a three letter code. The first two letters stand for the country, while the last letter identifies the nation in question's currency.
For example:-
USD: U.S. = United States, D = Dollars.
GBP: GB = United Kingdom (Great Britain), P = Pounds.
At any given time, business is going on somewhere in the world. Global business never sleeps, and neither does Forex. This can be beneficial to you - you can trade on the Forex market any time that is convenient to you.
There are seven currencies on the Forex which are called Major Currencies, due to their being the most heavily traded currencies on the market. The biggest four are, in order: U.S. Dollars (USD), Euros (EUR), Japanese Yen (JPY), and UK Pounds (GBP). The remaining three are Swiss Francs (CHF), Canadian Dollars (CAD) and Australian Dollars (AUD).
Advantages Of Forex Trading
There are a few advantages which the Forex trader enjoys which those who trade in the stock market do not.
1.Unlike with stock brokers, the investor does not pay commissions, per se, to the broker. Instead, the dealers in Forex trading receive part of the "spread" (that is to say, the difference) between the buying and selling price of currency. This is generally a very small amount per trade; a fraction of a percent.
2.You can trade on the Forex market any time which is convenient for you, unlike the stock market - it is closed only on weekends, from 5pm Eastern time on Fridays to 12AM on Mondays.
3.As opposed to the stock market, it is nearly impossible for companies or individual investors to manipulate the Forex market. The volume of Forex trading each and every day prevents any one actor from having undue influence. We all know of instances of the stock market being artificially influenced by unscrupulous persons and companies however.
4.Forex trading can be done with borrowed capital, meaning that you need not have hundreds of thousands in liquid assets to trade currency in large numbers. This concept is called Margin Trading. A small amount of your own capital (less than 5 percent) can be used to leverage a large chunk of borrowed assets, which may then be invested. Forex is traded in what is called lots, the normal size of a lot being 100,000 US dollars. Depending on the dealer with whom you deal you may be able to trade is smaller amounts, these are known as mini-lots or micro-lots.
The 7 Most Common Forex Trading Mistakes
By : James Theiss
When trading currencies online, there seems to be no end to the mistakes a beginning forex trader can make. Beginning traders are always the most susceptible, but experienced traders can often revert back into bad practices as well. Here are some of the most common trading mistakes listed in no particular order, and how to avoid them.
Predicting instead of reacting. Otherwise known as overconfidence. This usually happens after a winning trade or two. The trader starts to think that if he can enter a trade sooner, he will get more pips. He begins to believe he can pick the top or bottom before the market reveals it to him. So instead of reacting to what the market is telling him, he starts to predict what the market will do. He enters a trade and the market continues its move, which is against him. Now, does he admit he was wrong and close his position, or does he add to it?
Adding to losing positions. Here is an extension of predicting instead of reacting. Look, you just entered a trade and the market is going against your position. The market is telling you, you are wrong. Now is the time to close your position, not add to it. If you add to your losing position, you are making at least two incorrect decisions. First, you are predicting the market will turn around. Second, you are hoping the market will prove you right because you are unable to admit you made a losing trade. Losing trades are a fact of life in the forex market. You weren't wrong, simply, your edge didn't play in your favor on this trade. Close your losing position and move onto the next trade.
Insufficient capitalization. Forex trading is already highly leveraged. Insufficient capitalization just magnifies the potential problems you can face. If you read about the famous and big name traders, they never use more than 1% - 2% of their trading capital on a position. Get out a calculator and let's see... 1% of $10,000 is $100. So as a position trader who might have a stop-loss order of 100 pips, you can only trade one mini lot of one currency pair for each $10,000 in your trading account. That is, if you want to trade like the pros. Do you have $10,000 in your account? Why do forex dealers boldly advertise you can start trading with only $250 then? Because they are in business to make money, and if they can convince you to commit trading errors, they stand a much better chance that they will soon have your money.
Overtrading. A close cousin of insufficient capitalization. Knowing that very few currency traders trade with sufficient capital in the first place, they further compound the potential problems by trading too actively and in too many currency pairs. Spreading themselves too thin you might say. Potential problems include loosing focus and margin calls. Getting a margin call is a very irresponsible position for a forex trader to be in and is a direct result of overtrading, over leveraging, and insufficient capitalization. This is as close to the perfect recipe for failure as you can get.
Not using stop-loss orders. There are very few times when not using stop-loss orders is the correct action to take. Large traders with several hundred or more lots don't want to advertise where their stops are placed is one. The other might be scalpers whose stop is only 10-15 pips away. By the time they figure the math and enter it in the system, the price might already be there or even past it. And some forex dealing stations won't let you place stops closer than 15 pips anyway, especially in fast moving situations. Other than those times, you need to put stop-loss orders in on every position. It is in your own best interest to protect yourself. I know, some people whine that their stops are always being run by the dealer. A whole article could be written on stop-loss order management, if not a complete chapter in a book. Let's just say for now, don't put them where everybody else does, and don't put them too close.
Trading as a hobby. Golf is a hobby and it costs you money to play. Horseback riding is a hobby and it costs you money as well. The point is hobbies cost money, business makes money. You need to treat your forex trading as a business if you ever hope to make money on a consistent basis. That means keeping records, keeping a trading journal, and have a written business plan. You wouldn't invest money into a start up business without first seeing a business plan, so why would you invest money into your own trading account without the same thoughtful consideration.
Not having a trading plan. This is one of those catch-all mistakes. If you have a written trading plan, and follow it, you will already have identified and hopefully eliminated all of the above mistakes. If you don't have a written trading plan, you are almost assuredly making some, if not all of the above mistakes. Maybe not all at once, but even occasional mistakes add up quickly. Do yourself a favor and don't put on another trade until you think through and write down the response for all of the above mistakes and any others you can identify, as well as entry and exit rules. Then follow it.
These are just some of the many mistakes you can make as a forex trader. You need to take responsibility for yourself and your money and act in your own best interest. The currency markets are a zero sum game and the many players are out to make a profit. Don't let them profit with your money. Do your best to eliminate the above mistakes, and you will go a long way to ensuring you are the one who profits in the forex market.
When trading currencies online, there seems to be no end to the mistakes a beginning forex trader can make. Beginning traders are always the most susceptible, but experienced traders can often revert back into bad practices as well. Here are some of the most common trading mistakes listed in no particular order, and how to avoid them.
Predicting instead of reacting. Otherwise known as overconfidence. This usually happens after a winning trade or two. The trader starts to think that if he can enter a trade sooner, he will get more pips. He begins to believe he can pick the top or bottom before the market reveals it to him. So instead of reacting to what the market is telling him, he starts to predict what the market will do. He enters a trade and the market continues its move, which is against him. Now, does he admit he was wrong and close his position, or does he add to it?
Adding to losing positions. Here is an extension of predicting instead of reacting. Look, you just entered a trade and the market is going against your position. The market is telling you, you are wrong. Now is the time to close your position, not add to it. If you add to your losing position, you are making at least two incorrect decisions. First, you are predicting the market will turn around. Second, you are hoping the market will prove you right because you are unable to admit you made a losing trade. Losing trades are a fact of life in the forex market. You weren't wrong, simply, your edge didn't play in your favor on this trade. Close your losing position and move onto the next trade.
Insufficient capitalization. Forex trading is already highly leveraged. Insufficient capitalization just magnifies the potential problems you can face. If you read about the famous and big name traders, they never use more than 1% - 2% of their trading capital on a position. Get out a calculator and let's see... 1% of $10,000 is $100. So as a position trader who might have a stop-loss order of 100 pips, you can only trade one mini lot of one currency pair for each $10,000 in your trading account. That is, if you want to trade like the pros. Do you have $10,000 in your account? Why do forex dealers boldly advertise you can start trading with only $250 then? Because they are in business to make money, and if they can convince you to commit trading errors, they stand a much better chance that they will soon have your money.
Overtrading. A close cousin of insufficient capitalization. Knowing that very few currency traders trade with sufficient capital in the first place, they further compound the potential problems by trading too actively and in too many currency pairs. Spreading themselves too thin you might say. Potential problems include loosing focus and margin calls. Getting a margin call is a very irresponsible position for a forex trader to be in and is a direct result of overtrading, over leveraging, and insufficient capitalization. This is as close to the perfect recipe for failure as you can get.
Not using stop-loss orders. There are very few times when not using stop-loss orders is the correct action to take. Large traders with several hundred or more lots don't want to advertise where their stops are placed is one. The other might be scalpers whose stop is only 10-15 pips away. By the time they figure the math and enter it in the system, the price might already be there or even past it. And some forex dealing stations won't let you place stops closer than 15 pips anyway, especially in fast moving situations. Other than those times, you need to put stop-loss orders in on every position. It is in your own best interest to protect yourself. I know, some people whine that their stops are always being run by the dealer. A whole article could be written on stop-loss order management, if not a complete chapter in a book. Let's just say for now, don't put them where everybody else does, and don't put them too close.
Trading as a hobby. Golf is a hobby and it costs you money to play. Horseback riding is a hobby and it costs you money as well. The point is hobbies cost money, business makes money. You need to treat your forex trading as a business if you ever hope to make money on a consistent basis. That means keeping records, keeping a trading journal, and have a written business plan. You wouldn't invest money into a start up business without first seeing a business plan, so why would you invest money into your own trading account without the same thoughtful consideration.
Not having a trading plan. This is one of those catch-all mistakes. If you have a written trading plan, and follow it, you will already have identified and hopefully eliminated all of the above mistakes. If you don't have a written trading plan, you are almost assuredly making some, if not all of the above mistakes. Maybe not all at once, but even occasional mistakes add up quickly. Do yourself a favor and don't put on another trade until you think through and write down the response for all of the above mistakes and any others you can identify, as well as entry and exit rules. Then follow it.
These are just some of the many mistakes you can make as a forex trader. You need to take responsibility for yourself and your money and act in your own best interest. The currency markets are a zero sum game and the many players are out to make a profit. Don't let them profit with your money. Do your best to eliminate the above mistakes, and you will go a long way to ensuring you are the one who profits in the forex market.
Author Resource:- James is a successful online currency trader and also runs the popular website http://www.todayscurrencytrading.com. Go there now and you can sign up for his FREE, "Currency Trade of the Week".
Friday, April 18, 2008
What Makes A Good Forex Trading Market?
Whatever you are trading, whether it is stocks, futures, bonds, foreign currency or anything else, there are certain conditions which must exist for the market to be attractive to the trader and profitable for him. The four characteristics of a good investment market are liquidity, transparency, minimal trading costs and trending.
Liquidity
Trading in its simplest form comprises two elements, a sale and a purchase, and the liquidity of a market is nothing more than the ease with which a trader can both buy and sell. For a market to be truly liquid however a trader must not merely be able to buy and sell with ease, but he must also be able to do so in substantial volume without this having a marked effect on the price of the items being traded.
If a market is not sufficiently liquid delays in buying and selling can often result in considerable differences between the price when an order is placed and when it is executed. Additionally, traders can often find that it is difficult to sell items in a market with poor liquidity.
The foreign currency market is arguably the world's most liquid market with an enormous trading volume which is second to none.
Transparency
When we talk about the transparency of a market we are referring to a trader's access to accurate information throughout the trading process. The greater the access to accurate information, the greater the transparency.
Information is the key to successful trading in many of the world markets and indeed there are numerous examples of individuals and companies running into problems because they did not have access to accurate information.
Fortunately, in addition to being the world's most liquid market, the Forex market is also the world's most transparent market.
Minimal Trading Costs
In any market the market makers need to make a profit and that means that there are inevitably costs to be met by the trader. The secret to a successful market, as far as the trader is concerned, is for trading costs to be as low as possible, as the higher the trading costs the lower his profit, or the greater his loss.
The Forex market enjoys some of the lowest trading costs of any market with no commission or similar trading costs and trading costs being largely limited to the difference between the buying and selling price in any currency trade. This difference, which is known as the 'spread' and which is common to many markets, is also extremely tight in the case of the foreign currency market, keeping trading costs to a minimum.
Trending
In most markets the biggest problem traders face is knowing when to buy and when to sell and it is vitally important that traders have some way of gauging the direction in which a market is moving.
In the case of the Forex market many traders employ a technique known as technical analysis, which essentially studies the past performance of the market and looks for trends which can then be used to predict its future direction.
Such predictive tools are not unique to the Forex market and most markets will display at least some form of trend. However, the Forex market shows particularly strong trending characteristics and this makes it much easier for traders to identify when to enter and exit trading positions than is the case in most other markets.
Liquidity
Trading in its simplest form comprises two elements, a sale and a purchase, and the liquidity of a market is nothing more than the ease with which a trader can both buy and sell. For a market to be truly liquid however a trader must not merely be able to buy and sell with ease, but he must also be able to do so in substantial volume without this having a marked effect on the price of the items being traded.
If a market is not sufficiently liquid delays in buying and selling can often result in considerable differences between the price when an order is placed and when it is executed. Additionally, traders can often find that it is difficult to sell items in a market with poor liquidity.
The foreign currency market is arguably the world's most liquid market with an enormous trading volume which is second to none.
Transparency
When we talk about the transparency of a market we are referring to a trader's access to accurate information throughout the trading process. The greater the access to accurate information, the greater the transparency.
Information is the key to successful trading in many of the world markets and indeed there are numerous examples of individuals and companies running into problems because they did not have access to accurate information.
Fortunately, in addition to being the world's most liquid market, the Forex market is also the world's most transparent market.
Minimal Trading Costs
In any market the market makers need to make a profit and that means that there are inevitably costs to be met by the trader. The secret to a successful market, as far as the trader is concerned, is for trading costs to be as low as possible, as the higher the trading costs the lower his profit, or the greater his loss.
The Forex market enjoys some of the lowest trading costs of any market with no commission or similar trading costs and trading costs being largely limited to the difference between the buying and selling price in any currency trade. This difference, which is known as the 'spread' and which is common to many markets, is also extremely tight in the case of the foreign currency market, keeping trading costs to a minimum.
Trending
In most markets the biggest problem traders face is knowing when to buy and when to sell and it is vitally important that traders have some way of gauging the direction in which a market is moving.
In the case of the Forex market many traders employ a technique known as technical analysis, which essentially studies the past performance of the market and looks for trends which can then be used to predict its future direction.
Such predictive tools are not unique to the Forex market and most markets will display at least some form of trend. However, the Forex market shows particularly strong trending characteristics and this makes it much easier for traders to identify when to enter and exit trading positions than is the case in most other markets.
Getting Into The Lucrative World Of Forex Trading
For many years the foreign exchange market was the preserve of major players such as national banks and multi-national corporations. In the 1980s however new rules were introduced which permitted smaller investors to enter the market through a margin account. In simple terms, a margin account allows you to trade with more money than you actually have in your trading account. For example, a 100:1 margin account allows you to participate in trading up to $100,000 with an investment of only $1,000.
Now, although this entry level has opened up the market to the smaller investor, care needs to be taken as Forex trading is not easy and is certainly not without its risks. For this reason the very first thing that any novice trader needs to do is to sit down, study the foreign exchange markets carefully and learn the ins and outs of trading before putting any money at risk.
In addition to some basic training, the newcomer will also need to find a good broker as all trading must be conducted through a broker. Here a personal recommendation is often the best place to start but, in the absence of this, you should choose a broker who is registered with the Commodity Futures Trading Commission (CFTC) as a Futures Commission Merchant (FCM). This will provide you with protection against both abusive trade practices and fraud.
It is normally a simple process to open an account with a broker and once this is done and funds are added to your account you can start trading. Brokers will normally offer a number of accounts to suit individual clients and most will have "mini" accounts which will allow you to begin trading with as little as $250. The margin on which you are permitted to trade will vary from one account to the next.
One thing that you should always look for when selecting a broker is the ability to cut your teeth by carrying out simulated, or paper, trades for a period of time. This is a facility which many good brokers will provide and which simply allows you to trade in the normal manner but to do so simply on paper and without any money changing hands until you have found your feet. Many online brokers provide simulated accounts allowing you to make free paper trades for up to 30 days.
One thing that worries newcomers is the subject of trading charges and brokerage fees. Unlike many other markets, the Forex market is free of commission and so you can make as many trades as you like without worrying about running up huge brokerage fees. Your broker will make his profit from the 'spread' on each trade, which is the difference between the buying and selling price of a currency pair and is a subject all of its own.
Now, although this entry level has opened up the market to the smaller investor, care needs to be taken as Forex trading is not easy and is certainly not without its risks. For this reason the very first thing that any novice trader needs to do is to sit down, study the foreign exchange markets carefully and learn the ins and outs of trading before putting any money at risk.
In addition to some basic training, the newcomer will also need to find a good broker as all trading must be conducted through a broker. Here a personal recommendation is often the best place to start but, in the absence of this, you should choose a broker who is registered with the Commodity Futures Trading Commission (CFTC) as a Futures Commission Merchant (FCM). This will provide you with protection against both abusive trade practices and fraud.
It is normally a simple process to open an account with a broker and once this is done and funds are added to your account you can start trading. Brokers will normally offer a number of accounts to suit individual clients and most will have "mini" accounts which will allow you to begin trading with as little as $250. The margin on which you are permitted to trade will vary from one account to the next.
One thing that you should always look for when selecting a broker is the ability to cut your teeth by carrying out simulated, or paper, trades for a period of time. This is a facility which many good brokers will provide and which simply allows you to trade in the normal manner but to do so simply on paper and without any money changing hands until you have found your feet. Many online brokers provide simulated accounts allowing you to make free paper trades for up to 30 days.
One thing that worries newcomers is the subject of trading charges and brokerage fees. Unlike many other markets, the Forex market is free of commission and so you can make as many trades as you like without worrying about running up huge brokerage fees. Your broker will make his profit from the 'spread' on each trade, which is the difference between the buying and selling price of a currency pair and is a subject all of its own.
Profits Through Clickbank
By : Scott Taylor
It is entirely possible that someone reading this article may never have heard of Clickbank. For those of us that "eek out" a living online, Clickbank is one of the core resources used to generate cash flow.
There are several ways to produce income through Clickbank and they can all add up to a tolerable income paid in two week cycles.
The two main ways of creating income through Clickbank are "affiliate sales" and "direct product sales".
Affiliate Sales
There are thousands of downloadable digital products for sale at Clickbank in a variety of categories covering a wide range of topics. When products are added to Clickbank by the sellers they are given the opportunity to allow for affiliate sales. The product owner determines the percentage to be paid to the affiliate, if any.
Anyone can view all the products with affiliate sales potential at this link:
http://clickbank.com/marketplace/
Once a category is clicked on in the Clickbank Marketplace, sub-categories and product listings appear. For example, today in the 'Business to Business' category the top selling product listed is: Data Entry Ads Online - Join The Best! [Earn 50%].
As an affiliate marketer, you would click on the [Earn 50%] link and fill in your Clickbank ID to capture the correct Clickbank Hoplink for the product. This Hoplink would be used in conjunction with all ads directing traffic to a particular product.
Each product Hoplink contains the ID of the affiliate and the ID of the seller thus making successful affiliate sales attributable to the correct parties.
Clickbank has an automated tracking system that determines which affiliate, if any, is to be associated with the sale. Although Clickbank feels their tracking system is "more fair and accurate than any alternative" it is still not perfect.
There are apparently ways for unscrupulous people to take advantage of the system for their benefit at the expense of those of us who do not delve into such matters. Link cloaking can be useful in these situations.
The benefits of affiliate marketing through Clickbank far outweigh any potential negative experiences that may arise due to an unscrupulous few.
Direct Product Sales (Your Own Products)
A popular way for internet marketers to get their products to the public is by using Clickbank payment processing. Clickbank makes it very easy for anyone to sell a downloadable product through their service and their fees are not likely to be out of the reach of anyone with computer access.
Although not shy about being one of the most expensive payment processors on the Internet, Clickbank makes up for their several imperfections by general ease of use and reliable service.
It is simple to sign-up for a Clickbank ID; just go to Clickbank.com and create an account. You can begin to promote affiliate products immediately after your membership is confirmed.
http://clickbank.com/signup/
To sell your own products on Clickbank there is a seven step process:
(1) Signup with Clickbank
http://clickbank.com/signup/
(2) Make a "Pitch Page"
http://clickbank.com/setup.html#ppp
(3) Make a "Thank You Page"
http://clickbank.com/setup.html#thankyou
(4) Make a Test Purchase
http://clickbank.com/setup.html#test
(5) Submit Product Approval Request
http://clickbank.com/setup.html#limit
(6) Pay $49.95 Product Review Fee
http://clickbank.com/setup.html#activate
(7) Set Your Product Price and Start Making Sales!
http://clickbank.com/setup.html#setprices
It is not mandatory to offer affiliate sales of your products but there is at least one good reason to do so. Often sellers get to a point where affiliate sales produce enough income that they can stop using pay per click advertising to drive traffic to their site. What is lost in direct sales at the full item price is made up by the savings in pay per click marketing.
Overall, Clickbank is an excellent place to get a start in product sales on the Internet. Whether you are selling your own product or putting up affiliate links, the potential to create a viable income is available to everyone.
It is entirely possible that someone reading this article may never have heard of Clickbank. For those of us that "eek out" a living online, Clickbank is one of the core resources used to generate cash flow.
There are several ways to produce income through Clickbank and they can all add up to a tolerable income paid in two week cycles.
The two main ways of creating income through Clickbank are "affiliate sales" and "direct product sales".
Affiliate Sales
There are thousands of downloadable digital products for sale at Clickbank in a variety of categories covering a wide range of topics. When products are added to Clickbank by the sellers they are given the opportunity to allow for affiliate sales. The product owner determines the percentage to be paid to the affiliate, if any.
Anyone can view all the products with affiliate sales potential at this link:
http://clickbank.com/marketplace/
Once a category is clicked on in the Clickbank Marketplace, sub-categories and product listings appear. For example, today in the 'Business to Business' category the top selling product listed is: Data Entry Ads Online - Join The Best! [Earn 50%].
As an affiliate marketer, you would click on the [Earn 50%] link and fill in your Clickbank ID to capture the correct Clickbank Hoplink for the product. This Hoplink would be used in conjunction with all ads directing traffic to a particular product.
Each product Hoplink contains the ID of the affiliate and the ID of the seller thus making successful affiliate sales attributable to the correct parties.
Clickbank has an automated tracking system that determines which affiliate, if any, is to be associated with the sale. Although Clickbank feels their tracking system is "more fair and accurate than any alternative" it is still not perfect.
There are apparently ways for unscrupulous people to take advantage of the system for their benefit at the expense of those of us who do not delve into such matters. Link cloaking can be useful in these situations.
The benefits of affiliate marketing through Clickbank far outweigh any potential negative experiences that may arise due to an unscrupulous few.
Direct Product Sales (Your Own Products)
A popular way for internet marketers to get their products to the public is by using Clickbank payment processing. Clickbank makes it very easy for anyone to sell a downloadable product through their service and their fees are not likely to be out of the reach of anyone with computer access.
Although not shy about being one of the most expensive payment processors on the Internet, Clickbank makes up for their several imperfections by general ease of use and reliable service.
It is simple to sign-up for a Clickbank ID; just go to Clickbank.com and create an account. You can begin to promote affiliate products immediately after your membership is confirmed.
http://clickbank.com/signup/
To sell your own products on Clickbank there is a seven step process:
(1) Signup with Clickbank
http://clickbank.com/signup/
(2) Make a "Pitch Page"
http://clickbank.com/setup.html#ppp
(3) Make a "Thank You Page"
http://clickbank.com/setup.html#thankyou
(4) Make a Test Purchase
http://clickbank.com/setup.html#test
(5) Submit Product Approval Request
http://clickbank.com/setup.html#limit
(6) Pay $49.95 Product Review Fee
http://clickbank.com/setup.html#activate
(7) Set Your Product Price and Start Making Sales!
http://clickbank.com/setup.html#setprices
It is not mandatory to offer affiliate sales of your products but there is at least one good reason to do so. Often sellers get to a point where affiliate sales produce enough income that they can stop using pay per click advertising to drive traffic to their site. What is lost in direct sales at the full item price is made up by the savings in pay per click marketing.
Overall, Clickbank is an excellent place to get a start in product sales on the Internet. Whether you are selling your own product or putting up affiliate links, the potential to create a viable income is available to everyone.
Monday, February 25, 2008
How to Get Started Investing in Stock - 3 Must Do Checklists
By : Zainul Anuar
Many novice investors are not sure how to start their stock investing career. Often than not, due to their ignorance and arrogance, they start buying stocks without following the most basic and simple rules to be successful. Get your hand dirty first if you want to make one million dollar profits from stock investing.
Specific Investment Plan
You must be hearing the importance of investment plan so much. Unfortunately, most investors do not get it right. Initially, you should set up specific financial goal. For example, you want to retire by 40 with $5000 passive income. Secondly, discount it to current value with the inflation rate to identify how much cash you need now or later. For example, you need to have $500k cash in five years time to generate $5000 per month by 2020.
Last but not least, discover which investment option that can help you to achieve the financial goal. For example, plain saving, stock investing, option trading or real estate.
Discover Investment Niche
Once you have the investment plan in place, you will have clearer picture where are you heading to. The next questions would be how do you get there?
Look, there are so many ways to make money in stock market. So many ways that is enough for everyone to make the least money. Therefore, instead of looking for the fastest way to make money, why don't you concentrate on which investment style suit your needs, niche and time commitment. But first, you have to understand the methodology of each concept. Day trading, value investing and swing trading are some of the most common techniques used in stock market investing.
Recognize Investment Personality
Although penny stocks investing suit me very well, the same might not hold true for you. You might not comfortable with the Over-The-Counter (OTC) purchase, its unproven track records or its natural price volatility. The fact is, neither you nor me were created equal. And same goes to other investors as well. Since individual personality, habits and thinking are affecting the decision making process, it really worth the time and effort to understand which investing personality you belongs to.
You can either be a reserved investors, speculators or optimist investors. Whoever you are, discover what you capable of, overcome your weaknesses and start investing in stock market. you might want to make that as a habit whenever you want to start doing anything.
Many novice investors are not sure how to start their stock investing career. Often than not, due to their ignorance and arrogance, they start buying stocks without following the most basic and simple rules to be successful. Get your hand dirty first if you want to make one million dollar profits from stock investing.
Specific Investment Plan
You must be hearing the importance of investment plan so much. Unfortunately, most investors do not get it right. Initially, you should set up specific financial goal. For example, you want to retire by 40 with $5000 passive income. Secondly, discount it to current value with the inflation rate to identify how much cash you need now or later. For example, you need to have $500k cash in five years time to generate $5000 per month by 2020.
Last but not least, discover which investment option that can help you to achieve the financial goal. For example, plain saving, stock investing, option trading or real estate.
Discover Investment Niche
Once you have the investment plan in place, you will have clearer picture where are you heading to. The next questions would be how do you get there?
Look, there are so many ways to make money in stock market. So many ways that is enough for everyone to make the least money. Therefore, instead of looking for the fastest way to make money, why don't you concentrate on which investment style suit your needs, niche and time commitment. But first, you have to understand the methodology of each concept. Day trading, value investing and swing trading are some of the most common techniques used in stock market investing.
Recognize Investment Personality
Although penny stocks investing suit me very well, the same might not hold true for you. You might not comfortable with the Over-The-Counter (OTC) purchase, its unproven track records or its natural price volatility. The fact is, neither you nor me were created equal. And same goes to other investors as well. Since individual personality, habits and thinking are affecting the decision making process, it really worth the time and effort to understand which investing personality you belongs to.
You can either be a reserved investors, speculators or optimist investors. Whoever you are, discover what you capable of, overcome your weaknesses and start investing in stock market. you might want to make that as a habit whenever you want to start doing anything.
Stock Investing Basics - 3 Things to Do Before You Get Started
By : Zainul Anuar
No doubt you can make millions of dollar and get rich from stock market, but it won't happen if you missed these critical checklists in the first place. In case you are so eager to invest in stock market, hold yourself first. Make sure you have the right starting point before putting any money in any stock.
Have Enough Money
You can invest everything you have in savings into stock market, but it is like risking your life into it. The truth is, there is nothing as guaranteed as cash deposit when it comes to investing no matter how strong the stock is. So, it is a wise decision to create an emergency fund in case the stock is turning against you. I always advise my friends to keep at least six months income worth in savings before investing in share market.
Trust me, you can concentrate much better by doing just this.
Understand Yourself
There are many ways to make money in stock market. For instance, you can buy and hold the stock forever, buy and sell stocks after holding them for few years or even trade the stocks in the same day. Believe me, there is no one way that is better than the other. It is really up to you which investing style suits your needs. Besides, your investing capability, commitment and the available fund will affect your preference too.
Spend time asking yourself, which investing style you prefer the most.
Aware of the Risks
There are three risks associated with stock investing; namely individual financial risk (possibility of you went broke), company business risk (possibility of the company went down) and market risk (possibility of weak market sentiment). There is no way you can avoid these risks, but you can reduce the risks by applying some mitigation measures. For example, invest in stock market whenever you have enough money or buy stocks that offer huge growth potential only.
It is not about avoiding risk that matters, but how you can manage the risk is more important.
Not many investors did these whenever they've decided to invest in stock market. What they do is simply jump into the market using others tips. Stock brokers, insiders and friends influence them the most in deciding which stocks to invest. If you are high risk investors' type, then it is fine. But if you are looking for long term profits, I suggest you stop it now.
Author Resource:- Find out step by step stock investing tips, zecco review and doublingstocks review in http://www.Stock-Investment-Made-Easy.com/
No doubt you can make millions of dollar and get rich from stock market, but it won't happen if you missed these critical checklists in the first place. In case you are so eager to invest in stock market, hold yourself first. Make sure you have the right starting point before putting any money in any stock.
Have Enough Money
You can invest everything you have in savings into stock market, but it is like risking your life into it. The truth is, there is nothing as guaranteed as cash deposit when it comes to investing no matter how strong the stock is. So, it is a wise decision to create an emergency fund in case the stock is turning against you. I always advise my friends to keep at least six months income worth in savings before investing in share market.
Trust me, you can concentrate much better by doing just this.
Understand Yourself
There are many ways to make money in stock market. For instance, you can buy and hold the stock forever, buy and sell stocks after holding them for few years or even trade the stocks in the same day. Believe me, there is no one way that is better than the other. It is really up to you which investing style suits your needs. Besides, your investing capability, commitment and the available fund will affect your preference too.
Spend time asking yourself, which investing style you prefer the most.
Aware of the Risks
There are three risks associated with stock investing; namely individual financial risk (possibility of you went broke), company business risk (possibility of the company went down) and market risk (possibility of weak market sentiment). There is no way you can avoid these risks, but you can reduce the risks by applying some mitigation measures. For example, invest in stock market whenever you have enough money or buy stocks that offer huge growth potential only.
It is not about avoiding risk that matters, but how you can manage the risk is more important.
Not many investors did these whenever they've decided to invest in stock market. What they do is simply jump into the market using others tips. Stock brokers, insiders and friends influence them the most in deciding which stocks to invest. If you are high risk investors' type, then it is fine. But if you are looking for long term profits, I suggest you stop it now.
Author Resource:- Find out step by step stock investing tips, zecco review and doublingstocks review in http://www.Stock-Investment-Made-Easy.com/
Stop Trading Individual Shares If You're Not Beating The Market
By : James Woolley
Every share investor enjoys hunting out profitable companies they can invest in, and hopefully finding a potential ten-bagger that will make them rich, but there comes a time when you have to analyze your portfolio and make harsh decisions if you're not beating the overall market.
After all what is the point in spending hours and hours researching different companies if the end result is that you are underperforming the overall market. You may as well just invest in a tracker fund that tracks the market or a top performing mutual fund and spend your time doing more worthwhile things.
I know it can be quite exciting doing your own research and investing in the companies of your choice, but professionals are paid to do the same job and will generally have access to more information than you do, and can make better informed decisions.
So take a look at your share portfolio over the years and see how it's performed in percentage terms. Then compare this to the performance of the FTSE 100, for example (or the Dow Jones if investing in US shares) and see how you compare.
If you find that the overall index has seriously outperformed your own efforts then something is seriously wrong here, and it might be an idea to seriously rethink your investment strategy.
For instance, taking the FTSE 100 as an example, this index has increased dramatically since 2003 almost doubling in value so almost all good quality companies will have risen a lot during this time. Now look at the companies you've been investing in. If they haven't risen during this time when the market as a whole has been extremely bullish, then your investment strategy is seriously flawed.
If however, you have achieved excellent gains in percentage terms then your individual share picking strategy is of course justified, although it might still be an idea to place your money in a tracker or mutual fund, depending on your performance.
This isn't always true though, because it's important to note that portfolio managers have more constraints placed on them in terms of the types of companies they can invest in, plus of course there's the added fees you have to pay for their service, so ultimately it's a matter of choice and convenience.
I personally have done extremely well investing in my own portfolio over the years and have plenty of time to do my own research. However for people who have busy lives and have maybe shown that they are not that successful in managing their own portfolio and selecting individual companies to invest in, then paying someone else to do it for you is probably the better option.
Every share investor enjoys hunting out profitable companies they can invest in, and hopefully finding a potential ten-bagger that will make them rich, but there comes a time when you have to analyze your portfolio and make harsh decisions if you're not beating the overall market.
After all what is the point in spending hours and hours researching different companies if the end result is that you are underperforming the overall market. You may as well just invest in a tracker fund that tracks the market or a top performing mutual fund and spend your time doing more worthwhile things.
I know it can be quite exciting doing your own research and investing in the companies of your choice, but professionals are paid to do the same job and will generally have access to more information than you do, and can make better informed decisions.
So take a look at your share portfolio over the years and see how it's performed in percentage terms. Then compare this to the performance of the FTSE 100, for example (or the Dow Jones if investing in US shares) and see how you compare.
If you find that the overall index has seriously outperformed your own efforts then something is seriously wrong here, and it might be an idea to seriously rethink your investment strategy.
For instance, taking the FTSE 100 as an example, this index has increased dramatically since 2003 almost doubling in value so almost all good quality companies will have risen a lot during this time. Now look at the companies you've been investing in. If they haven't risen during this time when the market as a whole has been extremely bullish, then your investment strategy is seriously flawed.
If however, you have achieved excellent gains in percentage terms then your individual share picking strategy is of course justified, although it might still be an idea to place your money in a tracker or mutual fund, depending on your performance.
This isn't always true though, because it's important to note that portfolio managers have more constraints placed on them in terms of the types of companies they can invest in, plus of course there's the added fees you have to pay for their service, so ultimately it's a matter of choice and convenience.
I personally have done extremely well investing in my own portfolio over the years and have plenty of time to do my own research. However for people who have busy lives and have maybe shown that they are not that successful in managing their own portfolio and selecting individual companies to invest in, then paying someone else to do it for you is probably the better option.
Stock Broker or Stock Analyst - What's the Difference?
By : Denise Villani
Depending on what type of investing you plan to do, you might need to hire a broker to handle your investments. Brokers work for brokerage houses and have the ability to buy and sell stock on the stock exchange. You may wonder if you really need a broker. If you intend to buy or sell stocks on the stock exchange, the answer is yes, you must have a broker.
Stock brokers are qualified and regulated professionals who buy and sell shares and other securities through market makers on behalf of investors. In order to become a stockbroker in the United States, a person must pass exams such as the General Securities Representative Exam, also called the "series 7 exam". Also, most brokers have a background in business or finance, with a Bachelors or Masters Degree.
It's important to differentiate between a stock broker and a stock analyst. A stock analyst basically analyzes the stock market, predicts what it will or won't do, and predicts how specific stocks will perform. Keep in mind that it's fairly common for some stock brokers to also be analysts and vice versa.
Stock analysts basically do alot of research and make recommendations to help companies and clients make investment decisions. They read company financial statements, analyze commodity prices, sales, costs, expenses, and tax rates to determine a company's value to help project its future earnings. Sometimes the analyst will meet with company officials to gain an insight into the company and determine how effective the company's management is. Analysts usually study an entire industry, assessing the current trends in business practices, products, and industry competition. They also keep current with regulations and policies that affect the industry and monitor the economy to determine its effect on earnings.
Putting all this together, analysts write reports and make presentations citing their recommendations on whether or not to buy or sell a particular investment or security. Analysts summarize their reports with ratings such as "buy", "sell", "market perform", "overweight", "hold", etc.
Stock brokers, on the other hand, are usually there to follow instructions to buy or sell stock, not necessarily to analyze them. Stock exchange transactions must be made between two members of the exchange. Basically, the typical person can't just walk into a stock exchange and make trades.
Stock brokers perform three types of stockbroking services: execution only, advisory dealing, and discretionary dealing. Execution-only, or discount brokers, just carry out the client's instructions to buy or sell, nothing more. Advisory and discretiony dealing is done by full service brokers who do research and provide advice. In advisory dealing, the broker acts as an advisor and advises the client on which shares to buy and sell, but leaves the decision making up to the investor. In discretionary dealing, the stockbroker knows the client's investment objectives and then makes the decisions on that client's behalf.
In most cases, brokers get paid from commissions on transactions made for their clients. Brokers usually earn a flat per transaction percentage of each transaction they perform.
If you are new to investing, you may need to go with a full service broker to ensure that you are making wise investments. They can offer you the skill that you lack at this point. However, if you are already knowledgeable about the stock market, all you really need is a discount broker to make your trades for you.
Depending on what type of investing you plan to do, you might need to hire a broker to handle your investments. Brokers work for brokerage houses and have the ability to buy and sell stock on the stock exchange. You may wonder if you really need a broker. If you intend to buy or sell stocks on the stock exchange, the answer is yes, you must have a broker.
Stock brokers are qualified and regulated professionals who buy and sell shares and other securities through market makers on behalf of investors. In order to become a stockbroker in the United States, a person must pass exams such as the General Securities Representative Exam, also called the "series 7 exam". Also, most brokers have a background in business or finance, with a Bachelors or Masters Degree.
It's important to differentiate between a stock broker and a stock analyst. A stock analyst basically analyzes the stock market, predicts what it will or won't do, and predicts how specific stocks will perform. Keep in mind that it's fairly common for some stock brokers to also be analysts and vice versa.
Stock analysts basically do alot of research and make recommendations to help companies and clients make investment decisions. They read company financial statements, analyze commodity prices, sales, costs, expenses, and tax rates to determine a company's value to help project its future earnings. Sometimes the analyst will meet with company officials to gain an insight into the company and determine how effective the company's management is. Analysts usually study an entire industry, assessing the current trends in business practices, products, and industry competition. They also keep current with regulations and policies that affect the industry and monitor the economy to determine its effect on earnings.
Putting all this together, analysts write reports and make presentations citing their recommendations on whether or not to buy or sell a particular investment or security. Analysts summarize their reports with ratings such as "buy", "sell", "market perform", "overweight", "hold", etc.
Stock brokers, on the other hand, are usually there to follow instructions to buy or sell stock, not necessarily to analyze them. Stock exchange transactions must be made between two members of the exchange. Basically, the typical person can't just walk into a stock exchange and make trades.
Stock brokers perform three types of stockbroking services: execution only, advisory dealing, and discretionary dealing. Execution-only, or discount brokers, just carry out the client's instructions to buy or sell, nothing more. Advisory and discretiony dealing is done by full service brokers who do research and provide advice. In advisory dealing, the broker acts as an advisor and advises the client on which shares to buy and sell, but leaves the decision making up to the investor. In discretionary dealing, the stockbroker knows the client's investment objectives and then makes the decisions on that client's behalf.
In most cases, brokers get paid from commissions on transactions made for their clients. Brokers usually earn a flat per transaction percentage of each transaction they perform.
If you are new to investing, you may need to go with a full service broker to ensure that you are making wise investments. They can offer you the skill that you lack at this point. However, if you are already knowledgeable about the stock market, all you really need is a discount broker to make your trades for you.
3 Factors Affecting Share Prices That Most Stock Investors Do Not Know
By : Zainul Anuar
Certainly, there are just so many factors affecting share prices. For example, high oil prices, interest rates, GDP and CPI to name few. However, many beginners are focusing too much on the external factors than what can happen from the accounting perspective. They can easily get frustrated from their own ignorance. Therefore, before you think of getting cheated next time, spend time to read this article very carefully.
Dividend Effect
I love dividend as much as you do, but apparently, it does not comes for free. Simply because, the share price drops in the same value as the dividend paid after the ex-date. For instance, if Wal-Mart Stores Inc. decided to distribute $1 per share as dividend to its shareholders, its share price will generally drops from $49 to $48 per share after the ex-date.
So, do not comment so much in the future if the stock price drops after the dividend payout, because you took the money away already.
Bonus Issue
Bonus issue is additional shares given by the company to its existing shareholders. By doing so, the company is able to reinvest the dividend cash for better earnings growth. In fact, this is another way for the company to maintain its share price at cheaper rate without splitting the stocks. Bonus issue is also a good way to reward long term stock investor.
Ideally, the share price drops the same ratio of bonus issued. For instance, if the company is giving one new share for each four shares own by the shareholders, the share price will drop by 20%.
Warrants Exercise
With warrants, you have the right to buy shares from a company after the exercise date at specified price. As a result, its earnings will be diluted as more shares are sharing the same earnings pie. In general, the share price drops the same proportion of the number of exercised shares. For example, if the exercised share is 10% of the existing number of shares, the stock price will normally drops by 10% as well.
Unfortunately, unlike stock split, these factors are diluting the earnings per share (EPS) of the stock, which in turn will adjust the share price accordingly. That is why, the stock price will get affected if any of the events happen. Although long term investors do not care much about it, stock traders (esp. swing traders, day traders, position traders) should consider these factors seriously.
Author Resource:- Find out step by step stock investing tips, zecco review and doublingstocks review in http://www.Stock-Investment-Made-Easy.com/
Certainly, there are just so many factors affecting share prices. For example, high oil prices, interest rates, GDP and CPI to name few. However, many beginners are focusing too much on the external factors than what can happen from the accounting perspective. They can easily get frustrated from their own ignorance. Therefore, before you think of getting cheated next time, spend time to read this article very carefully.
Dividend Effect
I love dividend as much as you do, but apparently, it does not comes for free. Simply because, the share price drops in the same value as the dividend paid after the ex-date. For instance, if Wal-Mart Stores Inc. decided to distribute $1 per share as dividend to its shareholders, its share price will generally drops from $49 to $48 per share after the ex-date.
So, do not comment so much in the future if the stock price drops after the dividend payout, because you took the money away already.
Bonus Issue
Bonus issue is additional shares given by the company to its existing shareholders. By doing so, the company is able to reinvest the dividend cash for better earnings growth. In fact, this is another way for the company to maintain its share price at cheaper rate without splitting the stocks. Bonus issue is also a good way to reward long term stock investor.
Ideally, the share price drops the same ratio of bonus issued. For instance, if the company is giving one new share for each four shares own by the shareholders, the share price will drop by 20%.
Warrants Exercise
With warrants, you have the right to buy shares from a company after the exercise date at specified price. As a result, its earnings will be diluted as more shares are sharing the same earnings pie. In general, the share price drops the same proportion of the number of exercised shares. For example, if the exercised share is 10% of the existing number of shares, the stock price will normally drops by 10% as well.
Unfortunately, unlike stock split, these factors are diluting the earnings per share (EPS) of the stock, which in turn will adjust the share price accordingly. That is why, the stock price will get affected if any of the events happen. Although long term investors do not care much about it, stock traders (esp. swing traders, day traders, position traders) should consider these factors seriously.
Author Resource:- Find out step by step stock investing tips, zecco review and doublingstocks review in http://www.Stock-Investment-Made-Easy.com/
Top 2 Hottest Online Businesses
By : Scott Johns
Do you like to write? Have you dreamed of seeing your name in print? It is possible to make money as a freelance writer. The term freelance may be misinterpreted by aspiring writers. One may assume that work will be hard to come by. This is not true if you are willing to do research and can produce quality work. Thanks to the Internet, a myriad of possibilities exist. Finding writing gigs, is not as difficult as it seems. There is a high demand for writers and freelancers in just about any area of expertise. Today, companies are interested in saving dollars and time by electing to freelance work; instead, of the hassle of overhead and overhead expenses. Online magazines are a good place to start. It seems that most are looking for writers. However, you may have to start off writing for free. Yet, you are still making your name known to viewers and building respect with the magazine. It also, looks great in your portfolio. Some websites may also list companies looking for freelance writers.
The research for finding writing opportunities is time consuming, but rewarding when you find yourself writing, getting published, and getting paid.
Websites to Consider
1. www.writersdigest.com
This is a very helpful website, besides having writing job listings.
2. www.writersweekly.com
3. www.sunoasis.com
4. www.mediabistro.com
5. www.fwointl.com
You can sign up for their weekly email newsletter, which is loaded with tips for writers, and possible markets.
As a freelance writer, you will find that most potential clients expect to be able to view your portfolio . This allows them to gain perspective of your writing style and ability. If you dont have a portfolio they may ask you to provide a sample writing on a topic the employer suggest. Do not be intimidated. This is common procedure.
Ebay/Online Auctions
Ebay is the most popular online auction community. It is also a lucrative source of income for sellers. Selling is easy and fun with Ebay tools and its large community. If you have a solid product, a well written sales letter, and patience, online auctions can be a lucrative and successful online business. You do not have to be an expert to sell on Ebay or any other online auction site. I most cases, the tools are already in place. The buyers are ready to bid. The key to success is the product. It has to be a product that buyers want. It does not have to be expensive or unique just easy to sell. As an auctioneer research is required an necessary to discover what items are hot and which ones are not. Take the time to do a little research and business will be running itself in no time.
Do you like to write? Have you dreamed of seeing your name in print? It is possible to make money as a freelance writer. The term freelance may be misinterpreted by aspiring writers. One may assume that work will be hard to come by. This is not true if you are willing to do research and can produce quality work. Thanks to the Internet, a myriad of possibilities exist. Finding writing gigs, is not as difficult as it seems. There is a high demand for writers and freelancers in just about any area of expertise. Today, companies are interested in saving dollars and time by electing to freelance work; instead, of the hassle of overhead and overhead expenses. Online magazines are a good place to start. It seems that most are looking for writers. However, you may have to start off writing for free. Yet, you are still making your name known to viewers and building respect with the magazine. It also, looks great in your portfolio. Some websites may also list companies looking for freelance writers.
The research for finding writing opportunities is time consuming, but rewarding when you find yourself writing, getting published, and getting paid.
Websites to Consider
1. www.writersdigest.com
This is a very helpful website, besides having writing job listings.
2. www.writersweekly.com
3. www.sunoasis.com
4. www.mediabistro.com
5. www.fwointl.com
You can sign up for their weekly email newsletter, which is loaded with tips for writers, and possible markets.
As a freelance writer, you will find that most potential clients expect to be able to view your portfolio . This allows them to gain perspective of your writing style and ability. If you dont have a portfolio they may ask you to provide a sample writing on a topic the employer suggest. Do not be intimidated. This is common procedure.
Ebay/Online Auctions
Ebay is the most popular online auction community. It is also a lucrative source of income for sellers. Selling is easy and fun with Ebay tools and its large community. If you have a solid product, a well written sales letter, and patience, online auctions can be a lucrative and successful online business. You do not have to be an expert to sell on Ebay or any other online auction site. I most cases, the tools are already in place. The buyers are ready to bid. The key to success is the product. It has to be a product that buyers want. It does not have to be expensive or unique just easy to sell. As an auctioneer research is required an necessary to discover what items are hot and which ones are not. Take the time to do a little research and business will be running itself in no time.
Free Online SMS Messaging
By : Christa Kowalczyk
This small electronic device is fast finding its place in everybody\'s pocket. It is your cell phone which we are discussing about and with the increased use of it we can agree that it is such an object you cannot imagine your life without. Your cell phone is not all about making or receiving calls but it is also popularly used for sending SMS or texts and also receiving them.
If you have been texting your friends regularly you know how much fun is to send some interesting messages to them and bring some smile on their faces. Buy what generally stops you is the fees charged by your cellular service provider on sending Texts or SMS.
But worry no more we have some information which will bring smile to your face. If you want to send some cool, funny, romantic and sexy messages to your friends and that too free of cost just log on to mobile-sender for sending free texts or SMS to your friends all over United Sates.
No catch it is all 100% free. With this amazing service you can still bring the smile on your friend\'s faces and that too without increasing your phone bill. What you need to do is to visit the particular website and follow the simple steps.
To start with as soon as you hit the home page the first step is to enter the receivers cell phone number in the mentioned field. While doing so remember not to use dashes or other characters other than the number and to enter the area code as well. The second step is to enter the subject of the message you want to send. It helps the receiver in identifying the content of the message.
The third step is to enter your message you intend to send to the receiver and here you need to remember that the limit of the message is 140 words. So enter the precise message and continue to the final step. The fourth step is to choose the receivers cellular service provider from the given list.
And the final step is to click on the send text message button to send the message. Using these simple steps your message is delivered to the person you want to send it to. Isn\'t it a simple way of sending your message across without you or the receiver paying anything for using the service.
It is the simplest way of sending SMS which is getting popular everyday. What you benefit is sending free texts whenever you want to and whomever you want to. This free SMS are well protected by spammers and a complete privacy is maintained over the data.
Plus you never receive any advertisements or spam messages and the messaging always remains clean. It is better to cut down on your phone bill and start using this service which is easy and 100% free. Play prank on your friends by sending anonymous messages using this service.
This small electronic device is fast finding its place in everybody\'s pocket. It is your cell phone which we are discussing about and with the increased use of it we can agree that it is such an object you cannot imagine your life without. Your cell phone is not all about making or receiving calls but it is also popularly used for sending SMS or texts and also receiving them.
If you have been texting your friends regularly you know how much fun is to send some interesting messages to them and bring some smile on their faces. Buy what generally stops you is the fees charged by your cellular service provider on sending Texts or SMS.
But worry no more we have some information which will bring smile to your face. If you want to send some cool, funny, romantic and sexy messages to your friends and that too free of cost just log on to mobile-sender for sending free texts or SMS to your friends all over United Sates.
No catch it is all 100% free. With this amazing service you can still bring the smile on your friend\'s faces and that too without increasing your phone bill. What you need to do is to visit the particular website and follow the simple steps.
To start with as soon as you hit the home page the first step is to enter the receivers cell phone number in the mentioned field. While doing so remember not to use dashes or other characters other than the number and to enter the area code as well. The second step is to enter the subject of the message you want to send. It helps the receiver in identifying the content of the message.
The third step is to enter your message you intend to send to the receiver and here you need to remember that the limit of the message is 140 words. So enter the precise message and continue to the final step. The fourth step is to choose the receivers cellular service provider from the given list.
And the final step is to click on the send text message button to send the message. Using these simple steps your message is delivered to the person you want to send it to. Isn\'t it a simple way of sending your message across without you or the receiver paying anything for using the service.
It is the simplest way of sending SMS which is getting popular everyday. What you benefit is sending free texts whenever you want to and whomever you want to. This free SMS are well protected by spammers and a complete privacy is maintained over the data.
Plus you never receive any advertisements or spam messages and the messaging always remains clean. It is better to cut down on your phone bill and start using this service which is easy and 100% free. Play prank on your friends by sending anonymous messages using this service.
Secrets Of How To Make Money Online
By : Saleem Rana
Do you want to learn the secrets of how to make a living online? There are plenty of people offering their secrets to help you make more money online. The only problem is that as you trawl around the web searching out these secrets you soon discover they aren\'t secrets after all.
What you will learn is good, old-fashioned business common sense. These secrets will teach that some kind of a promotion is necessary to attract people to your web site. Once attracted, you need to entice people further with more offerings in exchange for their contact information (email address). As the saying goes, the money is in the list. You cannot run any kind of business online, or offline unless you have a list of potential customers.
So, the secrets that you are searching for online have been there ever since business began. Find something people want, entice them to connect with you, get their details and sell, sell, sell to them over a period of time to convert them from interested parties to confirmed customers.
But the one secret that is often missing from much of the information online has been around offline for centuries as well - be different. Don\'t try to be the same as your competitors. Stand out from the crowd. Do something different that gets you remembered.
For example, take the cab driver who gets the name and address of every passenger. Each Christmas they get a card from him. And guess what, people remember him and recommend him. He gets most of his fares from referral business, rather than having to wait around. Have you ever met a cab driver who sends all his passengers cards at Christmas?
Yet online, everyone seems to be the same. New online businesses follow the rules set by the experts and gurus. The result is that almost all web sites trying to sell something are starting to look the same. They all do the same thing - have a great offer and a box to fill in your details. Many of them even use the same templates. If you follow the \"rules\" that are part of the secrets you will end up following the pack and you won\'t be noticed. If you truly want to make it online, you have to be different.
So stand out from the crowd by being different - not just visually, but in the way you approach your readers. Do whacky things perhaps. You will be noticed and remembered - and online that\'s nine tenths of the battle. This is a simple but effective secret on how to make money online.
Do you want to learn the secrets of how to make a living online? There are plenty of people offering their secrets to help you make more money online. The only problem is that as you trawl around the web searching out these secrets you soon discover they aren\'t secrets after all.
What you will learn is good, old-fashioned business common sense. These secrets will teach that some kind of a promotion is necessary to attract people to your web site. Once attracted, you need to entice people further with more offerings in exchange for their contact information (email address). As the saying goes, the money is in the list. You cannot run any kind of business online, or offline unless you have a list of potential customers.
So, the secrets that you are searching for online have been there ever since business began. Find something people want, entice them to connect with you, get their details and sell, sell, sell to them over a period of time to convert them from interested parties to confirmed customers.
But the one secret that is often missing from much of the information online has been around offline for centuries as well - be different. Don\'t try to be the same as your competitors. Stand out from the crowd. Do something different that gets you remembered.
For example, take the cab driver who gets the name and address of every passenger. Each Christmas they get a card from him. And guess what, people remember him and recommend him. He gets most of his fares from referral business, rather than having to wait around. Have you ever met a cab driver who sends all his passengers cards at Christmas?
Yet online, everyone seems to be the same. New online businesses follow the rules set by the experts and gurus. The result is that almost all web sites trying to sell something are starting to look the same. They all do the same thing - have a great offer and a box to fill in your details. Many of them even use the same templates. If you follow the \"rules\" that are part of the secrets you will end up following the pack and you won\'t be noticed. If you truly want to make it online, you have to be different.
So stand out from the crowd by being different - not just visually, but in the way you approach your readers. Do whacky things perhaps. You will be noticed and remembered - and online that\'s nine tenths of the battle. This is a simple but effective secret on how to make money online.
The Best Way to Increase Website Conversions?
There\'s no question that the marketplace is loaded with vendors offering solutions to increase website conversions. With an increased drive toward true alignment of search marketing and site optimization for online shopping, it would seem that a majority percentage of people arriving on a website would buy.
But they\'re not.
In fact most organizations rarely have better than a 1% conversion rate for all unique traffic. What\'s worse is that many of these organizations have less than 1% unique traffic conversion. Yet, marketing directors and other leaders responsible for online sales in organizations whose names you probably know, continue to burn through massive online budgets, running large infrastructures and managing large teams for what amounts to an anemic performance.
Increasing conversion is the only thing that matters online.
You\'ve really got to sit down and ask yourself why these organizations think the only way to increase revenues is to increase traffic. This is insane. For starters, traffic is not infinite. In fact, most website traffic will never come back to your site. The majority of good prospects are lost to no decision at all.
If you think your traffic is going to come back and buy from you, you\'d better think again.
* In a study released by BizRate and The NPD Group, more than 10,000 consumers were surveyed. Respondents indicated what occurred after they abandoned the shopping cart:
* 39% did not purchase the item at all
* 26% purchased the product from a competitor
* 17% made their purchase offline
* 18% returned to the site to make the purchase at a later time.
The next largest group of departing site traffic is driven into the arms of the competition. When you consider how poorly sites convert, you\'ve got to wonder why people continue to burn cash and other valuable resources on traffic without looking closer at this problem.
Instead, marketers should first re-focus on making the site convert better, THEN turn up the tap on traffic. The etailing Group found in a study that 47% of e-commerce directors didn\'t even know their abondoment rate.
Embarassing.
What\'s worse, consider the following facts:
* 35% of online shoppers find navigating sites difficult (Yankee Group)
* 20% of online shoppers find technical glitches frustrating (Zendor)
* 61% of people who abandon may not come back (Zendor Study)
* 55% of online shoppers are reluctant to provide their credit card information online (Yankee Group)
* Consumers, on average, spend more than 19 hours deciding where to buy online for a given purchase. (ScanAlert)
The fastest way to long term conversion improvements.
One of the best ways to increase site traffic without wholesale changes to navigation and graphics is with real human beings. Deploy a service that offers live chat to site visitors when they arrive based upon some entry criteria like the keywords they used to find your site in the first place. Chat is anonymous and non-confrontational for site visitors who genuinely would appreciate some help.
Staff that chat system with trained sales agents who know your products and can properly qualify based upon the most common needs of your visitors. Be careful not to overload those agents with too much traffic or you\'ll burn your brand with yet another version of poor customer service. Offer people the ability to speak with your agents on the phone during that sales cycle and conversions will go up even higher.
Then measure those results.
Is it that easy?
Probably not, but you won\'t know if you don\'t try. And with websites converting less than 1% of traffic, it would be hard for things to get much worse. Realistically though, you WILL increase conversions.
If you do it right, conversions will DOUBLE. What would that mean for your revenues?
People like to buy from people.
A sale is not just a transaction...it is a transfer of positive energy from one person to another. It is one person helping another make a solid buying decision. Imagine going to the mall and no one being in any store to help you. That would seem weird wouldn\'t it?
So why do we think it\'s normal to abandon decades of learning and retailing best practices from with on-line stores? Forget about new navigation and fancy graphics for now. Leverage something that will always be more powerful: the human element.
Then outsource it.
Author Resource:- Brooks helps organizations convert existing traffic into revenue without increasing advertising spend. http://www.onlinesalesaccelerator.com
But they\'re not.
In fact most organizations rarely have better than a 1% conversion rate for all unique traffic. What\'s worse is that many of these organizations have less than 1% unique traffic conversion. Yet, marketing directors and other leaders responsible for online sales in organizations whose names you probably know, continue to burn through massive online budgets, running large infrastructures and managing large teams for what amounts to an anemic performance.
Increasing conversion is the only thing that matters online.
You\'ve really got to sit down and ask yourself why these organizations think the only way to increase revenues is to increase traffic. This is insane. For starters, traffic is not infinite. In fact, most website traffic will never come back to your site. The majority of good prospects are lost to no decision at all.
If you think your traffic is going to come back and buy from you, you\'d better think again.
* In a study released by BizRate and The NPD Group, more than 10,000 consumers were surveyed. Respondents indicated what occurred after they abandoned the shopping cart:
* 39% did not purchase the item at all
* 26% purchased the product from a competitor
* 17% made their purchase offline
* 18% returned to the site to make the purchase at a later time.
The next largest group of departing site traffic is driven into the arms of the competition. When you consider how poorly sites convert, you\'ve got to wonder why people continue to burn cash and other valuable resources on traffic without looking closer at this problem.
Instead, marketers should first re-focus on making the site convert better, THEN turn up the tap on traffic. The etailing Group found in a study that 47% of e-commerce directors didn\'t even know their abondoment rate.
Embarassing.
What\'s worse, consider the following facts:
* 35% of online shoppers find navigating sites difficult (Yankee Group)
* 20% of online shoppers find technical glitches frustrating (Zendor)
* 61% of people who abandon may not come back (Zendor Study)
* 55% of online shoppers are reluctant to provide their credit card information online (Yankee Group)
* Consumers, on average, spend more than 19 hours deciding where to buy online for a given purchase. (ScanAlert)
The fastest way to long term conversion improvements.
One of the best ways to increase site traffic without wholesale changes to navigation and graphics is with real human beings. Deploy a service that offers live chat to site visitors when they arrive based upon some entry criteria like the keywords they used to find your site in the first place. Chat is anonymous and non-confrontational for site visitors who genuinely would appreciate some help.
Staff that chat system with trained sales agents who know your products and can properly qualify based upon the most common needs of your visitors. Be careful not to overload those agents with too much traffic or you\'ll burn your brand with yet another version of poor customer service. Offer people the ability to speak with your agents on the phone during that sales cycle and conversions will go up even higher.
Then measure those results.
Is it that easy?
Probably not, but you won\'t know if you don\'t try. And with websites converting less than 1% of traffic, it would be hard for things to get much worse. Realistically though, you WILL increase conversions.
If you do it right, conversions will DOUBLE. What would that mean for your revenues?
People like to buy from people.
A sale is not just a transaction...it is a transfer of positive energy from one person to another. It is one person helping another make a solid buying decision. Imagine going to the mall and no one being in any store to help you. That would seem weird wouldn\'t it?
So why do we think it\'s normal to abandon decades of learning and retailing best practices from with on-line stores? Forget about new navigation and fancy graphics for now. Leverage something that will always be more powerful: the human element.
Then outsource it.
Author Resource:- Brooks helps organizations convert existing traffic into revenue without increasing advertising spend. http://www.onlinesalesaccelerator.com
Some Free Ways To Make Money Online
By : Saleem Rana
When it comes to free ways to make money online there is no shortage of ways to do it. Of course if you have a product of your own that is the best place to start. What if you do not have a product of your own?
Here are a few ways you can sell stuff online with affiliate marketing to make money for yourself.
Affiliate Programs. Getting paid to sell other people\'s products is the quickest way to get going that I have found. Affiliate marketing has been around for over 10 years now and many people look at Amazon.com as one of the first companies to sell products this way.
You can make money selling clicks such as with Google Adsense. You can make money selling leads with affiliate programs like Max Bounty. You can make money selling products. One such way is to sell information products like you would find at ClickBank.
Another thing you can do is affiliate program directories like AssociatePrograms.com or Commissions Junction where they have compiled some of the best products to sell in one place.
Certainly network marketing also offers some great residual income for repeat business on a monthly basis. Many MLM companies will set up your customers and distributors on auto-ship and the products they order go out like clock work every month. When they do you make a commission every month just like clockwork as well.
Selling memberships is also profitable. This can be done through both affiliate marketing as well as network marketing. Getting paid over and over for making one sale is called residual income. Products that can be accessed online and offer value to your customer are great to sell. Paid memberships fit this description. Subscriptions on how to run a home business, personal development, paid newsletters on every subject imaginable, website hosting, autoresponders, and just about anything you can think of, offer you a chance to create residual income.
Two tier programs where you get paid on the sales of people you recruit work great for paid membership programs as well. Of course network marketing falls into this category and can even be better because you can make money every month on the sales of a large group of people.
The key with most paid subscription programs is you make a little bit of money on every sale. The first month this may not amount to much. The second month it can be more. In a year it can be quite a lot. Kind of like compound interest if you know how that works.
Free ways to make money online abound and it is really a question of deciding what interests you and what income model you want to use.
When it comes to free ways to make money online there is no shortage of ways to do it. Of course if you have a product of your own that is the best place to start. What if you do not have a product of your own?
Here are a few ways you can sell stuff online with affiliate marketing to make money for yourself.
Affiliate Programs. Getting paid to sell other people\'s products is the quickest way to get going that I have found. Affiliate marketing has been around for over 10 years now and many people look at Amazon.com as one of the first companies to sell products this way.
You can make money selling clicks such as with Google Adsense. You can make money selling leads with affiliate programs like Max Bounty. You can make money selling products. One such way is to sell information products like you would find at ClickBank.
Another thing you can do is affiliate program directories like AssociatePrograms.com or Commissions Junction where they have compiled some of the best products to sell in one place.
Certainly network marketing also offers some great residual income for repeat business on a monthly basis. Many MLM companies will set up your customers and distributors on auto-ship and the products they order go out like clock work every month. When they do you make a commission every month just like clockwork as well.
Selling memberships is also profitable. This can be done through both affiliate marketing as well as network marketing. Getting paid over and over for making one sale is called residual income. Products that can be accessed online and offer value to your customer are great to sell. Paid memberships fit this description. Subscriptions on how to run a home business, personal development, paid newsletters on every subject imaginable, website hosting, autoresponders, and just about anything you can think of, offer you a chance to create residual income.
Two tier programs where you get paid on the sales of people you recruit work great for paid membership programs as well. Of course network marketing falls into this category and can even be better because you can make money every month on the sales of a large group of people.
The key with most paid subscription programs is you make a little bit of money on every sale. The first month this may not amount to much. The second month it can be more. In a year it can be quite a lot. Kind of like compound interest if you know how that works.
Free ways to make money online abound and it is really a question of deciding what interests you and what income model you want to use.
Thursday, February 21, 2008
How to Invest In Stocks
By : Sameep Shah
Investing in stock market to make capital gains is often a very tricky affair. There are thousands of stocks floating in the market, and to pick the right stock at a price that will maximize the return on investment requires deeper knowledge and insight into the stock price movements and other technicalities. If you are intending to invest in shares and stocks, then to start with, you must open a brokerage account with a stock broking firm. After that you need to learn about the different instruments which are being traded in the stock market.
For beginners one of the safest investment options is bonds, which are devoid of any risk and offer assured returns. For other investment options one must calculate the compensation factor -- the return on investment compared to the interest offered by banks. If you are new to the stock market then choose a broker who is well established and has a good track record. If you want to play safe then invest in bonds that are guaranteed by the government which tend to have lower risks.
But how does a brokerage account work? There is a simple legal agreement between an investor and a licensed broker. Through this account the investor can make investments in securities as well as place orders through the firm. So the next time you decide to buy or sell securities like stocks, bonds and mutual funds, operating through a brokerage account is one of the safest avenues for carrying out investment transactions.
Investment in stock market can be for a very short period, known as short-term investment, or it can be for a fairly longer period, which is known as long-term investment. Short-term investment can bring in good returns when the market is dynamic and there are rapid movements in stock prices. In this kind of investment the investor should be an active trader and should keep a close look into the share prices. Traders generally take independent decisions but often the weight of numbers has a direct influence on short-term prices.
Long-term investment is suitable for investors who want to earn substantial returns from investments. However, for long-term investment it is essential to identify stocks, which have greater potential for growth in future. While purchasing shares for long- term one should opt for the shares, which are well established since shares are even more risky than mutual funds. While asset management companies manage mutual funds, portfolio shares are to be managed by the retail investors themselves.
There are two major ways of judging and selecting stocks - through fundamental and technical analysis.
Fundamental analysis, as the term suggests, is concerned with the economic fundamentals which may have an effect on the stock prices such as interest rates, exchange rates, performance of different sectors, fiscal and monetary aspects of the economy and stock management. If you're a long term investor then you should familiarize yourself with fundamental analysis.
Technical analysis, on the other hand, is an extensive research on the stock price movements over a shorter period of time such as weeks and months at most. If you're a short term investor, which I am, then you should familiarize yourself with technical analysis.
In stock market investments, both short term and long term investments come with risks and therefore nothing comes with absolute guarantee. However a smart investor with deeper insight and skillful analysis of the stock prices can reap the benefit even in a volatile market condition.
Author Resource:- Sign up for our Free Stock Picks Newsletter to find out how our last stock pick, Netflix, could have helped you gain a whopping 31% in less than 2 months. How To Invest In Stocks
Investing in stock market to make capital gains is often a very tricky affair. There are thousands of stocks floating in the market, and to pick the right stock at a price that will maximize the return on investment requires deeper knowledge and insight into the stock price movements and other technicalities. If you are intending to invest in shares and stocks, then to start with, you must open a brokerage account with a stock broking firm. After that you need to learn about the different instruments which are being traded in the stock market.
For beginners one of the safest investment options is bonds, which are devoid of any risk and offer assured returns. For other investment options one must calculate the compensation factor -- the return on investment compared to the interest offered by banks. If you are new to the stock market then choose a broker who is well established and has a good track record. If you want to play safe then invest in bonds that are guaranteed by the government which tend to have lower risks.
But how does a brokerage account work? There is a simple legal agreement between an investor and a licensed broker. Through this account the investor can make investments in securities as well as place orders through the firm. So the next time you decide to buy or sell securities like stocks, bonds and mutual funds, operating through a brokerage account is one of the safest avenues for carrying out investment transactions.
Investment in stock market can be for a very short period, known as short-term investment, or it can be for a fairly longer period, which is known as long-term investment. Short-term investment can bring in good returns when the market is dynamic and there are rapid movements in stock prices. In this kind of investment the investor should be an active trader and should keep a close look into the share prices. Traders generally take independent decisions but often the weight of numbers has a direct influence on short-term prices.
Long-term investment is suitable for investors who want to earn substantial returns from investments. However, for long-term investment it is essential to identify stocks, which have greater potential for growth in future. While purchasing shares for long- term one should opt for the shares, which are well established since shares are even more risky than mutual funds. While asset management companies manage mutual funds, portfolio shares are to be managed by the retail investors themselves.
There are two major ways of judging and selecting stocks - through fundamental and technical analysis.
Fundamental analysis, as the term suggests, is concerned with the economic fundamentals which may have an effect on the stock prices such as interest rates, exchange rates, performance of different sectors, fiscal and monetary aspects of the economy and stock management. If you're a long term investor then you should familiarize yourself with fundamental analysis.
Technical analysis, on the other hand, is an extensive research on the stock price movements over a shorter period of time such as weeks and months at most. If you're a short term investor, which I am, then you should familiarize yourself with technical analysis.
In stock market investments, both short term and long term investments come with risks and therefore nothing comes with absolute guarantee. However a smart investor with deeper insight and skillful analysis of the stock prices can reap the benefit even in a volatile market condition.
Author Resource:- Sign up for our Free Stock Picks Newsletter to find out how our last stock pick, Netflix, could have helped you gain a whopping 31% in less than 2 months. How To Invest In Stocks
Subscribe to:
Posts (Atom)
