Author: Jim Hartwell

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Training – Industry / Sector Analysis

This report shows the performance ranking of each Industry / Sector. The Industry / Sector name, Avg Gain%, and the Sector Rank are displayed for each. You can can sort the stocks by any column in the report just by clicking on the column header.

Column Descriptions

Industry / Sector Name = name of each industry and sector.

Avg Gain% = the average previous close gain percentage for all stocks in the sector.

Sector Rank = the rank of each industry and sector based on price, volume, and other proprietary metrics.

Links

Stocks in each ranked sector above.

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Training – Under Valued Portion of The Market by Industry

This report only shows the Sectors that are over-all under valued.  The Sector name, Count Of Under Valued stocks, and the on average PE ratio remaining for the under valued stocks in the Sector.

Column Descriptions

Industry Name = name of the industry.

Count Of Under Valued Stocks = only the number of stocks that are under valued.

Per Stock Average Earnings Factor Remaining = proprietary factor based on the PE ratio and the previous day's close price compared to the bench mark closing price in the factor for each stock. Some stocks in the industry may have more remaining other stocks may have less remaining. Of course there may be some stocks in the industry that are not under valued at all. The number in this column only pertains to the under valued stocks.

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Training – Under Valued Portion Of The Market By Sector

This report only shows the Sectors that are over all under valued.  The Sector name, Count Of Under Valued stocks, and the on average PE ratio remaining for the under valued stocks in the Sector.

Column Descriptions

Sector Name = name of the sector.

Count Of Under Valued Stocks = only the number of stocks that are under valued.

Per Stock Average Earnings Factor Remaining = proprietary factor based on the PE ratio and the previous day's close price compared to the bench mark closing price in the factor for each stock.  Some stocks in the sector may have more remaining other stocks may have less remaining. Of course there may be some stocks in the sector that are not under valued at all. The number in this column only pertains to the  under valued stocks.

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How Rich Stock Traders Pick Winning Stocks And Make More Money

So You Want To Be A Rich Stock Trader

There are rich stock traders and there are traders who go bust. The difference between the two types is the rich traders pick winning stocks and the busted traders get stuck with too many losers.  If you pick winning stocks you'll make more money, and improve your chances for not going bust.

Of course no one starts trading stocks to lose money. All stock traders see themselves growing wealthy to live a better life and help more people; their family or their fellow man. As mentioned at the beginning to make money in the stock market you (the future rich stock trader) must pick winning stocks. How?

Rich traders generally have an advantage that they capitalize on. They have a system or a service that identifies stocks that meet the criteria for their trading strategy of buy low and sell high. They concentrate only on the specific stocks that trade according to the pattern of their specific strategy.

Strategies For Picking Winning Stocks

The first criteria for a winning stock is that it has to be one that lots of other traders are interested in. Trading volume can be an indicator of this. More importantly the direction of change in volume should be going up.  How do they find stocks that meet this first criteria? Usually successful traders use a service or a stock screener that identifies these stocks for them.

Next a stock with a high amount of interest (increasing volume) needs to have a price that is rising or at least anticipated to rise. There are various trading indicators that will signal this condition, on balance volume (OBV), dollar trading volume, moving average convergence & divergence (MACD) and others. Used in combination all of these indicators can be used to confirm a stocks candidacy for a winning trade.

Somewhat harder to identify is a stock with a good story or good news driving it's price. The reason why its called "news" is because nobody knew it before it was released (supposedly). So a good story is hard to anticipate. But as they say "success" leaves footprints. A stock's fundamentals (how much the company makes and at what cost) is a good way to measure and compare one stock with another to identify emerging good news.

After finding a stock with a high level of investor/trader interest, strong price, a good story then the only thing left to do is determine a good price "entry point" (when to buy) and an "exit point" (when to sell after making a profit).  Rich traders buy when the price is on the way up (buy low) and after  the anticipated rise in price takes place they sell before the price starts to drop (sell high).

Am I Too Late - How Do I Know The Opportunity Hasn't Already Passed?

There are a combination of indicators that can be used to identify stocks that are reaching a "top".  And if the opportunity to capitalize on trading a particular stock has already passed so be it, let it go.  As the price of a targeted stock dips in the future a new opportunity may present itself. There will always be another stock that will give you the opportunity to capitalize on its price move.  Just identify that other stock quickly.

The best way to identify the next winning stock is to use analytics that are applied to the entire market each day. On a daily basis our service generates a watch list of stocks that meet the criteria spoken of in this article in addition to many other proprietary criteria. Membership to our service will give you statistics and analytics for many winning stocks in winning industries and sectors.

Evaluate our stock trading analytics FREE for the first seven days here.

 

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How To Choose A Broker

Choosing a Broker

Whether you are a stock trader or a stock investor you need a stock broker. As you no doubt already know there is a difference between stock trading and stock investing. Investors buy stocks long-term, stock traders buy them short-term. Either way you need someone to execute your stock trades.

Depending on the type of investing that you plan to do, you may need to hire a broker to handle your investments for you. 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. The answer is yes. If you intend to buy or sell stocks on the stock exchange, you must have a broker.

Stockbrokers are required to pass two different tests in order to obtain their license. These tests are very difficult, and most brokers have a background in business or finance, with a Bachelors or Masters Degree.

It is very important to understand the difference between a broker and a stock market analyst. An analyst literally analyzes the stock market, and predicts what it will or will not do, or how specific stocks will perform. A stock broker is only there to follow your instructions to either buy or sell stock… not to analyze stocks.

Brokers earn their money from commissions on sales in most cases. When you instruct your broker to buy or sell a stock, they earn a set percentage of the transaction. Many brokers charge a flat ‘per transaction’ fee.

There are two types of brokers: Full service brokers and discount brokers. Full service brokers can usually offer more types of investments, may provide you with investment advice, and is usually paid in commissions.

Discount brokers typically do not offer any advice and do no research – they just do as you ask them to do, without all of the bells and whistles.

So, the biggest decision you must make when it come to brokers is whether you want a full service broker or a discount broker.

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.

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Why Does Technical Analysis Work?

The Psychology Behind Technical Trading

Markets are based on willing sellers interacting with willing buyers. The seller  offers something of value and  the buyer is willing to give up something of equal value to obtain what the seller is offering. In the stock market the value placed on stocks (the thing offered between sellers and buyers) is based on the beliefs, needs, and wants of the seller versus the beliefs, needs, and wants of the buyer. The price of stocks fluctuate because the beliefs of buyers and sellers differ at any point in time and at any given price of a stock.

Beliefs

Sellers of a stock usually believe the price of the stock will soon drop so they want to sell and take profits or minimize further loss. Buyers believe that a stock price is going to rise so they are willing to buy at the current price with hopes that their belief is true.  Sometimes the beliefs of buyers and sellers can be the same but their time horizons can be different. For instance in the long-term both buyer and seller may believe the price of a stock will rise, but the seller may not have the desire to wait long-term so he or she sells to the buyer that is willing to wait.

Technical Analysis Can Identify Sentiment And Thus Price Movement

Time, price, and volume used in combination are the key metrics that most indicators are based on to calculate whether it is fear or greed that drives the market, or a particular stock, at any given time.  We won't discuss any specific indicator here except to say that even when trading stocks based on their fundamentals (expected earnings, etc) technical indicators are a good way to identify how fast or slow the price will move to meet the expectations based on the fundamentals.

The technical indicators used to produce the watch lists on this site are calculated daily at the end-of-day when all price and volume for every stock is definitively known.  With our watch lists in hand at the beginning of the trading day our members can develop a trading plan that can help them compete with the high frequency trading programs in finding and executing profitable trades..

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The Case For Online Trading

About Online Trading

The invention of the Internet has brought about many changes in the way that we conduct our lives and our personal business. We can pay our bills online, shop online, bank online, and even date online!

We can even buy and sell stocks online. Traders love having the ability to look at their accounts whenever they want to, and brokers like having the ability to take orders over the Internet, as opposed to the telephone.

Most brokers and brokerage houses now offer online trading to their clients. Another great thing about trading online is that fees and commissions are often lower. While online trading is great, there are some drawbacks.

A Word Of Caution

If you are new to investing, having the ability to actually speak with a broker can be quite beneficial. If you aren’t stock market savvy, online trading may be a dangerous thing for you. If this is the case, make sure that you learn as much as you can about trading stocks before you start trading online.

You should also be aware that you need to have a "computer" with Internet access attached to you - your smart phone. You want to always have the ability to get online to make a trade. If necessary you need to be sure that you can call and speak with a broker if your internet connectivity is compromised. This is true whether you are an advanced trader or a beginner.

It is also a good idea to go with an online brokerage company that has been around for a while. You won’t find one that has been in business for fifty years of course, but you can find a company that has been in business that long and now offers online trading.

Bottom Line

Again, online trading is a beautiful thing – but it isn’t for everyone. Think carefully before you decide to do your trading online, and make sure that you really know what you are doing!

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Can You Time The Stock Market?

Why You Can’t Time The Stock Market

Can you time the stock market? In a word “No”, say the institutional experts. Although the consensus is that you can’t time the stock market that doesn’t stop individual stock traders from trying, and often times failing.  In time they fail because no one can know the individual goals and circumstances of every participant in the market for all stocks, or for even a given stock.

Can you beat the market?

“Yes” say many, many expert stock traders.  Often times many do beat the market. Why? How? Because successful stock traders are able to identify the moves that the big investors in the market are making and then move with them, and can get out before them.  This takes a vigilant daily effort on the part of stock traders. Because this daily effort can be exhausting sometimes even experienced traders get burned by taking short cuts, or skipping a step in their method of finding stocks, determining entry/exit strategies, and executing those strategies.

How Do You Streamline The Effort To Research Stocks?

It takes a computer of course. Computers perform operations millions of times faster than the human mind reads and calculates so a computer can take into account more correlating facts to determine the true trend of price and volume movement for all stocks in the market. The calculations and comparisons can be made for daily trends, day ranges of trends, and combined trends. There are multi-million dollar trading programs that operate in the stock market everyday. But most individual stock traders can’t compete with these high frequency trading programs on a minute-by-minute basis. But individuals can compete on an end-of-day overnight basis.

Most Excellent Investor Analytics Can Beat The Market (And High Frequency Trading Programs)

The superior performance of our watch lists can be seen here. The daily calculations for the analytics on this site are performed at end-of-day when the markets are closed.  The high frequency trading programs lose their advantage over individual traders when the time frame for calculating trends and indicators is expanded beyond nano seconds. The trading analytics for identifying trends and indicators for potential price moves are best determined when all moves can be included in the calculations. That happens at end-of-day when the complete data set of volume and price moves for every stock traded in a day is known definitively. Next to be considered is how to access these stock trading analytics in an easily digestible manner. That is what this site and its memberships are all about. We make the end-of-day calculations for a universe of over 3,000 stocks and grade them with our proprietary programs and make the research available to our members via daily watch lists and online screeners. Subscribing members can then use the watch lists created from these analytics to prepare a trading plan for the day.

One Dollar Trial

In the span of a few days a stock trader can determine if the analytics on this site reveals actionable trading opportunities that are worth following on a daily basis. That is why each of our memberships starts with a $1 fourteen-day trial. Give our analytics a try for fourteen days by signing up for one of our subscriptions and see whether or not your stock trading gets upgraded.

Happy trading!