8 Important Tips for Trading in the Stock Market

Here is a great article I found

1. Be patient: pay attention to the market tendencies and follow the stock charts at least one hour before you place a trade.
2. Be smart: look for hot financial news about the company of which stock you are trading. Get hooked with an RSS service and place a trade the moment you get the news.
3. Don't be greedy: if you earned a 200% payout, stop trading and withdrawal your money!
4. Be calculated: divide your money on several different investments in order to spread the risk. Don't invest all of your money in one option!
5. Be smart (2): look for opposite influenced stocks and indices. For example, the oil prices go up - the airlines stocks go down.
6. Learn from your mistakes: start trading with small amounts of money, and increase your investment amounts only after you feel you know what you are doing.
7. Use the entire time frame for trading: hourly options are open for trade a whole hour before they get locked, and daily options are open almost all day long! Divide your trades on the same option during the entire trading time frame.
8. Take advantage of market fall down: when markets are falling, like in the past month, trade 'Put' options.

tom0123 said:

4. Be calculated: divide your money on several different investments in order to spread the risk. Don't invest all of your money in one option!

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They call this diversification. Snag is, many people think this means rather than buying just BA, you by Quantas, Singapore Airlines, SAS etc, to diversify your risk. And then there's a plane crash and all stocks crash. Not so diversified now, is it? Or you buy Barclays, BA, Microsoft, Tata... and there's a global recession...

shadowninja said:

They call this diversification. Snag is, many people think this means rather than buying just BA, you by Quantas, Singapore Airlines, SAS etc, to diversify your risk. And then there's a plane crash and all stocks crash. Not so diversified now, is it? Or you buy Barclays, BA, Microsoft, Tata... and there's a global recession...

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I thought those tips were quite helpful.

Yes, maybe, apart from the one I highlighted.

Yes agree with shadow. It's amazing how many markets are correlated.

E.g. if the dollar sinks, US market goes up (& drags world markets with it), Gold rises, oil rises, all other commodities rise.

are u guys familiar with EZtrader?

shadowninja said:

They call this diversification. Snag is, many people think this means rather than buying just BA, you by Quantas, Singapore Airlines, SAS etc, to diversify your risk. And then there's a plane crash and all stocks crash. Not so diversified now, is it? Or you buy Barclays, BA, Microsoft, Tata... and there's a global recession...

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QANTAS:
Acronym: Queensland And Northern Territory Aerial Services

I can't help it if they can't spell their own company name.

Acronym: Queensland And Northern Territory Aerial Services

Thanks for the tips.There all the sort you would tell a gambler who didn't know when to stop.Have you been bitten recently.? Are these tips or just common sence !!!

You are very right in terms of stocks and shares, however I only deal with FX so its a completely different story when it comes to my trading model. Check out my blog i'm giving free recommendations for now.

My 8 tips would be more cynical:

1. If someone tells you to buy this or that stock because it just can't lose, punch him in the nose, then run like hell

2. Instead of listening to paid stock analysts, you are better off getting advice from cab drivers.

3. The more time you spend listening to the financial news, the worse your trading results will be

4. Every trader should read the book "Extraordinary Popular Delusions and the Madness of Crowds". Even though it was written in 1852, it's better than whatever the flavor of the month trading book happens to be.

5. If you can think of another way to earn a living aside from trading, do it.

6. You can learn a lot about the markets by watching the reaction of a herd if wildebeests when a lion approaches.

7. Spend a minimum of 1000 hours learning about the markets before putting any real money at risk

8. Many of the most profitable celebrity traders did it thru illgal means. Think Milkin, Boesky & Madoff. Since you probably don't intent to break the law, you are at a disadvantage

Good trading to all;
Miracletech
TuffTrade- Day Trade Smart

miracletech said:

My 8 tips would be more cynical:

1. If someone tells you to buy this or that stock because it just can't lose, punch him in the nose, then run like hell

2. Instead of listening to paid stock analysts, you are better off getting advice from cab drivers.

3. The more time you spend listening to the financial news, the worse your trading results will be

4. Every trader should read the book "Extraordinary Popular Delusions and the Madness of Crowds". Even though it was written in 1852, it's better than whatever the flavor of the month trading book happens to be.

5. If you can think of another way to earn a living aside from trading, do it.

6. You can learn a lot about the markets by watching the reaction of a herd if wildebeests when a lion approaches.

7. Spend a minimum of 1000 hours learning about the markets before putting any real money at risk

8. Many of the most profitable celebrity traders did it thru illgal means. Think Milkin, Boesky & Madoff. Since you probably don't intent to break the law, you are at a disadvantage

Good trading to all;
Miracletech
TuffTrade- Day Trade Smart

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Great tips!

tom0123 said:

I thought those tips were quite helpful.

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They are a pile of bollox. Be patient, ffs?!

joeking323 said:

Great tips!

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I don't think traders should completely ignore tips, for example I give tips and don't make money unless my client does. Thats a more realistic proposition.

I'll love some real 'tips'.

(you know, the greenback variety)

I've heard no. 5 in relation to so many jobs!!

I don't know about you, but these tips really help me out.

like a guy said on another thread 'tips are for waiters' lol

tom0123 said:

are u guys familiar with EZtrader?

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Hi everyone,

I am looking to adapt my strategies to the eztrader.com platform as well, the thing is, I am not sure whether or not to trust EzTrader yet or not...has anyone had any experience with using them? I think that they are a legitimate company with a legitimate business model...but as wel have seen in the past, companies might have a legitimate business plan, but if it fails, sometimes they disappear with our money.

Does anyone have any experience with them?


Also, I want to mention that I have analyzed their business plan, and I believe I know how it works.

First of all, they are offering binary contracts, what happens is, when you open a binary contract, they are the counter party to the transaction. If you win the trade, they lose, but what I believe they do, is as soon as you open a trade, they have a system that opens a similar contract in the REAL options market. They pay a small commission to open that small contract.

So if your position wins, their position wins as well...they take the profits and pay you your profit, but here is where they make money: They are charging you a SPREAD, kind of like a juice in sports betting. If you notice, the payouts on each winning trade (bet) are around 65%.

So, lets say you risk $100, and you win...they also "risked" $100, but probably paid only a $5 commission for their contract in the market. So this means they have taken the $100 risk money, won $95 on it (or thereabouts, after commission), and then take the $195, but pay you back only $165...resulting in a $30 profit for them. They are "retailing" options contracts to the general public. It is like placing a sports bet priced at -135 on the Money Line. You have to risk $135 to get paid a $100 profit if you win (plus getting your original $135 "investment" back).

I am sure their business model works something like this...it might be a little bit more sophisticated then that, many sports books (such as canbet.com, etc) are very profitable and they keep clients' funds in an escrow account, but I have not seen any such guarantee come from EZTrader just yet.

Once we see if this firm stays around, I will probably deposit funds with them, because I will be able to use my sports betting strategies with them (I live in the US and cannot place bets on sports anymore).