Author: Editor

  • Invest in any age, put the money in the stock market

    Invest in any age, put the money in the stock market

    2 min read

    Invest in any age. Don’t care how old you are you, you should put the money in the stock market. You should invest. Also, it doesn’t relate to how wealthy you are.

    What makes us think like this.

    The stock market is, yet, the genuine way we have for the progress.

    Think!

    Who invests a nice part of salary every year can be compensated after a decent number of years.

    For our financial growth, long-term investing is the best way to increase our wealth.

    Build your investing portfolio with the right stock and bond mix.

    Support it with index funds to maintain costs low. Avoid hedge funds for small investors and ETFs. In other words, you have to be smart and manage your investments.

    It is never late. Yes, we know. Everyone will tell you that the early ages are the best time to start investing.

    That’s true, but also, you can invest in any age.

    Invest in any age, put the money in the stock market

    The stock market is open space, who would forbid you to invest at age after 40, for example? Or after 50?

    Human’s life is longer and longer. Hence you could buy some stock, invest in bonds and in some index fund and supply your investment account for the next 10 years.

    When picking stocks you need to have in mind how you project to manage your investment. Say you are in your 40s, so you might want to invest in some high-risk assets.

    You might choose shares in some new or small company. But you might be interested in some abroad assets and developing markets.

    If, however,  you plan to invest shortly before retirement you will need some different strategy.

    Therefore, you should invest in a less volatile property.  For example, you might like to invest in bonds and shares that are paying plentiful dividends. If you are an older investor who just starts investing it is recommended to hold a mix of stocks, bonds, and index funds. Just put your money in the stock market.

    Invest in any age no matter how old you are.

    The S&P 500 gives a 10%  return per year, with dividends included.

    You might think it isn’t too much, but thanks to phenomena of compound interest you will double your capital every seven years.

    You see, just a little amount of money simply put in the stock market can produce big pays after some time.

    Where to invest in your 50s?

    Invest in any age, put the money in the stock market

    As you are nearing your retirement it is allowed to be a more aggressive investor so put your money in the stock market. For example, you may have a portfolio with 60% in stocks and 40% in bonds. It is a good balance for the majority of investors. Keep in your mind your plan to retire at 65 and you have 15 years at least to collect very nice income thanks to compound interest.

    Of course, it is best if you can start earlier. But, truly, you may invest in any age. Think how much you will have after 14 years if you start in your 50s with $10,000. The compound interest phenomena are on the scene again. Just count, after 7 years double, and the next 7 years, and… Not bad, not at all.

    Maybe you wouldn’t be able to buy the new house but you might have enough for a relaxed life.

    That’s why you should invest in any age.

    risk disclosure

  • Creating strategy for Forex trading

    Creating strategy for Forex trading

    Forex Educational Series – Part 3

    Forex strategy

    Trading Forex is the area to focus on

    by Hans Stam – A Forex trader

    Creating a strategy

    We left off in the previous chapter talking about creating a strategy of your own.

    It’s obvious you do not want to lose money, your aim is to be right on your trading as much as possible to make a profit.

    So how can you create a strategy that will work for you?

    I mention specifically it has to work for you because many will sell trading signals on their analyses, but once you try to implement the signals, your timing could be off and totally miss the trade.

    Then again, who knows if that signal is very successful and why would you trust other traders signals?

    Of course, that’s a personal choice to make, but once you would decide to create your own strategy, here are some tips.

    Demo testing before creating a strategy

    While creating a strategy that works for you, you obviously do not want to spend a lot of money so you will use virtual money using a demo account.

    Once you have set up your demo account, you can start trading as if it was real money, but more importantly, you get to know the trading station you will be using later on.

    You see all kinds of options, and most will not apply to you so you will have to figure out what you will use or not.
    For instance, the chart used.

    If you like to open a demo account.

    Charts

    Most will stick to candlestick charts but there are many other types of charts to choose from.

    Also, there are timeframes you can choose from.

    In this example, we’ll stay with candlesticks but many other types of charts will have similar info.

    A candle represents what the price did in a specific timeframe.

    If you pick an hourly chart, it shows candlesticks and the info of the price in an hour.

    Main info a candlestick is giving you the Opening Price at the beginning of that hour, the highest price, the lowest price and the closing price of that hour.

    The next candle would start its opening price where the previous candle ended its closing price.

    (If that is not the case we speaks of having a gap, but that’s not common)

    If you would change your hourly chart to a 5-minute chart, it would give you a lot more information whereas the hourly would give you the bigger picture.

    It’s for you to decide what you do with that information and how you would apply that in your strategy or not to apply it at all.

    Indicators

    Forex strategy

    Using charts you will also have indicators. For example, you can use a curving line which follows the Simple Moving Average of the price known as SMA.

    Others are MACD or RSI to name a few. There are countless indicators, and it’s up to you to use some of them or to ignore them.

    Every indicator you would use has its own specific purpose and shows you the result of what that indicator is designed for.

    We can’t go through all of them, so if you choose to apply you can do some research on a specific indicator.

    Most commonly are MACD, RSI, Moving averages, often in combination with trendlines, Channels which form, Support/Resistance, Fibonacci or Elliott Waves, etc.

    It’s up to you what you want to use or go a completely different way in your trading.

    Trends

    Forex strategy

    Often when patterns emerge from the charts it shows a direction to where the price is heading.

    If you see a clear direction you could translate that to yourself as seeing a trend.

    As we talked about previously, we would like to figure out what most other traders would do, and seeing a trend could be useful.

    If you build your strategy, you could make up some rules for yourself to test and see what result that gives you, one of them could be catching those trends.

    The beauty of trying that out on a demo is, it will be virtual money, so even if you lose, no harm is done. But it is very useful while creating a strategy.

    Stick to what works

    While trying out your strategy starting from scratch, you will notice some things work, others don’t.

    Try to figure out what causes losses, and eliminate those reasons by altering your strategy to where that won’t happen again.

    Then go test it again on your demo.

    You decide when you think your strategy is working properly, then you can try to trade real money and go make a profit.

    As soon as you notice it’s not working, stop trading and go back to demo trading, see what caused it to fail, and alter the strategy.

    Rules

    When you look at how others trade, they often have rules. Institutions also have rules which you cannot break if you want to work there.

    The big advantage we have as private traders is that there are no rules at all.

    We can make up our own rules. It’s our money, our strategy, and whatever anyone else says, you can choose what to apply or not.

    The broker you work with could have some rules, but other brokers might not have those rules at all.

    Choosing a broker may be of importance when you want to trade your strategy.

    It really takes some creativity and patience to create your own style, but once you have done that, the rewards will be all yours.

    Mentor

    If you think to yourself, it’s hard to do all that work, can’t I just get a mentor?

    Well, that may be harder than you think.

    Often when people look for a mentor they end up in a strategy that can be incredibly difficult to follow.

    The alternative is to just let some robot trade which is programmed by these “companies”

    Real mentors will learn you how to think for yourself, and if what they have tried and tested makes sense.

    The reason why a mentor is very valuable to you

    …is that you will have to make your own decisions in the future.

    You can’t rely on anyone else to make all the decisions for you, because what would happen to you when that mentor decides to just quit?

    Or what would happen when that mentor starts to charge you $1.000 a month just to follow instructions?

    If that would happen, the information may or may not be that valuable, but you would still have to make more to end up with a profit.

    A good mentor will take you by the hand and walk you through all your questions, pointing out the stones on the road so you can find your way in the dark.

    I once met a man who had sold over a thousand courses for the price of $300.

    So he made over $300.000 just by selling his course and in addition, he lets his students pay an additional $30 a month just to get access to “Hindsight Trading” on YouTube.

    When I talked to him, he did know a lot about indicators, etc. but frankly, I thought he didn’t know what he was talking about as he was guessing just as we would too.

    He’s a great salesman, but that is not a guarantee you will get value for your money.

    In the end, results count and you will be the judge if it is worth your money or go look for another mentor if you would need one in the first place.

    Q&A

    If you like me to cover a specific item regarding trading, just let me know by sending me an email, and I’ll try to clear that up in the coming articles.

    Best Regards,
    Hans Stam

  • The stock market trading for beginners – It Shouldn’t Fright You

    The stock market trading for beginners – It Shouldn’t Fright You

    stock market trading for beginnersIf you’re afraid to start trading stocks, here are some sure ways on how to do that

    By Guy Avtalyon

    The stock market trading for beginners can appear somewhat terrifying. Trust me, I know that.

    Before you begin to trade stocks you need to know the costs. Invest the money you can cover if failed. The tricky part of the stock markets is that you can’t expect any guarantee you will get big returns.

    But there is a big advantage when trading stocks. It gives you an opportunity to preserve your savings in circumstances of rising inflation. If you work smart and catch the experienced traders’ performances, you may have the chance to hit big returns.

    How to start trading stocks?

    As first, you have to pick a broker. That broker must be licensed and regulated. This matter is crucial for all stock market trading beginners.

    The chosen broker will provide you access to its trading platform. For instance, you would like to join the stock market.  You have to know better what are you dealing with. If you want to become friendly with the platform you prefer, the general advice is: begin with small sums of money.

    You are a fresh participant in the arena of online stock market trading.

    You have to read the financial news. That is helpful when it comes to which stock to buy. News is very important for stock market trading for beginners. Also, you can participate in a number of forums. There you can find some advice.

    Truly, you can get a lot of helpful free data in public places for stock market trading for beginners. And study a business you prefer before you stock market trading.

    The reasons to start the stock market trading

    Say, you got some stock. And the time goes by as always. Assume that after several months the price of the stock goes up. So, you may trade your stock, sell them, and earn a profit. Of course, you can wait longer. If you were smart enough and done well research you picked a worthy company and your stock will rise more.

    The stock market trading for beginners is full of chances. But here we come to the importance of news. The value of your stock depends on a large variety of circumstances. As you are a beginner in the stock market trading, you have to know that socioeconomic impacts, geopolitical topics, inflation, and so many others may have an influence on the value of your stock.

    You have to know that all the time, all of them, are acting cooperatively. Sometimes they are operating in reverse courses, but they are working. And all of them may have influenced the price of the stock. That is necessary to know for stock market trading for beginners.

    But possibly the highest influence on stock prices create the people. If there is a crowd that assumes the price is going up, the price will go up. It will take some time to learn how to trade stock but it worth your effort.

    Stock trading strategies for beginners

    When you start a stock trading and you are beginners one central question appears. Which trading strategies for beginners to implement?

    This question isn’t without purpose.

    Some stock trading strategies are very complicated. You should not implement those as the best stock trading strategies for beginners. As a beginner, you should rise with simple strategies. With something smooth and comfortable. This rule fits every novice. It is very important to understand how markets work, so it is highly recommended to follow the trends.

    Following the trend is an excellent strategy for stock trading for beginners. Just set it and open the position in the course of the trends. There are various ways created to identify when a trend begins and finishes. An easy stock trading strategy for beginners has simple rules. Follow trends and you can gain large profits.  But there are also some disadvantages. Actually, large trends develop rarely.

    This strategy can generate losing trades. “The trend is your friend, UNTIL THE END,” said some very smart and experienced once. The end is when the trend sinks.

    It is very important for stock trading strategies for beginners to be executed with risk management. Find more about stock trading and investing in stocks with a little money HERE

    Don’t waste your money!

  • Forex is the area to focus on

    Forex is the area to focus on

    Forex Educational Series – Part 2

    6 min read

    Forex Trading Program - How To Choose The Best

    Trading Forex is the area to focus on

    by Hans Stam, A Forex trader

    The terminology of trading Forex

    When I first started showing interest in trading, I might have been where you are now, so I will go back a long way to put myself in that place again and try to help you.

    The first obvious attempt was going for stock trading and I didn’t have a clue what I was looking at.

    After I had done a course on stock trading I soon got stuck on terminology.

    Also, I figured out very quickly, stock trading was not for me.

    At the end of the course I was getting really good grades, but in real life that didn’t do much for me as I simply did not have the money to buy stocks in masses and get something of real value back. Back then I had to go to the bank and buy stocks, but the commissions were very high and it wasn’t really worth the effort.

    The other problem I had was I did not understand the language traders used, so in my writing, I will try to explain every step so you can follow this series with ease.

    First, I will try to explain trading to you, before going to set up an account and trading platform, as that is a totally different story.

    Options vs Forex

    When I figured out stock trading was not for me simply because I did not have the money, I soon found out about trading options.

    The big plus of trading options was that you didn’t actually buy the stocks, but you bought a contract to buy these stocks at a certain price.

    Think of it as getting an option to buy a house, it simply means the house is being taken off the market for a while because there is a potential buyer.

    Now I was able to trade at leverage. Instead of buying 100.000 shares hoping they would go up to sell them again against a profit, I could buy a contract to buy at current price and keep that option for say 3 months, if the price went up I could still buy these shares at the previous price and make an instant profit.

    Instead of actually buying and selling these stocks or commodities like oil etc. the put and call options that were being traded.

    The contracts were much cheaper than buying the actual stocks or commodities, but the negative to me was that if the stock went against the option, the option was worthless.

    Why would anyone buy a contract that would allow them to buy a stock at a higher price than they could at the current price? If that happened, the money to buy the option was gone.

    So back to Forex. Again, forex trading is being done using leverage. But this time, although you may lose some of your money, it’s always worth something.

    Closing out your position (your trade) will still have some value even if the other currency went down. That’s when I knew, Forex will be the area to focus on. 

    Bull and Bear Market

    You might have seen this before, and you probably have.

    Think of the bull of Wall Street, or the phrase bullish or bearish markets.

    Maybe it seems irrelevant to write about this, but once you are looking at a chart, it’s good to see of the Pairs go up or down.

    When the market is heading upwards, we call that a bullish market. When it’s heading down, it’s called a bearish market.

    The way to see this clearly, think of it like a bull that takes you on his horns and throws you up in the air, as where the claw of a bear crashes you down.

    Explaining Pairs

    Forex is the area to focus on 2

    In our previous example, I used the pair EUR/USD.

    But how about Base and counter currency?

    In this example, it’s simple to understand you can buy the Euro against the Dollar.

    But what if I want to buy the Dollar against the Euro, I don’t see that pair anywhere?

    That’s correct, so instead of buying the Dollar, you will now Sell the Base currency, the Euro.

    That also explains the next bit of terminology, Buying the Euro (EUR/USD) now becomes going LONG, and buying the Dollar now becomes going SHORT on the pair EUR/USD.

    Simply put, Long is buying, and Short is selling the Euro against the Dollar pair (Where in fact you are buying the Dollar as the counter Currency of the pair)

    Analyzing the market

    As you may have read in the previous article, there is a difference between trading and gambling.

    So what makes the difference? And why are traders not agreeing with each other on where prices will go?

    The final judge is the market itself, and sometimes you are right and sometimes you’re wrong.

    To make sure you are more right than wrong, you would want to try to analyze what the market is going to do based upon what other people think.

    Although, there are analyses of the market, even so, if everyone would disagree with the projections and still went another way, the market as the judge would rule that the price would head towards supply and demand.

    Unfortunately, that doesn’t happen often in real life. If you’re interested in reading more about this, Google George Soros and see what he did.

    The majority of traders will try to analyze based upon two different types of analyses, Fundamental or Technical.

    Knowing that other traders have the same information, they will very likely try to figure out what most others decide to do based on the presented information and go along with the flow.

    Fundamental vs Technical in Forex

    Fundamental analyses, in a nutshell, are more or less analyzing where the market will go based upon the news and events that happen around the world.

    It’s possible the influence of these analyses are very high, high enough to even close the markets temporarily. Think of an event like 9-11 or a war for example.

    More common in this type of analyses are reports that are presented publicly like unemployment rates or elections etc.

    Whatever the news is, usually this is affecting the market greatly and prices will go up or down rapidly, sometimes in seconds.

    Once the move happens, you probably are too late already because of the speed, so many will preset orders in case the market goes up or down fast, others will already have the trade open based upon their expectations of what will happen with certain rates like unemployment.

    Technical trading Forex

    …is something completely different.

    When trading based upon technical indicators, many will look for patterns in all kinds of shapes and sizes.

    There are many tools to use, think of moving average price waves based on the last X numbers of price values.
    Others are Elliott waves or Fibonacci for example.

    Also, support and resistance levels are used a lot. When a price is trying to go upwards, it often happens it will try to break a ceiling, bounce back, and have another attempt to breakthrough. Once that happens often, a resistance level is forming. Other traders will see that too, and will most likely trigger a lot of buying orders once that level is broken which is a self-fulfilling prophecy as it will go up because others will buy in that direction which supports the move.

    The support level works the same, the difference here is that it supports the lower side of a move.

    So the difference between Gambling and Trading basically is that you can try to analyze what most traders will do and go along with that direction.

    If you made it this far, you really seem dedicated to learning! Well done!

    When you need mentorship, please contact me by clicking here.

    Is there another way?

    In short, Yes.

    We’ve been over Emotions, we’ve been over Analyses. So basically I need to be a robot?

    No, you don’t, you can be a vibrant human being and still get very good results.

    In fact, it doesn’t have to be difficult at all, but it does require a bit of money to do it right.

    I’ll say it out loud, it will take between $5.000 – $10.000 to get started, so a few hundred doesn’t really get you very far with this option.

    If you want to know more about this option, please contact me here and I’ll set it up for you.

    What is  PIP?

    pip
    For consumers, the best-known decimal is in cents.

    For example, if the rate EUR/USD is 1,12 it means that 1 Euro is worth 1,12 Dollar.

    It would be very difficult to trade on that decimal.

    So in trading, we add a few numbers behind the comma and start trading in PIPs.

    PIP (Price Interest Point) Although some have other versions, it’s the point on the market.

    1 PIP equals 1/100 cent on the dollar.

    Example:

    1.1200 to 1.1300 equals a price change of 100 PIP’s and that equals 1 cen

    1.1200 to 1.1201 equals a price change of 1 PIP…

    But wait, there are more digits when I’m trading?

    Correct…

    When you see 1.12000 to 1.12001 that’s 1/10 PIP So we call that a Pipette.

    Hopefully, this is a simple way to understand how that works.

    Demo Trading

    The best way to start learning is to open an account and start demo trading. You can do that by clicking here.

    Those account with real live numbers are FREE to use, and most will be temporarily but on request, most brokers will extend the trial period.

    It might be overwhelming at first, but the good part is, you can get to learn how it works, and you can see directly if you make or lose money.

    By the time you are ready, you can open a live account, and start trading for real.

    Be aware, going live is really different!

    The main difference is, you can refresh your demo, where on a real account your money is gone when you lose.

    I have seen people trade on a demo and all seemed reasonable, but when they switched to a real account their balance went south.

    The most common difference I noticed was the demos were being traded without much stress in comparison to live-accounts.

    It didn’t really matter if this was about thousands of dollars or a few dollars; the tension was just making traders fail a lot quicker on the live account.

    Most common mistakes were taking profits way too early, and experiencing fear of loss which totally ruined their trades.

    Although some brokers do have their tricks, it’s usually something you can figure out and workaround, but the human factor makes trading more difficult than you may think for most people.

    Many also think it will not affect them until they realize they too are human.

    Artificial Intelligence (A.I.)

    Many of us are aware of Alexa, Siri, and other A.I. which to a lot of us is very intriguing.

    For us Forex Traders this is the future.

    If you want to experience A.I. which checks your trading and gives you advice on where to focus, you can try that out for free by clicking here.

    What you will need is a Free demo account or set up a live-account by clicking here.

    This A.I. does not give you strategies, but it makes you aware of the risks you are taking, and if you are doing well or where you need to improve.

    If you are struggling to get a good score, and need to perfect your strategy, wait until upcoming articles where I will explain how to create a strategy of your own.

    This is not like the trading robots you may have heard about, as I believe you always will have to keep a close eye on your trading instead of letting whatever robot take your decision from you because to a robot it doesn’t matter if it is blowing your money away or not. And of course, we don’t want that to happen.

    We will go through more valuable information coming very soon!

    Hopefully, you appreciate the value offered to you on this website, stay tuned!

    Best Regards,

    Hans Stam

    risk disclosure

  • Tesla shares drop but it could a 50% grow within a month

    Tesla shares drop but it could a 50% grow within a month

    3 min read

    Tesla shares were higher 2%, floating around the $200 mark on Thursday.

    The day before, Tesla CEO Elon Musk had sent an email to employees, saying that Tesla could gain a new delivery record and had above 50,000 net new orders for the next quarter.

    “Based on current trends, we have a good chance of exceeding the record 90,700 deliveries of Q4 last year and making this the highest deliveries/sales quarter in Tesla history!” Musk wrote in the mentioned email.

    Tesla last report for the first-quarter was disappointing for Wall Street.

    The company missed Wall Street expectations.

    And the worries about Tesla short term arose immediately.

    Tesla last month announced first-quarter deliveries missed Wall Street expectations. The worries about the company’s short term bloomed.

    The consequence was, some Wall Street experts have decreased their expectations for the company.

    They expressed their concern, frequently focusing on sale worries and liquidity. The negative criticism arose.

    Tesla shares have dropped 30% in the past 12 months and 42% this year.

    The big turn over of Tesla’s shares

    Shares of the electric-car maker drop at $190. It is for the first time in two years.

    Tesla shares grew but it could a 50% drop within a monthImage source: Yahoo Finance

    The company got thrashed by a range of negative analyst predictions.

    Also, Elon Musk warned the stuff the “hardcore” cost cuts are necessary because the company would be out of cash in 10 months if not doing so.

    For analysts, the bad sign was recently price cut on its cars. The demand is lower and there are so many reasons for experts concerns.

    But still, some of the analysts claim that Wall Street is “misunderstanding the Tesla story”.

    Musk’s successes are internationally recognized. Also, it isn’t a secret that he put himself and Tesla into trouble. All because of a tweet on August where Musk claimed there is a possibility to the company to be taken private with “funding secured”. That caused problems with the government.

    According to Yahoo Finance, an analyst for a firm “with a major investment in Tesla said Friday that recent drastic price-target cuts on the stock by others on Wall Street are missing the big picture.”

    That firm is Ark Invest. Last year its founder forecasted on CNBC that Tesla could score $4,000 per share. They still stand by that call, even now when Tesla’s stock lost almost 40% of its value.

    To buy or to sell Tesla shares?

    Tasha Keeney, Ark analyst, stated Ark hold so firmly in Tesla that its five-year, bear-case scenario is $560 per share.

    That would be almost triple the value of the price where the stock closed, at $195.

    Also, the fact is the company raised $2.7 billion. The first quarter was finished with $2.2 billion in cash.

    So, bankruptcy appears very doubtful. Almost impossible. The opinion that Tesla will easily run out of money in the next period and close its complete business looks a bit absurd.

    The company could raise more capital as Musk already showed they are able to do so.

    Also, they could change its business model and sell battery packs to some other carmakers. Or something else, Elon Musk is able to do very unexpectable things to maintain Tesla and exits as a winner.

    Tesla could also sell more stock and convertible debt. The last has a lower interest rate than regular loans. Tesla recently raised a convertible debt with an interest rate of 2%. So, who says they cannot do it again?

    Tesla is a global leader in two businesses: cars and renewable energy.

    Tesla has a really great opportunity in the sector of electric cars. Especially in China, for example.  

    Its stock could easily produce a return of more than 100% in the future.

    Okay, there was some disturbing situation with their autopilot when one man was killed in a traffic accident while using autopilot. He simply and sadly hit the truck. But the company announced that their new cars have the hardware for full self-driving abilities and the software is ready.

    Tesla can meet its near-term production goals, that is for sure. It can manage the cash crisis. So it is more realistic to expect it will have a good future. This brand is not going to easily disappear.

    Yes, its CEO Elon Musk can be questionable but at the same time, no one can say he isn’t a very capable man. Controversial but capable.

    So, Tesla stock can be attractive for risk-tolerant investors.

    risk disclosure

  • Forex – What is it – The Differences and Similarities With Other Tradings

    Forex – What is it – The Differences and Similarities With Other Tradings

    Forex Educational Series

    Trading Forex is the area to focus on

    by Hans Stam  

    Forex trading

    As a Forex Trader, I would like to create a series of short explanations about how this market works. What are the pros and cons etc?  

    My aim is to make this as clear as possible, so you can follow the process step by step.

    What is Forex?

    Forex (FX) is the abbreviation for Foreign Exchange.

    When you travel to another country, you may want to exchange your local currency to the currency of the country you’re traveling to.

    At the bank or airport, you can exchange your money into the currency used in the country you are heading.

    The exchange office works with an exchange rate, depending on the current value of both currencies of a “pair”.

    A Pair is, for example, a euro against a US dollar which would be the EUR/USD pair, where the EUR is the base currency, and the USD the quote or counter currency.

    EUR/USD – Base / Counter

    At the end of your trip, you like to exchange the remaining funds again, back to your currency.

    Again, the exchange rate can be changed as it is constantly changing.

    So it could be very possible that you will get more value back compared to when you first exchanged it, or a lot less value.

    The excitement of Forex trading

    This exchange can make or lose you money, and that is very interesting to investors, especially the part where the trader can make money of course.

    Just like stocks, currency can be traded on the Market, and you don’t have to go to an exchange office to do it.

    So what makes Forex different from trading stocks?

    First of all, you don’t have to find a buyer for the trade you are holding, you can close the trade any time you want and instantly get the current value credited back to your trading account.

    The second main difference is, leverage!

    For instance, the broker gives the trader a 1:100 Ratio with your broker, which means you can trade 100 times the value you pay for.

    An example would be trading the Pair EUR/USD and you would buy 10.000 Euro’s, the broker will then take 100 Euro’s locked in your account while you trade the exchange rate over 10.000 euro.

    It’s easy to understand you can make far more profit over 10.000 euro, than over 100 euro.

    When the market goes your way

    Now, when the market goes your way, and close the trade to take the profit, you get the initial 100 euro credited back into your account. So all that happened was that you win or lose the price difference from where you entered the trade to where you closed the trade over 10.000 euro.

    It’s logical that when you take profits over 10.000, you make a high percentage on 100 initial deposit.

    This goes both ways, so it can be risky, but the rewards can also be a very nice ROI (Return on Investment)

    If you like to find out more about how you can enter this market, please visit my page.

    Can you really make a living trading the Forex Market?

    That is a question I’m getting a lot, so I will try to give some clarity.

    The exact percentage of the people who really make a consistent profit is low.

    Some speak of a top 5% and that is going as low as a top 1%.

    What most traders will agree on is that the number is low whatever that percentage might be.

    So how come many people are still trading this market and how come so many are struggling?

    The first answer on to why so many people still have an attraction to this market is that it’s possible to make a lot of money really quick, on the other hand, they can lose it just as fast.

    But in the end it is very simple, you either are right in the direction your trade will go, or not.

    I will elaborate in later articles some more about market directions, but this is the basis of all trading.

    The trader buys or sells at a specific price, hoping the counter currency will have a positive price change for their trade.

    Forex isn’t the same as gambling

    Some traders are hooked on the possibility of great profits, and you could compare it to Las Vegas Casinos, and it can be very addictive.

    So that it the why people keep on trying, it’s like gold fever or putting your money on Black or Red in a Casino.

    Second, why are so many people struggling with this fairly simple way of trading?

    The biggest reasons are emotions and lack of knowledge which basically makes it like gambling.

    The lack of knowledge speaks for itself, but how about emotions?

    Many struggling traders have fear of loss and get excited too quickly when they are winning.

    It’s usually when people are doubting a strategy they bought or came up with themselves and experience fear of losing.

    When they see the trade going against them, they let the trade go really deep, but when the trade finally goes their way, they can’t wait to take the profit and have that excitement produce an adrenaline kick.

    The strategies can be altered

    Often strategies are altered, without really knowing why, but if they had that strategy a bit different on the last trade, then their loss would have been profitable in their mind, forgetting the trade would probably have been closed well before it matured.

    Hindsight trading has been used a lot with this type of trader, and that doesn’t count.

    The top percentage of the traders who make a consistent profit have learned to do things differently, and it would be wise for traders to have a mentor who knows where the pitfalls are.

    Also, it is typical for this kind of gambling trader to put in a few hundred dollars, while in reality, the minimum should be at least $5.000 just to have a buffer.

    Once a trade goes against the direction desired, it will need some breathing space. The bigger the buffer, the longer you can keep the trade open.

    Fact is, you will not lose a trade until you take the loss, or when you run out of margin. So part of that is a decision, the other part financial.

    If you like to find out more about strategies or have specific questions, please visit my page.

    I hope this short explanation has your peaked interest, and it is clear to you how the basics work.

    In the next article, I will go deeper into some facets of trading the FX Market and its terminology.

    Make sure to bookmark this page, and come back to read more soon.

  • Tesla’s stock hit a new 52-week low

    Tesla’s stock hit a new 52-week low

    2 min read

    Tesla's stock hit a new 52-week low 1

    Tesla’s stock has fallen another 6% yesterday. It is now down 40% in comparison with last year, according to CCN.

    Tesla’s stock is falling more and more every day and Wall Street predicts a total disaster.

    Tesla's stock hit a new 52-week lowImage source: Yahoo Finance

    At the same time, Tesla’s car price is falling down too.  

    The company announced that it is going to lower prices on older model S and X cars. Merrill Lynch announced that selling on those models is lower than ever.

    Critics have the opinion that Tesla’s stock has always been a bet for naive traders.

    Morgan Stanley reduced its lowest-case scenario price target to $10:

    “Our revised bear case assumes Tesla misses our current Chinese volume forecast by roughly half to account for the highly volatile trade situation in the region, particularly around areas of technology, which we believe run a high and increasing risk of government/regulatory attention.”

    The Tesla golden era is likely over

    Tesla’s stock had confronted pressure for a long time. It had problems with the installations of its car. It had delays and deficits of components. But Tesla and Elon Musk somehow managed to cover all of these problems.

    The company had to report a huge loss of $702 million in the first quarter this year, just a few weeks ago. The consequences were they had to draw extra funding. This loss was caused by a decrease of 30% in selling cars.

    Also, their tax credit of $7,500 was cut in half meaning the government subsidies are lower. That’s really the bad position for the company and Elon Musk itself.

    Tesla rivals are more powerful than ever

    For example, BMW progress the development of their own electric cars.

    Tesla shares continued the slump falling 6% to close at $192,73.

    Citigroup analyst Itay Michaeli lowered the price target on the clean-energy carmaker’s plans by nearly 20% to $191 per share.

    Michaeli stated the company’s recent capital growth of $2.7 billion provides the balance sheet defense against a 2019 downturn.

    “The recent capital raise was a positive step but won’t necessarily get the balance sheet out of the woods if Tesla cannot achieve FCF targets,” Michaeli formulated.

    But, at the same time, he said the company has to solve its serious cash spending rate.

    Tesla and Elon Musk tried to guarantee the investors their investments are safe. They claimed the company developed a new driving automation system and self-driving vehicles which should increase the safety. Obviously, the investors have no trust as the consumers don’t have.

    Tesla’s claims are not supported by the data, they look more just hollow promises.

    Musk tries to avoid criticism and keep a good status, it is obvious.

    But it looks the Teflon chief position doesn’t belong to him anymore since his reputation likely not stays intact.

    Moreover, he and Tesla seem will have more problems in the future.

    With competition and investors both.

    Elon Musk was putting all of Tesla’s difficulties under the rug.

    Declarations on how Tesla should be prized as a tech stock and not as a business with unlimited problems fall into the water.

    Banks warned to a Tesla’s disaster

    Bank of America Merrill Lynch and Citi analysts each declared critical statements evaluating the stock’s recent pull-backs by investors. They both concluded it is a sign that should concern.

    Their analysis is based on intense selling pressure, with shares falling 16% during the past week.

    And also, there is a leaked email from Elon Musk that refers to employee expenses.

    All of this was very important for BAML and Citi.

    “With fundamentals deteriorating, specifically deliveries/production that are starting to stall as well as losses/cash burn that are not turning a corner on a sustainable basis, some of these optimists now appear to be taking a much more pessimistic stance, with the stock breaking down in recent days,” BAML analysts headed by John Murphy addressed to clients on Wednesday.

    The analysts told the current tension on the stock seems to be inspired by “shorts pressing aggressively, as the stock (and story, to some extent) was already breaking down.”

    risk disclosure

  • Huawei is Riding Again in the US market

    Huawei is Riding Again in the US market

    2 min read

    After The White House Has Fired Shots, Commerce Department Seemingly Walks Back On It

    On May 15 after the US President has signed the executive order declaring a national emergency and giving to the US Commerce Department power to create a blacklist for foreign companies which are barred from procuring the US-made products and selling their products in the US.

    On May 20 the Commerce Department has issued a special 90-days authorization for Huawei.

    After the US has blacklisted Huawei and another 68 Chinese companies from purchasing the US made products and services stock markets around the world had their say. This latest “broadside” in the US-China trade war has sent shockwave around the globe which caused stocks of many involved companies to the tank.

    Alphabet, owner of software giant Google; Qualcomm, mobile chip maker; Micron Technology, NAND memory chip producer; Huawei, mobile phones and telecommunication equipment manufacturer; are some of the largest companies whose stock prices were impacted.

    In the unexpected move on May 20, the US Commerce Department has issued a special dispensation in the form of a general license which will allow Huawei to continue purchasing the US made goods and services.

    The special general license has a 90-day period and will be reviewed before August 19.

    The talk on the street was dominated by security concerns for customers who have already purchased Huawei phones. With Google confirming that it will not continue providing its services to Huawei, this concern seemed founded in facts.

    With these new developments, there are indications that Google has reversed their decision, or at least stayed it for the next 90 days. For Huawei’s customers, which are not only smartphone owners, it means that Huawei will be able to receive security updates and advisories from Google and distribute them to their customers until August 19.

    But that is just half of the story about Huawei and US 

    Huawei is striving to become the largest smartphone maker by the year 2020, and currently the largest telecommunication equipment maker in the world, which describe itself as the “unparalleled leader in 5G”.

    The US has already attempted to pressure its allies to stop using Chinese made telecommunication equipment in their infrastructures. In a statement a Huawei spokesperson said that imposed restrictions “will only serve to limit the US to inferior yet more expensive alternatives, leaving the US lagging behind in 5G deployment, and eventually harming the interests of US companies and consumers.”

    And these words are not without merit, as many American rural internets and phone operators rely on affordable Chinese made equipment to provide their services in their markets. Replacement of which could have a large economic impact and take several years according to the January filling to FCC by the Rural Wireless Association, an association of small communication and internet providers.

    “The Temporary General License grants operators time to make other arrangements and the Department space to determine the appropriate long term measures for Americans and foreign telecommunications providers that currently rely on Huawei equipment for critical services,” Secretary of Commerce Wilbur Ross said in a statement.

    The US underestimating Huawei

    In one of the rare interviews for Chinese media on May 21, the Huawei founder, Ren Zhengfei has said that the US is underestimating his company.

    “Huawei’s 5G will absolutely not be affected. In terms of 5G technologies, others won’t be able to catch up with Huawei in two or three years. We have sacrificed ourselves and our families for our ideal, to stand on top of the world. To reach this ideal, sooner or later there will be a conflict with the US.”

    With the development of this situation reminiscent of the last year’s ban on ZTE equipment, Ren’s defiant words sound like a promise to not cave in the way their competitor did.

    While the unilateral decision of the US to ease the trade limits indicates awareness of how far-reaching consequences these bans can have, and desire to avoid the repeat of fiasco caused in Europe and South Asia last year.

    risk disclosure

  • Huawei is banned from the US market

    Huawei is banned from the US market

    3 min read

    Huawei is banned from the US market

    Huawei is banned. Last week the global markets dropped as trade pressures promptly increased between the U.S. and China.

    There is an expectation that the trade communications between the US and China will be settled positively. But putting on the blacklist Huawei by the US could indicate even extra market volatility advance.

    Wall Street shares have closed lower.

    The Dow Jones Industrial Average fell 0.33% to 25,679.76, the S&P 500 lost 0.68% to 2,840.09 and the Nasdaq Composite dropped 1.46% to 7,702.38.

    Thanks to Huawei ban, the tech stocks dropping, beginning another week of losses.

    Broadcom and Qualcomm, which gets at least half their income from China, stocks dropped Monday. They are big Huawei’s suppliers.

    The same was with  Micron Technology and Xilinx.

    The U.S. choice to ban technology sales to Huawei caused the tech companies stock losses. Investors are disturbed the move against Huawei could decrease selling for companies, particularly chipmakers. Their income is extremely attached to China.

    Amazon, Nike, and Starbucks are hit too. Their stocks dropped yesterday.

    But T-Mobile and Sprint are between the few businesses to make profits. Those two companies are expecting the merger worth $26,5 billion.

    The investors moved to less-risky holdings.

    For example, utilities and energy are the sectors where you can see gains.

    It is so natural because the investors typically in circumstances like this, want to invest their money into the safer field.

    Chipmakers have sunk because of U.S. ban on technology sales to Huawei.

    The U.S. government states that Chinese suppliers, meaning Huawei and its rival, ZTE Corp., are an espionage peril.

    The reason behind is they are indebted to China’s ruling Communist Party.

    And Google bans Huawei phones, strengthening U.S. consumers’ dependence on Apple and Samsung.

    But what will happen with users?

    Google confirmed that it had canceled Huawei’s Android license, as Reuters reported. Huawei devices 002502, +2.20%  will only be able to use an open-source version of the Android platform.

    Access to Google services such as Gmail and YouTube and Google Play app store for third-party apps are restricting.

    Google did this to comply with a Trump administration policy.

    Trump’s administration policy requires federal-government approval for all purchases made by Huawei.
    Also for affiliated businesses of U.S.-made microchips, software, and other parts.

    Government officials became suspicious of Huawei. They worry that the Chinese government could use the phones to spy on US citizens.

    “For users of our services, Google Play and the security protections from Google Play Protect will continue to function on existing Huawei devices,” said a Google spokesperson.

    But the U.S.users could stay with fewer smartphone options.

    Apple and Samsung rule the smartphone market in the U.S. The two companies control approximately 80% of the mobile market, according to data from GlobalStats.

    Huawei tried to break the U.S. market. According to GlobalStats, the company’s market share in the US is less than 1%. And Huawei had retreated from the U.S. market in expectation of a confrontation with the US government.

    For example, Huawei doesn’t sell its leading Mate 20 models directly in the U.S., but the phones are accessible from third-party retailers.

    Market will recover

    Despite the new blast of market volatility,  Edward Yardeni marks a return to all-time highs this year.

    He believes U.S. multinational companies, which are endangered to the trade war, will eventually provide the market increase.

    “I think it moves higher partly because there’s a recognition that even companies that do business with China are going to find ways to deal with this escalating trade tension like moving some of their supply chains to other countries,” said the Yardeni Research president Friday for CNBC.

    The last UPDATE Huawei is Riding Again in the US market

    Risk Disclosure

  • How to invest in a mutual fund

    How to invest in a mutual fund

    4 min read

    How to invest in a mutual fund

    To invest in a mutual fund, you can buy into a mutual fund through a mutual fund company, bank, or brokerage firm (similar to stocks).

    Typically, funds are either equity funds (investment in stocks), fixed income funds (investment in bonds), or money markets (kind of like cash).

    You will have to consider what is the minimum threshold for investing in the mutual fund. Because different funds have different investment minimums.

    Also, you will have to decide if you want to invest in a load or no-load fund.

    This means you will either be paying commission or not. But regardless of if you invest in a load or no-load fund, you’ll still be paying some fees. So, you have to factor that in when deciding.

    And, it is really simple to invest in a mutual fund.

    You simply determine the amount of money you’d like to invest in a mutual fund over the phone, online, or in person. There are so many options today.

    Online brokers generally often offer more diverse selections. However, you will have to open an individual retirement account.

    There are several expenses to account for. Like, transaction fees accumulated when investing in a mutual fund, early redemption fees if you wish to sell a fund in the first 60 to 90 days, and expense ratios that are a percentage of your investment.

    You can make money off of your mutual fund by selling it for more than you paid for it. Or through a variety of distributions like dividends or interest that can be paid out throughout your investment. However, most mutual funds will reinvest dividends for you unless you specify otherwise.

    Can money invested in mutual funds be lost?

    We will try to keep it simple. If you have invested only in mutual funds, theoretically the money can be lost.

    Reasonably – it depends.

    Well, investments are time unstable. So, at some period, your portfolio can hit the loss.

    But over the long period in time, the odds of losing your money are close to null.

    Yes, there might be accidents like some major market breakdown which could destroy your collected profits notably. But, in most cases, it is for a short time and markets would recover and your investment too.

    Let us explain.

    During the 2008 financial crisis, the fall in stock prices led to near 50% decline in the portfolio value of many people nearly throughout the world. Many people had panicked because this was a huge story. But, inside a one year, the portfolio value jumped back to its 100%. So, if some investor was really holding till today, it would be extra up 50–60% at least. In short, the possibilities of losing in the long-term are very small when investing in mutual funds.

    Take a look at this chart:

    Why Mutual fund is opportunity 

    Let’s do some math.

    You invested $100 and holding it for 10 years earning 15% CAGR = $404.5.
    You remember from the previous lessons: CAGR is the compound annual growth rate (CAGR).

    Some breakdown in the 11th year decreased prices by half – $202. But, this is still a return of 7.3%.

    The risk, if you are forced to sell here is not reaching your financial intentions and considerably it will influence your habits if you are retired.

    But what we can learn from the history of the present business world? The value of assets has jumped back to healthy from the critical after the great depressions.

    One note more. Instead of focusing on the systematic investment plan (SIP) a better choice is a focus on the systematic withdrawal plan (SWP). That’s the point where you begin to take out your money from risky assets. You are close to your goal and place in secured assets.

    So, the chances of not reaching your financial aims are reduced.

    The note: Mutual fund investments are subject to market risk.

    You have to keep this in your mind forever when investing in mutual funds. There are no investments without some risk associated with it.

    Missing or getting the money depends completely on the investment period an investor picks.

    We will show you how it looks in one more chart. We aimed out the period of big crisis 2008, in the red circle.

    Why Mutual fund is opportunity  1

    For example, you invest $1,000 for a day or two. If the stock market slips the preceding day, the value of your $1,000 will surely not appreciate.

    Also, if you invest the same amount for a week and the market is in a downtrend throughout that week, the invested money will not yield any profit.

    If you choose to stay invested for a year or more than that, though there is no guarantee, there is a possibility that your $1,000 may go up as a long-term investment horizon is always likely to give better results.

    In other words, you won’t lose all your money.

    Money can be lost mostly due to wrong timing.

    When the market is bullish, people invest aggressively. When the market corrects, people get scared and they take out money when the market is down or sideways.

    Say, investing in stocks through mutual fund route is a safer way to putting in money in the ever-volatile stock market. In a mutual fund, your investments are managed by professionals, who ensure the protection of your capital.

    Past trends have shown that usually mutual funds are profitable giving an average return of around 10-12%.

    Mutual fund investments become even safer and convenient if done via SIP (Systematic Investment Plan) route. SIP is a type of investment set up whereby rather than putting in a lump sum, you put in small amounts of money either in monthly, quarterly or annual installments. This, in turn, enables the fund to benefit from the power of compounding and also isn’t too much of a burden on the investor.

    risk disclosure