Tag: investing

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Dow Jones Dropped More Than 300 Points, But Two Stocks Hold Gains

3 min read

The Dow Jones dropped more than 300 points after frustrating economic data stopped an early rally in the stock market on Tuesday. The stock market rally experienced a strong reversal. The rally appeared under more pressure as worsening U.S. manufacturing index activity renewed recession fears. JPMorgan Chase (JPM) dropped below a buy point, as Treasury yields declined.

The Institute for Supply Management’s manufacturing index declined to its lowest level previously seen in June 2009.

The Dow Jones Industrial Average (DJINDICES:^DJI) and the S&P 500 (SNPINDEX:^GSPC) both lost more than 1%. All sectors declined, but industrial stocks were damaged the most.
But some of the Dow Jones Index stocks made the largest gains, Apple (AAPL) and Visa (V). Apple stocks rose for 0,5% and Visa increased by 1,4%. Visa has been consolidating below the 50-day line the past three weeks after pulling back from a 184.17 buy point of a flat base.

Apple scored a new high early and gained as the market reversed. It regained a 221.47 buy point of a flat base and continues in buy range from the entry. The market uptrend is under pressure, so you must be aware that all trading is riskier now.

According to investors.com “investment banks, machinery, and telecom stocks led the downside among IBD’s 197 industry groups.” On the other side, long-term medical care, gold miners and food, and beverages were between the several groups resisting the decline.
Hexcel (HXL) fell 6% to a two-month low, retailer Boot Barn Holdings (BOOT) sank 5% in below-average volume.
Israeli medical technology company InMode (INMD) and Visa were some of the few IBD 50 stock winners with increases of 1% or more.

The point is that just one strong market session could upgrade the whole picture, but if another large sell-off occurs could freeze the stock market rally.

China trade discussions will continue next week, but there are possible risks for the weak stock market rally. Investors have been hoping for a China trade suspension of hostilities. That was the reason why the market wasn’t down on Monday.

The added uncertainty to the markets is the Trump impeachment inquiry. For now, it doesn’t make to much damage to the US stock market but investors may become more nervous because of all of that.

Is this a scary start to October?

Markets are already in bubble territory. Dow, S&P experienced the worst day in more than 5 weeks after gloomy US manufacturing report. Manufacturers quoted the US-China trade war as pressing on demand and making materials more expensive, according to the ISM.

“The disappointing data is only fanning long-standing fears of slowing global growth,” said Alec Young, managing director of global markets research at FTSE Russell.

Stocks didn’t like this data pretty much.

Investors came into Tuesday’s session, with increased emotion around the U.S.- China trade relationships hoping that it will come to an end soon.

But stocks dropped after the Institute for Supply Management (ISM) stated U.S. manufacturing activity dropped last month to its lowest level in a decade. The U.S.-China trade concerns caused that. The weak manufacturing data come from Europe too. All of that forced investors to sell equities and bought bonds.
The market recognized the ISM report as a warning the trade war is taking increasing damage to the economy.

What is next?

Yes, Dow Jones dropped but investors are waiting for data from ADP and Moody’s Analytics. They are planned for release on Friday. For investors, it is a kind of preview to the government’s monthly job report. So, we will see.

2nd October 2019
Preferred Stock Advantages Explained

Take advantage of owning these stocks, they are paying guaranteed dividends, but the owner doesn’t have the voting rights

By Guy Avtalyon

Preferred stock signifies an ownership stake in some companies. It is like a share of common stock but less volatile.
But there are more advantages to hold preferred stocks. For example, they are prioritized when it comes to dividends or bankruptcy. But by owning this stock you will not have the same voting rights as owner of common stock. Actually, you will not have them.

Preferred stock is similar to bonds. See, with preferred shares, you will have a fixed dividend in continuity. And you can easily calculate the dividend yield. All you have to do is to divide an amount of dividend in the currency by the current price of the stock. Yield is the effective interest rate you earn when you buy a share of the preferred stock.

Let’s do some math.

Assume a preferred stock has an annual dividend of $6 per share and is trading at $120 per share. So, the yield is $6 divided by $120 which is 0.05. Multiply by 100 to turn to the percentage. The yield is 5%.

6/120 = 0.05

0.05 x 100 = 5

This is regularly based on the standard value ere a preferred stock is sold. It’s generally determined as a percentage of the current market price after the trade starts. This is a difference from a common stock. Common stock has variable dividends that are published by the board of directors and it is never guaranteed. Moreover, a lot of companies don’t pay out to common stocks.

The added difference is that this kind of stock has a par value. It is in correlation with the interest rate. If the interest rate increases, the value of preferred stock drops. Also, when the interest rate decreases, the value of this stock will grow. You will not find a similar situation with common stock since its value is determined by supply and demand in the market.

Why buy preferred stock?

Investors frequently buy preferred stock for the income the dividends give. The dividends for them are higher than those issued for common stock. And the other benefit is notable. If the company has to miss out on a dividend it collects, it still must pay preferred stock dividends before any common stock dividends come to the schedule. That is why they carry less risk than common stock. Preferred stock owners must be paid before common stockholders if the company failed or in case of bankruptcy.

When evaluating the investment potential of preferred stock, it is most important to compare the dividend yield to the yields of the company’s bonds. You will find that preferred stocks often work similarly to bonds.
Preferred stock is a good choice for investors who don’t want to take a big risk. Moreover, it is less volatile than common stock and provides a better flow of dividends.

How to buy preferred stock?

The process is the same as you buy any stock. You can use a broker’s service, doesn’t really matter if it is a discount broker or full-service broker. The main point is that the company has to be publicly-traded, of course. But before you start finding a preferred stock to buy, you must know why should you do that. Why don’t you buy that company’s common stock?
When buying common stock, you’re actually buying a part of ownership in the company. You’ll have voting right as one of the co-owners. On the other hand, if you buy a preferred stock you’ll almost never get voting right.

They have regular dividends payments

When you buy preferred stock, you’ll get regular dividends payments. That is opposite from the owner of common stock that doesn’t have guaranteed dividends. Even a case that the company stops to pay dividends, your unpaid dividends are still yours and once, when the company decides to continue these payments, you’ll receive them.
The other advantage of buying preferred stocks is that your investment will be repaid in full even if the company goes bankrupt.
The owner of common stocks will get nothing instead.

One thing more is present here.

Those stocks give more options to investors. Let’s explain this. Numerous preferred shares are callable. This means the issuer can purchase them at any time. Investors have a true chance for these shares to be called back at a redemption rate. It can be a notable bonus over their purchase price. The market for preferred shares usually assumes callbacks and prices may be bid up respectively.

And we must point out one disadvantage again. Its shareholders regularly do not have voting rights as the owners of common stock. It may be a problem for some investors.

30th September 2019
Trade War Spillover In The Stock Markets

3 min read

The U.S. Treasury announced in a Saturday statement that the administration “is not contemplating blocking Chinese companies from listing shares on U.S. stock exchanges at this time.” Following this news, Dow Jones futures grew a bit on Sunday evening, the same happened with S&P 500 futures and Nasdaq futures.

Only one day before, Bloomberg reported the Trump administration is thinking about limiting the exposure of US investment to China. Such a decision would have an impact on public pension funds’ exposure to China’s market and limitation for Chinese companies in main stock indexes.

The information about delisting Chinese stocks from U.S. exchanges frightened investors. The consequences of the trade war spillover were that Alibaba stock dropped 5.1%, slipping through its 50-day and 200-day moving averages. JD.com stock dropped 6% to a bit over its 200-day. Two Chinese IPOs, Pinduoduo slipped 4.2% and Huya stock 9.4% due to trade war spillover. New Oriental Education stock, dropped 6.55%, which is under its 50-day line.

Beijing described possible limitations on U.S. investments in China “the latest attempt at a decoupling,” published in Global Times on Sunday. All reports of Chinese state-owned media stated that the delisting Chinese companies from US stock exchanges would have deep impact on both, Chinese and US economies.

Don’t miss this: Trading With Success – A FULL guide for beginners

Monica Crowley’s, U.S. Treasury assistant secretary for public affairs, stated this weekend that US administration is not thinking to block Chinese companies: “We welcome investment in the United States.”

The trade war between the US and China lasts almost one year. The next round of discussions will be held one week after China’s National Holiday, 70th anniversary of the founding of the People’s Republic of China on October 1.

The Chinese economy is the second-largest in the world. Its progress in the field of artificial intelligence and chips is notable. Also, robotics, 5G, energy storage could lead China to be the most powerful in advanced technologies.

What to watch in the stock market in the week ahead?

The next few days will produce some earnings releases, which could give some individual stocks moving.

Costco

Market Cap $125.758B

Its earnings report appear this week. It looks that Costco had benefit throughout the quarter. The analysts estimated they have earnings of around $2.54 per share. Last year it was $2.36. So, the expectations are a 7.6% increase.

Costco will reveal its results on Thursday. The investors are expecting to see good news. This warehouse retailing giant has enjoyed a nice increase in customer traffic lately. In the fiscal fourth quarter, it grew 6% in the U.S. market and over its global sales.

Stitch Fix

Market Cap $1.85B

This company’s earnings release will be revealed on October 1.

Its stock has dropped more than half of its value during the past 12 months. But this online service that gives clothing services has built solid annual income growth in the past 3 years.

Client numbers rose 16.6% in the fiscal third quarter. This is, of course, assuming Stitch Fix keeps its pricing in check. The analysts estimate is calling for $0.04 per share this week. Good news for shareholders.

Constellation Brands

Market Cap $39.511B

The company’s earnings release will be public on October 3.

The company has succeeded to keep a very constant sales trend within an alcohol industry. In the last 5 years, Constellation Brands has grown its earnings from sales. Its investment in Canopy Growth was a weak move since the Canopy didn’t show some good results this year. But the company’s beer segment may show better condition. For now, that is the best part of Constellation Brands’ business.

30th September 2019
How to Identify Market Trends

6 min read

By Guy Avtalyon

Being able to identify stock market trends is a crucial part of your investments and trading. How many times have you heard that the market is trending? Numerous. But did you have the ability to recognize the signs before the market move in some direction?

So, when we say the market is trending we are talking about market moving in one of two directions. When the market is moving up it is Bullish, but when it moves down it is a Bearish trend. There is some misunderstanding toward trends. Let’s say this way, never fight against market trends. That will take you to losses. Rather catch the flow to manage your risk-reward.

It is so important to have ways to identify market trends. Markets can also move within a ‘range’, and they don’t need to be recognized as Bullish or Bearish, rather they are falling sideways. So, you can see we have three possible market directions. Ability to recognize when a market is probably moving out of a trend will also help you.

Assume you are trading while the market is in a Bullish trend. So your focus would be on buying the position. But suddenly the market starts to change and your edge disappears.

It is absolutely scary when you are looking at those changes at your charts. But there are several things that will provide you to know how to identify market trends.

First, let’s make clear what the trends are you looking at.

This is very important. You have to determine the time frame you are looking at. Why is this so important? Assume you are looking at a daily time frame and the market is in a bullish trend. Suddenly, the market moves up. Where is the problem? Your 10 minutes chart shows the bearish trend! Yes, but you must have a bigger picture. The market may be in bullish trend the whole day but in those 10 minutes, it is bearish because it is falling.

That is the nature of markets. They will never go only up or only down.

That’s why the timeframe you are looking at is very important. Just like in sport. Your favorite basketball team is in permanent progress to the top of the table. In the market, it is a bullish trend. But suddenly, your team has a match against some outsider and they lost the game (which usually happen to my favorite team). That is a bearish trend in the market.
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How to Identify Market Trends

Identifying the trend is essential. But you have to be able to associate that trend with your trading. For example, you recognize a market as bullish on the daily timeframe. What is the possible move? Just wait until it comes back within support levels that you expected to be the span where the buyers will continue the trend. Than start to look at the 1-hour timeframe to buy positions. That is how you may adjust your trades with the market trend.

You can identify market trends by applying different kinds of technical analysis. You can use trendlines and technical indicators. But trendlines are the most effective method of verifying that a trend breathes.

Identifying the trends will help you to avoid wrong buy/sell signals. One thing is important to know, the trending indicator will operate better in trending markets, while oscillators are better in sideways trends. Which one to use may define your success rate.

Recognizing Trends

The trends are an overall direction that a particular financial market is moving. To analyze trend you have to use technical analysis to determine direction. Just connect by using trendline all the highs and lows in your charts.

So, let’s see what kind of trends we have:

Uptrend

The uptrend is when you can inline low points sloping upward. The main characteristic of uptrend is higher highs and higher lows.

Downtrend

Connect a series of chart high points sloping downward, and you will have a downtrend. A downtrend is always defined by lower highs and lower lows.

These graphs are simple images in order to have a clear picture. Trendline should be drawn on the candlestick chart. But in any case, to be able to start a trend line you will need at least two points in the market. You may draw the trendline only when the second swing high or low is identified.

Speaking about the candlestick chart, you will see that the majority of trend lines overlap the high or low of a candle. The point is to get the maximum touches without cutting the body of a candle. If the trend line cut the body of a candle you may be sure it is a violation.

Identifying Market Trends

Draw triangles on market swings.

We already mentioned the market swing points. I am free to say that probably the most obvious way to identify a market trend is to follow them. You can do it by drawing triangles.

We already know that higher highs and higher lows relate to a Bullish trend and lower highs and lower to a Bearish trend. By drawing triangles over important market swings you will spot when this is occurring. This helps also to inform you when the market

It will also keep you alert to when the market finish trending and moves into a range, or the trend goes reverses.

Also, you may use the Bill Williams fractals indicator.

It is an excellent tool to identify market trends. This indicator is helpful to spot the market swings. When the arrows are upward that is the high of the swing, when the arrows pointing downwards it is low of swing.

Upward pointing arrows indicate the high of a swing, downward pointing arrows indicate the low of a swing. This is a simple tool that will show you if the market is in a trend. Moreover in what direction, or if it is in a range.

Moving average as help on how to identify market trends

The moving average is one of the most popular methods to identify market trends. When the market is beyond the level of the moving average, it is Bullish. If under, it is Bearish. But this method has some disadvantages. It depends on the period you are looking at.

One moving average can miss out on great parts of trends so you will end up struggling against the trend. It is always smart to apply two moving averages. One has to be slower the other faster. And, when the faster one is above slower the market is bullish when it is below the market is bearish.

Use trend lines

That’s why we had to explain the trend lines. Trend lines are a great tool to identify a market trend. Also, they will highlight potential trading zones inside the trend. The market is in trend when it respects the trend line.

When the market breaks the trend line it is moving out of the trend into a range, or into a trend reversal.

Bottom line

Markets consist of many different varieties of trends. How to identify market trends will principally define the success or downfall of your investing. No matter if you are a long or short-term investor.

27th September 2019
BTC Price Will Surge Again

2 min read

Yes, the Bitcoin prices displaying a massive drop on Tuesday. Well, there is good news too. Crypto investors continue bullish! So the BTC price will surge again.

As BTC recorded a huge fall and fell about 13%, investors and traders persist optimistically. They expect the bull market to recover quickly.

Bitcoin price made a sharp drop yesterday (September 25) falling almost 16%. The daily open was at $9,691 but recorded a new low at $8,164. The price support was broken at $9,090 leaving the area that it has been trading in since June.

In doing so, price broke strong support at $9,090 and exited the area that it has been trading in since June. Bitcoin’s price action continues bearish under this scope.

But nothing is finished. Today’s chart (at the time of writing) shows some uptrend. A small one but still.

The larger picture reveals regular price action with prior corrections.

You wouldn’t like to miss this: MONETIZING BITCOIN

Traders-Paradise wrote about the second-largest German exchange in Stuttgart which started Bitcoin trading. Also, Bakkt starts and SoFi, a finance management firm is launching a crypto trading platform.

Are people still micro wise? Well, not all thankfully. BTC price will surge again.

The BTC/USD pair is trading at the $8,407 after hitting a low at $8,125. In the past two days, the price has passed below the SMA200. Dangerous? Yes, but the typical race for Bitcoin. For unexperienced in Bitcoin, the bullish momentum will continue as long as the daily close is above the long term average. The indicator stays on the bullish side of the indicator. You can check it.

BTC/USD needs strong support levels, instead, it may fall even more since BTC/USD had another heavily bearish day on Wednesday. The disturbing element is that the daily confluence indicator doesn’t show any support levels until $8,100.

But even if it goes lower its still a good entry for longs. It is expected the volume further fails on a macro scale. But the price may consolidate if the trading starts again.

Bitcoin’s price is a distraction from the value. Everyone was yelling about Bitcoin’s drop past two days. What is about today? It has recovered.

Don’t judge based on hash rate data. It is an estimation. It isn’t exactness. Until traders start to trade it again the price of Bitcoin may stay on the low level. The point is, Bitcoin may drop slightly more in the next few weeks, with frequent ups and downs but to the end of the year, it may surge again, and more than anyone can expect. That’s the nature of Bitcoin and the beauty of the game

26th September 2019
European ETFs: Invest in the World’s Biggest Regional Economy

by Guy Avtalyon

European ETFs give a large diversification in mutual funds and with a bit of the fee. If you buy one security as a foreign investor you will have exposure to a lot of firms in the EU. Why Europe is interesting for investors? First of all, some of the biggest companies are located in Europe. So, it is a great opportunity for foreign investors to invest in EU ETFs. The European Union factors about 20% of the world GDP, therefore it looks like one of the most valuable investment targets in the world.

Benefits of Investing in European ETFs

Europe is one of the best-shielded business areas around the globe. To be honest, there are still some risks after the crisis in 2009. The companies in Eastern Europe have better growth potential than Western Europe. Anyway, having EU ETFs in your investment portfolio is a great choice and I’ll try to explain why that is.

First of all, in Europe are some of the most successful companies. For example, a lot of US investors are very interested in them. Moreover, Europe is consists of several areas. That makes European ETFs very good for diversifying a stock portfolio without the risk which developing markets may give. The added quality is that the EU is honestly low-risk. Just compare it with Asia, for example.

Many investors are now attempting to enter the European Union market through mergers and acquisitions. Also, by investing in its main businesses. The EU is, in fact, welcoming foreign investment.

Here is full information that will help investors about investing in European Union.

Risks of investing

Of course, there are some risks involved.

The main risk is that the members of the EU are very connected and dependent on each other. At first glance, nothing is bad with that but if a crisis occurs it will spillover among them, and business in the union may fall down like a house of cards. As I mentioned above, Wester Europe economies have slower growth and they may seem less attractive for investing. Especially for investors who want more risky investments.

Where to find: Top European ETFs

MSCI European ETF (NYSE: VGK)

Vanguard is available in Europe. Its European funds are based in Ireland. Vanguard allows non-residents to buy their ETFs/funds through a broker. So you can not directly do it through them. Vanguard’s ETF is a good option but it involves currency exchange. You can simply open an account with any broker with access to the NYSE ARCA. That is the stock exchange where Vanguard ETFs trade. The rest is simple, buy it just like with any other international stock.

iShares MSCI United Kingdom ETF (EWU)

A lot of investors favor “tracker” funds. They allow you low-cost investments. But not all tracker funds are low cost. Moreover, the fund charge is not all you pay, you will have to pay the broker or fund platform too. The good news is that as your portfolio grows the broker will charge you less on a sliding scale.

SPDR DJ Euro STOXX 50 ETF (NYSE: FEZ)

FEZ includes the 50 biggest EU companies but the large-caps from countries that don’t use the euro, including the UK, Switzerland, and Sweden, are not included. But, FEZ’s portfolio includes companies from France and Germany. As a difference from other EU funds, it does not hedge euro exposure.

European ETFs provide the most comfortable approach to get exposure to European markets and the easiest access to invest in Europe. In comparison to buying foreign stocks directly, it is for sure.

Further, European ETFs are an excellent method to diversify your stock portfolio with low-risk investments. To be honest, I have to say that European ETFs will not suit every investor. Risk seeking investors wouldn’t like them, or for younger investors, European markets are not volatile enough. Yes, there is pretty much a lack of excitement.

26th September 2019
Trailing Stop Loss Definition and Examples

3 min read

The trailing stop loss may be practiced with stock, options, and futures exchanges that support regular stop-loss orders. It is a variety of stop-loss order. A trailing stop-loss order is executed when the price of the trading asset drops by the trailing value which can be expressed in percentage or currency amount.

For example, you might place a trailing stop order to sell your stock with a trailing stop loss of 4%. When the stock dropped 4% from its nearest high the trailing stop order will be executed.

For example, assume that ABC stock is in its uptrend and hits $100 per share. If you placed a trailing stop loss of 4% it would be triggered when the price drops to $96 or below. Hence, your trailing stop loss at 96%, the sell order at $96 would be a market order. Instead, you can set a trailing stop limit which would provide you to gain a specified price placed in advance.

Also, instead of placing percentages you may enter a trailing stop loss in currency. It is more favorable. Let’s do some math.

Let’s say, ABC shares increase to $120, a $4 trailing stop would trigger at $116, which is a 3,3 % drop. If you entered a 4% trailing stop, it wouldn’t trigger until the shares fell 4% to $115.
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The mistakes about using a trailing stop

A typical mistake is to set a trailing stop too close to the current price. For example, 1% or 2% trailing stop loss. Most stock prices are changing by at least a few cents per minute. If you set the trailing stop loss too tied to the entry it will be stopped out before any significant price moves occurred.

The best way is to set a trailing stop distance enough from the current price. If you keep in mind that that the market regularly fluctuates inside a 10 cent span, you would like to set it a bit far from that amount. But be aware, if you set it more from that range because it could happen that you never reach the placed point. The consequence is that the trailing stop could be invalidated and never executed.

The point of using the trailing stop loss is to get you out of the trade if there is a high possibility of the price changing and destroying your profit on your trade.

Trailing stops are useful because they secure in profit when the price moves in our beneficial. The disadvantage is that sometimes they get us out of a trade when the price isn’t really changing, but simply pulling back a little. A good option to a trailing stop loss is to apply a profit target, have that in your mind.

How to move a trailing stop loss

It is easy to find a lot of brokers that provide this type of orders. It’s up to you to choose how much space you want to in your trade. Think twice would you like to set it in percentages or currencies (you have both examples above). When you confirm the order it will move as the market moves because that is the nature of trailing stops: to move as the prices move. You can set it automatically or manually.

Bottom line

Traders use different systems to improve their profits and diminish the losses. One of these methods is the trailing stop order. It allows you to define the circumstances that will trigger an order to exit your position. It safeguards your trade against unexpected downturns.

No matter if you are trading stocks, bonds or whatever, you must have a solid exit strategy. Moreover, you must have it before you buy the position. We already wrote about emotional trading. A good exit strategy will allow you to diminish fears. Let’s say your exit strategy is to wait for the price of your stocks to drop by 15%. You’ll be able to avoid trading in a panic if your stocks drop by 10%. That is the main purpose of applying a trailing stops and other stop-loss orders, to give you a plan to realize your exit strategy.

Don’t miss this: Trading With Success – A FULL guide for beginners

25th September 2019
How Often to Check The Investments?

2 min read

by Guy Avtalyon

Your investments should certainly be periodically checked but not every day. Even though it is your money invested. You have a bigger chance to lose money if you check your investments every single day.

How?

Well, you know that the price changes occur very frequently due to the stock market volatility. The stock price can rise and drops hourly. Watching that, you may feel a bit more nervous about your investments and provoke you to sell instead to hold and wait for the price to increase. Also, you have to know that daily fluctuation in stock prices does not influence your investments. The most important is how your stocks perform in a bigger time frame.

If you check your investment too frequently, you will end up acting irrationally to market movements and sell your stock at a low price.

Yes, I know, our investments may give us the impression that we will never end up with sufficient money. You have to know how often to check your investments so that you don’t destroy them.

For new investors, quick gains can cause investing to look impressive. It is normal to check your investment every night. I can understand that. I know some investors are checking several times a day. If you need to be worried about your investment it is a sign you made the wrong choice.

If your portfolio loses just a bit in a few days or weeks there is no reason to panic. The statistic shows that fresh investors usually put money in mutual funds or ETFs because they are afraid to invest in more volatile stocks and they avoid them. The truth is that holding stocks requires more attention, time to track them, and knowledge.

But you can’t have only mutual funds or ETFs in your portfolio and check them once a year. You would like to have stocks as well. And a lot of things will be changed.

So, how often to check the investments?

With stocks, things are pretty different. You have to check them at least once a week to notice if something, some event, for example, influences your investment.

If you are holding or trading individual stocks, try to check them quarterly. OK, maybe monthly if you are so nervous. It is reasonable to check your investments from time to time. But too much checking can make you panic and sell at a lower price. And you will start that chain. That frequently checking will cause trading, fast trading will cause over-selling, over-selling will produce more fees and costs. Also, if you have too much trades you will have low returns.

It is smart to pick a good investment strategy and stay with it. Check the progress of your investment quarterly and check the price, for example, monthly.

With mutual funds and ETFs, you have wide diversification, so once a year is enough.

With stocks, check it out by online approval or in the paper version. Most of the financial websites such as Yahoo Finance and some others offer stock research data. Also, your broker has quotes available.

How often to check your investments? Less is better. You are investor, investing is a marathon, it is for a long run. Make a reasonable plan, according to your risk tolerance, be patient. Rebalance your investments once a year and let your money work for you.

23rd September 2019
Market Timing – A Way to Beat The Stock Market

How is market timing possible? Read to the end.

By Guy Avtalyon

Market timing is the method of buying and selling in the market based on financial inclinations, business information, and market circumstances.

It is a kind of investment or trading strategy. It is an effort to beat the stock market by prognosticating its movements and buy and sell according to that data. While you are making moves in the financial market, changing the asset classes, you need some predictions. To make predictions you need tools, for example, technical indicators, financial and economic data, to be able to estimate how the market will move.

From these tools needed you can easily see that the market timing is in contrast to a buy-and-hold strategy.

Some investors don’t believe that is impossible to time the market. But on the other side, you have a whole range of investors, especially traders that are sure in it. Well, both sides are right, at some point. It is pretty hard to time the market, but it is possible for the short run. Seeking to time the market over the long run can be difficult and may show a lack of consistency.

Is market timing possible?

If you are a short-term trader or full-time investor, you may have some good results but you have to be an exceptional one to notice the right time to buy and sell in the market. The statistic is explicit, there is no notable success in comparison with the buy-and-hold investor.

Market timing is related to tactical asset allocation or dynamic investing.

Let’s say you want to invest $10,000 and you put $5,000 in the stock, $3,00 in the bonds, and $2,000 in the cash.

The market timer tries to sell when the price is the highest and to sell when the price is at the lowest level. So, the trader or investor confidence to market time will sell some part of stocks in case the interest rates are increasing and buy bonds. Such an investor wants to profit from something called a market “peak” for stocks and the start of growth for bonds.

The believer in market timing is sure that price movements in short-time are essential and usually predictable. That’s why the market anomalies are important to them to support their opinion. Chart patterns that are repeating are also important to them. Their investment horizon is shorter, it can be minutes, days, or months. On the other side, long-term investors, so-called buy-and-hold, prefer to estimate the long-term potential of their investments by employing fundamental analysis. They are estimating the company’s strategies, products, etc.

Market time investors will use leverage to gain returns. This will add more risk to their portfolios but their returns could be higher too.

Are there any costs for it?

Investors that practice this strategy claim that by using this method they are able to diminish losses. The principle is quite simple, they just have to move one sector before drawbacks. You see, their aim is to find a safe investment and avoid market volatility while they are holding volatile investments. Market timing investors that attempt to time entries and exits very often may underperform the long-term investors. The reason behind, it is extremely hard to gauge the next direction of the market. Despite their optimism, the real costs for the majority of them are higher than the possible gain of moving in and out of the market.

There are also extra trading commissions and capital gains taxes. The continuous analysis linked with market timing requires frequent asset reallocation and a lot of trading activity. Much more than passive investing. If you want to practice this method you will need more time and an excellent education.

Market timing is a questionable approach. You can find a lot of very serious studies that have revealed that the market’s bottoms and tops are pretty hard to find consistently.

Moreover, long-term investors truly support the efficient market hypothesis, which claims that the prices are random and reflect all available data, so it is impossible to outperform the market in the long run. It is especially too hard in a short time since it is impossible to forecast stock prices. Although, market timing has huge and faithful followers among investors. Can we say they are enjoying the challenge to consistently produce higher-average returns? Maybe.

The most important thing for all investors is the fact that they have to watch their investments, to watch charts and they have to know the market timing method.

23rd September 2019
Stocks Under 5 Dollars Per Share to Buy Right Now

Stocks under $5 can be a good opportunity, they are low-cost but can generate a large percentage gains

By Guy Avtalyon

Why should anyone invest in stocks under 5 dollars per share? Just read this post to the end. There is no excuse for not investing. You can do it with just $5 per share. Traders-Paradise presents you three stocks under 5 dollars per share with pretty great potential. There is a great risk involved too since they are really volatile. Be aware, all stocks under $5 are volatile. Because of their nature, these stocks may provide you great returns but large losses too.

So, these are our tips on stocks to buy right now and make a profit.

Reebonz Holding Limited

Ticker – RBZ
Market cap – $16.053M

Reebonz is an online platform with a focus on buying and selling luxury products. Headquarter is in Singapore. The company was founded in 2009, today it is the leading online platform for buying and selling luxury products in the Asia Pacific region. It has offices in Singapore, Thailand, Hong Kong, Korea, Taiwan, Japan, China, Australia, the United States, and many other countries.

On Friday it stated that will release its unaudited business results for the first half of 2019, before the opening of U.S. markets on September 23. So, we will see.

Until then, let’s see what do we know about this company.

This platform operates as an eco-system of B2C e-tail and B2C marketplace covering more than 1,000 brands. It is supported by C2C which provides private members to sell luxury products. Shopping is very easy since the company’s UI is user-friendly. Reebonz sources collections of many brands from luxury boutiques from all over the world.

The current price per share is $2.58. The analysts estimated the RBZ stock will be one year from now at $11. Our suggestion is to buy its shares.

ReneSola Ltd

Ticker – SOL
Market cap – $71.59M

ReneSola Ltd was founded in 2005. ReneSola Ltd is headquartered in Shanghai, China. The company is listed on the New York Stock Exchange in 2008. It is an international technology provider of green energy products.

It is a Chinese producer of the range one solar panel with a 10-year product and 25-year performance warranties. Their panels are corrosion resistant, and that fact makes them very convenient for installation by the sea. Renesola has offices in Sydney and Melbourne too.

The company produces string inverters, microinverters, and LED lighting too. It provides the highest quality green energy products and services for EPC, installers, and green energy projects all over the world.

The current price per share is $1,88. So, our suggestion is to purchase since the shares are undervalued for no reason. These shares are good. They already beat analysts’ expectations.

Trevi Therapeutics Inc.

Ticker TRVI
Market cap $82,930,751

Trevi Therapeutics was founded in 2011. Its headquarter is in New Haven, the U.S. state of Connecticut. They are developing nalbuphine ER, treatment for uremic pruritus, improving “the quality of life of patients suffering from the serious symptoms associated with chronic neurologically mediated conditions” as they stated on the official website.

The Trevi Therapeutics’ team is highly engaged and experienced in life science clinical development, successful commercialization, and building companies of exceptional value.

Since launching, Trevi has raised $92.2 million in the financing, according to the filing for its IPO this May.

Trevi Therapeutics, Inc. is focused on the development and commercialization of nalbuphine ER to treat serious neurologically mediated conditions. The company’s nalbuphine ER is in a clinical trial. The purpose is for the treatment of chronic pruritus, chronic cough in patients with idiopathic pulmonary fibrosis, and levodopa-induced dyskinesia in patients with Parkinson’s disease.

The current price per share is $4,5 but analysts predict that easily can be over $16 in the next 12 months

These are only three stocks under 5 dollars worth to buy right now. There are more, of course. The price per share is low, the growth potential is reasonably good. But remember, the low-cost stocks are extremely volatile. The high potential risk is involved but the reward can be great also. Everything is up to you when it comes to stocks under $5. This is just a suggestion. But I would like to give more info on trading so-called penny stocks.

Why trade penny stocks?

As I just gave you a suggestion of stocks under $5 I would like you to know that these are so-called penny stocks. So, penny stocks represent the companies whose stocks are valued under $5. You can find that definition can vary but, in essence, this is the right explanation. At least, it isn’t wrong. So, let’s put aside the definition. You may ask yourself why should you trade penny stocks.
Trading penny stocks has one reasonable goal: to turn a little money into the big money. Traders’ profit comes from small changes in stock price but from large percentage gains. They trade with large leverage. That’s the point. Also, that’s the way how you can trade with a little money and earn very nice. Once I said don’t be shy to buy cheap stocks, stocks under 5 dollars. This is especially valuable for the penny and undervalued stocks.

At the end of the day what really matters is your profit. Happy investing!

22nd September 2019