Secrets To Buying Stocks
It's a no brainer that there is money to be made investing in stocks. But then it is just as likely you can lose money. The key is to pick stocks that will perform as you want. There are three terms that you may not have heard of and why they are important to you.
DEAD CAT BOUNCE: This is the effect seen when a stock price rises after a sustained period of downward movement. Often people start to buy again thinking the turn around has happened and then the stock drops even further.
What does it mean for me for stock trading? Because no one can predict when a decline will reverse don't rush in. But it may provide you a window to make trading gains while the stock is in this pattern.
A BELLWETHER STOCK: This is a stock (or security) that usually signals the direction the market will take.
Why is this important to me? These stocks usually have a large percentage ownership by institutional investors - the big boys on the scene. While these stocks may signal the direction of the market they may not be the most attractive investment choice for those wishing to make gains. They are useful to watch however to get a feel of what might happen next.
THE JANUARY EFFECT: this is pattern that is often seen at the beginning of the calendar year when markets traditionally rise. Often the rise starts in the last few days of December and strengthens through January. Sometimes this is due to tax implications and psychological influences of the investor.
Why is this important to me? While research shows the effect to be real, it is hard to turn these gains into profits. The chances have become less and less. However it is important to be aware of this phenomenon so that if an opportunity presents itself, you may be lucky to be able to take advantage of it. - 23221
DEAD CAT BOUNCE: This is the effect seen when a stock price rises after a sustained period of downward movement. Often people start to buy again thinking the turn around has happened and then the stock drops even further.
What does it mean for me for stock trading? Because no one can predict when a decline will reverse don't rush in. But it may provide you a window to make trading gains while the stock is in this pattern.
A BELLWETHER STOCK: This is a stock (or security) that usually signals the direction the market will take.
Why is this important to me? These stocks usually have a large percentage ownership by institutional investors - the big boys on the scene. While these stocks may signal the direction of the market they may not be the most attractive investment choice for those wishing to make gains. They are useful to watch however to get a feel of what might happen next.
THE JANUARY EFFECT: this is pattern that is often seen at the beginning of the calendar year when markets traditionally rise. Often the rise starts in the last few days of December and strengthens through January. Sometimes this is due to tax implications and psychological influences of the investor.
Why is this important to me? While research shows the effect to be real, it is hard to turn these gains into profits. The chances have become less and less. However it is important to be aware of this phenomenon so that if an opportunity presents itself, you may be lucky to be able to take advantage of it. - 23221
posted by X - Men @ 9:27 AM
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