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Friday, June 12, 2009

Easy Money For Small Investors Through Forex Swing Trading

By Megan Rewards

One very profitable market where the only determinants are the demand & supply is the Forex market. This is more or less unaffected by any external agents. These markets have been criticized for catering only to one section of the society.

The Foreign exchange markets were the forte of the rich and were seldom in the reach of the lower strata of the society. The concept of these markets was such that one could not have the needed money to mint profits in these markets. Big shots like the central banks, the government and individuals with huge financial resources at their disposal only were capable of investing in these markets.

The world has undergone a tremendous change over the years. The dotcom boom has made sure every household has a computer and information spreads faster. These changes have also brought about a change in the thought process of people. As a result the Forex markets are being open to the larger populace. The changing investor band has also brought about a change in the type of transactions carried out as well. Some transactions are specific to certain band of investors now.

Participating in the Forex market means undertaking certain transactions when the time is ripe. There are market swings and one who takes advantages of these and makes the transaction at the proper time can make a fortune. The market might fluctuate in the short term but not have any impact on the long term prospects.

While any and every investor can take advantage of the swing, the truth is that large investors can rarely afford to exit their positions just to take advantage of a swing in the market. Large investors act as position traders rather than forex day traders. They try to take advantage of the inherent profitability in the market. They do not try to earn a profit from fluctuations in the market. Hence, when a swing does take place, it is the ordinary retail investor who is in best position to take advantage of this swing.

However, a forex currency trader can take advantage of swings only if he or she is constantly monitoring the market. That is the reason why the World Wide Web has become very important for those who trade in foreign exchange. Forex trade is a real time market where changes in the world are reflected without any delay in the transactions in the market.

A global forex trader who relies on outdated modes of information like telephones and telex will certainly lag behind those who make use of the World Wide Web. Further, computer software program programmed with knowledge of foreign exchange ratios and tools quickly analyze the market condition to determine whether a swing is imminent or not. - 23159

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Buying Foreclosed Real Estate

By Doc Schmyz

We have all heard the old saying that "one man's trash is another man's treasure." Now while foreclosure is considered a tragedy it can also be a blessing for the real estate investor. Residential real estate is also expensive. Prices vary from one place to another. This is a major reason somemany take a look or start investing with foreclosure real estate.

Repo homes are a great opportunity for those who simply cannot afford a new house. Often these houses are sold far below the market value.

Unfortunately most repossessed houses are those which require a lot of repairs. Previous homeowners do hot have the means to maintain the house or just didn't take care of them. Some of these houses have also been abandoned by their previous homeowners and mortgage lenders have no choice but to get rid of them immediately.

Study up on the process

Before you buy, you need to make sure that you're going to get a good deal. The biggest part of the deal is adding up all the expenses to see if it is indeed the deal you thought it was.You may have to do a little bit of research first to be able to see how much you will have to spend in buying and repairing the property.

If you are short on cash, you can get a loan. ( in some cases you can get an assumable loan) Talk first to loan officer or mortgage broker to see if you are qualified. If you are qualified you can move forward from there.

You will be able to find several lists of foreclosure homes or homes for auction on the internet. In some cases a list will also be published in local newspapers. Use the contact information listed in the ad to find out about seeing the property.(In some states this is NOT an option)

Review your budget. What are you willing to pay for the foreclosed house along with the repairs? If you're planning to "flip" or sell the house,ask your agent to get you comps for the "after repair value". If you're planning to rent it, calculate the monthly rate and compare it to prices in the local paper for the same type of property.

Once you have finished all the research, make a bid on the property. After you have purchased the house have it inspected and appraised. Then look for a title company to research the history of the house. Once the house is yours and, any repairs you need to make are done, you have the option to live in it or rent it out. - 23159

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How to Make Money in a Down Stock Market

By W. Alan Gay

My clients often ask me if they can still make money trading stocks even when the stock market is down. The answer depends on the kind of holdings an investor has.

If you hold stocks, stock mutual funds, or your investment is in the standard asset allocation accounts the answer is probably no. The simple explanation for this is that these types of accounts are so large that they are not allowed by the regulators to hold short stock positions. This means that if the stock market goes down over the next 3-5 years, the accounts will lose money every single year.

Short positions, however, will allow you to make money whether or not the market goes down. These types of investments are only available to companies and individuals who trade individual accounts.

If you trade through your individual account rather than a fund, it is possible to for you to take charge of your own investment and make money in the stock market almost every day. This is because regardless of the direction a stock is moving, you can make money, by buying if you expect it to go up, or selling short if you expect it to go down.

Well, then, why doesn't everyone do it? It does take an investment of about $25,000 to set up your individual account. Some people don't have the funds, or are reluctant to risk it in an individual account. After all, trading stock for a novice can be complicated. You could lose all your investment fast if you aren't sure what to do.

Luckily, there are strategies to mitigate the anxieties of a new trader.

The first step is to find a trading system that provides you minimal risk recommendations. The system I and my students use has stock pickers with an average experience level of thirty one year. This means that you can just follow their suggestions and are fairly assured that you will make a profit. And if you set your stops to tie in with your personal risk tolerance level, your loss over time will be minimal.

Its also critical to find a system that will walk you step by step until you achieve your goals. As an example, in the nine day trading course that I lead, the participants actively learn every piece to the process it takes to successfully trade stock whether it goes up or down.

Despite the program you choose, if it has advisors with the needed know-how and experience as well as a turnkey process you can follow, you can be enjoying profitable stock trading success while those around you are complaining over the declining markets. - 23159

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Learn To Trade Exotic Currency Options

By Ahmad Hassam

Currency Options are used by companies as risk management tools. What are Options? Simply stated, it is a contract that gives the buyer the right but not the obligation to buy an underlying asset under specific conditions on payment of a premium.

The buyer may exercise the right if it makes him/her a profit. He/she may not exercise the right if it is unprofitable. However, if the buyer of an options contract exercises his/her right to buy the underlying asset, the seller is obligated to sell the asset at the specified price.

In all foreign currency transactions, one currency is purchased and another is sold. Consequently, every currency option is both a call and a put option. A call conveys the right to buy the underlying currency at a specified price. A put gives the buyer the right to sell at a predetermined price.

Why options are important as a risk management tool. Suppose a Japanese company is going to make the payment for its import of raw materials in 3 months time in USD.

The Japanese company can stay unhedged. It can purchase US Dollar at prevailing spot rate in three months time. On the other hand, it can hedge. Buy USD forwards or it can use an options strategy.

One of the strategies available to the Japanese company is to buy JPY put/USD call option. The effect of buying the JPY put option is to put a ceiling on the cost of imports in case JPY depreciates. The exporter limits the cost to a maximum while not limiting the minimum. Now lets discuss five exotic options that you can trade to make profits under different market conditions.

Digital options are simple and inexpensive. If you believe the EUR/USD rate is going to be above 1.0900 after two months, buy a digital option if you are not sure when this will happen. If after two months, the EUR.USD rate is indeed above 1.0900, you can earn your predetermined payoff. If not, your digital option will expire with a loss of a small premium.

One Touch Options are perfect vehicles for those forex traders who believe that there will be a retracement. The price action of a given currency pair will test a support/resistance level with a false breakout. The one touch options will pay a profit if the market touches the predetermined barrier level. If not, you lose a small premium.

A No Touch Option is a great way to profit from a trending market. The no touch option pays a fixed amount if the market never touches the barrier level that you choose. All you need to do is to determine the desired payoff, the currency pair, the barrier price and the expiration date.

A Double No Touch Option is perfect for you if you have the successful record of identifying and profiting from breakouts. But you have always lost money when the market is ranging. On the other side, you can use a Double One Touch Option if you know how to pick the tops and bottoms in a ranging market. However, you have always lost in a breakout market. - 23159

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Helpful Forex Blogs

By Bart Icles

One of the largest and most liquid markets in the world is the foreign exchange market, or what we also refer to as the currency, FX, or forex market. Everyday, the average volume in foreign exchange and related markets continues to grow. Over the years, more and more investors have become attracted to the profitable forex market. Today, large corporations, central banks, governments, and other financial institutions are not the only ones participating in the currency trade. Currency speculators, including average individuals who are interested in the forex trade, have joined the dynamic forex trading.

There are lots of concepts that need to be understood about forex trading. For a start, it helps to understand what makes the forex market unique. Its trading volumes, extreme liquidity, geographical dispersion, long trading hours, and use of leverage are just some of the factors that set it apart from other trading or financial markets. It can be a headache to completely understand the goings-on in the forex market but one is never short of helpful resources. There are several books that discuss the foreign exchange market. Some business schools have also added this topic into their curriculum. As the forex market is open to online trading, there are also loads of information on the forex market available in the Web. Some have even put up blogs on forex market and forex trading to help others understand what forex is about.

Typically, forex blogs help people familiarize themselves with ins and outs of forex trading. They also offer tips for newcomers to the market. Most of these blogs also make jargons used in forex trading easier to understand. Different forex market participants can make use of the plethora of information available in forex blogs.

Oftentimes, forex blogs give tutorials on starting a forex trading career. They give guidelines on how to protect one's self from fraud or hoax that exists in any type of market. They also give tips on how to fast track forex investments. Many seasoned forex investors have also put up their own forex blogs to share their experiences and success in forex trading. Forex blogs can be thought of as beginner's guides to currency trading.

Currency trading news and analyses can also be read in forex blogs. With all the changes going on in the forex market, not every piece of news is captured by a single forex website. It is therefore helpful to browse through different forex blogs to be updated with the latest happenings in the forex market.

Other pieces of information that can be obtained from forex blogs include lists of forex brokers, forex trading systems, and forex economic indicators. If you are looking for a valuable piece of information about forex trading, you are sure to find one in forex blogs. - 23159

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