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Tuesday, November 24, 2009

ETF Trading For Beginners: Choosing Systems

By Patrick Deaton

If you are just beginning to get into ETF trading you have probably been reading a lot and wondering about an ETF trading system that will be most effective. There are many websites that offer an ETF trading system that can't lose. Or, you may even see an advertisement for a that is guaranteed to make you a lot of money fast. It is important to take the time to research these kinds of advertisements before investing any money.

There are several ETF trading systems. Some are extremely effective when they are used in certain sectors with certain strategies. Others are more effective in an entirely different sector. The other thing to know about trading systems is that one system may be effective if you are going in for long positions and it will not work at all in short positions.

Successful traders often use a system that is a hybrid of a system that is consistently effective on it's own. They have adapted the system to meet their unique needs and requirements. The most effective system is one that will allow flexibility and versatility for the trader without strangling the ability to make proactive trades and moves.

Deciding on the right system will be a matter of tracking systems to see which are most effective in the sector that you are going to trade in. By tracking the system, you are not going to trade using the system(s). It is very easy to track several systems at the same time for the same sector and evaluate how effective they are in that sector and with those spreads.

ETF trading systems have a history. They can be analyzed just as well as the sectors that you will be trading. Finding out the history of a system can help to find the ones that have a history for consistent gains. By staying with a system that offers medium low to medium risks a new trader will have more opportunity to learn without suffering substantial losses.

The system history will also have the method that is used with that system. The method used is going to be important to how quickly you learn the intricacies of trading and how smoothing you move through the learning curve. The systems that use a trend following method are going to help you to develop the skills that will make you a successful trader.

If you see an advertisement for a system that looks enticing, check out the history of the system. Find out how effective it has been over a period of time. Use the ETF trading forums to find out how the system has worked for successful traders and other traders on the forum. There are many forums and blogs hosted by successful traders who are a valuable resource of free information about ETF trading.

This is a very rewarding and fulfilling career. You're going to find out that there is something new to learn about ETF trading every day. This is especially true during the learning curve of about two years. While a system may be tempting, if it cannot fulfill the promises that are made it can be both costly and frustrating.

The key to finding the best ETF trading system for you will be to analyze the systems as carefully as the sectors that you are going to trade in. By talking to other traders about the successful systems used in sectors you will find that deciding on the system will be much easier. - 23159

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Using a Forex Trading System To Secure Your Financial Future!

By Howard G. Platt 111

Amateur forex traders should invest in a good forex trading system. Forex traders who are not financial experts or who are trading to earn an additional income to their regular jobs probably don't have the knowledge or expertise of a professional forex trader. Without clear guidelines to assist in the decision-making of forex trading, the trader can make huge mistakes and consequently risks losing a lot of money.

Essentially the forex trader needs to understand how currency pairs relate to each other on the forex market and then be able to effectively analyse the market data to make decisions about when to buy or sell. Thus it is important that the trader's decision-making is based on a sound framework that will guide the trader's choices. This framework is found in a quality forex trading system.

Forex trading systems claim to dispel "secrets" to successful trading. The self-proclaimed trading experts that create these systems try to empower the trader with the knowledge to know when to enter or exit a trade, rules for money management and tools for technical analysis. It also provides information and explanations about different types of forex trading such as day trading and swing trading. Most currency trading systems will even provide the trader with actual trade examples to make the learning more experiential.

The trader looking for a forex trading system has an array of different products to choose from online. These vary in cost and comprehensiveness. At the get-go, the trader needs to decide if they are looking for a currency trading system that requires manual versus automatic trading.

If the trader desires more control over interpreting market data and making decisions about which trades to execute, then the manual currency trading system would be the system of choice. However, this system requires a larger investment of time on the trader's part as he or she would need to sit in front of the computer and manually track the markets.

Automatic forex trading systems works with software and tracks the markets on the trader's behalf, under the interpretation guidelines set by the system, which dictates what constitutes a profitable trade. Trade signals are then generated automatically and the trader is alerted when profitable trade opportunities are identified. The trader can then decide whether to act on the signals by executing the trade or not.

Whichever forex trading system the trader chooses, it is important to remember that no matter how brilliant a system is or claims to be, successful forex trading still requires basic knowledge of the forex market, patience, hard work and determination. - 23159

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Building a List of Penny Stocks to Watch

By Bo Miller

If you are fed up with Wall Street, there are several penny stocks to watch. Your return is just as likely with penny stocks. However, you don't have to stand by and watch all of the greed and corruption that comes with the bigger companies. This approach to investing is focused on small businesses and up-and-comers. These types of companies can even produce better returns than Wall Street in many cases. However, the penny stock market has its problems too so you have to invest wisely.

Penny stocks are risky, but so are the larger stocks, especially while we are suffering through a recession. Many stocks on the larger markets go as high as $50 / share. That means that $1000 will purchase 20 shares in one large company. If that company performs poorly, that investment will dwindle quickly. It's kind of like putting all of your eggs in one basket. However, on a penny market, that same $1,000 could be used to cover investment fees and still buy thousands of shares in multiple companies. If one stock performs poorly, your investment will still be safe.

Even the people who have the money to buy blue chip stocks are turning away from them. It's no wonder. In recent years the FEDs attempts to save the market have made it even more unstable and have driven stock prices down quickly. Add to that the constant news about another bank that got greedy and burned its customers or corrupt executives being sent to prison. When all is said and done, people just don't trust the big businesses represented by the stock exchanges.

On the other hand, the penny stock market is made up mostly of small businesses like the farm down the road or a family run oil company. They are good hard working people who make a living running the small businesses in this market. They general take their company public for one of three reasons: They need funding to expand their small business. They need a tax break and want to share their profits with employees or other people. Or they were scammed by a penny stock broker into a costly IPO and can't back out without losing their company.

This growth is usually slower than that of their large business counterparts, as is the growth of their stock value. However, overtime that growth can add up. Further, some companies on the penny stocks will grow naturally from a small business to a large player. Along the way, the value of the stock in the company will grow too. When this growth happens it's usually very quick. Sometimes it will plateau in as little 24 hours, so penny stock investors have to be prepared to sell quickly.

Just be careful when investing in penny stocks. These companies aren't as well regulated as the big boys on the stock exchange. Because of this lack of oversight, it's easy for people to game the system and make it look like a company is growing fast. When they do this, the stock prices rise. At some point in time, these scammers dump their shares at the new rate and walk with the cash. This can make your shares worthless overnight.

The ease of growth, honest values, and chance at rapid growth has created many penny stocks to watch over the years. These stocks can definetly produce stock exchange style returns without the same types of risk or the BS that comes with Fortune 500 companies. - 23159

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How To Make Your Forex Trading System Work

By Bart Icles

Forex traders come in different types. There are the pros of the forex world while there are also the beginners or the novice traders. No matter how much experience a forex trader has, whether he/she is only starting in forex trading or wether he/she has been trading for a long time, the one thing that they have in common is a forex trading system. The forex trading system is a system that you follow in forex trading. It may be a system that you got from others, or it may also be something you are able to come up on your own, or it may be a combination of a forex trading system that you got from others then modifying it depending on how you think a particular part of the system will benefit you in trading.

In formulating your own forex trading system, first and foremost you'll have to have a good background on forex trading. Getting trading tips from people who have actual trading experience is a plus because in doing so, you are getting the tips that actually have worked for other people and at the same time you can confirm if you have learned forex the right way.

After you have developed your own forex trading system, it is recommended that you practice actual trading first in a dummy account. In this way you can practice your system and do some adjustments without losing real money in the process. But you should remember that trading in a dummy account is a lot different when trading actual money. You should be able to control your composure even after incurring some losses and not lose discipline in implementing your trading system when you do actual trading.

A good forex system is aimed at one thing: Make your profit as big as possible. This is easier said than done however, as the percentage of successful traders is much less than the unsuccessful ones. A good forex trading system will give you an edge in trading because it makes you track your trades in all angles, helps you set up forex trading indicators to your advantage, helps you read the market better, helps you read trade signals for the right entry and exit trading points, and it helps you have sound money management skills.

Forex trading is one with a lot of potential for big return on your investment but at the same time, you can also lose big when you keep on making the wrong calls. Before starting your forex trading career, and if you really want forex trading to be a substantial source of income, you should have a forex trading system that WORKS. - 23159

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Common Sense Guidelines For Forex Traders

By Ahmad Hassam

If you don't use common sense than you might as well not trade at all! Someone had rightly said a long time ago that common sense is so common that nobody uses it. Well, if you are going to become a trader than you need a lot of common sense. OK, now a few common sense guidelines for you as a trader:

1) You should always look for a reputable broker. Don't fall into the trap of some unknown broker. Your ability to trade effectively depends on consistent spread and ample liquidity. Anyone can open a position. However, your ability to close a position at a good price is more important.

2) Trading means making consistent steady profits! Learn prudent money management rules. Avoid using excessive leverage that puts your investment capital at risk. Always trade with a stop! Never try to win big in one single trade. This is not trading, it is gambling. Always live to trade another day. If you believe in winning big than quit trading and start gambling! But if you do that you will only ruin yourself.

3) Never ever trade emotionally. Stick to your plan and maintain your trading discipline. Always develop and make a trading plan before you take up trading. Set a reasonable risk/reward ratio for your trades. Never ever override yours stops for emotional reasons. Don't react to price action buying just because you think it is cheap or selling because you think the price is high now. Always use technical analysis to make your decisions.

4) Always remember you should plan each trade before actually entering it. You are not a punter. Always plan each trade. Don't punt. Punting is trading for the sake of trading without any planning or view.

5) Don't try to trade around round numbers. Don't leave stops at round numbers or obvious levels. If you do that chances are they will be triggered.

6) You are not a gambler. You are a trader. Don't use martingale strategies in trading. Don't double up just in order to recoup your losses. In other words, only do that if it is part of a trading strategy. Don't add to a losing position unless it is part of a plan to scale into a position.

7) When trading against the trend be disciplined in taking profits and don't hold out for the last pip. When trading with a trend always use a trailing stop loss order.

8) Emotions are your biggest enemies in trading. Never make emotional decisions in trading. Avoid emotional highs or lows on individual trades. Consistency should be your target. Treat trading as a continuum. Don't base your success on one trade.

9) Crosses are very important. They can give you a lot of useful information about the major currency pairs. Always keep an eye on the crosses. Try to trade multicurrency. This will hedge your risk.

10) Markets hate surprise news. You should know the economic calendar. Don't trade just ahead of an economic news release. Always beware of volatility following the economic releases. Be cognizant of what news is coming out each day so that you never get surprised.

11) There are highly illiquid periods everyday when one market closes and the other is not open. You should avoid these times. Beware of central bank intervention in illiquid markets. Stay away from illiquid times like holidays or pre-holidays when liquidity is thin. - 23159

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