Stories are still told of how these two events in 1987 and 1929 alone wiped out entire generations of wealth. And that it happened so fast they didn’t see it coming. But how quickly did it really happen? Were the warning signals there? In this article I will show you a quick and easy method for being aware of an impending stock market crash, and how you can avoid it.

The truth is, both of the major stock market crashes through 1987 and 1929 yielded many facts that we should be aware of, and we can also spot them in the future.

Number one is that prices in the market fell quite a while before the stock market crash occurred. In fact in both cases of 1987 and 1929, prices fell for a full seven weeks, from the peak to the start of the crash.

The second is that even though prices did fall for seven weeks prior to a stock market crash, there was a bounce in between. What this means is that prices fell, then they rose for one to three weeks, before falling back down through the previous trough in price. And the week after is when the stock market crash happened.

Take a look at this price action on a price chart, and it will look like a zig zag downwards. This zig zag was noticed by Charles Dow in the late 1800s, who coined the theory as his own, and as we now know it: “Dow Theory”.

So, it’s pretty simple so far, right? Yes, but does a stock market crash happen every time we see a zig zag down in price? In simple terms, no. This zig zag can happen quite often, especially when we look back over the last century.

However Dow Theory doesn’t just warn of crashes – it works for Bear Markets as well. In fact if you take a look at 2007 – a few months before the “experts” were talking about recession – you will see a quiet little Dow Theory zig zag down. So sometimes the move will be severe like 1987 or 1929, sometimes we may get a recession, and sometimes it may just turn around and go up again.

Overall, the probability is high though, at around 70%.

So what does this mean for you? It’s simple. As an investor, if you see price fall, bounce, and then fall through the previous trough (most notably on a weekly price chart), then it might be a good time to lighten some of your positions and be ready. You can always get back in again if a crash doesn’t happen.

For more tips on how to avoid a stock market crash, visit Dave McLachlan’s site www.ASXmarketwatch.com. You can get a free course on investing, free research and free articles!

categories: stock market, investing, trading, finance, money, wealth

The swiftest way to enter the futures market is by heading on the net and undertaking some research. Corn futures trading in particular have a style of shifting in cost from day to day depending on the particular supplies and need. The Internet is a fantastic method to stay up with these kind of changes and permits the smart individual to track their activities using trivial to no effort.

There are many web sites offered that allows for the buying and following of corn futures and also different commodities. These may be an priceless device for the buyer that would like to do this without the use of a agent. By obtaining shares in this way, the broker costs can be cut out and all of the earnings goes straight to the investor.

Trading in corn futures nonetheless is one of the elevated risk opportunities obtainable today. You may reduce the initial risk by using a few diverse techniques. These kinds of additional procedures both demand the use of a broker, however this allows for a reduced danger to your capital along with the awareness that you have a professional giving you information.

The first approach to reducing your danger might be to start a managed account. Using this style of account, the broker would help make the purchasing choices for you using your money to purchase the futures. The benefit to this is the education the trader provides to you in the trends in the marketplace alongwith what is a wise move or not.

The second technique might be to enter into a commodity pool. This is the smallest risk way to operate in corn futures as the overall investment is added in to others and for that reason if a loss is incurred, that damage is divided between a few individuals rather than solely you as a solitary investor taking the brunt. The commodity pool also permits for diversification into alternative areas of commodity trading.

By going on-line and carrying out some investigation, a lot of sites may be found describing trading proceduresand the correct way to invest. These web sites all contain worthwhile tracking information in respect to trends in the commodities industry and general pricing guides for past years. They may also show projections for the approaching year as the area of investment that is being looked into be is after all, the “futures” market.

These internet sites are one way the do it on your own trader can obtain the same information as the brokerages that work from an office. They employ the same numbers and trending patterns to make their selections and the Web permits you to take advantage of that. Many of these internet sites also offer very low priced trades and are ideal for the part time trader or the full time day trader.

Thank you for reading our Corn Futures Trading information. If you might like additional Corn Futures, Corn Futures Prices, or Corn Futures Trading resources please visit http://www.cornfuturesgo.com today.

And what’s more – the traders or investors who do these certain things end up becoming the statistic – more than 82% of traders close their accounts within 9 months, never to trade again. Long term investors have it slightly better, although 2008 certainly sent many running for the sidelines.

That’s why I’ve made a list of 10 major reasons why traders and investors fail in the markets. How can you use this? It’s simple – do the opposite of everything on this list, then click the link at the bottom for even more reasons and things to avoid. When you know what to avoid – you can be far better prepared.

Ready? Let’s get started!

1: They don’t create a plan. You wouldn’t start a business without a business plan, would you? Then why start trading without a trading plan? List your entry and exit rules, you money management, your goals. All of these things bring you greater success.

2: They can’t admit when they’re wrong. We are all wrong at times – but the best traders or investors don’t have trouble admitting it. They are able to sell out of a stock at a pre-determined point, regardless of how much they love the stock. Forget your ego, and start being ok with being wrong. (Please note… this reason may also be wrong).

3: They don’t have the discipline to stick to their strategy. For example a long term investor who gets shaken out of the market by a short term price fluctuation. If you have a strategy, stick to it. If it really doesn’t suit you, change it.

4: They mistake a rising market for investment skill. Ah bull markets. How many “gurus” come out of the woodwork as a market is rising? And what happens to most of them when a bear market comes? That’s right, never heard of again. Whatever the conditions, keep learning in the markets. Or as Han Solo from Star Wars puts it: “Don’t get cocky, kid”.

5: They have a plan, but they don’t follow it. So they have done the research, they’ve tested their theories, but when they actually put money in the market they break all of their rules!

6: They give up too quickly (and don’t let their expectancy work). Many methods will work over the longer term, given a positive expectancy. But some traders or investors get discouraged and give up, right when the market conditions are about to change in their favor.

7: They listen to the news. Everybody loves gossip, and traders and investors are no exception. The only trouble is when it comes to the news: they are reporters, not investors! They don’t actually know what the blazers is going on! So they make something up, like “hedge funds are short selling” or “investors are running to safe-haven assets”. If you want gossip, listen to the news. If you want trading wins, get a solid system.

8: They don’t watch the trend. Some of my best friends are extremely successful fundamental investors. But even the most successful fundamentalists lost money in 2008 (and some of the best fund managers got absolutely hammered), because they didn’t keep an eye on the trend. The stock market will lead the overall economy by approximately six months, so watch for a trend to emerge regardless of company balance sheets.

9: They think that investing does not mean hard work. Ah the carefree life of a trader – lying on the beach making casual calls to your broker. What a life! And what a load of marketing rubbish. The truth is, becoming a trader or investor is hard work. You need to research and manage your positions, while not losing your head.

10: They hound people for tips instead of learning the ropes. How people love tips! Some people will do anything for a “hot tip” in the market. But it’s usually at the expense of actually learning the ropes themselves. And if you buy using someone else’s tip, when do you sell?

Get 31 MORE reasons why traders and investors fail and things to watch out for at Dave’s free site www.ASXmarketwatch.com.

At first glance it may seem like a silly thing to try – especially when there are perfectly qualified people like financial planners or stock brokers telling you it is impossible. But what if there was a way to know, with a high probability, that a new bull market was starting?

Ken Fisher, in his book “The Wall Street Waltz”, discovered that unemployment was the key. Why? It’s simple: when the economy and the stock market are riding along nicely and moving upwards as they should, unemployment will never rise too much. This means that people are working, companies are making profits, and both of them are spending this money and stimulating the economy.

But the opposite is also true – if less people are working (unemployment up), then they are also spending less, companies are making less profit, and the stock market will be in a decline.

This is where Ken formed his “1 Percent Rule” – where if unemployment figures rise by more than 1 percent, this is a good time to start putting money back into the stock market. While it is hard to pick the exact bottom of a new Bull Market, Ken says this rule will get you in the ball park and ready to take advantage when it comes along.

Another way to say it is that cyclical stock market lows thoughout history haven’t happened without a 1 percent rise in the rate of unemployment. It happened in 1970 after two years of falling stock prices, and it happened in 2009. But also many times along the way.

There is one caveat however – the unemployment rate is not as reliable when it comes to predicting peaks in the market. This is because the stock market actually leads the over economy anyway in that regard. But Ken did find that a major peak in stock markets rarely happened without unemployment falling (jobs up) for two years.

So what can you do with this information? Well next time the stock market is falling in a bear market, keep an eye on the news for a time when the unemployment rate rises more than 1 percent. When it does, it might be a good time to get back in the stock market.

Learn how to avoid downward markets and make more with your investments. Dave’s site www.asxmarketwatch.com has free courses, free research and a free weekly market watch.

categories: stock market, investing, trading, finance, wealth

Knowing anything in advance would be a blessing – from the birth date of your first child to the winning horse at the race track. But imagine if you could see into the future and tell when an economic recession would end? Your business would soar, your job offers would multiply, and you would be ready for it all.

So, how do we tell when an economic recession will end? The answer is extremely simple – and yet it has been proven over many decades of data this last century.

In fact it is so simple your children could research it in the comfort of your own home.

And this is where we look to the stock market for the answer – as Ken Fisher outlined in his book, “The Wall Street Waltz”, the stock market has a magical way of leading the overall economy. Fisher discovered that the stock market will start going up before the end of an economic recession is announced.

Don’t believe it? Let’s look at our most recent example: the 2008 recession. The market started going up in March 2009, and the economic recession was announced over in October 2009 – a lead time of around 5 months. Or perhaps the recession before that – 2001 to 2003. The market started rising in March 2003, and the recession was announced over in July – 4 months later.

But there are many more: markets in 1952 declined before a recession was announced in 1953. The stock market had predicted an economic recession again – and the end was no different.

We can see the same pattern in 1957, 1960, 1967, 1970, 1974, and then in more recent recessions like the early 1990′s and 2002. The average time-frame that the stock market leads the economy by is 6 months. Of course some will be more, and some will be less, but as a general rule 6 months is a good one to go by.

So how can you turn this information into $$? Well, considering we have had at least 3 economic recessions in the last 20 years, you can bet there will be another one in your lifetime. But when the next one hits, you’ll know in advance. And when it is about to end, you’ll be out there getting that job you want or the customers who are coming back to buy!

Dave writes for ASX Market Watch, where he has a free course and research on trading and investing in the stock market.

categories: stock market,investing,trading,finance,wealth,business

A broker will facilitate your learn the terminology and create informed selections that are keep with your financial situation and your money goals. He or she can conjointly facilitate your identify your financial goals and your retirement wants furthermore a timeline for retirement. In other words a broker is a useful tool in helping you secure the monetary future of your dreams.

When you are looking out for the correct stock broker to figure with you may need to consider a few things first. You may wish to search out out concerning his history. How long has he been within the business, how long has he restrained specific aspects of the business? What type of education does he have? Where he visited faculty? And what, if any, advanced degrees, education, and certifications he could have ought to be a nice set of queries to start with. Several of these of course will be found on the broker’s web site therefore you’ll be able to save your time meeting with him for more important questions.

A number of the important queries may be how abundant time he sets aside for his shoppers, how much of a retainer (if any) is needed for him to require you on as a client, what are his going commission rates, financial coming up with rates (if applicable), and if he goes to be accessible to you or dodge your calls and emails. You’ll typically get a hint about these items before you’re a customer. If he dodges your calls and emails when he’s trying to urge his hands on your cash, probabilities are he will do the same once he has them on your money.

Get recommendations from friends and family and ask them the same queries about fees, commissions, and a spotlight before you even speak to a monetary advisor. The most necessary issue you can get from some time with a broker or advisor may be a foundation upon which you’ll be able to build a money future. If you’ll be able to learn as you pass asking queries of your advisor and having them answered you just may produce a situation in that the 2 of you’ve got a lifelong and beneficial operating relationship.

This brings me to my final recommendation. Escort a broker that you’re feeling comfortable talking to and secure returning a massive portion of your money to. This person is going to assist you intend your money future you would like to feel as though you can trust him to form the right choices for your financial dreams and goals. If you can’t then you would like to seek advise and steerage elsewhere.

Finding the right financial planner or stock broker to assist handle your monetary desires will take a huge weight off your shoulders whereas allowing you the liberty to worry about nowadays whereas he worries regarding your tomorrows.

Learn more about investments Grand Rapids. Stop by Scarlett Embs’s site where you can find out all about investments Western Michigan and what it can do for you.

Statistical studies of large cap, mid cap and the small cap stocks has shown that over the years small cap stocks have outperformed. Mid caps are companies with $1 to $5 Billion in capitalization and small caps are companies with $250 million to $1 Billion in capitalization. Anything below $250 million can be considered as micro cap. However the following divisions are generally accepted: Large caps are companies with over $5 Billion in capitalization.

Perhaps the most important ratio is the Price to Earnings Ratio (P/E). Now the most important term that you come across is growth stocks and value stocks. How do you determine this is a growth stock or a value stock? Suppose, company ABC stock is presently selling for $50. Now suppose that last year company ABC earned $5 for every share of the stock outstanding. This means stock ABC P/E ratio is 50/5=10. So the higher the P/E ratio, the more investors are willing to pay for the stock. What is the P/E ratio? The P/E ratio divides the price of the stock by the earnings per share.

Let’s make this clear with an example. Do you know how to read the balance sheet of a company? One of the most important things in doing research on a stock is the balance sheet of the company. Suppose, company ABC stock is presently selling for $50. Now suppose that last year company ABC earned $5 for every share of the stock outstanding. This means stock ABC P/E ratio is 50/5=10. So the higher the P/E ratio, the more investors are willing to pay for the stock. So what is the P/E ratio? The P/E ratio divides the price of the stock by the earnings per share. Over the years, studies have shown that the P/E ratio is somehow related with the growth of a company. Now the higher the P/E ratio, the more growth the company is supposed to have. So it can be either the company is growing real fast of the investor have high hopes of its growth. Now these hopes can be realistic or foolish, you never know!

Eugene Fama did seminal research on stocks and stock market s in’70s. Most of his results were startling and broke many myths. According to Fama and French, two famous researchers who did ground breaking research on stocks, over the last 77 years, large growth stocks have only seen 9.9% annualized rate of return as compared to 11.5% for the large value stocks.

The most probable cause seems to be their immense popularity. Since most of the headlines are captures by high growth companies, investors seem to think that they are the best investments. Now intuitively you might have thought that growth stocks are better. What can be the reason for their lower performance over the years?

Let’s go back to the IPO of Google. Think about Google, how its stock price shot up within a matter of weeks after it hit the market. Weeks after that it began to cool off. In 2007, Google stock was selling something around $500. So large growth stocks tend to get overpriced before you are able to buy them!

Mr. Ahmad Hassam is a Harvard University Graduate. Try these cash printing Forex Signals from heaven. Discover a revolutionary Forex Robot System!

The best time of the year to own stocks is the Santa Claus rally which for all practical purposes is the 17 day stretch from December 21 to January 7. This is the best time of the year. Most of the folks usually feel fairly good about themselves around this time of the year.

FED always wants the consumer confidence high during this part of the year. The more shopping the consumers are going to do, the more companies are going to sell and earn. The more companies earn, the more their stock prices go up.FED tends to lower interest rates during holidays in order to go into the New Year with less of a worry if the economy is slowing down. There is a low trading volume which tends to exaggerate the trend if the economy is not doing well and is slowing down. However, when you are dealing with seasonality, you should keep these facts in your mind:

1) The market is not longer static. Money has no borders now. With one mouse click money is transferred from one locality to another. The seasonal effect may get interrupted by other events. More and more people have real time access to information and larger amounts of capital than at any time in the past.

2) At the end of the year, institutional investors want to make their results look as good as possible to their shareholders and tend to buy the stocks and so on. Institutional investors like mutual funds, hedge funds and insurance companies have become important players in the markets. So in case of an event free environment, seasonal tendencies may hold up fairly well.

3) The days of long term investing or what you call buy and hold are dead! Frequent market crashes have taught the investing public that investing for the long term is fairly risky. So there is more short term trading going on. These are the times for day traders and swing traders. With fewer people willing to hold stocks for longer periods, it is very difficult to predict seasonality.

4) The recent market crash was the result of CMO and Default Swaps bringing down the banks and Insurance companies in ways that had not been anticipated or foreseen by the analysts. Many had assumed that derivate securities are safe. Infact they have highly unpredictable tendencies. Derivates and outside the market trading activities can result in highly unpredictable patterns.

Then there is a change in demographics also taking place. With the aging of the population, the overall trend will be towards more income producing investments. So with everyone talking about the seasonal tendencies in the market, it reliability becomes less diminished.

Mr. Ahmad Hassam has done Masters from Harvard University. Try This 1500 Pips A Day Forex Signal Service! Know These Candlestick Patterns!

It is like the continuous ebb and flow of the tides. You must learn to ebb and flow with the tides in the market. Setting stops on the key levels of price support are crucial. These key support levels represent significant market realities occurring with enough trade volume to warrant a stop loss level.

The market will continuously fluctuate. How do you reduce the possibility of getting stopped out of a perfectly good trend by the normal ebb and flow of the market? The answer lies in the current price, volume and volatility of the market.

You will need to ensure that your trading system and approach take these factors into consideration so as to allow your stops to ebb and flow with the markets. The stops need to protect you from risk but they also need to allow the market freedom to fluctuate.

The market will tell you where to set your stop loss if you know how to listen to the market. To choose a random exit that does not include the crucial information the market is giving you at any time is ignoring what the market is telling you.

First learn to understand the market dynamics. Then you need to learn how to identify the correct stop loss based on the market dynamics. Then learn to adjust your trade size to manage your dollar loss. Never ever use an arbitrary dollar amount like, I will get out of the trade when it goes against me $200.

A stop loss protects you from different types of risks. The value of having the stop loss in place prior to entering the market is that you can unemotionally determine the best exits possible for the different types of risk like the trade risk, the market risk, the liquidity risk, the margin risk, overnight risk and the volatility risk.

As a rule dont try to risk more than 2% of your trading account in a trade. The position of your initial stop should be based on the rule of 2% risk on your trading account. Your stop loss position is determined by how much risk you are willing to take. For some advanced traders it is sometimes beneficial to risk more than 2% of their trading account on a single trade. However, the amount these traders risk must be carefully calculated depending on their proven historical performance statistics.

Remember the saying that there should be some method to your madness. Learn the yin and yang of trading. Placing stop loss correctly is an important part of the money and risk management program. One of the greatest challenges for any trader is to finally come to the point where he/she firmly believes that a sound money and risk management program is vital.

Mr. Ahmad Hassam has done Masters from Harvard University. Try This 1500 Pips A Day Forex Signal Service from heaven! Learn These Candlestick Patterns!

We have all been victims of other people’s stock advice. “This stock is guaranteed to go up!” Sometimes the advice comes from a neighbor, or a close friend. It may even come from your own investment advisor.

Our emotions get us thinking. You don’t want to lose out on the potential gains. Irrationally, without blinking an eye, you invest. Most of the time the end result is much worse than you expected. Surprisingly, you continue to repeat this same mistake over and over again.

What is wrong with our thinking? The answer, for most of us, is that our emotions take control of our decisions. They are so powerful that we often ignore our rational, logical thoughts. The opportunity for a quick dollar or hope to “get rich quick” heightens our emotional thinking. You must realize that it is not the rational side of our brain that is tripping us up, but the emotional side!

We tend to ignore many sound investment plans due to emotions. You can, however, quiet that emotional side that forces you to ignore your well thought out investment strategy if you work at it. You can learn to stick to your investment plan through both good and bad times.

Some investors, however, cannot shake the investing demons that compel them into making the same mistakes over and over. It is this type of trader that cannot overcome emotions while investing. They often lack the experience that allows them to treat investing like a business, and not like a game of poker.

The main driving emotion for many investors is the fear of losing money. The next is making a quick buck. Lets not forget to mention greed, the king of all emotions. All of these cloud judgment and prevent you from thinking clearly about how an action affects your portfolio. It doesn’t take long for disaster to strike when this kind of thinking is in play.

When investing, I had a difficult time getting my emotions under control. I was finally able to control my emotions and let my logical side control my investment decisions. To help me do this, I developed an investment system that I use over and over with consistent success. I have certain parameters that I follow to guide me towards the right kinds of investments. This system is black and white, very logical. Now I remain focused and stick to my strategy even when that emotional beast tries to rear its head.

There is no shame in making poor investment decisions over and over. There is good news, you can change things starting now! I made that change and as a result I have been more successful than I ever have been investing in the stock market. I also managed to do this when the stock market was in a sharp decline! I promise you, to be a successful investor all you need is a solid investment strategy and the ability to keep your emotions checked at the door. Take the advise of someone that did that very thing!