Sunday, 13 March 2011

Study Share Market Timing and Make Money

By Sherie Rene


Stock Market - Introduction

Ask most investors and investment experts, and nearly all will tell you that it is impossible to time the market. Those who disagree are in the minority, and I'm one of them. I would say yes, you can now stock market. How would you like to see a method of stock market timing, which is not difficult to implement and has been consistently profitable? One of the words, regardless of the economy or the stock market is doing.

Without doubt, over the years is to get to know and probably spent a buy and hold strategy. Buy blue chip shares in a well-known company or companies and hold them for long periods is the buy and hold investors have always done. This method does not allow you to time the stock market successfully.

In the past, the buy and hold strategy could produce a profit, but it is increasingly difficult to do in the environment of the last ten years. Today, the atmosphere is very different.

At the top of the market in late 2007 to buy and hold investor can feel the modern stock market square. In March 2009, although the trust has become a terror, and immersed in the stock market and found a new low. But the market has made a comeback to say. Yes and no. It's still considerably lower than the previous high. The value of buy and hold investor's portfolio is likely to be negative.

Most stock prices go down when the stock market is down. For the most part, the price will be higher when the overall market trend higher. Why you or someone you want to own stocks when the market is falling? You do not. Want to own shares in the stock market are up and not to short stocks when the market goes down. It is essential to reverse the trend to invest successfully you want to time their investment decisions based on whether the stock market is a trend more or less.

Everything you need to determine trends in the stock market is a picture of a year, every day of the S & P 500-index and a 10-day and 30 day moving averages. I like to use exponential moving averages. That's what you must meet in order to anticipate the market. You could buy an index fund shares or ETFs, while the average 10-day average crosses the 30 days. Crossing becomes your buy signal. You short stocks or buy a reverse index ETFs, while the average 10-day crossing below the average of 30 days. This passage is falling sell signal. It really is not that simple, as you maintain a strict discipline, and not try to make assumptions or predictions.

For your convenience, you can establish S & P 500 return and make a simple test to see how it can be profitable. Using an index fund ETFs go long the market index fund and an inverse ETF to go short the market when, after a sell signal. The same strategy works for one or more stocks, and you should be able to sell near the high and listen very close to a bottom.

If a long-term investor has been using this strategy, they have been on the market in a few weeks after the Dow Jones Bull market high in October 2008. And as the stock market retreated, there was a lot of money to make a short circuit on the way inventories low, or the possession of one of ETF funds around. How long will the stock market.

Something you want to explore in more detail.

You probably have heard and believe that learners are children of the basic investment errors itself. I think the biggest mistake of all time is simply the lack of consistent exercise of discipline. You can experience incredible trading results and your income will be the only test of whether the discipline. Discipline allows you to time the stock market successfully and cannot afford to ignore its importance.

Sometimes, indicators produce "false signals" opposing signals in a short period of time. In the long run if you're on the right side of the market and maintain profitability. Brokers may call the dark days of economic decline or an accident on the eve of a bear market, but only listens to their indicators, the best source of new jobs, good advice.




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