Analysis Topic: Investor & Trader Education
The analysis published under this topic are as follows.
Friday, March 04, 2022
The Put / Call Ratio – A Technique Used To Gauge Stock Market Extremes / InvestorEducation / Technical Analysis
By: Chris_Vermeulen
Perhaps you’ve heard of the “Put / Call Ratio” (PCR) and been unsure of exactly what it is or when and how to use it.
First, a quick review of what Calls and Puts are. Calls are option contracts that increase in value from a RISE in the price of the underlying stock or index. Puts are option contracts that increase in value from a DROP in the price of the underlying stock or index.
Let’s jump in and see what’s “under the hood” and how we might use that to better inform our decision-making as traders and investors.
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Thursday, January 20, 2022
How to Get Rich in the MetaVerse / InvestorEducation / Metaverse
By: Nadeem_Walayat
Whilst my forthcoming in-depth analysis will point out the primary mechanisms and strategies for becoming wealthy, however here is what one needs to do to fully capitalise on the metaverse where basically you get out what you put in in terms of effort.
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Wednesday, December 22, 2021
FREETRADE - What Value FREE SHARES Can You Expect to Get When Signing Up? AMD, Apple, Microsoft? UK / InvestorEducation / Learning to Invest
By: Nadeem_Walayat
FREE TRADE is probably one of the best UK trading platforms for Stocks and shares ISA's, with it's commission free trading and fractional shares and low F/X fee of 0.45% AND they give a free share currently worth between £10 and £200 when signing up through a referral link. However what free share can people expect to get will it be an AMD? Apple, maybe a Microsoft as I show what my 7 FREE shares were that I got via referring others to FREE TRADE, so this is a good realistic expectation of what one is likely to get from FREE TRADE.
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Saturday, December 04, 2021
INVESTING LESSON - Give your Portfolio Some Breathing Space / InvestorEducation / Learning to Invest
By: Nadeem_Walayat
Investing is accumulating positions in good corporations for the long-run and not trying to swing trade as some appear to be doing. My primary tools for monitoring my portfolio are Excel spread sheets that I only tend to update prior to posting an article that contains the list of AI tech stocks as I am used to not constantly looking at the state of my portfolio i.e. in years past I would update the prices usually once every couple of months or so given that it is a manual exercise.
Folks, you need to give both your portfolio and yourselves some breathing space, peace of mind as staring at the your stock tracker app's blinking red and green is going to drive you nuts! Don't use trackers, don't use app's. Just use a spread sheet and update your holdings manually once in a while then get on with the rest of your life, don't let your portfolio rule your life!
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Saturday, November 27, 2021
Stock Market Investing LESSON - Buying Value / InvestorEducation / Learning to Invest
By: Nadeem_Walayat
INVESTING LESSON - BUYING VALUE
Remember folks when investing one is not trying to buy the bottoms, one is trying to buy VALUE! There are many metrics for measuring value but for most investors the easiest way to measure value is the P/E Ratio, it is simple and easy to determine and virtually every investment site features the P/E ratios for stocks. Though from my experience many of the sites posted P/E ratios tend to out of date or inaccurate i.e. I calc virtually all of the PE ratios myself by dividing the share price by the earnings per share for the last 4 quarters and that is how one gets the P/E ratio i.e. how many YEARS it would take for the corporation to EARN it's share price.
Now there are many more metrics than that which can be just as important such as whether the corporation printing it's own shares Powell style, Brrrr, so shareholder dilution is another metric I watch among 15 that go towards generating the EC ratio, a quick way to see how expensive or cheap a stock is.
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Friday, November 26, 2021
Stock Maket Trading Lesson - How to REALLY Trade Markets / InvestorEducation / Learn to Trade
By: Nadeem_Walayat
Stock Market Conclusion
Stock market correction so far has been fairly mild with the tech stocks not reaching levels to offer enough of a discount to justify exposure to in the face of the coming inflation storm. Whilst October is not done with yet i.e. we could yet see a final leg down, especially given the potential for earnings surprises form the tech giants due over the next 10 days.. However with each passing day such an outcome diminishes, thus the stock market appears to be gearing up for another run to new all time highs which given the mild correction so far suggests that the Dow could trade nearer to 40k, than 37k by the end of this year.
However, my outlook for 2022 sees worsening conditions that will see transitory inflation become permanent, so there is going to come a time when investors will do the math of what high inflation means for future corporate earnings, i.e. lower earnings due to rising costs and less disposable incomes. Hence it remains highly probable that most stocks will trade to below their October 2021 lows during 2022.
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Tuesday, November 16, 2021
Investing Tips For New Investors / InvestorEducation / Learning to Invest
By: Mark_Adan
1. Know Your Investment Goals
There are several key questions every potential investor should ask themselves before venturing into the industry. Your reasons for investing and how long are two of the key questions you should have an answer to before you can venture into the stock market. Are you looking to grow your wealth, saving for retirement, or hoping for a house deposit? It is only after identifying and defining your investment goals that you’ll be able to determine what stocks to invest in and for how long.
Saturday, November 13, 2021
Tips For Investment Success / InvestorEducation / Learning to Invest
By: Mark_Adan
We live in an information society - however, the information that we receive cannot always be relied upon. That information is supplied by the mass media and is often the product of pundits in cyberspace - that obviously might not be those who are the best sources of information. However - as a logical human being you may very well have more logical ideas. But - even given that insight there are some hints and tips that can provide guidelines that will improve the performance of your portfolio.
So here are some hints and tips from those who know a portfolio and how to make it provide them with an income in a time of high uncertainty.
There is a tremendous amount of information that is available to those who want to enter into the realm of cyberspace. The print media still has a gravitas that is not easy to match. Then there are friends and family - and they can be tremendously influential in shaping your thoughts. Given all these inputs, how do we find that path towards a personal investment that actually delivers,
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Thursday, October 14, 2021
How to Protect Your Self From a Stock Market CRASH / Bear Market? / InvestorEducation / Learning to Invest
By: Nadeem_Walayat
Stock Market CRASH / Correction
We will soon be moving into the window for a stock market correction where I penciled the probable expectations for it to take place sometime between Mid Sept to Mid October, though it could start earlier hence why I was not willing to wait around and de risked ahead of the window.
How much could the general indices such as the Dow drop? I have in mind a drop of somewhere between 15% to 20% as being the most provable outcome, though it is early days, so it could be less or it could a more but 15% to 20% is what I have had in mind for the likes of the Dow for some time.
Whether it will be just a correction and resume it's raging bull market or signal start of a bear market proper is uncertain, probability favours continuation but this is not 2011 when we were in a hated stealth bull market that few took seriously instead now every tom dick and harry thinks that stocks can only go up! And so will assume that buying the dip is a one way bet to stock market riches. Which is why one needs to focus on VALUATIONS! Buy when Stocks are CHEAP! For it allows one to survive BEAR MARKETs and not end up with a 20 year Dead Parrots like Cisco and Intel!
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Thursday, October 14, 2021
Why "Losses Are the Norm" in the Stock Market / InvestorEducation / Learning to Invest
By: EWI
"I can measure the motions of bodies, but I cannot measure human folly."
Did you know that Sir Isaac Newton "lost his shirt" in the South Sea Bubble of the 1720s?
This great scientist and mathematician lost more than the equivalent of a million 2021 dollars.
Here's a brief description of Newton's investment actions from Robert Prechter's landmark book, The Socionomic Theory of Finance:
[Sir Isaac Newton] invested a little bit early in the trend and "wisely" took a small profit. Watching the trend continue, he finally bet heavily and "wisely" held on for the long run. He eventually sold out at a near-total loss.
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Thursday, September 30, 2021
Should you include ESG investments in your portfolio? / InvestorEducation / Learning to Invest
By: Sumeet_Manhas
The coronavirus pandemic has undeniably altered society in many immeasurable ways. It’s even had an impact on the world of investment. Indeed, it proved to be a major turning point for ESG investing as the pandemic not only altered the way we interact with one another but societal values too.
The experts at Saunderson House recently ran a study on financial well-being and put a greater focus on responsible investment. Their results reveal that, from a moral perspective, there is a major appetite right now for ESG or responsible investing. But what is ESG and why should you include them in your investment portfolio?
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Wednesday, September 22, 2021
MetaTrader 5 Features Every Trader Should Know / InvestorEducation / Trading Systems
By: Russell_Fenton
MetaTrader 5 is an advanced trading platform that features a wide range of asset classes, including cryptocurrencies. It is a multiple asset platform for modern traders considering taking their trading experience to the next level with practical and robust features. Read on to understand these features.
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Wednesday, September 08, 2021
6 common trading mistakes to avoid at all costs / InvestorEducation / Learn to Trade
By: Submissions
Even small mistakes can cost you big when you’re a trader. Read these six common trading mistakes and learn how to avoid them at all costs.
No trading career is free from mistakes. In the beginning, most traders embark on a trial-and-error journey. And, even professional traders can sometimes get so caught up in their trading that they forget about severe mistakes they should avoid. Well, don’t be any of them.
Trading is a very popular activity these days, precisely because it can bring you some massive returns. But it isn’t risk-free. One great way to minimize your risk of losing money is to learn what are the most common mistakes made and how to avoid them.
Here are six common mistakes traders make and how you should avoid them.
Thursday, August 26, 2021
Tips for Using MT4 Trading Tools to Increase Efficiency / InvestorEducation / Learn to Trade
By: S_N_Chatterjee
The current uncertain environment demands traders to continue using efficient trading software and one of the suitable solutions available is MetaTrader 4. Packed with tools and features, it can help users make well-informed decisions, now that global stock markets are unnerved by fears over growth.
Because of that, this material plans to share 4 insightful tips that could help retail traders using MT4 leverage the full benefits granted by this platform. Regardless of prior background, these pieces of advice apply to anyone.
Wednesday, July 28, 2021
Eight Do’s and Don’ts For Options Traders / InvestorEducation / Options & Warrants
By: Chris_Vermeulen
Trading, especially options, can be very exciting and rewarding. Having said that, you should not be trading options before learning at least the basics about how to trade them. Options are very different from stocks and there are more factors that go into the pricing. Many view it as a get-rich-quick scheme while others think it is gambling. I am here to say it is neither but you have to know the rules before you can trade them if you want to be successful. Last week I covered some little-known basic facts. This week I am covering 8 Do’s and Don’ts for options traders.
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Monday, July 12, 2021
An Investing Truth: Roughly 80% of Stocks Are “Duds” / InvestorEducation / Learning to Invest
By: Stephen_McBride
Today I’m spilling the beans on something very important. It’s a “truth” about investing almost nobody understands. This truth explains why most investors struggle to make any real money in the stock market… while a few achieve life-changing gains.
The truth is: most stocks are horrible investments. Let me show you what I mean, and how you can turn this truth into an edge that’ll let you beat 99% of investors.
Thursday, July 01, 2021
INVESTING LESSON - AI Stocks Relative Strength - Why Selling Google or Facebook is a Big Mistake! / InvestorEducation / Learning to Invest
By: Nadeem_Walayat
Stock market corrections are useful in gauging what is going on under the hood of corporations long before any information makes it into the public arena. For instance looking at the relative strength of the top 5 AI stocks shows Google and Facebook showing relative strength, whilst Apple and Amazon are showing relative weakness with Microsoft in the middle. What this is saying is that one should definitely NOT make the mistake of....
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Monday, May 31, 2021
You Should Never Trade Options If You Don’t Know This… / InvestorEducation / Options & Warrants
By: Chris_Vermeulen
Have you ever heard someone say “90% of people that trade options lose money.”? I certainly have. Looking at an options chain can be a dizzying exercise for the uninformed. Delta, Gamma, Theta, Rho, Vega – and let’s not forget – implied volatility? Single, spread, butterfly, condor. What does it all mean?
So what is an option from a high level view?
At the end of the day, an options contract is just a derivative like any other stock, bond, ETF, or other tradable security based on an underlying asset. Most people will look at these other forms of derivatives and have an understanding of why the price fluctuates. For example, if a company posts a strong earnings report and the price of the stock goes up, it is easy to understand what is going on. In the case of options contracts, however, things do get a bit more complicated. Let’s break things down a little bit to start to get an idea of why many investors are afraid to trade options.
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Sunday, May 16, 2021
INVESTING IN HIGH RISK TECH STOCKS - ALL OR NOTHING / InvestorEducation / Tech Stocks
By: Nadeem_Walayat
There is a reason why I don't like discussing investing in high risk stocks and it's nothing to do with the fact that I DO invest in high risk stocks to a limited degree. And that reason is because most of the people I converse with DO NOT UNDERSTAND HOW TO INVEST IN HIGH RISK STOCKS! So my preference is to avoid the subject altogether and stick to discussing that which has a high probability of success and low relative risk of loss. Though the stock market being what it is one never know when the likes of for instance a BP is going to EXPLODE! So stocks can never be risk free no matter what the stock is.
So the starting point before I fire off a list of high risk tech stocks is to explain how I invest in high risk stocks and hopefully my Patrons will be able to incorporate what I am saying into how they view high risk stocks for I have given up on trying to explain to people in the real world, including highly intelligent doctors, as there tends to be a mental block where high risk stocks are concerned i.e. people tend to look in the rear view mirror and see how x or y stock has soared into the stratosphere and thus think it is easy to be placed in for instance the next Tesla or TSM or AMD or whatever. Without understanding the fundamental fact that even if by chance they had invested in say AMD at $2, they would NOT be invested in AMD today at $80 because their short-term mindset would have likely ejected then from the stock at $3 or $4. That's why the starting point has to be to explain how I actually invest in high risk stocks which given exchanges with people tends to be the exact opposite of how many investors perceive high risk stocks and likely why they don't end of up capitalising fully on their investments.
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Monday, May 10, 2021
Apply This Technique to Stop Rushing into Trades / InvestorEducation / Learn to Trade
By: EWI
Dear reader,
You know this feeling even if you've traded only a little.
Here's how it usually goes: You look at a chart, you see what appears to be a setup -- and you instantly pull the trigger.
Then you look closer and realize that... you were early. WAY early.
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