Stock Trading ? Technical Analysis For Fun And Profit

How do you scrutinize the stock you're considering buying as an investment vehicle? More and more traders are finding out that an excellent way to perform their analysis is technically rather than fundamentally. As a devout technical analyst, I believe there are more and quicker profits as a reward to the trader using the technical approach to study stocks. Even the most fundamentally sound stock may not be in favor and may not gain in share price for quite awhile. But when a tradable stock is found using technical analysis, the move will happen soon or most likely won't happen at all. No more buying stock and waiting for a gain that may not happen. No more shotgun approach and diversifying to overcome the losses you hold in your portfolio. The technician lets go of losers quickly while letting their winners run. It's an active approach to trading stocks, options, forex and commodities. Besides, technical analysis is much more enjoyable than pouring over a company's profit and loss statement!

Proper technical analysis is the study of an equities chart and forecasting probable price moves based on patterns exhibited on the chart. To be a successful technician of the markets it's best to keep things simple. One of the pitfalls a budding technical analyst has to overcome is the massive amount of information on the subject and not falling prey to the "holy grail" syndrome. Many people have forgotten that the most important considerations of the stock chart are price and volume. While indicators may be helpful to some, others have tried to use them as a timing system almost to the exclusion of the price chart itself. Indicators are mathematical algorithms of price movement, volume or a combination of both. They where meant to be used as a tool to help the trader validate what they see on the chart, NOT to enter a trade. The most probable trades come from the price chart itself. The price chart tells a psychological story and trades should be based on the confirmed break of a pattern such as a head and shoulders or bearish wedge.

The satisfaction of mastering the craft of technical analysis can't be overstated. It's very satisfying to find a stock that screams "buy me" and then watching as the price breaks out of a trading range and clocks ten to fifteen percent over the next few weeks. Learning to read charts takes time but not an eternity. The key is to spend some time each night studying stock charts and over time you will begin to recognize the technical patterns that tell you if a stock has bottomed, topped out or will continue its trend. Keep it simple, learn to think for yourself and soon you will be on your way to successful trading with technical analysis.

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Forex Is For Everyone!

Simply put, foreign exchange, more popularly known as Forex or FX, is the simultaneous purchase of one currency and sale of another. The market for trading in currencies is known as the Forex Market. While getting started in Forex, you must understand that the Forex market determines the ?exchange rate? for which the specified currencies can be bought and sold. This exchange rate is essentially a price and can be analyzed in the same way as we would analyze a price.

This can best be understood by providing an apt analogy in terms of the price of the commodity. Say that commodity is a pencil. If the purchase price of 4 pencils is $1 then, the dollar-to-pencil rate of exchange will be 4 pencils. You can look at this from another angle also. You can also have a fair idea of the pencil-to-dollar rate of exchange. This comes out to 25 cents. This essentially means that if you sell one pencil you can get 25 cents for it. You must understand that the rate of exchange that is available in the newspapers doe not refer to these simple commodities but gives readers information about the comparative prices for different currencies.

Getting Started in Forex!

Forex, in the true sense, is a global 24-hour marketplace. This is because, investors can respond in real time to any fluctuations caused by current economic, social and political events. You can get started in Forex by choosing two currencies you want to trade in. This is because the currencies are traded in pairs, i.e., Euro and Yen, US Dollar and Euro etc. The foreign exchange market is unique due to the extreme liquidity associated with it. Money freely flows from this market since millions of dollars can get in and out of it each day. It is also considered liquid due to the fact that traders can just open and close their trade positions in a wink of an eye!

Bevy of Trading opportunities in Forex

The sheer number of currencies traded is fascinating. There will always be currencies that are moving rapidly up or down, offering opportunities for profit (and commensurate risk) to astute traders. Yet, like the equity markets, Forex offers plenty of instruments such as forward contracts, futures and options, spot market etc, to mitigate risk and allows the individual to profit in both rising and falling markets.

Who can participate in the Forex Market?

Until recently, this 2 trillion dollar market was reserved for banks, insurance companies, large corporations and other large institutions, as the minimum traded volume was rather high. However, less than a decade ago, it became possible for retail investors to get started in the Forex market through dealers. Although the retail market for currency trading is more or less a parallel to the inter bank market, prices in both markets are very similar and move very closely.

Conclusion

The currency markets are hard to resist due to its sheer liquidity, opportunities for booking huge profits and high levels of leverage. However, you must also be aware of the risks involved in this segment so as to make an informed decision before venturing out into the unexplored world of Forex!

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Vix And The Psychology Of Markets

We know that greed and fear rule the markets. But did you know that when investors gets too greedy, markets usually fall, and when investors are overcome with fear, markets usually rise. So how can when we monitor investors emotions and take advantage of investors emotional extremes?

Welcome to the world of investor sentiment analysis.

Investor psychology has been analysed for at least 250 years. Charles MacKay wrote his book, ?Extraordinary Popular Delusions And The Madness Of Crowds?, in 1841, describing, among other manias, the herd mentality that caused the South Sea Bubble. Since then, many academics have published financial theories based on the concept that individuals act rationally and consider all available information in the decision-making process. But real life frequently demonstrates that the behavior of equity markets is irrational and unpredictable. A field known as ?behavioural finance? has evolved over the years attempting to explain how emotions influence investors and their decision-making process. Studying human psychology helps predict the general direction of financial markets as well as many stock market bubbles and crashes. At the height of a period of optimism, greed moves stocks higher, ignoring business fundamentals and therefore creating an overpriced market. At the other extreme, fear moves prices lower, ignoring obvious opportunities and creates an undervalued market.

One important study, (?Aspects of Investor Psychology,? The Journal of Portfolio Management, Summer 1998) found that investors are much more distressed by prospective losses than they are made happy by equivalent gains. Some researchers theorize that investors ?follow the crowd? and conventional wisdom to avoid any regret in the event their decisions prove to be incorrect.

QUANTIFYING INVESTOR EMOTIONS OR INVESTOR SENTIMENT

When a stock or market index rises, we know that it means investors are more eager to buy than to sell. But how can we accurately gauge just how investors feel?

Most often, investors are somewhere between mildly positive and mildly negative, and only occasionally do they demonstrate the extremes of greed or fear. It is easier to detect emotion when it is close to either irrational exuberance or outright fear. When markets act this way, it becomes "news" and moves from the business section, to being featured at the start of the evening news, and on the front page of the daily newspaper.

The success of charting as a tool, depends on investors repeating their behaviour patterns. There is always a comfort factor in doing the same as others and generally an aversion to behaving differently. Investors display herding instincts in their behaviour and this has become particularly noticeable among institutional investors. In the early stages of a rising trend in a market, positive sentiment can act as a positive driving force as everyone rushes in to join the party. However, there comes a time after the trend has been in place, when this positive sentiment acts as a warning that the trend is nearing its climax. That's when smart investors will start switching to alternative investments.

The most sophisticated and active players in the market use derivative products to effect their transactions. These players tend to display earlier changes in emotion than most investors and normally their emotions run to greater extremes. So, derivative markets are a good source of data on investor sentiment. There are various options available on stocks, ETF's and indexes. By using an option pricing formula, we can extract a measure of how much investors are prepared to pay for the possibility of making a profit, or hedging against a loss. This is known as implied volatility, and it provides a mathematical valuation of investor emotion. Implied volatility tends to be high (the scale is inverted) when the market has had a sharp fall and this is associated with investor fear. At the other extreme, low implied volatility often occurs after a rise in the market and when investors are becoming complacent.

Implied volatility image

WHAT IS THE VIX?

VIX is the symbol for the Chicago Board Options Exchange's volatility index for the S&P 500 (SPX). It is a measure of the level of implied volatility and not historical or statistical volatility. A numerical value for the VIX has been published by the CBOE since 1993. The method of calculating VIX was changed in early 2003. Instead of using the S&P 100 (OEX) Index options, it is now calculated using the options on the S&P 500 (SPX). Also note that the VXN is the symbol for the implied volatility index of the NASDAQ 100 index.

The implied volatilities are weighted to give the VIX a value that in effect acts as the implied volatility of an at-the-money SPX option at 22-trading days to expiration. The VIX represents the implied volatility of a hypothetical at-the-money SPX option. If implied volatility is high, the premium on options will be high and vice versa. Generally speaking, rising option premiums reflect rising expectation of future volatility of the underlying stock index, which represents higher implied volatility levels. The higher the VIX, the more panic in the markets and the greater the chance that investors have given up hope, taken their money, and gone home.

Comparing the movement of the VIX with that of the market can quite often provide clues as to the future direction the market might move. The more the VIX increases in value, the more "panic" is an issue in the market place. On the flip side, the more the VIX decreases in value, the more complacency there is amongst investors. The psychological impact measured by a relatively high VIX is a clear indicator that tells traders markets are oversold. A historic example was displayed on July 23rd 2002 when the VIX shot over 55. That big move coincided with a significant low in the Dow Jones Industrial Average that was followed by a 1,034-point, six-day rally. That rally didn't stick and the market again re-tested its July low in October of 2002. But throughout this double bottom in 2002 the VIX accurately identified a major directional shift in the market. At its core, the VIX is a statistical measure of emotions, and emotions are a major factor signalling capitulation in the market.

Sample charts

INVERSE RELATIONSHIP

Extremely high readings of VIX indicate market bottoms, while low readings indicate market tops.

The VIX actually has an inverse relationship to the stock market. This is one of the first things you'll notice when viewing the VIX on a bar chart. When the VIX goes down the stock market moves higher. When the VIX advances, the stock market is headed lower. Generally speaking, a rising stock market is considered less risky by investors. On the other hand, a declining stock market is considered more risky. Therefore, the higher the perceived risk by investors the higher the implied volatility. This will make options, especially put options, more expensive.

When the phrase "implied volatility" is mentioned, keep in mind that it is not about the size of price swings. Rather it's the implied risk that is associated with taking a position in the stock market. When the stock market declines, the demand for put options usually increases. Increased demand means higher put option prices.

USING VIX to TIME the MARKET

One early study identified a VIX value of 25 as normal, and a value above 35 as high. Between October 1997 and May 2001 the VIX indicator went above 35 eleven times. In this study, the S&P 500 index as represented by SPY ETF. was purchased each time and held until the VIX retreated below 25. There were 9 profitable trades for an average gain of 3.1% and an average holding period of about one month. By using this VIX timing scheme you could capture 80% of total gains in the market, but your money is only at risk one third of the time.

Sample chart

Extremes in fear mark great buying opportunities.

Sample chart

THE CONTRARIAN VIEW POINT OF THE VIX

An extended and/or extremely low VIX suggests a high degree of complacency and is commonly considered bearish. From the contrarian view point ,many traders are of the opinion that if the VIX becomes low, they'll begin looking for a reason to begin selling stock. On the flip-side of the coin, a very high VIX can indicate a high degree of anxiety which often leads to panic among options traders. This action is often considered bullish by the contrarian, and they'll look for reasons to begin buying stock. High VIX readings usually occur after an extended or sharp market decline with investor sentiment still very bearish. Some contrarians view readings above 35 as bullish. Hence, they'll begin looking for a major market turn to the upside.

The VIX should be used in conjunction with "regular" analysis of price action on price charts. The wise trader will never make a purchase or sale based solely on the price level of the VIX. The wise trader will use the VIX (and its support and resistance levels) in conjunction with the price action of charts of the S&P 500, the Dow, and the NASDAQ.

Using the VIX with charts of these indices will help you get a good grasp of the current market psychology. Since market movements are based entirely on human emotions, it is important for traders to understand psychological indicators. When the VIX is used correctly it helps you stay on the right side of the market and make profitable trades.

SUMMARY
Understanding Investor Sentiment (or Investor Psychology) is by far the most powerful tool an investor can use to understand exactly where the stock market is, and where it is going. But it is often hard to digest, as it is counter intuitive to our human nature.

Here is a recent example that will help illustrate this point.

In September 2005, the TSX was making multi year highs. While the VIX Indexes was down near multi year lows. Standing back and looking at these two pieces of information, you might question the wisdom of adding long-term money to this market at this time.

You might, but human nature would not.

From GARY NORRIS
Canadian Press
Mon Oct 17, 3:58 PM ET

Canadians are shovelling money into mutual funds almost like it's 2001 again, with September purchases of $1.8 billion - up from net redemptions of $545 million a year ago.

The Investment Funds Institute of Canada said Monday that investments in long-term funds - equity, bond and other funds excluding short-term money market funds - topped half a trillion dollars for the first time. "This underlines the fact that investors are making long-term commitments to funds, and not simply parking their investments temporarily in money market funds," commented Tom Hockin, president of the fund industry association.

Sales in the first nine months of the year, net of redemptions and excluding reinvested distributions, totaled $18.4 billion, "the highest net sales figure since the same period in 2001," Hockin observed.

Yes, you read that correctly, Canadian have not been this enthusiastic since the last time the market was peaking.

TSX Sample Chart

Now we don't have enough data yet, but since Canadian Mutual Fund investors did their "extreme" mutual fund shopping last month, the market has already dropped 800 points.

Now ask yourself, if you were going to put money into this market, was September the best, low risk time to do so in the past 5 years? Were these investors thinking analytically, or did the emotion of greed cloud their judgments?

My guess is that this is what I like to call "Panic Buying", of Canadian Mutual Funds last month, will signal the very top of this market, and be the catalyst for a major sell off.

Only time will tell if I am right.

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The 40 Rules Of Consistently Profitable Commodity Futures And Option Traders, Part 6

Are you following these forty commodity trading guidelines? Follow them all and you have a better chance of becoming a consistently profitable commodity futures and options trader. Design your trading plan around these rules. Don't underestimate their value for your success.

We All View The Market Through Fuzzy Glasses

34) Be fully willing to change your mind. A flexible mind is a sign that?your ego is under control. Stay in the now moment and let the market unfold as it may. You should be simply watching for clues to make a decision. The commodity futures contract market doesn?t ?have to? do anything. Remember that everyone views the world through their very own fuzzy, distorted and colored glasses. There is a tremendous amount of information we miss.
It's like trying to watch a live football game through a soda straw. We see just a tiny bit of what's really happening. However, we think we are seeing the whole picture ? that's where we run into trouble. The good news is your competition is in the same boat. We need to be flexible and change our minds when we must. Our input of the world is too small, biased and inaccurate to be correct most of the time.

Know Your Trading Time Frame and Eliminate the Useless Noise

35) Pay attention to the time frame that is larger than the one you are trading. If you are trading five-minute bars, be aware of the 30 or 60-minute chart. If you are trading daily bars, then watch what the weekly futures chart has done. We are looking for clues. The balancing act is to take in just enough information that is important, but not too much.

Many futures and options traders have their charts loaded with too many things; redundant moving averages, momentum indicators, multi time frames, etc. These indicators are fine as long as they each add important information and you can digest them. In reality, all you really need is a few price bar chart time frames and a few personally developed indicators you trust to convey information that you cannot see otherwise. The brain receives information in a serial manner, meaning we take in data in a single, narrow stream, one idea at a time.

We should make our futures contract trading information unique and different, not redundant. Information overload is a big problem. Everyone goes though it. There should come a time when every good commodity trader cleans house and removes the useless accumulated junk on his charts. Keep your charts Spartan lean with as few competing indicators as possible.

Each one should sing for its supper and pull its own weight. Each one needs to tell you a story that cannot be seen in the price bars alone. That's what the computer is for. To have a 10-day, 20-day, 40-day, 100-day and 200-day moving price average is pure noise. There's much better stuff to put up there. I'm sure you get the picture.

Watch Out For Market "Scenarios"

36) Be careful when hanging your hat purely on fundamental commodity futures information. These are news events, supply and demand figures, etc. I've seen the biggest losses taken as a result of traders getting fixated on news. Their trading gets sloppy and a long haul stock investor mentality begins. What started out as a disciplined short term trade turns into a long haul trade, once the loss begins.

Recently, gold has been in a bull market. Traders were lining up and?pyramiding as prices went higher?from news of big India and China buying. Many commodity traders did quite well for a while as gold quickly moved from $500 to $750 an ounce. But then the correction came. Many were prepared for a nerve racking $30-50 slam. The gold gurus were warning of it. It corrected as expected and many bought more gold and talked about the same bullish news.?Buy alas,?the gold market continued down into the low $600 area. This was a devastating correction for many. In reality, this was just a normal correction when compared to many other commodity futures or stock markets.

For example, stocks often run up to 75 and correct to 62 (same percentage) as well as pork bellies, and other commodities. But because many of these traders were fixated on the news and then pyramided, they got caught badly. I heard stories of $100,000 accounts going to less than $10,000 even after the first $50 gold correction. Most were wiped out way before the full $200+ correction. Being vulnerable and inflexible is a dangerous game. Don?t'swing on just one branch of a tree.

Part Seven of Seven, Coming Next!

There is substantial risk of loss trading futures and options and may not be suitable for all types of investors. Only risk capital should be used.

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Spot Forex Investing

Most likely 1 of the most widely used strategies of investing forex more than the previous couple of many years has been spot foreign exchange trading and its potential to give traders improved leverage and versatility when getting their forex positions. Quite a few critics have argued that spot fx trading is highly difficult to implement as a feasible extensive expression strategy and is only a approach that is made use of by small expression speculators and forex trading gamblers. The reality is that spot forex trading can still be a aspect of a much larger and far more detailed investing system as very long as the currency trader is familiar with how to use the procedure effectively. A large number of traders who only use spot on an intermittent foundation can hardly ever get a fine come to feel for how the true movements in the overseas trade promote are contingent on competing forces. These traders often do not place the time in to investigation and analyze like forces and alternatively just easily count on the leverage that spot affords them to just take distinct positions and then hope for the top.
This can give good results, but the very best use of spot is as a piece of a larger approach that has been proved to deliver the results for other traders in the previous, and whilst you can experiment with spot, it can be problematic to see any kind of continual returns owing to the volume of volatility that is current on the overseas trade advertise. Numerous people both get perplexed or are uncertain of irrespective of whether to use spot foreign exchange trading or forex trading futures as part of their in general strategy. This is a standard event considering that the two are quite identical and they each can basically provide you with parallel final results if they are applied by using similar positions. The key big difference relating to spot and futures is that with futures the exact trade of forex will only just take spot at the preset date and time that is in the future. This generally effects in no exchange of exact forex, as the majority of traders who take advantage of futures are basically speculators who will not abide by by means of on the precise trade date.
With spot forex trading the exchange happens when the exact contract is designed at the stage of trade even although a date and time is setup the equivalent way as it is with futures. With spot the buying and selling positions that are generated with the institution of the deal are not frequently held onto for a longer time than about a day. This has constructed spot forex trading buying and selling a limited time period system that can be a great deal more widely put into use as part of a much larger plan if the trader sets it up that way. This is how the vast majority of spot traders use the approach to make a normal profit, and only using it irregularly is not what some of the most flourishing spot forex traders do. It is ok to experiment a little bit at first to see if you like the way spot will work and specifically if you've been trading futures for a extensive time. If you have had good results with spot then you should not wait to make it a part of your more substantial methodology as this will increase your likelihood at making a usual revenue with your forex investing company.
Other forex means

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Forex Trading For Beginners - Keys To Becoming A Successful Forex Trader

Forex trading involves the simultaneous exchange between two currencies. Shares are bought and sold by investors in order to make profits. The Forex market does not have a physical address. The Forex market is actually a large network of individual investors and central banks all involved in the process of changing currency. The market is open 24 hours a day, and follows all the major countries including The United States, Europe, and Asia.

The Forex market is unlike traditional markets as you are not required to place the full amount of money into each contract. The Forex market works on a margin system, typically 1%. For example, if the contract at hand is for $100,000, you are only required to place 1%, or $1,000 into the contract. This money is used more as an insurance policy if the contract goes negative.

The main currencies found in the Forex market are:

USD: U.S. Dollar
CAD: Canadian Dollar
GBP: British Pound
EUR: Euro
CHF: Swiss Franc
AUD: Australian Dollar
HKD: Hong Kong Dollar
JPY: Japanese Yen

New Investors often find the Forex market to be one of the most profitable markets in the world. However, this does not mean that anyone without training should attempt to trade by themselves. There is a 95% failure rate with new investors, because the majority simply do not take the time to properly educate themselves. Successful Forex traders must understand the ins and outs of Forex trading before becoming successful. This often takes years of risking their money and time.

If you choose to trade on your own, the best possible option is to get well educated before trading. You may find the information and training needed to become successful to be overwhelming. Gaining the knowledge and experience needed to become successful at trading may take years. Experienced traders understand the basic fundamentals of the system, and how to properly make decisions, while leaving human emotion out of the picture.

A key to becoming a successful Forex trader is finding tools and services that aide you in making informed decisions. The Internet allows investors to access an almost unlimited amount of information. Whether it is a program, chart, or article, successful Forex traders rely on any reliable tools they can get their hands on.

Training Tutorials: Numerous types of online training tutorials are available for little or no cost. Typical training tutorials take you from the very basics to the more advanced portions of Forex trading. By reading, studying, and following the training programs as instruction, you gain knowledge and experience in the Forex market, which will help you make informed decisions later.

Statistic Analyzers: Programs are available that actually analyze data for you. When you are new to investing, the statistics and information may seem to be in gibberish. Statistic analyzers take the information and make it readable by even the newest investor.

Real Online Trading Programs: If you prefer to trade without the pressure of learning the trade, you may consider an online trading program. Online trading programs allow you to determine your settings, then the program controls your portfolio for you. Since programs do not rely on human emotion, profits are easily obtainable.

The most important way a new investor can trade efficiently is by using a trading program. Trading programs not only rely on information rather then emotion, they have the potential to do all the work for you, eliminating the need for hours of learning to learn the basics of the Forex system.

One alternative to going through the process of learning the system is using an online trading system.

Whichever method that you choose, stick with it. Don't jump from one to another. Learn the system thoroughly, set it on autopilot and stick with it.

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Stock Investing - What You Need to Know to Get Started

Learning how to get started in stock investing doesn't have to be complicated or intimidating. Anyone can learn how to invest in the stock market with some knowledge of how markets work, the types of stocks there are, and the best strategies to use. Armed with this information, you'll be ready to jump in to the world of trading with both feet.
What are Stocks?
Stocks are essentially a share of a company. When you buy stocks, you own a part of the company you are buying from. Companies sell stocks in order to raise money that they need for research, development, and expansion. If the company does well in business and profits, a part of the profits will go to you through annual dividends or through the sale of the stocks that you own.
What is the Stock Market?
The stock market is where stocks are bought and sold. It's not an actual location. In short, the stock market is the business where the trading happens.
Another term for the stock market is the stock exchange. The biggest stock exchanges are NYSE (New York Stock Exchange), AMEX (American Stock Exchange), and NASDAQ (National Association of Securities Dealers).
On the news, they tend to talk about the Dow Jones Industrial Average, the S&P 500, and the NASDAQ Composite Index. They all are just general market averages to give the public a basic understanding of how well the economy and companies are doing. The average return of the market is about 8 percent a year, which is a good return. However, this is the average return of the entire stock market - your investment might have a higher or lower return depending on how well the company does in a given year.
The Different Kinds of Stock
Generally, stocks are grouped in three different ways: by size, by style, or by sector. When grouping stocks by size, we refer to them as large-cap, mid-cap, or small-cap. Large-cap stocks are sold by large companies with a market cap of over five billion. Mid-cap stocks are sold by mid-sized companies that have a market value of 1 to 5 billion. Small-cap stocks are sold by companies that have a market value of less than 1 billion. Although small-cap stocks give you more potential for profit, they are riskier than large-cap or mid-cap stocks. It all depends on the risks that you're willing to take.
Stocks can be grouped by style - growth and value stocks. Growth stocks are those that are expected to rise in value higher and faster than the whole market (higher than 8 percent return). Value stocks are stocks that are at lower prices than they should be, perhaps due to company problems or bad public relations. Some investors like to invest in value stocks in order to "buy low and sell high."
Lastly, grouping them by sector means to separate stocks into categories depending on the industry that they're in - e.g., technology and health care.
Investing Strategies
A common low-risk strategy for investing in stocks is to buy low and sell high. You'll see better results if you employ a lot of patience and keep a cool head during dips in the market. There are two ways to do this - by investing in a value stock and holding it on for a long time until prices rise, or investing in an established company and not selling your stocks for a long time.
Another important strategy to use when you're learning about investing the stock market is to diversify. None of the different types of stocks will perform the same in a given year. They all go up and down at different times - during one year, some will rise and others will fall. If you invest all of your money in only one type and then they don't do well, you lose a lot of money and it'll be hard to recoup your losses. Instead, if you spread your investments into different types, you might lose some money on certain kinds but you'll still see profits in other kinds.
Why You Should Invest in Stocks
Money that's sitting in the bank is not doing you any favors. Actually, you lose money when you leave your money in a bank account, even a high-interest savings account. Inflation will catch up to your money. With some practice and experience, along with smart decisions such as diversifying and taking the slow approach to buying and selling, soon enough you'll be seeing profits from your investments.

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Foreclosure Investing Is A Smart Investment Strategy

Foreclosure investing is a kind of real estate investment. It is one of the greatest investment options as far as returns on investments are concerned. Foreclosure investing opportunities are normally created when homeowners default on monthly installment payments and the bank confiscates their property. The property is then sold at a foreclosure auction. Foreclosure investing opportunities are also available when a homeowner tries to sell the property immediately to the ready buyers, before the foreclosure is announced. Information about such auctions is readily available on the Internet. You can use the information to invest in properties that have the potential to maximize your investment returns, in the next few years.

It is a Buyer's Market

The foreclosure investing market is often called a buyer's market because buyers are in a better position to negotiate the price of the property and other related terms and conditions in a deal. A homeowner, who has not made timely payment towards a mortgage loan, is usually aware of the fact that the property will be confiscated and he will not be able to profit from the sale proceeds. To avoid foreclosure, homeowners try to sell their property and use the proceeds for applying for new mortgage loans or buying new properties. Generally, owners who want to avoid the impending foreclosure have only 60 to 90 days to sell the property, before it is evaluated at a public trustee sale. According to certain state laws, homeowners are even given the option to reclaim their property within 360 days. Homeowners, who do not use this option, if available, will not be able to stop the lenders from foreclosing the properties and eventually selling them at a public auction.

Foreclosure investing is a cheap and low risk investment option

Foreclosure investing in properties is probably the least expensive way of maximizing your investment returns. If you conduct a thorough research, you can easily identify and buy properties at very reasonable prices. In the past, there have been foreclosure investing properties that were sold at discounts as high as sixty to eighty cents to a dollar. The foreclosure investing market is considered a low risk one, since land is a scarce resource. The value of the land will categorically rise, even if the real estate market witnesses a downtrend.

Other Foreclosure Investing Benefits

There is no collapse of foreclosure investing and properties in the real estate market. In order to buy a foreclosure investing property, you may not even have to apply for a bank loan. You just need to identify a suitable buyer, who is willing to pay the right price. Foreclosure investing properties are either sold at auctions or the buyer sells it directly.

As compared to the regular real estate market, the foreclosure investing properties market has a fewer investors. This makes it a lot easier to find and buy properties below the existent market rates. It is anticipated that the foreclosure investing properties market is set to grow at a steady pace in the next few years. Foreclosure investing thus made is worth all the initial effort and patience applied. The foreclosure investing market offers real value on the money spent and re-evaluation of the property always reveals that the price paid was well below the existent market value.

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Do You Know What Forex Trading Is?

Forex trading is the trading of foreign currencies on the foreign exchange market. This is exchange where a Nations currency is traded for currencies from around the world. Participating in Forex trading means that you are participating in an international market in which a large number of currency fluctuations take place due to many different factors. Profits generated in this market are usually in the trillions of dollars every day and millions of people from many backgrounds engage in it worldwide.
There are a large number of people that make this their primary way of earning money, and for others, it as an additional source of income. There are people who have earned enormous profits very quickly while at the same time there are those that have lost their fortunes in this market. As with any endeavor, you need to take care of several things in Forex trading, such as through understanding of the market, sufficient money to trade with, a constant eye on the pulse of the market, and expert knowledge.
Technically, Forex trading is one of the largest, most liquid and most popular ways of earning legitimate money online that operates round the clock. As per one estimate Forex trading generates exchanges as much as 3 trillion dollar each day and still growing. Therefore, it means a lot of money involves in it so if you are able to take right decisions at the right time you could have probably earn a huge sum of money. And, the beauty is anybody can participate in this market almost from anywhere irrespective of his or her nationality or geographical location.
Transactions in Forex trading take place between small investors as well as large private investors, multinational corporations, private and public banks, financial institutions, currency speculators, large government and central banks. Another remarkable feature of Forex trading is that it differs from the stock market as it is divided into various levels of access. At the lowest level you will find small or individual investors, while at the highest level you will find inter-bank market which has large investment banking firms and institutions that deal in billions of dollars each and every day. But that shouldnt dissuade small investors who have only a few hundred to a few thousand dollars to invest. The truth is they have the clear majority.
Believe it or not, most of the information that is available on the internet doesnt seem to guide you in the right way, so you need to be very careful while putting your hard earned money in this Forex trading. Just like any other business activity, you need to equip yourself with sufficient knowledge, have through understanding of the market, and need to have a lot of patience and persistence. Never fall in trap for those service providers or companies that promise to make you huge money instantly. Instead of reaping short term gains, always look for ways that help you invest for a long term. While choosing a company or service provider, always look for their past track record and customer feedback.
Listen to everybody but when it comes to making a decision, choose wisely because you are investing your money, otherwise you are only gambling your money away. When you develop your own strategies based upon your own feelings and guidance from experts and technical analysts, you should become an expert investor. The lack of guidance and you trade aimlessly, and gambling your money away and finally into ruin instead of earning money from Forex trading.

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Save Smart With Financial Planning Services

Bills! Its just one word that can get a disappointing frown on your otherwise smiling face. You can try all you want but even with a great paycheck coming into your account you might not be able to save just enough money to claim good savings as all your money will just end up in satisfying various bills. Money management is the key to survive this financial nightmare and a brilliant way in which you can achieve that is by getting some smart financial planning services that will work around the bills and save a great deal of money.

Wealth management is one thing that everyone should know but in your daily battle with the routine life it isn?t easy to dedicate your time to managing your finances and this is where a smart financial consultant can come to your rescue. A good consultant can devise a brilliant investment strategy to assess your financials and understand how to get the maximum returns from it. Working on saving your money isn?t easy but with good help from J.P.Turner & Co you can relax as these professionals know exactly what needs to be done.

There are a variety of areas in which a financial consulting firm like JP Turner can aid you with your money like tax management, investment management, retirement strategies, conservation of estate or property, insurances and more. A key area in which financial planning services can guide you in making money by saving money is in the area of tax planning. Many people give away a large amount of money in their taxes not aware of how they can save this money by making smart investments and a financial consulting firm will know this for a fact and help you too in protecting your assets from taxes.

The core idea of retirement planning is to save enough money for your old age days and a smart investment plan made by a financial consultant will also be able to ensure that your old age is the golden period of your life financially. Property is one of the biggest assets you can have financially and making good money out of investments and savings is possible by employing independent broker dealers that can guide you to converting your property into an investment that delivers high returns. Investing in the right insurance policies can also save your money efficiently especially in areas like auto insurance or health insurance where without a good insurance a lot of your money might get spent for the smallest hiccups in your personal health.

The right investment strategy isn?t hard to plan but a financial consultant makes it easier for you to relax as their great understanding of money saving techniques will help you save a whole lot of money that you just didn?t expect. So get ready to transform your shaky steps into confident strides with the kind of financial strength you always wanted all thanks to these money making sages.

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Find The Right Retirement Job

Well you have retired lately. You ex-colleagues, friends and relatives are saying that you're "over the hill", but still you feel you can walk miles uphill till you settle for good finally. Moreover, you are not a person to while away time through reading, traveling and other leisure activities. In other words you want to go back to work. Yes, you can as there is plethora of post-retirement jobs. You have to know where and how to find them. If you are confident enough about your strength to slog further then here are the ideas that will help you to land up with the right retirement job.

Assess yourself. This is very important to understand your capacity and passion for the job-type that will help you and your employer in the long run. You will come to know about the skills that need brush up. Knowing your plus points will help you undergo the interview with confidence. Moreover if you want to explore new fields after retirement an assessment will clearly tell about the ones that match with your skills.

While assessing yourself check your skills that are the abilities in you to perform a task. Know you interest that is your preferences for areas of work. Also gauge your personality that is ways of processing information, making decisions, and interacting with others. There are the factors that decide your suitability for a job.

Make a good R'sum?. Don't misrepresent yourself in the bio data. Mention your qualifications that are required for the job opening. You should also insert the recent accomplishments that are pertinent to the position. If you give extensive experience, skill-set and qualifications then it may be counted as your drawback as being unfocused. Show the crafts that will make you useful for the job. Don't compose a bible on work history. As you will upload the bio-data on the internet, use your target industry's keywords so that the resume comes within the notice of the employers.

There myriad job portals these days that post jobs for retirees. Aim a specific industry and position that you want to join. Identify the organization size as well - large, small, entrepreneurial, nonprofit. Always figure out if the job requires skills that you have. Check out the options like -full time, temporary, part-time, contract, or seasonal work. If you are trying out new post-retirement careers take up positions that involve fewer responsibilities. Now shoot resumes in appropriate organizations.

If you are asked to attend an interview do it with confidence. Always explain to the interviewer that money and title are not your priorities. Stress on your attitude, skills, and the interests that encouraged you to apply. Don't take a defensive approach. If you think that the remuneration package is too trim to carry out the task, tell the interviewer that the position needs experience and know-how which you have. If asked to stay extra hours, honestly answer whether it will be possible on your part. Beside this take enough preparation to answer the technical questions related to the job field. If selected for the jobs check the policies that they have for hiring post-retirement candidates. Investing in business is also a good post-retirement option.

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Unleash The Hidden Power Of Your Trading Plan

Deep in your trading plan, you may be missing an element that could be eliminating huge winners. By merely tweaking a few indicators and steps to your trading plan, you may be able to produce returns you've never been able to achieve.

Change your entries and exits

Depending on your trading style, you may be cutting losses too deep and winners too short. Many traders make the mistake of letting losers run while their winners get cut off after a modest gain.

Changing your exit plan to a trailing stop, or setting the bar just higher, will let the winners run and prove profitable. Likewise, having extremely tight stops means that the overwhelming majority of trades will be stopped out before they even get the chance to move. Tinkering with entries and exits will do a lot to work towards consistent profits.

Change your timeframes

Most day trading strategies are more profitable when adapted to the long term. swing trading and investing strategies perform better because the infrequent trades save hundreds in commission fees and take less off the bottom line. Expensive spreads might make the difference of a few percentage points of profitable trades, which is sometimes enough to double your results. If you can successfully trade the 1 minute charts, it will be an easy switch to the hourly or even daily charts. The longer the timeframe, the easier the investing and the less you'll pay for trading.

Being able to adapt

Experienced professional traders have seen it all and have likely tried every strategy around. What is hot on the market for the next decade might soon fall behind when a new trading science takes over. The secrets of profitable traders is that they're able to adapt and able to make money in every situation. It doesn?t take an investing genius to be able to adapt what they've learned to a new trading environment. In just the past 50 years, so much has changed in the stock market, and it's probable that trend is unlikely to stop now.

Participate in a trading seminar

Trading seminars are a great way to bounce ideas off other traders, along with rationale behind different types of techniques. With a trading seminar, you may even walk away with strong trading secrets otherwise unavailable to you. Regardless of your skill level, you can always improve your strategy through a trading seminar, and they are a good way to tap into the intellect of the traders you're competing with. Skill-building activities and the step-by-step instructions available in an online home trading seminar will build your foundation for pulling consistent profits.

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Investing Wisely To Create Wealth

People think that wealth creation is destined and only for the lucky one's. This is an entirely false notion and a reason for many people not achieving financial success. To be financially successful lot of thinking, planning and innovative ideas are required.

One should learn to be a good fund manager and create assets and investments for a life time with ones own ability or if you can afford it with the advice of expert investment managers of advisors. As you grow plan the events in your life like getting the right education that gives a good career in something you like to do to generate money to invest. Remember financial success is necessary before you can think of moving further.

Only after you are totally self dependent should you marry and have children. Financial self sufficiency is a must for going in to have a family. Adequate finances are required for managing family household expenses, education of the children and buying cars and household utilities.

Create a debt free portfolio of wise investments in stocks, shares, real estates and all other investment opportunities that one deems fit. Though short term gains are appealing an can fetch lot of returns on your investments the long term goals should also be kept in the mind for the retirement and ailment periods.

Safe guard your money. Spend your money cautiously on luxuries you can afford, do not be a spendthrift or soon you will loose cash and accumulate debt. It is always wiser to be aware of your spending capacity and never exceed that. The money you rightly save can be invested further to get good returns and secure you and your family's future.

Meet experts, investment advisers or knowledgeable friends who keep you informed about all potential investing opportunities and smart financial planning. Follow the advice in this article and see how quickly you achieve financial success.

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Introduction To Options Trading, Part 2

An option is a contract that provides you with the right to execute a stock transaction?that is, to buy or sell 100 shares of stock. (Each option always refers to a 100-share unit.) This right includes a specific stock and a specific fixed price per share that remains fixed until a specific date in the future. When you have an open option position, you do not have any equity in the stock, and neither do you have any debt position. You have only a contractual right to buy or to sell 100 shares of the stock at the fixed price.

Since you can always buy or sell 100 shares at the current market price, you might ask: "Why do I need to purchase an option to gain that right?" The answer is that the option fixes the price of stock, and this is the key to an option's value. stock prices may rise or fall, at times significantly. Price movement of the stock is unpredictable, which makes stock market investing interesting and also defines the risk to the market itself. As an option owner, the stock price you can apply to buy or sell 100 shares is frozen for as long as the option remains in effect. So no matter how much price movement takes place, your price is fixed should you decide to purchase or sell 100 shares of that stock. Ultimately, an option's value is going to be determined by a comparison between the fixed price and the stock's current market price.

A few important restrictions come with options:

?The right to buy or to sell stock at the fixed price is never indefinite; in fact, time is the most critical factor because the option exists for a specific time only. When the deadline has passed, the option becomes worthless and ceases to exist. Because of this, the option's value is going to fall as the deadline approaches, and in a predictable manner.

?Each option also applies only to one specific stock and cannot be transferred.

?Finally, each option applies to exactly 100 shares of stock, no more and no less.

Stock transactions commonly occur in blocks divisible by 100, called a round lot, which has become a standard trading unit on the public exchanges. In the market, you have the right to buy or sell an unlimited number of shares, assuming that they are available for sale and that you are willing to pay the seller's price. However, if you buy fewer than 100 shares in a single transaction, you will be charged a higher trading fee. An odd-numbered grouping of shares is called an odd lot.

So each option applies to 100 shares, conforming to the commonly traded lot, whether you are operating as a buyer or as a seller. There are two types of options. First is the call, which grants its owner the right to buy 100 shares of stock in a company. When you buy a call, it is as though the seller is saying to you, "I will allow you to buy 100 shares of this company's stock, at a specified price, at any time between now and a specified date in the future. For that privilege, I expect you to pay me the current call's price."

Each option's value changes according to changes in the price of the stock. If the stock's value rises, the value of the call option will follow suit and rise as well. And if the stock's market price falls, the call option will react in the same manner. When an investor buys a call and the stock's market value rises after the purchase, the investor profits because the call becomes more valuable. The value of an option actually is quite predictable?it is affected by the passage of time as well as by the ever-changing value of the stock.

Tip

Changes in the stock's value affect the value of the option directly, because while the stock's market price changes, the option's specified price per share remains the same. The changes in value are predictable; option valuation is no mystery.

The second type of option is the put. This is the opposite of a call in the sense that it grants a selling right instead of a purchasing right. The owner of a put contract has the right to sell 100 shares of stock. When you buy a put, it is as though the seller were saying to you, "I will allow you to sell me 100 shares of a specific company's stock, at a specified price per share, at any time between now and a specific date in the future. For that privilege, I expect you to pay me the current put's price."

The attributes of calls and puts can be clarified by remembering that either option can be bought or sold. This means there are four possible permutations to option transactions:

1.Buy a call (buy the right to buy 100 shares).

2.Sell a call (sell to someone else the right to buy 100 shares from you).

3.Buy a put (buy the right to sell 100 shares).

4.Sell a put (sell to someone else the right to sell 100 shares to you).

Another way to keep the distinction clear is to remember these qualifications: A call buyer believes and hopes that the stock's value will rise, but a put buyer is looking for the price per share to fall. If the belief is right in either case, then a profit may occur.

The opposite is true for sellers of options. A call seller hopes that the stock price will remain the same or fall, and a put seller hopes the price of the stock will rise. (The seller profits if the option's value falls.)

Tip

Option buyers can profit whether the market rises or falls; the trick is knowing ahead of time which direction the market will take.

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Studying The Stock Trading Online Through Internet

Share marketplace is really prosperous and several people have derived fund due to it. Huge numbers of people have as well lost money and their fortunes, but are still lures since it is simple funds. Once you're fortunate and keep in mind proper share investing suggestions you are able to money.
It is obvious that the suitable recommendation is that it is necessary to focus on a small series of cash. You've to realize at length related to all little complexity related to the share trading systems along with the method of their work and the consequences involved and continue smartly once dealing with shares.
The share marketplace is the site where the stock shares of the listed corporations are purchased and marketed. With the assistance of share market it's easy to buy and sell stocks. A broker is an personal who buys as well as sells shares as your representative. The broker need to be approved and possess registered in order to deal in stocks. The demat account is the account by which stock trading is practiced. The share investing systems give them the probability only to trade with demats account and so the shares are saved independently in them. The account might be handled by the one who has opened it. The broker agent would be billed by the bank if you have opened a demat account in a bank or by a private agent if you have opened an account by utilizing a private share broker.
One particularly basic share investing ideas is virtually that you must be up to date with the stocks that are to become acquired by you or marketed by you. You've to read graph of the investing shares and consequently track its ups and downs attentively, else you will encounter deficits in your dealing. This is actually the 1st rule of share market training that is advised you always sell the stocks while the price is up and purchase once the cost is minimal.
The stocks must offer you with an excellent return, it needs to give you the profit of additional than the bank interest on cash, after which only there could be profit. Gaining shares at reduced prices is among the most wise move to generate. Once purchasing a stock never fail to check the value with the expert organizations so you are aware of the popularity. Constantly if a specific corporation isn't earning funds, then it might be relatively possible that it will not earn money afterwards as well, hence you don't need to invest in that corporation. Take note of the record, long term plans as well as the chart of the return of the corporation so that you stand to come up with take benefit of its stocks. There needs to be a lot of cash so that you could manage loses which can be happened at any point of time.
Acquire yourself sufficiently solid to endure deficits or to come up with benefits. Share investing is the name of change so it cannot be constant. Earning is not normal and losing is also not steady. If you are earning cash at a number of point of time maybe soon after you will be dealing with deficits. It functions two ways. Prepare your self to produce yourself sufficiently powerful to suffer failures and not being unhappy.

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Key Levels For The Major Indices

Much has been made about the Dow Jones Industrial Average (DJIA) touching the key 7,500 level this week. Why is this level considered important from a historical and technical basis? And what are the other major indices, such as the S&P 500 Index (SPX), NASDAQ 100 Index (NDX), and NASDAQ Composite Index (COMP) showing on a long-term basis?

As you can see in the following chart, this area on DJIA marks the previous lows from November 2008 and 2002-2003 and was also an important technical level in 1997-1998, so it can be considered a strong support level. As you can see the following chart, if we do break sharply below 7,500, we are basically going back to mid-1990s levels in the Index.

The S&P 500 Index (SPX) has breached the 800 level which was significant in the past, but the 750 area is perhaps more important, and we have not yet touched that level this month. We are currently about 5% above that level.

The NASDAQ 100 Index tracks the performance of the biggest NASDAQ stocks -- this Index almost touched the key 1000 level in November 2008, but currently is about 15% above that level, due to the recent general outperformance of NASDAQ stocks. Some of this is due to the lack of Financial and Energy weighting in NASDAQ Indices.

The NASDAQ Composite encompasses almost 3,000 NASDAQ listed stocks. The COMP is the Index that famously hit 5,000 in March 2000 at the height of the parabolic uptrend now known as the "Internet Bubble". This Index bottomed around 1,100 in 2002/2003, and thus far we have remained above that level, both currently and in the November 2008 plunge. We currently stand about 25% above 1,100 on the COMP.

The bottom line is that we are dangerously close to making 12 year+ lows on two of the most widely followed indices, the DJIA and the SPX. However, we do we established support around and just below the current levels which one would anticipate is likely to hold (at least for a trading range consolidation). The NASDAQ indices have withstood the 2008/2009 drop much better ... but from the bearish perspective, they indicate a potential 15% to 25% more downside to their key levels. Of course, these are very long-term charts -- within the big picture multi-year trends are many short-term great trading opportunities on both sides of the market for option traders.

Moby Waller,
BigTrends Portfolio Manager & Analyst

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Prepaying Your Mortgage ? The Pros And Cons

If you have looked into wealth building strategies, you have undoubtedly stumbled upon the raging debate over prepaying one's mortgage. Here is the objective scoop.

Prepaying Your Mortgage ? The Pros and Cons

When paying a mortgage, one is in the unique and unfortunate position of having to pay a lot of interest over a long period of time. Depending on the value of your home, you can easily expect to pay hundreds of thousands of dollars over the life of a 30 year loan.

Advocates on one side of the isle suggest that paying even a few extra hundred dollars a month against your principal will save you tons of money over the life of the loan. Others feel this is lunacy as the money can be used for other purposes. As is often the case, both parties are partially right and partially wrong.

If you purchase a home with a 30 year loan and live in the home for 30 years, you will pay a draconian amount in interest. In such a situation, paying a few hundred dollars more in principle each month will save you tens or hundreds of thousands of dollars in interest over the 30 years. The question, however, is whether this makes sense for you in the real world.

The first issue to consider is how long you intend to live in the home. In our modern transitory society, most people don?t plop down for long periods. If you are going to sell your home in five or seven years, the extra payments on the balance of your mortgage are not going to make much of a difference. On the other hand, making such payments makes sense if you are definitely in it for the long haul.

The second issue is the mortgage interest deduction. Many people fall in love with the deduction. Obviously, yours will fall if you start paying off your loan ahead of time. Typically, you will not see a big drop off for at least five years, but it is something to keep in mind.

The third issue is alternative money usage. Specifically, would you be better off using the money in another way. Historically, the stock market has returned a little less than a 10 percent rate of gain. While each year brings different results, some believe you are better off to invest this money in the market since you will be earning more at 10 percent versus paying off a 7 percent loan. This argument tends to forget one small thing, to wit, capital gains tax you will have to pay on any stock market gains. There is no correct answer, so make sure to analyze your situation.

All and all, the decision to prepay a mortgage is a personal one. Take a stark look at your life and determine if it makes sense in your situation.

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Understanding Your Investment Style

No matter what kind of investing you do - bonds, stock options, mutual funds, gold, commodities, real estate - in order to be successful you need to have a thorough understanding of your personal investment style. Some investors are risk takers, some investors are conservative, some investors are a combination of the two, depending on their cash position and the form of the investment. Understanding your personal risk tolerance and investment style will aid you in making smart investment choices.

While there are many different types of investments, there are only three specific investment styles ? and those three styles directly relate to your risk tolerance. The three investment styles are: conservative, moderate, and aggressive. These styles are dependent upon your tolerance of risk and how much time you're willing to invest in ... your investing.

For example, some investment strategies may have you watching prices go up and down continually throughout the day. Are you equipped to handle these changes, especially if they don't go your way? Other ventures may place your entire investment at risk. You could lose all your money. Is that something that would weigh heavily on your mind, possibly affecting the way you handle the investment? Do you panic easily? Are you able to stick to the numbers and the plan they represent, with clear cut entry and exit points? Or are you the type to watch an investment dive and toss out the original plan in the hope that the investment will eventually come back?

Also important to consider: how involved do you want to be in your investments? Do you want to trade daily and make a career out of it? Do you want to overlook and control every aspect of your investments? Or would you prefer a more passive role, spending only an hour a week or a month in making sure everything appears on track? Do you prefer to do your own research or rely on the research of others?

The next consideration is your life situation. For instance, if you're investing for your retirement and you're in your early twenties, a conservative or moderate approach to your investments is often the best road to take. However, if you're investing for your retirement and you're in your mid-fifties, you may have to be more aggressive, and therefore a little riskier in your investments. In the same vein, if you're trying fund your first house, your approach will generally be more aggressive because your time-line for generating profits will be dramatically shorter than if you were simply working toward a goal such as retirement.

Conservative investors want to preserve their initial investment. If they invest $5000, they want to be sure that they'll get their initial $5000 back. Common stocks and bonds, short term money market accounts, Treasury notes, high-rated municipal bonds, CDs, even interest earning savings accounts are generally preferred investments for this type of investor. They tend to steer clear of stocks, since stocks can loose their value.

A moderate investor invests similarly to a conservative investor, with the goal of increasing the value of their investments without risking any major losses. They'll generally use a portion of their investment funds for higher risk investments. Many moderate investors invest 50% of their funds in safe or conservative investments, with the remainder in something slightly riskier (blue chip stocks, for example).

An aggressive investor is looking for significant gains, and he's willing to go out on a limb with his initial investment to achieve these gains. Individual stocks, stock mutual funds, stock options, and some of the speculative markets are all potential investments for the aggressive investor. Larger returns, generally in the short run, are the goal here.

Determining the style of investing that best fits your personality, life situation, and financial goals is the most important step toward making successful investments. However, no matter which approach to investing you take, always do your due diligence. Never invest without having all of the facts.

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An Inside Look At Cameco?s Smith Ranch Uranium Facility

Cameco Corp (NYSE: CCJ) is the 800-pound gorilla of the uranium sector. Cameco is to uranium what Wal-Mart is to retailing, and what Saudi Aramco is to petroleum. On a percentage basis, Cameco dominates its sector more so than either of the two. Cameco probably has more clout in turning off the electricity now powering your computer than any other company in the world.

This week, the spot price of uranium rose to $40/pound, for the first time since Ronald Reagan was president. That should help grow the uranium business in Wyoming by leaps and bounds. In Part 5, we look at the largest U.S. uranium producer, Cameco-owned Power Resources.

Understanding ?In Situ Leach? Uranium Extraction

?It took $284 million Canadian to build, and it operated with 546 people,? said Patrick Drummond, Plant Superintendent for Cameco subsidiary Power Resources? Smith Ranch facility. He was pointing to Kerr McGee's Smith Ranch underground mine on the wall across from desk, which was later converted into an ISL operation, first run by Rio Algom. ?This operation cost US$44 million to build and 80 people to start.? Drummond was referring to the In Situ Leaching (ISL) uranium extraction facility, known as Smith Ranch. ?That should give you the scale of the ISL versus an underground mine,? he explained.

The aging, but sprightly, Drummond knows his uranium. He's worked in underground mines, open pit mines, and uranium mills since 1980. From 1996 to the present day, he's worked in Wyoming for Power Resources at the company's ISL uranium extraction facility. ?I started off in the coal mines in Scotland,? boasted Drummond, who claims he can spot a coal miner in a bar, just by looking at the veins in his hands. ?I worked up in Elliot Lake and the massive underground mines up there.? Clasping his hands and looking down, he seemed to apologize, ?It's also a massive environmental problem to clean up, a major undertaking. Quirk Lake was one of the bigger mines up there. It cost a lot of money to clean it up.?

The New Face of Wyoming's Uranium Mining is the ISL uranium extraction method, also known as solution mining. The differences between mining uranium underground and an ISL operation are both minor and vast. Both methods mine uranium beneath the surface. So both methods are underground mining. However, that is where the similarities end. ?With underground, you bring up the ore, grate it, crush it, and extract the uranium from the ore,? Drummond explained the basics of underground uranium mining. ?That ore becomes waste, which is known as tailings. You then have to service these big tailings and then decommission.?

ISL is the new breed of mining. ?With ISL, we don?t do that,? continued Drummond in his day-long lecture to our editorial team during a VIP tour of the Smith Ranch facility. ?To mine underground with ISL, you drill the holes where the uranium is and extract the uranium from the underground ore,? he said. ?Then, you process that into yellowcake.?

It's not all wine and roses for Drummond, though. He pines away for his underground mines, ?From a mining perspective, it's not mining so it is not as exciting. Drummond laughs, ?ISL is like a water treatment plant. We take water out and remove some ions.? He makes it sound so simple, ?We remove the water from the underground and remove the ions, being the uranium ion. Then, we put the water back under the ground.? All of the water goes back into the ground? Actually no. Drummond explained, ?We take our water out and we put 99 percent back in. The one percent we call ?bleed.? It's a control function.?

Drummond cites more comparables, ?To start an underground mine, it would take a year to do the shaft before you could start mining. Then, there's the development cost of the mill complex. You have all that outlay of cost before you can get any benefit. It's expensive to do underground -- $200 million plus ? because of the upfront development costs.? From his perspective, the miner in Drummond has come to like solution mining. ?ISL is easier. It is a lot cheaper: less expensive capital costs and less operating expenditures. It is less labor intensive.? Asked about the deadly radon emissions, often cited as a danger in underground mining, Drummond shot back, ?This is a zero emission facility.?

Analyzing the two methods, he said, ?You can start producing faster with an ISL operation. You start your first header house, and you can start producing and make money.? He added, 'so you get a return on your investment faster.? What's the downside? ?We also recover less uranium with ISL,? Drummond admitted. 'some of Cameco's mines in Saskatchewan are running around 5, 10, 15, and 27 percent uranium. In this area, or in an ISL, it runs less than one or two percent. It's very low.? Plus the uranium ore body must be found below the water table. He added, ?You can only do ISL in rock that's porous and has water in it in the first place.?

To put it in the simplest terms, billions of years ago, the uranium found its way into the underground aquifers of Wyoming's sandstones. ?We add oxygen and get the uranium back into solution,? Drummond remarked. ?We complex it with CO2 to keep it in solution, and then bring it to the surface. We extract it with an ion exchange base.? According to Drummond, extracting uranium works on the same principle as a water softener. ?We add salts to the resin to get the uranium to back off from the resin. Then, we take that uranium and make it into a final product called yellow cake.?

And why it is called yellowcake? 'some of it is yellow; some of it is green or dark green. Some of it is black,? Drummond patiently explained. ?The color is a function of how we dry it, not how we process it. There is a very definite correlation between drying temperatures of yellow cake and color.? It all depends on what chemicals you use while processing uranium. At Smith Ranch, we make uranium peroxide. It is very clean and yellow. We complex uranium with hydrogen peroxide to make our product. You can make different types of yellowcake. You can make a uranium diuranate, a complex made with ammonia.? Yellowcake can be made with other chemicals.

How is Wyoming's ISL uranium dried? ?We dry the uranium with vacuum dryers,? said Drummond. ?The benefit of vacuum dryers is first of all, it's a vacuum so everything is sucked inside the canister so nothing escapes into the environment. There are no gases that escape.?

Investigating the Environmental Issues

It was, at this point, we felt it appropriate to inquire about all the puzzling worries many of us might correlate when thinking about nuclear energy and uranium. How safe is all of this really? ?When we first started uranium mining, we inherited people from the gold mines,? Drummond explained. ?They were underground, and smoking, breathing in the dust. In the early days, we didn?t have good ventilation. In underground mining, you've got to keep the air moving.? Hard rock underground mining produces dust. ?The shards of silicone you are breathing stick to the follicles on your lungs,? he noted. But that doesn?t happen during the ISL extraction process. No emissions, a farm of well fields with underground pipes and tubing, and very detailed safeguards explain they the lobby wall of Power Resources is lined with Safety Award certificates and plaques.

?On a daily basis, when we leave the facility, we are scanned for alpha radiation,? continued Drummond. 'depending upon your position here, you get urinalysis once per week or once per month. We also check for radiation levels.? How did Drummond fare on his most recent radiation check? ?I was way below,? he laughed. ?There are guys on the beach in Malibu that have higher radiations than I have.?

What precautions does Power Resources take to protect the environment during the ISL extraction process? 'since 1996, we have had zero excursions,? Drummond announced with steeliness in his voice. ?We take very great pains to look at the topography, so if we do have an excursion, we make sure it does not enter what we call the ?waters of the state.? Any channel that could take that and move it into the ?waters of the state,? is something that we are very cognizant of.?

After the holes are drilled into the well fields, a company does a ?baseline sample.? Drummond said, ?That's a sample of the constituents in the water. When we mobilize the uranium, we mobilize other items. It is our duty here, after we start the well field, to return the aquifer back to baseline when we are done.? He added, ?If we know what's in the water before we start, then we know how to restore it to background.? Restoration of the underground tampering with Mother Nature can take anywhere from 18 to 36 months.

The company is meticulous in restoring the landscape as well. Any restoration work on the surface is called ?reclamation.? That can involve farming. ?When we start a well field, we have to, by license, remove the topsoil and store it somewhere,? Drummond explained. ?When we go back to reclaim the property, we take all the pipes out, we take the houses down, and cut our wells off. It's all identified. We put an ID marker on the well. In 50 years time, when Farmer Joe comes around and wonders what was there, the state can say, ?That was a uranium well.? From the time we've stopped mining, we put everything back to normal.?

It takes from two to four months, or up to seven years, to exhaust a well field, depending upon the roll fronts. While it can take up to 24 months to put in a well field, reclamation and restoration take longer. ?We put back the topsoil on, depending upon the weather, as soon as we can,? said Drummond. ?We re-seed, during the spring or the fall, which is the best time for seeds. The seed we use is dictated by the regulators so we use a certain amount of native vegetation.? Because it's very dry at the Smith Ranch, nearly bordering on desert, and because it is also very windy, slapping down the topsoil won?t last very long. ?First, we plant some fast-growing oats to establish a root bed,? he explained. ?If we just planted grasses, it would all blow away. Because we plant the oats, we have fat antelope and fat deer.? From our observations, the sheep were well-fed and frisky.

How does Wyoming ISL mining compare to other places, such as in Texas or in Kazakhstan? ?In Wyoming, the water is pristine, very clean, even compared to Texas, where they do ISL,? answered Drummond. ?The water's pretty clean down there also.? Is the uranium the same? ?When we bring our uranium to the surface, it comes up as uranyl dicarbonate,? he responded. ?In Texas, it comes up as uranyl tricarbonate.? What's the difference? It's in the processing of the uranium. ?We get about 8.5 pounds of pounds of uranium per cubic foot of resin,? he explained. ?In Texas, they get about 3 to 4 pounds of uranium per cubic foot of resin.?

Drummond described the Smith Ranch ion exchange operation, ?We have two columns in the ion exchange, each with about 500 cubic feet of resin.? The resin costs about $200/cubic foot and, barring mechanical damage, can last up to thirty years, according to Drummond. The polymer beads ? they look like tiny plastic ball bearings ? capture the uranium during the processing phase. ?In Kazakhstan, you get about two to three pounds of uranium per cubic foot of resin,? he continued. ?They use hydrochloric acid because of the water conditions. Of course, you've changed the chemistry of the water and have all the acid to clean up.? Drummond described the water in Kazakhstan as very brackish, and yellowish. ?The TDS (total dissolved solids) is very high,? he added. ?The water's not fit for human consumption anyways.? He laughed, ?Using acid over there cleans their water up.?

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Futures Trading: Behind The Scenes

You see them every day with a new and costly cell phone, driving every day in latest sports car, you hear of their super bonuses and hence decide to join the world of futures trading. Along with enormous bonuses and costly mobiles, futures trade mainly share two other traits:

1. High level of stress.
2. Huge risk.

It is true that many people are engaged in the Futures trading, many have become wealthy as well. If you are well known of the market, avoid greed and fear, and act with it as serious investment opportunity, then the success probability is excellent for you.
Let us know about the requirements for futures trading. There are four requisites, which mainly influence your ultimate success in futures trading:

(A) Take futures trading as business enterprise; apply all orthodox business rules, money management and judgment.

(B) Adopt predetermined trading plan - adopt established guidelines and set of rules, which are well known and valid.

(C) Utilize risk capital - make sure that if you lose the invested money, it should not alter your living standards.

(D) Psychological make-up.

Psychological make-up plays a significant role in futures trading. What type of person you are, how you act under pressure, your ability to think logically, your ability to make quick decision, the way you react under pressure, your power to make quick decisions, your personality, your character, your approach toward money - will regulate your success in futures traders.

Many futures traders let fear, pride and greed, determine their trading decisions. These futures traders oftentimes lose money due to their emotions. Futures trading system annihilates these problems by creating objective trading decisions on a coherent basis. Futures trading systems will allow futures traders a chance to trade smartly.

An effective trading system must

? Be totally objective.
? Be easy to use.
? Give clear purchase and sell signals.
? Keep draw downs to minimum.
? Produce large profits every trade.
? Take little time.

If you want to be a successful futures traders you should have futures software, at minimum it should include:

? A ticker tracker: If you want to trade in a future, search for a ticker symbol of that future, get the futures quote, then make up your mind if you like to trade. A ticker is a specific 4-letter symbol distinguishing future.
? Charting: The software package must have a charting function.
? Market averages.
? A futures quote function.
? Market alerts.
? Market indices.
? Trading screens.
? News alerts.

One cannot yield to trade in futures trading without the impartial advice provided by good software.

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