Let’s assume that you want to make some serious money and you have chosen to take things into your own hands rather than depend upon a “professional trader” to make your trading decisions. This is usually only recomended if you can afford to lose the money that you are trading with, and you appreciate the fact that there is much more upside potential with this added risk. In any case, you have decided on 3 stocks that you like and are now at your computer ready to purchase them.

Before you decide to get into the market, you will want to do some research. Determining a good time to get into the stock market is very hard, but it can also be one of the most important decisions you make. When traders get carried away and think too optimistically, the market gets over valued and it is ripe for a downturn. After that downturn is when you want to enter the market. Once believe that time is now, the next step is to sign up for a online brokerage account. Then, you will want to choose at least 3 stocks from different sectors of the stock market. Perhaps you like Genentech- DNA or Phizer – PFE as a drug stock, google – GOOG or intel – INTC as a tech stock, and Exon Mobile – XOM or Valero – VLO as an energy stock.

Then, it’s as simple as entering the symbols for the stocks that you have chosen to invest in and setting a limit price. Or, if you prefer to have your trade placed instantly at the best available price, just make it a market order and it’s even simplier for you. Now, unless you have the time and interest, let your stocks sit for a year or more before you even consider selling them. This way you can avoid short term capital gains tax which can eat into your profits.

Of course, if you prefer a less risky approach consider purchasing a no load mutual fund. You will want to make sure it is a no load mutual fund otherwise you could be charged up to 5% or more by your broker on each trade you make. With all the competetion out there, don’t get sucked into a mutual fund with “hidden fees” like that.

I hope this article has given you an introduction to online investing and will help you.

Troy Smith is a freelance writer who also makes a living buying and selling stocks on a daily basis. Visit his Website: StocksOptionsTrading.com

You just heard about the E-currency Exchange Program. You hear about people making money with it. You wonder if you can make money with it. Is it too complex? Is it a scam? Could you double your income with it? Read on to find the answers.

How soon before I can double my investment? Will I be able to get my money out? Can you really make money with the E-currency Trading Business ? While you may ask yourself this, the important thing to realize is that this system is already working for other people. It takes a good strategy and some pacience but having a high 5 figure portfolio in Electronic Currency Exchange is something you definetly can do.

Here are some of the truths about the E-currency Trading Program :

-You can start with as low as 50 bucks, but to be honest you’ll be sorry you didn’t put more. Your money will grow really fast.

-It takes anywhere from a week to a month to process a request to take money out of the system.

-Making money with this system takes no special skill. It only requires for you to have a basic understanding of how the E-currency Exchange Program works and how to put your money in.

-Once you have started, managing your the E-currency Trading Business portfolio takes 30 minutes a day, most days even less.

Are you satisfied with your current income? You think you deserve more money? Want to be have a better christmas this year? I’m pleased with the results I’ve had myself. I’m 21, and I already have a very large portfolio thanks to the E-currency Trading Program.

Want to have an investment that actually brings you money. Want to double your money in 30 days, and get a residual monthly income? The E-currency Exchange Program allows that to become a reality.

Ok, so let’s say that you’ve made the decision of getting started. You’re ready to make money. What should you do? I can highly recommend the path we have taken. By taking a training program. There is the other way which takes much more time and effort, but it’s free, and that is by searching in forums and websites learning about how this system works.

If you are seriously interested in earning more money, I can say you can have that for yourself today, think about the things you really want, and if you think you deserve a second income, my advice is to get started right now. It can be a very rewarding experience you will enjoy.

Discover what are the best ways to learn about electronic currency exchange, visit my site (http://www.currencytrading-center.com) for the inside scoop on How to Make Money with E-currency Exchange

Both the stock market and oil prices rallied recently, which seems to be a paradox, because high oil prices are negative for earnings (i.e. a higher production cost and a higher consumer tax). However, the stock market was worried about another “soft patch,” of slower economic growth, and the sharp rise in oil prices suggest the U.S. economy is still expanding at above trend growth.

The two charts below are same period daily charts of SPX and OIH. The short-term technical indicators suggest SPX is near a top, e.g. VIX closing at a multi-year low, VXN closing at an all-time low, and the NYSE Oscillator’s 20 day MA at an extreme level. Also, Nasdaq closed at 2,090 Fri, and 2,100 is major resistance. SPX rallied to 1,219.5 Fri, and 1,220 may be resistance. SPX may be creating a bearish head & shoulders pattern, with the left shoulder at 1,217.9, the head at 1,229.1, and the right shoulder at 1,220 (see chart). SPX may pullback, consolidate, and become more volatile next week. Major support is about 1,200, the current 20 day MA, which SPX held over the rally, and 1,200, in general, which is psychological support and a congestion area. Major resistance is at 1,220 and 1,229 (the recent high).

OIH closed at an all-time high and created a bearish hammer Fri. Major resistance is Fri’s high at 104. Major support is at 100.30 (previous highs), and the 10 day MA, currently at 99 1/4. There’s also an open gap at just below 95 1/2, and Jul Max Pain is still 95. OIH rose about 20 points, while oil rose from $47 to about $59 a barrel. Consequently, if oil falls to the low $50s, then OIH may retrace 50% of the 20 point rise. The steep rise (also, see MACD) suggests a consolidation period soon. Both the RSI and Oscillator (ULT) are severely overbought, particularly for an index.

Perhaps, the oil market has discounted future events that would influence oil prices, e.g. stonger than expected global growth, the start of hurricane season Jun 1st, which may affect oil platforms and refineries in the Gulf, end-of-the-quarter window dressing, and the 4th of July holiday, which is the start of the summer driving season. Also, I may add, the U.S. oil strategic reserve is filled up. So, the federal government isn’t draining oil from the market. Moreover, China’s economy is “overheating,” and it’s to China’s benefit to grow at a sustainable rate, to prevent inefficiencies.

Next week is a light economic and earnings data week. So, oil prices may have a more influencial effect on stock prices. Consequently, SPX puts, for example, may hedge OIH puts. Both SPX and OIH are at high levels. Economic reports next week are: Mon: Leading Economic Indicators, Thu: Unemployment Claims and Existing Home Sales, and Fri: Durable Goods Orders and New Home Sales. Also, the U.S. weekly oil inventory data Wed should move oil prices. I believe, the positive correlation in stocks and oil will decouple next week, because the longer oil prices stay high, the more negative it will affect earnings of non-energy stocks. Arthur Eckart, PeakTrader.com

See PeakTrader.com Market Overview section in Forum Index for charts.

Arthur Albert Eckart is the founder and owner of PeakTrader. Arthur has worked for commercial banks, e.g. Wells Fargo, Banc One, and First Commerce Technologies, during the 1980s and 1990s. He has also worked for Janus Funds from 1999-00. Arthur Eckart has a BA & MA in Economics from the University of Colorado. He has worked on options portfolio optimization since 1998.

Mr Eckart has developed a comprehensive trading methodology using economics, portfolio optimization, and technical analysis to maximize return and minimize risk at the same time. This methodology has resulted in excellent returns with low risk over the past three years.

You just heard about Electronic Currency Trading. You hear about people making money with it. You wonder if you can make money with it. Is it too complex? Is it a scam? Could you double your income with it? Read on to find the answers.

Can you really make money with the E-currency Trading Business ? How can I get started? Will I be able to get my money out? These are some of the questions you would want the answers to. Granted it is a complex system to learn. At first you need to have a proper strategy to make “big money” fast.

The good news is you CAN make good money with this system. Here are some facts about the E-currency Exchange Business :

-Once you have started, managing your the E-currency Exchange Business portfolio takes 30 minutes a day, most days even less.

-You can start with as low as 50 bucks, but to be honest you could be sorry you didn’t put more. Your money will grow really fast.

-When you get started with the E-currency Exchange Program, you make money from day 1.

-It shouldn’t take you more than 6 months to take your portfolio from 3 figures to 5 figures. Tip: Always re-invest your profits until you hit 5 figures.

Do you feel you should be earning more? Are you fulfilling what you were meant to be in this life? Do you think you could get there easier if you had more money and more time? These were some of the questions we asked for ourselves before we got into Electronic Currency Trading. You may find yourself asking these same questions, and you have to look inside to see if this system is right for you.

I highly recommend this opportunity because, not only has it worked for me, but it also has worked for many people I know. It makes you money and it isn’t a hassle at all. It’s always a pleasure to see that you have more money that the day before.

Let’s say you know what the E-currency Trading Business is and what it can do for you. You are ready to start. How do you do that? What is the path you need to follow to make start making money fast? From our own experience, we recommend one way: Taking a program that Trains you how to make money with e-currency. There are courses like Gary Jezorski’s CurrencyExchangeProfits, Matt Gagnon’s Mazu and Warren Barnes’s Learn-ecurrency-exchange, which can really put you up to date in what you need to do to make good money with this system.

If you are seriously interested in earning more money, I can say you can have that for yourself today, think about the things you really want, and if you think you deserve a second income, my advice is to get started right now. Based on my experience I can tell you it could be one of the most rewarding experiences.

Discover what are the best ways to learn about electronic currency exchange, visit my site (http://www.electronic-currency-exchange.com) for the inside scoop on you can learn more about How to learn E-currency Exchange

There is nothing more exciting than finding an undervalued stock and seeing it explode out of nowhere rising in value 100% or more in a few weeks. Some stocks can move as much as 1000% in a year and…. Even after the stock market crashed in 2000, some stocks still have gone up 500% or more in a year.

So how do we find these? Well first let me say that there is no way to know which ones are going to double or triple in value. If we knew then we could literally “bet the farm” on the trade.

The main thing we can do as swing traders and position traders is to uncover stocks that have the potential for profits based on certain technical parameters found on the charts. There is not enough room in this article to go into depth on the technical analysis of stocks, but what I am going to do is share with you the first step in sifting though the thousands of stocks that trade each day.

One of the easiest ways to cut your list of stocks down is to use a stock scanning software such as “Stockfetcher.com”. What it allows you to do is program in any criteria you want and then it will automatically spit out a list of stocks that meet those exact criteria.

Let me give you some specific examples…. For starters say you only have a small account of $10,000, you shouldn’t be looking at expensive stocks that are in the $50-$200 range. This is because when they are too expensive, you can’t buy many shares. So, the first thing I would do is tell the software to only give me a list of stocks under $20. I would also have it screen out stocks less than $2 as I don’t want to trade penny stocks.

Second, I only want a list of stocks that trade at least 500,000 shares a day. The more volume the better as there is more liquidity. This means that it will be easier to buy or sell shares at any time. Stocks with high volume have much less chance of being manipulated by market makers and market insiders.

Third, I want stocks that have a lot of volatility. Volatility is what causes fast movement over a short period of time. Old blue chip stocks such as Caterpillar, Ford or Kellogg’s don’t move that fast and have little volatility. To make sure you have volatility, I would tell the software to find only Nasdaq stocks. Since this comprises of mostly tech stocks, the odds are much higher of strong and fast moves.

Fourth, if the market is in an uptrend then I want to be a buyer so I could program in the following… Look for stocks with a relative strength of 90 or above. This will ensure that the stock has a lot of upward market momentum. You could even add an additional filter to cut the list down more. For example: Tell the software to look for stocks that made new highs within the past 90 days.

You could use the exact opposite approach to short stocks in a bearish market. Look for stocks with a relative strength of less than 10 and made new lows within the past 90 days.

What is really cool about stock scanning software is you can do the job in less than a minute. Without this software the work is slow and tedious. Once you run the scan you should have a relatively small list of stocks to examine closer.

The final step is to examine each stock for certain technical analysis patterns that can lead to explosive moves. However, as I said above there is just not enough room to go into detail here.

Hope this gives you some food for thought and points you one step closer to your goals.

This article is courtesy of Dr. Jeffrey Wilde, a trading veteran with 15 years of experience in all major markets. He is a trading coach to over 1500 traders in 47 countries.

For additional info: http://www.win-at-trading.com

We have been getting a lot of questions lately about options trading because of our new options trading service, so I wanted to use this week’s article to explain the basics of trading options. There is a lot more to consider when trading options and a lot more terminology you need to know then when trading stocks. Here are the most important things you need to know about options:

An option is a derivative, meaning its price is based on an underlying asset. These underlying assets can either be stocks, ETFs or Indexes. Buying an option gives you the right, but not the obligation to purchase the asset at a specific price (called the strike price).

There are two types of options, Calls and Puts. The value of Call options increase as the value of its underlying asset increases. Traders buy Calls when they think the price of the asset is going to go up. The value of Put options work the opposite way, they increase as the underlying asset decreases.

For Call options, if the price of the underlying asset is below the strike price of the option then it is “out of the money,” when the price of the asset crosses above the strike price it is called, “in the money.” This too works the opposite way for Put options. The price of the option has the greatest percentage moves when it crosses from out of the money to in the money but out of the money options also have the most risk.

Options are not issued by companies like stocks are. All options that exist are “written” or sold by another trader somewhere. So in a way, you are directly betting against that person if you buy an option.

All options have an expiration month. The option will expire at the close of trading on the third Friday of that month. If you are still holding the options at that time they will expire and be worthless.

When you trade options you are buying or selling options contracts. Each options contract controls a block of 100 options on 100 units of the underlying asset. So if the price of a stock option is $2.00 and you want to buy 4 contracts you will pay $800.00 (2*4*100) and you will have the right to purchase 400 shares of the stock.

There are a variety of different trading strategies that options can be used for. The most basic and probably the most common is simply buying Puts and Calls. More strategies include selling options, and using sets of options for calendar spreads, straddles, strangles and butterflies.

For example, on March 7 we bought GBZCS (BBH Mar 2006 195 Call) at a price of $1.50. “GBZCS” is the options symbol. “BBH” is the underlying asset, which in this case is a Biotech exchange traded fund. “Mar” stands for March, so this option will expire on the third Friday of March 2006, which is next week. The “195″ is the strike price. At the time this options position was purchased, the underlying asset was about $191.10, well below the strike price. The next day, on March 8th, BBH went all the way up to $196.50 so it crossed over the strike price and the price of the option went from $1.50 to $2.75, which is over an 80% gain.

There is much more involved with trading options, but these are some of the most basic concepts to help you get started.

David J. Kosmider is the President and cofounder of TimingResearch.com which provides advice and recommendations to stock and options traders worldwide. View all of his articles and services here:
http://www.timingresearch.com

When it comes to stock market trading it PAYS to have more knowledge than the rest of the pack. Pure gold can be harvested in each profitable trade that you accomplish.

But when you don’t know what you are doing stock trading can become a very difficult and life consuming business. You can lose a lot of money and time. Valuable time of your life. Stock trading can resemble the closest thing to a get-poor-fast system when you don’t implement a proven stock trade strategy.

Even when there are traders that can make more than $5000 on a single trade, it’s not unusual for a novice stock trader to lose $1000 in less than 3 minutes from the comfort of his own home, or waste a lot of family time thinking about the stock he should trade for tomorrow “according to the charts and the stars” and other confusing technical analysis trading indicators.

As an online stock trader your homework is all about learning and testing different online trading strategies that can help you take advantage of stocks and at the same time protect your profits. Just always keep in mind that a good stock trading strategy is simple and practical. Complicated stock systems will always make you slow in your decision making process or confuse you right from the start.

There are some very good sites on the web where you can access practical stock trading strategies that are easy to implement. One of those sites is Smart Day Trading http://www.smartdaytrading.com

They focus on momentum stock trading strategies that can help you identify and handle hot stocks while reducing your trading risk.

All in all, online stock trading is all about picking the best stock opportunities and following your buy and sell signals with ease and simplicity. Once you learn to master your trading decisions, you can aspire to produce consistent profitable results.

Learn how to stock trade in a practical way every day at Smart Day Trading http://www.smartdaytrading.com

SmartDayTrading.com helps day traders worldwide pick and trade momentum stocks every day in practical way.

Here’s a worthy profit generating goal: Have a lucrative Foreign Exchange (Forex) trading system that generates above average returns on your investment. Online!

Foreign exchange is the buying of one currency and selling of another simultaneously. Forex is the Largest financial market in the world, with over $1.5 trillion changing hands every day.
Where there’s an opportunity to turn a little money into a lot, let experience be your guide. This is especially true in Forex trading.

Experience starts with some good training to become very well educated in the Forex trading world. Trading the Forex market has many benefits over other financial markets, among the most important are: superior liquidity, 24hrs market and better execution. It’s exciting to know that there are great profits to be made but don’t let the excitement override common sense and patience. Many successful traders have chosen to learn every important aspect of trading. The best traders know that every trade is a learning experience.

There are different trading strategies that must be used in order to fine-tune your market sense and build confidence. A good Forex training course would show how to create and develop a set of rules-based methods for making transactions. These rules are the basis for an effective trading system. With a system in place, it can tell us when and where to ‘buy low and sell high’. With little or no experience in Forex trading, new traders who are interested in extra income and earning high returns for profit need to take a Forex course that is thorough and effective. Choosing the right Forex course will definitely put the odds in your favor of achieving profitable results.

Having a broad knowledge of currency-trading tips, tricks, and techniques puts you much further ahead of the trader who only knows about one or two ideas or one or two indicators. If you don’t have broad-based exposure to MULTIPLE trading methods, you may force yourself into a box and limit your profits. Instead, most of us expect greatness, strive for perfection and, as somebody who wants to earn a good living as a currency trader, create a success path in implementing breakthrough methods. Creating a system is the first big step to take. Why is this so important? Because a system needs to be built that suits your personality, otherwise you are going to find it hard to follow, thus hard to profit from. A worthwhile Forex course depends on the content quality of the material. Most courses or training programs focus or spend most of the time on basic concepts. Though these basic concepts are important, spending most of the course on them won’t help the trader to make consistent results.

An ideal course for the beginner would include not only the basic concepts, but also reliable, interesting, confidence building action plan that can be applied in the real-life Forex market. For example, in the Forex course found at fxstrategycentral.com/forex, part of the training includes a real-world plan:

• Start with a small-amount of seed capital and compound your profits using a tactical, stair-step risk-management method.

• Obtain much more leverage with money while taking on less total risk.

• Have more staying power, during an open trade, even in times of heavy market volatility.

• Develop a disciplined, rational trading strategy without excessively focusing on profits and losses.

A comprehensive course would include a day-by-day educational primer into Forex that explains what it is, how to profit from it and what to look out for. Also helpful is a guide that goes deep into such topics as reading the charts, advantages/disadvantages of technical and fundamental analysis, and equity management among other topics.

Before spending any amount of money on any Forex trading course or Forex training program there are some important aspects you need to take in consideration. There are many training programs available, but not every one of them suits the needs of every trader. Without thorough real life guidance and experience, it would be difficult to achieve consistent profitable results. It would be good to know Why is it that some traders succeed while others fail to trade successfully in the Forex market. Although there’s no single recipe to follow to achieve consistent profitable results, it’s helpful to know that traders that reach the top think different. They don’t follow the crowd; they are an independent part of the crowd.

Al McKenzie
An Internet Mentored Allstar

*Producing value for others by enriching
the quality of their lives in ways that
apply to life’s most important aspects.

Success in small cap & micro cap stock trading like with any other business in life comes from being able to see the big picture and from paying attention to the small details.

Let’s say for example that you are a business owner and you have a jewelry store on a given street just like the guy in the other corner does, but still the other guy is making 5 times more profits than you are only because he’s doing something different. He knows something that you still don’t and that’s what makes him more profitable.

The funny thing about this kind of situation is that you could be just a small distance away from being as successful as he is.

We know that day trading small cap stocks with momentum is not the only way to make money in the stock market. But it can be the fastest way when you do it right.

We also understand that a lot of people shy away from short term momentum trading and think that only a few traders can profit from it. It’s true. Only those short term traders with proven knowledge have the ability to profit consistently when stocks go up or down.

You don’t necessarily have to trade small cap stocks with positive or negative momentum all the time. But you can learn how to take advantage of them when you encounter with the best opportunities and at the same time limit your risk.

Visit us today at Profit From Penny Stocks http://www.ProfitFromPennyStocks.com and learn more on how to pick small cap & micro cap stocks stocks that you can short or ride all the way up on momentum every week.

ProfitFromPennyStocks.com helps beginner traders and investors take advantage of small cap and micro cap stocks in a simple way.

I read a comment by a forum member on another site earlier today that suggested that every investor should back test their system for at least twenty years. I disagree and will now tell you why. Back testing and paper trading seem to be the most over emphasized techniques offered by market theorists, educational elite, market novices and/or market fakes. While learning the pure basics, I can see why a novice investor may want to paper trade; to see the results of the developing system but I will warn that these results are completely false. The results will not contain the emotional decisions that go along with risking your own cash. Anyone and I mean anyone can paper trade successfully. It’s simple, place a trade and hope it goes up and if it doesn’t, you have no worries because you can’t lose. The emotional imbalance that occurs when you really start to lose money is not present. Don’t fool yourself by believing the results of your paper trading or virtual simulation portfolio. These things may give you some confidence in your system but they don’t prove a damn thing in the real world. The real world, specifically the stock market, is run by emotional human beings. People make decisions that are irrational and base their trading decisions on fear and greed. Paper trading lacks fear and greed because there is no gain and no loss; therefore there is no consequence to deal with.

Don’t worry about back testing for 20 years because historical back testing is never very accurate. The most accurate testing is real time. If you can back test real trades (actual trades that you have made in the past), then this would be just as good as real time testing (or forward testing). Back testing can get you somewhat of an idea of how your system will perform but there is no emotional attachments to this type of testing so it is not realistically accurate. We all know emotions are tied to our decisions in the markets so we can only get accurate results through real testing. Learn to ignore the talking heads and the people on TV and that internet chat room that claim they are up over 1000% trading a fake account. What really makes me laugh is the person that sets up a virtual trading scenario and then allows each participant to trade $500,000 or more in their account. If you are going to trade a fake account, at least keep it real so you try to learn something, maybe money management.

I setup one virtual trading competition a few years back and I only allowed each participant to start with $10,000, a reasonable amount, an amount that most people start trading with. The competition was fun but it was not real for me or the others. I didn’t care what risks I took and I never had a problem pulling the trigger which does happen in real life. I did try to keep my trades in line with my real life account but it varied slightly. I witnessed other traders making 20 trades per day or 20-50 trades per week. This is not real because the commissions alone, even with a discount broker will wipe you out. I did allow margin because I use margin in my account but I saw other investors abusing the fake power of margin in their virtual account, again, playing the game for fun instead of learning something valuable. As a fellow investor, keep testing your system in real time and you will know what works and what doesn’t based on real trades, not simulations. Professors and the like teach theories while investors actually do the trading! Back testing may convince some people but I am only convinced with what works now, in real time. Besides, why would I waste my time playing for fake money when I can learn and do for real? Back testing may be good for some people but I have been testing my systems in real time since the day I started investing seriously. Currently, I am testing the $60-$100 theory using options in my newest account. I will not have concrete data on this system for another year or two, most likely two years down the road. I could back test the system but how will that help me realistically going forward? It won’t, it may show me some probabilities and the possible expectancy of the system but it won’t guarantee anything until I place a position for real.

If you want to test a system, open an account with real money, even a minimal amount and give it a try. Make sure you use enough money to allow emotions to be attached to your decisions. Without the emotional attachment, you are cheating yourself and your potential system.

Chris Perruna – http://www.marketstockwatch.com

Chris is the founder and president of MarketStockWatch.com, an internet community that teaches you how to invest your money with solid rules. We don’t stop at just showing you our daily and weekly screens, we teach you how to make you own screens through education. Through our philosophy, you will be able to create your own methods and styles to become successful.

Every minute more than 150 Million Dollars change hands in the electronic index futures markets like the e-mini S&P and e-mini NQ. You can win or lose thousands of dollars in a few minutes; the futures markets can make you rich in a few weeks or months or wipe out your account with no mercy.

If you want to compete in the “game of games” and play against the best traders in the world, then you need to get ready. Too many gamblers are entering the arena without any plan or strategy, completely unprepared, and that’s why they lose.
Trading a system will dramatically increase your chances to succeed in trading, because it eliminates five of the top six reasons why unprepared traders fail.

Let’s take a look at the reasons why traders lose money:

1. Lack of a Trading Plan

2. Lack of Discipline to Follow the Plan

3. Failure to Control Emotions

4. Failure to Accept and Limit Losses

5. Lack of Commitment

6. Over-Trading

By all means you have to avoid these mistakes if you want to win.
Here’s how a trading system eliminates 5 of the 6 top reasons why traders fail:

Solution #1: Having a trading plan

Having a trading system means having a pre-defined set of rules you have developed to guide your trading. Therefore you HAVE a trading plan, eliminating the No.1 cause for failure.

Solution #2: Following the trading plan

The easiest way to follow a trading plan is to automate it. Almost every trading system can be automated, and you could let the computer trade for you. You won’t have to worry about your discipline any longer, as the computer mechanically trades every setup for you.

Solution #3: Controlling emotions

Trading with a system removes emotions from trading. If you don’t have a strategy and you try to make decisions when the market is moving, you are liable to become emotionally attached to positions. You may experience panic and indecision when the market does not move in your favor, as you do not have a prepared response. That’s when most traders lose their money. If you follow a system you will know what to do no matter what the market does.

Solution #4: Controlling your losses

You probably have heard the saying “Let your profits run”. Unfortunately most traders let their losses run. A trading system will get you out of a position when the predefined stop is hit. Unless you override the system to “give the trade a little bit more room” it will stop the loss and therefore limit your losses.

Solution #5: Commitment

You won’t believe how many traders show a lack of commitment and therefore lose money. Lack of commitment means that they stop trading after the first loss, and don’t give their system a chance to make back the money they lost. Trading is not a one-way street, and losses are part of our business. If you can’t accept the fact that there will be losses, you shouldn’t trade. Fortunately a trading system can help you to overcome this problem; an automated trading system continues trading according to the rules, and therefore adds much more consistency to your trading.

As you can see,
Five of the six top reasons why traders lose money in the markets are simply eliminated when you start trading with a system.
Without any guarantee, your chances of making money rise incredibly when starting with a profitable trading system.

Markus Heitkoetter is a 15 year veteran of the markets and the CEO of Rockwell Trading.

For more free information and a free eBook “How to make money with trading systems” visit http://www.rockwelltrading.com and http://www.futures-trading-systems.net

The demand for world oil is increasing while world reserves are decreasing. This is a known fact. The current price of oil can certainly confirm this statement. Consensus also agrees that we will never see $25.00 oil again. The logical conclusion to our above statement is oil stocks should be a good long term investment. However, the location of the oil companies’ reserves can affect their bottom line and valuation.

Some of the largest reserves in the world are found in Venezuela, Saudi Arabia, Russia and Canada. Political unrest in Venezuela, unstable and unpredictable government in Russia and Osama Bin Laden targeting Saudi Arabia leave Canada, namely the Alberta Oil Sands, as the largest, most reliable oil reserves in the world.

Companies like Exxon Mobil Corp., Royal Dutch/Shell Group and Canadian Natural Resources Ltd. are planning to spend billions during the next 10 years to develop Alberta’s unusual oil deposits as demand for crude rises and output from existing reserves decline. Oil sands output in Alberta may double to 2 million barrels a day by 2013, according to a presentation by Enbridge Inc. earlier this month. Oil sands are deposits of bitumen – heavy oil that must be treated to convert it into crude oil for use in refineries to produce gasoline and diesel fuels. The U.S. Energy Department revised its global oil resource estimates to include the oil sands 174 billion barrels of proven reserves that can be recovered using current technology.

With demand for oil and other commodities from China and India increasing due to their growing economies, strong trading relationships are procuring with Canada – a country with numerous resources, political stability and neutral military views.

Companies with reserves in the Alberta oil sands look like a great investment for the next decade
There are many companies with reserves in the Oil Sands here are some with strong exposure.

Suncor Energy Inc. SU.tse , Western Oil Sands Inc. WTO.tse and the Canadian Oil Sands Trust COS/UN.tse

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Paper trading is widely discussed regarding its merits, and whether it is of value to a trader as they try to make the transition to real money trader. One viewpoint is that since paper trading is not real, the profits are meaningless, and are no indication of real money profitability. An opposite viewpoint would state that paper trading is an important step in the trader’s learning progression, and regardless of whether it is real, if the trader cannot ‘properly’ paper trade, then they will not be able to real money trade.

I began trading in early 1995, with the intentions of becoming an options trader; my first trading education was through an oex options teaching service. Besides options training, the service included ‘tape’ reading, trade management AND sp500 index futures trading – also included in the service was the prevalent attitude that paper trading was for ‘sissies’.

So I was a new trader, trying to learn and understand completely new concepts and ideas – what was called a trading method AND I was ‘practicing’ with real money – because paper trading was for ‘sissies’. What did I accomplish, besides a big draw down in my account? I quickly introduced to trading psychology and the related implications – something else I also knew nothing about. Losing money and a trading psychology ‘wreck’, both from the losses and thoughts like I was too ‘stupid’ to ever learn how to trade, became a combination which took me out of futures trading, and then unfortunately carried over into my options trading which I had previously been doing well with. I just couldn’t take it any more – I had to somehow start all over, or just quit for good.

Paper Trading Viewpoints

Consider: simulator fill prices are not real and won’t be attainable with real money. Even if this is correct, is it really an issue unless the trader intends to be a scalper, trading for very small profits, and thus each tick is critical? Granted, but shouldn’t a beginning trader be very selective, focusing on learning their method and the ‘best’ setups that method provides? This would be my viewpoint, and in this capacity paper trading fill prices are not an issue.

Consider: the trades are being done with no risk. No, there isn’t any financial risk in paper trading, but I actually haven’t met nearly as many profitable paper traders as one might expect. Why would this be the case if being able to trade without risk was such an easy thing to do? As well, what about self-esteem risk, and an attitude like – how can I be so bad that I can’t even paper trade? The risk feelings like these are probably greater than that of financial risk, and if they are going to surface, you would want to encounter them before trading real money. As well, even if the issue was only one of financial risk – wouldn’t you want to begin with the confidence of knowing that you were paper trading profitable? It would be hard to imagine a losing paper trading being able to profitably trade real money.

Consider: there is no emotion involved with paper trading. I was in our chat room watching a paper trader post their trades in order for me to give them feedback, and I noticed that one of their specific plan setups wasn’t done. When I asked why, the trader told me that they were ahead for the day and didn’t want to risk those profits. But the profits aren’t real – how can you not take a ‘base’ method setup when paper trading – isn’t that the point? Would you be in agreement, that if paper trading profits could be viewed in this fashion, that it has the ability to become very real and thus emotional to the trader? I would suggest that this is related to paper trading really not being ‘so easy’, and as mentioned above, self-esteem risk can be very emotional.

Besides examples like this, emotions can be added to the paper trading process. Throw away your simulator, and then go into a chat room and post all of your trades – no ‘youknowwhating’ around where you wait to see if the trade was profitable before you post it, like a number of traders that I have seen. What’s the point, and when you consider the underlying implications of ‘needing’ to do this – the issue certainly isn’t about whether paper trading is of value or not, but certainly best to find out before trading real money. You must post immediately and without lag, giving your direction and entry price, along with subsequent posts of any partial profits, and of course your exit, which ultimately is the determinant of whether the trade was profitable. There is no need to make any comments, or answer any questions regarding your trades – simply post the particulars as fast and real time as possible AND see if you feel any emotions doing this in front of the rest of the room while you go through a series of losses. Do you want to add even more emotions? Go through the same posting process, but do so where the rest of the room actually knows the method that you are trading, and what the trades ‘should’ be. You will quickly find out just how emotional paper trading can be – actually a very valuable exercise for the paper trader to do.

Paper Trading And Making It Further Beneficial

I have two predominant problems with paper trading, but this is with the trader’s approach, and not with paper trading by definition: (1) the trader does ‘things’ paper trading that they would-could not do with real money (2) the trader views paper trading profitability, instead of paper trading proficiency, as the guideline of whether they are ready to begin trading real money.

I have seen too many paper traders, continuously and knowingly, over trade ‘non-plan’ trades, with trading size that is greater than they could afford the margin for in a real account – let alone accept the risk of loss, while also holding trades for risk amounts that they would not accept with real money. Viewing paper trading as a ‘step’ in the learning progression and transition to real money trading, it is critical that the paper trader only trades exactly what, and how they would trade with real money. Don’t allow yourself to turn paper trading into a game, supposedly because there is no risk – the risk of making bad habits that you can’t correct is tremendous, and will circumvent any attempt to trade real money. This is the time to learn YOUR basic trading setups, and make necessary adjustments to them and your entry-exit timing, in order to then make money trading them – this is NOT the time to turn your simulator into a pinball machine flipping at any ball that comes near you.

There is a problem with focusing on trading profitability -vs- trading proficiency. To begin with, profitability places the focus on money instead of on plan. And what is profitability – if you take 10 trades and make $75 are you profitable? Technically, if you are net ahead you are profitable, but what if those same 10 trades had a potential of $1,500, and you only made $75 – are you really profitable? This is what I am referring to when I think of trading proficiency. Instead of focusing on the common metrics, such as win:loss or win size:loss size ratios, I am most concerned with the win size:potential win size ratio, and want to maximize this percentage to the extent that is possible.

For instance, when a trader asks about adding trading size, taking the attitude that if they can make $100 trading 3 contracts, then they can make $1,000 by trading 30 contracts, the first thing I ask them is what is their proficiency ratio – why increase contract size and the corresponding trading risk, if you ‘should’ be able to make more money from smaller size? This is especially important for the paper trader, where they should not regard simple profitability as an indication of readiness to trade real money, but consider proficiency – for instance, begin trading real money when you are 60-70 percent proficient with your paper trades.

So What Is Your Viewpoint Regarding Paper Trading?

I never thought that I would ever make a dime trading, let alone be able to trade for a living or become involved with trying to teach others to trade – was this simply a function of starting over and paper trading? Granted that is too simplistic, however, I do know that it would have certainly changed the beginnings that I had, while very much shortening my learning curve, and reducing a lot of pain.

Clearly, I am on the ‘side’ that believes that paper trading is not only beneficial, but that paper trading is also necessary – however the value received will be dependant upon the trader’s approach and attitude. Needless to say, paper trading as described is something that I have always strongly recommended.

Barry Lutz has been trading, as well as teaching others to trade since 1997, through his firm Tactical Trading, LLC., http://www.tactrade.com He also writes a daily trading teaching lesson, which can be found along with other resources on trading psychology and trading method, at The Tactical Trader, http://www.tactrading.com