The best stock tip we will ever give you ! - by Darren Winters
After trading for many years and writing for the past few, we have pretty much seen everything that is out there. From doom and gloom newsletters to stock and option tipping services in the UK and US that cost from $100 per year to $10,000. Above all, we have realise one thing, that most investors are lazy and would rather put their faith into someone else as opposed to taking their own investment decisions.
The ironic thing is that most tipping services can be beaten hands down by any investor who is willing to put a small amount of time into his or her trading. These services are very often marketed much better than their results would have you believe too. We had a look at the results of a tipping service that cost $10,000 per year and found that it would have lost you about 60% of your money for the privilege!
We are at risk of dirtying out own bath water here, but the best person to get the long term success you want is yourself. What you should expect from us are trading ideas, technical analysis tutoring and guidance about maintaining a solid discipline. Of course we write about many more topics in various investment related issues, but they are not associated with your day to day investing.
The stocks we feature have gone through our own screening processes and we will give our opinion on them. We then give ownership to you in order to put them into a watch-list if you are interested in investing into them. You should not consider this or any market letter as a substitute for a personally managed account.
No one knows or cares for your personal circumstances better than you do; how much money you have to invest, your tolerance of pain, your goals or your investment timeframe. As long as you have the right tools for the job; a resource for fundamental analysis, some decent charting software that can help with your scans and a good knowledge of technical analysis, you are on the right track to making some good money at investing.
OUR STOCK TIP
If you feel you need it, spend more time educating yourself to become a better investor. Whether this is through reading more books, this blog or attending a good seminar, it usually works out to be far cheaper in the long run than paying a fund manager or tipster.
Although it will never teach you the emotions of investing and trading, open a paper trading account and go back to basics if you feel you need to. An inevitability is that you many have losing trades. No one is right all the time, it’s just a matter of managing your positions and maintaining stop losses. Some of the best traders in the world would make a very comfortable living from being right only 40% of the time. Although that means they lose 60% of the time, their losses are always kept very small which is how they manage to do it. If you are not planning on becoming a ‘trader’ like that, then your winning trades should be much greater than this.
The all important factor here is that you take responsibility for your investing whether you intend on becoming a day trader or someone who invests for several weeks or months at a time.
ASSET ALLOCATION
This is probably the most important part of every investors strategy and yet the most under utilised. Spreading assets across different risk groups is the key to long term wealth.
If, for instance, you had £100,000 in investable assets, it should not all go into your trading account. You need to look for investments that offer a lower risk than share trading. Some people may view property as a lower risk investment and there are plenty of other lower risk vehicles around if you are willing to look.
The reason asset allocation is considered so important is because traditionally, different asset classes will perform well at different times, thus smoothening out overall portfolio returns. Asset allocation can be used in various levels even within a trading account. For instance, an investor could allocate a certain percentage of funds to stocks and a smaller amount to higher risk options.
SUMMARY
Don’t be confused being a genius with a bull market. It’s not hard to make money in a roaring bull market. Making money in a bear market will prove difficult if you have not learnt to short or use derivatives. None of us are as smart as we think we are when everything is going well. But then we are not as stupid as we think we are when we have made mistakes either. We all get caught out by the markets now and then and unfortunately it happens just when we think we’ve got it all worked out!
Having said all of that, there is no better feeling of managing your own investing using the skills you have learnt. Use regular goal setting in order to keep a focus on where your investments are headed and be willing to learn new and better strategies from time to time. Beating a fund manager should not be difficult!
Darren Winter
The ironic thing is that most tipping services can be beaten hands down by any investor who is willing to put a small amount of time into his or her trading. These services are very often marketed much better than their results would have you believe too. We had a look at the results of a tipping service that cost $10,000 per year and found that it would have lost you about 60% of your money for the privilege!
We are at risk of dirtying out own bath water here, but the best person to get the long term success you want is yourself. What you should expect from us are trading ideas, technical analysis tutoring and guidance about maintaining a solid discipline. Of course we write about many more topics in various investment related issues, but they are not associated with your day to day investing.
The stocks we feature have gone through our own screening processes and we will give our opinion on them. We then give ownership to you in order to put them into a watch-list if you are interested in investing into them. You should not consider this or any market letter as a substitute for a personally managed account.
No one knows or cares for your personal circumstances better than you do; how much money you have to invest, your tolerance of pain, your goals or your investment timeframe. As long as you have the right tools for the job; a resource for fundamental analysis, some decent charting software that can help with your scans and a good knowledge of technical analysis, you are on the right track to making some good money at investing.
OUR STOCK TIP
If you feel you need it, spend more time educating yourself to become a better investor. Whether this is through reading more books, this blog or attending a good seminar, it usually works out to be far cheaper in the long run than paying a fund manager or tipster.
Although it will never teach you the emotions of investing and trading, open a paper trading account and go back to basics if you feel you need to. An inevitability is that you many have losing trades. No one is right all the time, it’s just a matter of managing your positions and maintaining stop losses. Some of the best traders in the world would make a very comfortable living from being right only 40% of the time. Although that means they lose 60% of the time, their losses are always kept very small which is how they manage to do it. If you are not planning on becoming a ‘trader’ like that, then your winning trades should be much greater than this.
The all important factor here is that you take responsibility for your investing whether you intend on becoming a day trader or someone who invests for several weeks or months at a time.
ASSET ALLOCATION
This is probably the most important part of every investors strategy and yet the most under utilised. Spreading assets across different risk groups is the key to long term wealth.
If, for instance, you had £100,000 in investable assets, it should not all go into your trading account. You need to look for investments that offer a lower risk than share trading. Some people may view property as a lower risk investment and there are plenty of other lower risk vehicles around if you are willing to look.
The reason asset allocation is considered so important is because traditionally, different asset classes will perform well at different times, thus smoothening out overall portfolio returns. Asset allocation can be used in various levels even within a trading account. For instance, an investor could allocate a certain percentage of funds to stocks and a smaller amount to higher risk options.
SUMMARY
Don’t be confused being a genius with a bull market. It’s not hard to make money in a roaring bull market. Making money in a bear market will prove difficult if you have not learnt to short or use derivatives. None of us are as smart as we think we are when everything is going well. But then we are not as stupid as we think we are when we have made mistakes either. We all get caught out by the markets now and then and unfortunately it happens just when we think we’ve got it all worked out!
Having said all of that, there is no better feeling of managing your own investing using the skills you have learnt. Use regular goal setting in order to keep a focus on where your investments are headed and be willing to learn new and better strategies from time to time. Beating a fund manager should not be difficult!
Darren Winter
posted by Darren Winters at 2:31 PM
0 Comments:
Post a Comment
<< Home