Stock Market Investment Advice. Accurate Stock Market Recommendations.

Quite a few individuals romanticize the stock market as though it were a glamorous international casino where iron nerves and intuition make poor people into millionaires. In this particular version of the fairy tale, striking it rich is all about somehow figuring out what other men and women don’t know, buying low, selling high, and then shopping for a yacht. People who are brand new to the trading game can save themselves quite a bit of time and distress if they quickly internalize one important truth: attempt to predict the future and you are likely to lose.

Since the stock market climbs up and down dependant on opinion, it performs separately from any rules of logic. Rather, the stock market moves due to human perception. Since vast sums are involved, emotion comes into play and logic goes out the window. Investing your savings on a hunch is like betting it at the craps table: the house typically wins. In the event you want proof, think about it this way: if the market could possibly be predicted, everybody would know exactly when to sell and when to buy, and then there would be no stock market.

We’ve now established that the stock market is unpredictable. Does that really mean it’s not possible for normal mortals to earn money? The answer is no. It’s possible to earn profits on investments, but rather than making predictions about the unpredictable, the sharp investor will base their strategies on stock market timing. The critical point here is that as opposed to trying to discover the next breakout stock just before it bursts onto the scene, a higher rate of success can be accomplished by investors who employ a stock market timing technique based on market realities.

Gambling on the stock market will generally only result in second guessing and heartburn. A much more reliable approach is to apply a method to proven stocks such as the 30 corporations in the Dow. By doing calculations determined by past performance and automatically buying and selling when specific criteria are met, the stress filled guesswork is eliminated from the equation and risk factors drop considerably.

In the present day, the character of trading has changed considerably because of computers. The pace and flexibility that data can be crunched means that automating the operation has never been easier. When working with computer systems it can be possible to chart current trends then assess what events will mark a change in that trend. An important note here is that not all programs are created equal and results will depend on precisely what parameters a given program utilizes.

An effective program will apply effective calculations to analyze real time stock market information next to a predetermined set of data. When certain indications are discovered, the system already knows exactly what to do. By using stock market timing as a guiding principle, annual returns are much more consistent, in some cases up to 50% or more. Naturally, there are no guarantees, yet by removing the guesswork and following a system, investors can forget the antacid tablets and depend on established science for much more dependable returns.

Are you looking for the right stocks to invest in in these troubled economic times? Visit Wealthy Investor Weekly to learn how to invest in stock and take the subjectivity out of investing. Download the free Wealthy Investor strategy to find out how this system can help you reach your financial goals.

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The risk of loss cannot be eliminated. A change in market value is not a loss of principal just as a change in the market value of your home is not evidence of termite damage. Markets are complicated; emotions about one’s money are even more so.

I’ve been thinking about starting a stock market prediction business. Clearly, there is a huge market for timely and accurate information of this type, and just as clearly, predicting the future is much easier than dealing with the realities of whatever is actually happening at the moment. If investors could know what’s going to happen next, they could develop a plan to deal with it in the present. Maybe Wall Street could help me get this new business up and running! What’s that? Wall Street institutions already spend billions predicting future price movements of the stock market, individual issues & indices, commodities, and hemlines. Really? Is that right also? Economists have been analyzing and charting world economies for decades, showing clearly the repetitive cyclical changes and their upward bias. Funny then, or strange would be more accurate, that the advice generated by the oracles of Wall Street seems to assume that the current environment, good or bad, will be everlasting. Isn’t it this kind of thinking and advising that prolongs the downturns and "bubbles" the advances in all markets?

If it were true that our favorite pinstriped product pushers can actually predict the future, why would investors do what they do in response to the predictions? Why would financial professionals of every shape and size holler: "sell" at lower prices, and "buy at any price" when market valuations surge upward? Shouldn’t lower prices be the call to the mall? Most Wall Street soothsaying has a short-term focus that dwells upon today’s market conditions; most Wall Street glossies emphasize the long-term nature of investment programs, and encourage investors to apply patience to the program they decide to use for goal achievement. The reason for the emphasis confusion is simple: it’s easier to play to the emotion of the moment than it is to look beyond even though we all know that a directional change will be along eventually. Regardless of the direction, Wall Street advice will always fuel the operative emotion: greed or fear! Wall Street’s retail representatives never go against the grain of the consensus opinion particularly the one projected to them by their superiors. You cannot obtain independent thinking from a Wall Street salesperson; it doesn’t fill up the "Beemer".

Here’s some global advice that you will not hear on the street of dreams: Sell into rallies. Buy on bad news. Buy slowly; sell quickly. Always sell too soon. Always buy too soon. And by the way, who do you think is buying and selling the securities you have been told to dump or to hoard? No self respecting guru would ever refute the basic truths that the market indices, individual issue prices, the economy, and interest rates will continue to move in both directions, unpredictably, forever. Hmmm, this is where you need to focus your attention if you want to get through the investment process with your sanity. You need to expect and plan for directional changes and learn to use them to your advantage. Tranquilizers may be necessary to get you through the first few cycles, but if you have minimized your risk properly, you can actually thrive on the long-term predictability of the markets.

The risk of loss cannot be eliminated. A simple change in a security’s market value is not a loss of principal just as certainly as a change in the market value of your home is not evidence of termite damage. Markets are complicated; emotions about one’s assets are even more so. Cyclical changes in all markets are just as predictable conceptually as knowing approximately where you are within a cycle is knowable actually. The key is to understand what your securities are expected to do within the cyclical framework. Now there’s a knowledge business with no Wall Street practitioners!

Predicting individual stock prices is a totally different ball game that requires a more powerful crystal ball and an array of semi legal and illegal relationships that are unavailable to most investors. There are just too many variables. Prediction is impossible, but probability assessment has enormous potential. Investing in individual issues has to be done differently, with rules, guidelines, and judgment. It has to be done unemotionally and rationally, monitored regularly, and analyzed with performance evaluation tools that are portfolio specific. This is not nearly as difficult as it sounds, and if you are a shopper, looking for bargains elsewhere in your life, you should have no trouble understanding the workings of the stock market. There are only three decision-making scenarios that investors need to master if they want to predict long-term success for their portfolios. The "Buy" decision has two important steps:

Step one allocates the available investment assets, by purpose, between Equity and Income securities, based on the goals of the investment program. It is done best using The Working Capital Model.

Step two establishes strict selection quality measures and diversifies properly within each security class. Investment Grade Value Stocks are the low-risk equity champions; long-term, non-gimmick, managed CEFs produce the best income/diversification mix available in readily tradeable form.

The "Sell" decision involves setting reasonable targets for profit taking for all securities in the portfolio. Loss taking decisions must not be undertaken out of fear, and must be avoided during severe market downturns. Understanding the forces causing market value shrinkage is important and a highly disciplined hand at the emotion control button is essential. There is no such thing as a good loss of capital. The "Hold" decision is most common, and it regulates and moderates the process, keeping it less than frantic. Continue to hold onto fundamentally strong equities and income securities that are providing their normal cash flow. Hold weaker positions until the appropriate cycle (market, interest, economy) changes direction, and then consider whether to sell or to buy more.

Wall Street spins reality in whatever manner it can to make most investors unhappy, thus increasing new product sales. Your confusion, fear, greed, impatience, and need for a quick panacea fuels their profit engines, not yours. Learn how to deal unemotionally with Wall Street events and shun the herd mentality… that’ll fix ‘em.

Steve Selengut
http://www.sancoservices.com
http://www.valuestockindex.com
Professional Portfolio Management since 1979
Author of: "The Brainwashing of the American Investor: The Book that Wall Street Does Not Want you to Read", and "A Millionaire’s Secret Investment Strategy"

By Steve Selengut Published: 4/16/2008  Earnings results and stock market valuation. At the other side of sectors still with positive growth there are basic consumer goods (eg food) and health care with 14.3% growth in profits or 9.7% (together with the utilities) Stock Market Guide: Analysis of global economies and Stock market This is not a market for either value investors or growth investors. This is an ideal market for those who look out for opportunities by working hard on news and trends.  Top Stocks Market In 2009, Stock Price, Stock Option The fertiliser sector has been a laggard at the stock markets and several fund managers and analysts remain skeptical of its growth potential. We feel that necessary changes

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