The Power of Choice - Using Adversity as the Catalyst for Change

None of us will make it through life without committing a series of mistakes or errors in judgment. I know I have made my share. Mistakes are a part of life. I don't mind making them, however I don't want to keep repeating the same ones over and over.

Some of them have been very costly and downright embarrassing.

Let me share with you one of my biggest mistakes, and more importantly, let me share with you the valuable lesson I learned from it.

It was 1997. I had worked my way out of poverty and had grown my business from a $100 investment into a $200,000 a year income.

I had learned how to make money, but had no clue how to manage it.

An acquaintance of mine, we'll call her Joni, mentioned to me that she was buying a lot of shares of a particular stock, with the expectation that it would soon split or triple in price within a few months. She told me she was investing her life savings into buying as much as she could and that I should do the same.

I thought about it, and at the time, I was saving money to buy my mom a new house so I thought, hey if I took the $30,000 I had saved up and bought the stock - and it tripled, that would be $90,000. Great move, right? (Mistake #1)

Well obviously I had never purchased stocks before and I had no idea how to do it. So what did I do?

I heard my UPS guy, (yes, my UPS guy) invested in stocks so I asked him how to buy stocks. He told me to go to XXX broker in town (who shall remain nameless) and open an account. (Mistake #2)

So I went to the broker, whom eagerly helped me open an account and he completed the transaction that bought me $30,000 of this particular stock. (Mistake #3)

Within a few months, the stock had plummeted and went from $30,000 down to $400. That's not a typo, it had gone down to $400.

I was sick about it. I was incredibly disappointed in myself.

I was upset with the other parties who guided me to create that outcome. I had every reason to be angry. I felt cheated. I mean, I later learned the broker broke the law and never should have placed such a large order for a first time client. They are not supposed to allow beginners to take such large risks.

I had every reason to blame everyone else for what had happened.

But I learned a very valuable lesson during that time and it has served me ever since.

I want to share it with you because I want you to pause and think about this the next time you experience a challenge, a difficulty or a problem in life, especially when you are tempted to blame everyone and everything around you.

Here is the lesson.

You always have a choice.

You see, I could have looked at that situation from a "Nail in My Coffin" perspective: ie "those people did me wrong and it's their fault," and "I'll never buy another stock again"

OR

I could have looked at it as a "Catalyst for Change" perspective. ie "I am responsible. I made the decisions, I didn't do my diligent research, I invested too much on my first trade, I will take a step back and re evaluate my approach next time."

Let me simplify it and break it down even further:

Problem: lost $29,600 in stock trade

My Choices:

Nail in Coffin = I am a Victim and I give my power away when I blame others

OR

Catalyst for Change = I emerge the Victor because I claim my power to change the present and the future by taking responsibility

You see, I could have easily put the blame on everyone else. And if I did that, I would never have learned the lesson. I would have never changed. Though it wasn't easy, after looking at it, I knew there were a number of things I could have done differently.

Whenever you focus blame outside of yourself, you give your power away. Whenever you take responsibility, you claim your ability to change, grow, and create different outcomes in the future.

I knew that despite the appearance of the circumstances, that I was responsible for that loss. I made a series of errors in judgment, as well intentioned as they were.

As long as you blame others outside yourself, you will not change. Nothing will change for you. You will be doomed to repeat the same mistakes.

You always have a choice.

Liberate yourself by taking responsibility for your actions, even when you can justify placing it outside yourself. Let your mistakes serve you. Learn from them, let them change you for the better. Let them empower you.

I turned one of my biggest mistakes into one of my greatest lessons and by taking 100% responsibility, I allowed it to serve me. I took back my power.

I used as a catalyst for positive change.

"Every problem contains within it the seed of an equal or greater opportunity. Not just some of the time, but all of the time." -Jill Koenig

The facts remained the same, I still lost $ 29,600. But it doesn't hurt anymore. My perspective on it changed.

It became a blessing that has served me many times over.

When you change the way you look at things, the things you look at change.

Live Your Dreams

Jill Koenig, the "Goal Guru" is America's Top Goal Strategist. A best selling Author, Coach and Motivational Speaker, she is an expert on the subjects of Goal Setting, Time Management and Business Success. Her Goal in life is to help you UNLEASH your untapped potential. Get your FREE Goal Setting CD at: http://www.GoalGuru.com

Media Requests: Jill Koenig is a dynamic high energy TV and radio guest available for interviews and corporate speaking engagements.

Mika Brzezinski Sets Paris Hilton On Fire

This story is entirely true. I swear that this did happen. In a parallel universe. And if you don't believe in parallel universes, you are a scientifically illiterate monkey and you should stop reading this article right now.

Okay, okay... I was only joking. As a theoretical physicist by training, I may be wrong about the monkey part (and may I suggest that you consult it with a zoologist to be perfectly sure about it), but the idea of parallel universes, as crazy as it sounds, may not be that crazy after all. Certainly not by scientific standards.

Now, in the Universe we happen to inhabit, also known as "the best of all possible worlds," the effect of Paris Hilton set on fire turned out to be pretty washed out. Fortunately for Paris... I am not so sure about the rest of the world, though.

In this Universe, Mika Brzezinski only attempted to set on fire a report about Paris Hilton release from prison having found it trash- rather than news-worthy. Since the lighter she was using refused to fully cooperate, she ended up tearing the report into pieces.

This simple act of journalist defiance against conveying trash information and, let's be perfectly honest here, some well calculated showmanship (or should we rather call it "showpersonship??") as well, made Mika Brzezinski an instant journalist superstar on YouTube.com and other hot Internet channels.

Nice job, Mika, although if I am to be totally honest, and with all due respect, this somewhat pales in comparison to what some Polish journalist, also a female (you male brownies take a note!), did some 17 years ago, when she publicly and demonstratively told the audience of TV news that she was quitting her job because she could not stand relaying the news the way her bosses insisted on. She then walked out of the studio. It was all live.

Mika Brzezinski is a daughter of Zbigniew Brzezinski, arguably the most influential Polish-American political strategist, a former member of the Carter administration.

For another, more interactive, version of this article, please see this page:
http://www.eminimethods.com/mika_paris.html

Waldemar Puszkarz, Ph.D., is a web veteran with 15 years of web surfing under his belt. By training, he is a theoretical physicist, but his interests are much broader than science and include trading financial markets, sports betting, poker, and researching online business opportunities. He is also an avid book reader and sports afficionado. Currently he is making his living mostly as a day trader. He has been in the trading trenches for almost a decade during which he has traded a variety of financial instruments. He is the owner and webmaster of Eminimethods.com (http://www.eminimethods.com) which provides free common sense trading education and simple trading systems for e-mini and stock markets as well as reviews of honest online business opportunities in Meet HOBO (http://www.eminimethods.com/HOBO.html) section of his site.

Pay Per Click Advertising Can Be Easy If You Have The Right Guide Book

Is Google Adwords giving you trouble? Are you having trouble trying to set up your Google Adwords campaign properly? Have you been advertising with Adwords for awhile now without having much success? Have you ever read a good Google Adwords guide book, preferably one by Perry Marshall? If not, what in the world are you thinking?

It's true that you can make an enormous amount of money by using Google Adwords, but you must learn what you're doing first. Just like anything else in life, this is a learning process. The rewards are great once you've learned the lesson and taken action, but you can easily lose your shirt if you don't find out the right way to do things first. Think about it like this, would you play the stock market without learning what you're doing first, or at least hiring someone who knows what they're doing? That would be a seriously ignorant maneuver, yet people do it with Google Adwords all the time. Actually, not just Google Adwords, but with other pay per click search engines also, like Yahoo and MSN.

The Perry Marshall Definitive Adwords Guide is the top-rated book on Google Adwords, without question. It was co-written by Bryan Todd who is one of Perry's top assistants and also a member of his coaching faculty. The book is 113 pages long and is updated every year at no extra charge. These guys live and breathe Google Adwords and they constantly test everything that they do in order to find better ways to beat the Adwords system. Those that own the book have a huge advantage over everyone else because they're reaping the rewards of all the hard work that these guys put in with the free updates.

If you haven't bought and read a good Google Adwords book, especially Perry Marshall's Definitive Guide, you're wasting your time, your money and your not seeing the total benefit you could be getting out of your Google Adwords campaigns. I highly recommend that you get more information about a good Google Adwords guidebook.

Does Pay Per Click Advertising Have You Confused? Find Out Important Things That You MUST Know About These Topics And More By Going Right Now To PayPerClickFirm.net or by clicking on Google Adwords Guide Book. Joe Stewart is a Webmaster and Internet Marketer That Uses Pay Per Click Advertising And Search Engine Optimization To Advertise Online.

Trading Stuff For Free Vs. Free Stuff

Swaptree
Swaptree is a great service that I came across recently. It lets you trade books, music, movies, and games with others for free. You tell the system what you have, and it figures out what you can get in exchange. Note that it supports one-for-one item trades only, but allows for three-way trades.

How Swaptree works
Swaptree does a good job laying out the ground rules simply and clearly. There is also a wonderful walkthrough here. Ebay users will find a similar buyer/seller rating system that they are accustomed to.

The site has been out of public beta since July 4th (so its no longer invite only) and seems to be gaining steam. Way to go, guys!

Freecycle
Freecycle would be a good alternative if you were looking for an item outside of books, music, movies, and games - such as apparel, computers, and furniture. The concept is that someone wants to get rid of something, while another person want s the same item. Rather than throwing the item away or trying to sell for a minimal amount, the item is given away, provided that a local person comes to pick it up.

The Freecycle website - http://www.freecycle.org contains a short animation of how Freecycling works as well.

At the time of this posting, there are a total of 4,041 Freecycle communities throughout the world. Chances are, you are either in or near one of them.

See this article's original posting at:
http://nowsourcing.wordpress.com/2007/07/10/trading-stuff-for-free-vs-free-stuff

Another quality article by NowSourcing.

To see more of my articles, please visit http://nowsourcing.wordpress.com

What Is A Bull Stock Market And Bear Stock Market

Unless you are involved in the stock market, or understand the jargon you may not understand what the term bull market or a bear market means. Stock prices are reflected in what is known as the financial market trends. These trends can best be demonstrated in a price chart and the purpose is to pick the best investment and trading opportunities. You may ask what drives these trends. Buyers and sellers are the driving factor, they are also known as the bulls and the bears.

When we say that it is a bull or bear stock market we are talking about the driving force behind the market. The bulls are the buyers so that would make the sellers the bears. Incidentally when we use the term bull or bear we could also be talking about specific securities and sectors.

A bull market is a market that is associated with investor confidence. As a result of this increase in confidence investors are more likely buy in anticipation of making a capital gain. The most memorable and longest running bull market was seen in the 1990s. This was the time when the U.S. and other global markets saw their fastest growth spurt ever.

Just to recap, in a bull stock market the investors are buying. They are looking for more ways to increase their capital gains. So then if it is a bear market, the opposite would be true. Investors will be more pessimistic about buying and are more inclined to sell their stocks to cut their losses. A bear stock market does not come about from a small decline, but a considerable drop in prices over a prolonged period of time. From 1930 to 1932 was probably the most infamous bear market in history. This bear market was the beginning of the Great Depression. There was a much less severe bear market from 1967 - 1983, which included the energy crises of the 1970s and the unemployment surge in the 1980s.

As we already stated a bear stock market does not come about as a result of a small dip in stock prices, it indicates sizable fall in prices over a prolonged period of time. It is most commonly accepted that in order for the stock market it to be considered a bear market there has to be a price fall of at least 20% in a key stock market index from a recent peak that happens over at least two months.

To summarize a bull stock market has investor looking to buy to increase their capital gains. They will be seeking out the best investment opportunities. A bear stock market has these same investors looking to sell their stocks so they can minimize their losses. Historically the U.S. has been a bull market. That is one of the factors why we have been considered the land of opportunity.

Check out the valuable information about Bull and Bear Stock Markets at http://www.stockinvestingforbeginner.com

Tips For Better Options Trading

If you trade, you may have heard of options. Trading options carries high risk and has many disadvantages for beginners and even seasoned traders. Therefore, it is wise to be cautious if you are considering options trading.

An option is a contract between two parties giving the taker or buyer the right, but not the obligation, to buy or sell shares at a specific price on or before a specific date. To have this right, the taker pays a premium to the writer or seller of the contract.

There are two types of options available: call options and put options.

Call options give the taker the right but not the obligation to buy the shares at a specific price on or before a specific date.

The put options give the taker the right but not the obligation to sell the shares at a specific price on or before a specific date. The taker of a put is only required to deliver the underlying shares if they exercise option.

There are a few advantages in option trading:

Put options allow you to hedge against a possible fall in the price of the shares you hold. You can consider taking it out as insurance against a loss in the share price.

By taking a call option, the purchase price for the shares is locked in. This gives the call option holder until the expiry date to decide whether he or she will or will not buy the shares. This is also applicable to the taker; he or she has to decide whether or not to sell the shares before the deadline.

The ease of trading in and out of an option position makes it possible to trade options with no intention of ever exercising them. If you expect the market to rise, you may want to buy call options, and if you are expecting a fall in the market, you may decide to buy put options. This means that you can sell the option prior to the expiry date to take a profit or limit a loss.

Options also allow you to build a diversified portfolio for a lower initial outlay than purchasing shares directly.

The income generation for options can get you profits over dividends by writing call options against your shares. By writing an option, you receive the option premium up front. While you get to keep the option premium, it is possible that you could be exercised against and have to deliver your shares to the taker at the exercise price. This strategy uses stock bought on margin.

By combining different options, or stocks with options, you can create a wide range of strategies.

You can earn extra income by writing options against shares you already own or are purchasing. This is one of the simplest and most rewarding strategies.

Using options gives you time to decide. Taking a call option can give you time to decide if you want to buy shares. You pay the premium, which is only a fraction of the price of the underlying shares.

The option then locks in a buying price for the shares if you decide to exercise. You then have until the expiry date of the option to decide if you want to buy the shares. This is the same as to the put option.

Keep in mind that, same as any other trades do not trade what you cannot afford to lose.

For more on Option Trading visit option-trading-expert.info. Susan also writes at Health and Fitness.

Investment VS Trading

Investment and trading both involve the purchase of assets in the hope that they will appreciate in value. However, there are significant differences in these contrasting approaches with the prime differentiator being the time frame involved.

Investment is something everyone should be involved in to some extent or another. Many do not consider themselves investors, but if you own (or are purchasing in mortgage) your own home or have a pension plan or insurance policy then you are an investor and your financial well being depends on the performance of stocks and/or real estate.

Trading is a minority activity seeking to derive profit (income) from the short term buying and selling of assets, or put simply selling higher than the buying price.

Investment is a long-term endeavor. It may be for life, as in providing a roof over ones head, or over many years, as in putting ones kids through college or providing an income in retirement.

On the other hand trading is relatively short-term, ranging from day-trading where positions are opened and closed within the space of a day up to holding them for a month or longer.

Investments usually consist of holding actual assets, eg stocks, bonds, real estate Trading can mean holding assets but also consists of devices such as short selling (selling an asset you dont have in the hope its price will fall), making use of margin (or leverage - ie trading with borrowed money), foreign currency (FOREX) trading, and more sophisticated vehicles such as options, CFDs (Contracts for Difference), spread betting etc.

Investment is concerned with gaining both from an increasing asset price and the income gained from holding the asset (interest, dividends, rent). Trading is primarily concerned with profiting from movements in the asset price.

Trading is essentially a form of gambling, though hopefully a more informed (and less random) kind than the roll of a dice or the spin of a roulette wheel.

Investors generally rely on fundamentals in choosing investments, ie they look at the global and national economy, whats happening in a particular sector, and at the prospects for the asset under consideration. Traders do the same, but they also rely on technical analysis (chartism) which attempts to predict future price movements by looking at graphs or charts of historic prices. Theres absolutely no logical reason this should work, but charts do perhaps give a picture of market psychology, and more importantly are followed by many and as such may become a kind of self-fulfilling prophesy. Technical analysis tends to be used most for i) short-term (day) trading and ii) optimizing entry and exit points (timing).

The key point is to know whether you are a trader or an investor. As weve said investing is something that should be done by just about everyone, trading certainly is not. If you do decide to become a trader, make sure it is a conscious and informed decision. Study loads, and do lots of paper trading (trading with virtual rather than real cash - there are lots of trading houses out there that will let you set up practice accounts for this purpose). Find a system that works FOR YOU, and stick to it along with disciplined risk and money management.

Johnny Finnis is editor of personalmoneymanagement101.com a simple and unbiased introduction to finance and investment for ordinary people to make the most of their money. Have your say on our blog

Trading Commodities - What Style Of Trading Matches Your Mental Make-Up? - PART 2

Matching your mental make-up to a method of trading is possibly the most important aspect of trading to get right. There are many traders who fail every year simply because they force themselves to do things they should not be doing. Read on to see why and how you can find out what trading style is best for you!

Professionals use their intuition all the time. A doctor uses his intuition when he makes a tough decision. He would have no intuition if he had not paid his dues learning and observing for years beforehand. The same goes for an electronics technician. He can look into a familiar piece of equipment, take some basic readings and give a pretty good guess where the trouble lies. Ask the doctor to do the technicians job and he is lost.

My point is, study hard to learn what creates a good turning point or opportunity in the S&P 500 futures market and then you will be able to recognize them in real time - intuitively. Some futures traders will never develop these skills no matter how hard they try, whereas others can do it with training. It requires focused analytical skills, a patient temperament and most importantly, the aggressiveness to step up to the plate and put real money on the line.

Few commodity traders ever get all three skills firing on all cylinders. We need ALL three working all the time, believe me. Some say musicians are well suited for spotting market patterns learned from playing pieces over and over to perfection. Some say that women are well suited for intuition. And maybe yoga masters are well suited for the patience needed to wait for the best market set ups. So would an aggressive female musician who practiced yoga be a good trader? I would put my money on her to be a successful commodity trader verses someone who had none of these inherent skills.

Why do I believe this? Many times Ive been right on the mark by calling a market turn but hesitated and just couldnt pull the trigger. (Lacked confidence and aggressiveness) Or lost my patience and started taking what I call drunken sailor trades. (These are commodity trades that have no rhyme or reason - all emotional). Or I had the aggressiveness to trade that session, but the market just had no opportunities that day or maybe I just didnt SEE them.

Knowing when NOT to trade because you are not firing on all three cylinders is as important as knowing WHEN to trade. How easy it is to wash away recent profits on a bad day! And, conversely, profits can come easily on those days when everything just clicks. Weve all tasted these times.

As once said: Beware of that man, for he knows himself well. Know yourself well, your strengths and especially weaknesses, and gain an edge on the competition.

Good Trading!

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.

Thomas Cathey directs the managed futures division of Thomas Capital Management, LLC. Get FREE, his complete 44+ lesson, "Thomas Commodity Trading Course" and weekly TimeLine newletter by visiting: http://www.thomascapitalmanagement.com/commodity/welcome.htm The course is brand new and fun reading... a "street-wise" trading e-course. Visit the main Thomas Capital Management trading website at: http://www.ThomasCapitalManagement.com

So, Where Does All The Money Come From?

When you talk about Capital Homesteading credit the first question that always pops up is, "Where does all the money come from?" The answer is, it comes from the government of the people, by the people AND for the people, via the Federal Reserve (which has the right to extend credit as it sees fit). And yes, it does create (FHA like) red ink, but the red ink

(a) is not repaid from taxes, savings or wages,

(b) has a well defined, systematic exit plan of how to get in and get out (kind of like Operation Desert Storm) of that credit/loan

(c) it has a productive purpose.

So the real issue IS NOT where does all the money come from? The answer to that question is always the same. The real issue is whats the difference between PRODUCTIVE and DESTRUCTIVE uses of credit, and their effects on individual citizens, and the economy in general. So let's talk about the ways that credit can be used productively, and the ways that credit can be used destructively. Lets talk about how we can embrace the first, and eliminate the second.

Many people, for example, are convinced that a formal college education is the key to economic success in the modern age, so they're perfectly willing to help their kids pay for (often in the form of extended credit) that college education because Mom and Dad see it as investment in their kid's future...a PRODUCTIVE investment.

The Big Bank however, sees this college education in a different light when they extend (consumer) credit card offers to college kids across the country. So, what does Joe College purchase with that credit card? Boom boxes, CDs, DVDs, MP3s, video games, gas for daddys car, a six pack of beer for this weekends party, and other essential items required by the modern collegiate learning experience.

Big Bank And Joe College VS
Hey, dont get me wrong here. Big Bank knows exactly what its doing when it extends that credit offer to Joe College. Theyve carefully studied all the data, and theyve concluded, based on empirical evidence, that this particular marketing strategy is profitable for them. In other words, before they ever extend this credit offer to Joe College, they know that they will make their money back and lots moreor else they would never do it. Its a good bet. Its just as simple as that.

Capital Homesteading And Johnny Paycheck To Paycheck
Lets contrast Joe Colleges credit offer from Big Bank with the concept of extending a Capital Homesteading credit to Johnny Paycheck To Paycheck. What youll find is that the credit extended to JPTP cannot be spent on non-productive consumer crap. On the contrary, it must be spent on a well-vetted, productive capital (i.e. stock) purchase, the kind that the conservative local banker (not some wild, dice rolling venture capitalist) would advise his local bank to purchase.

The loan will be repaid not from taxes, and not from JPTP's wages or his salary, but from tax deductible dividends generated by the productive capital (i.e. stock) purchase. This will take an average of seven years to pay off, at which point JPTP becomes the proud owner of a real live piece of the rock. He becomes a capitalist.

If done annually over a lifetime, JPTP will generate an earned income to augment his wage or salary. He will also create a privately owned and controlled nest egg that will free him from ever having to depend on the government (i.e. social security, medicare, medicaid) to take care of himself and his family...which by the way, will also unload the government and justify TAX REDUCTIONS!.

Now like the boys from Big Bank, the local banker will have studied all the data and will have a real good idea what the odds of repayment are going to be, before he ever advises JPTP to place his investment bet. Actually the odds of repayment are much better with JPTPs Capital Homesteading credit than with Joe Colleges consumer credit.

Consumer Crap VS
There is one much more important difference however. The difference is that the purpose of Big Banks Joe College marketing strategy is to get JC hooked on the consumer mentality of easy (buy now pay later) money, and in the long run, to program him to believe that its completely normal to exchange his long term financial freedom for immediate gratification when it comes to consumer crap that he wants to have right now. Once hes fully programmed, Big Bank will wrap its financial tentacles around Joe College, who will then be transformed into the Big Bank's profit producing mule for years to come.

A Legitimate Piece Of The Rock
On the other hand, the Capital Homesteading credit, as weve already said, must go toward winning Johnny a piece of Americas growing economic pie, a piece of the rock that will predictably pay itself off, and in the process, begin to transform Johnny Paycheck into a capital owner who has a vested interest in the future of a particular company, in a particular community, in a particular county, in a particular state, located in the United States of America. So what we're talking about here is a DISTRUCTIVE (consumer) use of credit, compared to a PRODUCTIVE (capital homesteading) use of credit.

Let Freedom Ring
And as his productive piece of the rock grows year after year, JPTP will begin to feel the chains of his wage slavery loosen, and the bell of financial freedom ring louder and louder, until he's finally able to sing right along with Martin Luther King himself, free at last, free at last, thank God, Im free at last.

In the lobrng term big picture the Capital Homesteading strategy is specifically designed to create a nation spilling over with more and more capitalists who are actively participating on the ownership side of the free market economy, instead of a nation spilling over with more and more workers who are effectively cut off and alienated from the modern economic miracle known as the free enterprise system. The Big Bank strategy is specifically designed to create programmed automatons who unknowingly trade their financial freedom and future in for consumer crap, and who, as the result can be easily controlled and dictated to by the captains of industry from their high rise corporate suites up on Wall Street.

Its Our Choice
So I guess the choice comes down todo you really want to underwrite a free enterprise economic system, and transform America into a real capitalist nation chock full of real live capitalists? Or do you prefer to create a nation thats primarily full of workers (sounds communistic/capitalistic to me), who are systematically required to compete tooth and nail with each other, driving wages lower and lower (lets become a third world nation ASAP, or redistribute from top to bottom in order to temporarily prevent the economy from falling flat on its face!) so that the captains of industry can oversee their respective monopolies without really having to concern themselves with legitimate competition. That way they can all get together, buy out the little guys, fix prices, fix elections, smoke big Cuban stogies, drive their fancy cars, and generally live off the fat of the land. Yes Tonto, I guess you could turn the clock all the way back to them thrillin days of yesteryear, if you wanted to. But do you really want to?

P.SViva Las Vegas!
I have one final thought to offer here. If all those incredibly bright and intelligent, bureaucratic bean counters in Washington, DC are simply unable to recognize a good bet when they see one, then I know there are plenty of folks out in Las Vegas who dont suffer from that same moronic, myopic malady. I mean its their business to assess the odds accurately, facilitate the bet, and they make lots of money in the process. They do it every day of the year, and twice on Sunday.

Yah sure, I know youre going to tell me that those folks out in Vegas are all crooks. But that comment simply begs the question. How does that make them any different than the crooks in DC? Now, if youre unable to come up with a believable answer to that last question, I suggest that we consider taking bids from both DC and Vegas. If Vegas wins, well just call itoutsourcing.

Joe L. Buckett is a Chicago based, freelance writer who in 2004, was our nations first virtual candidate for the Presidency of the United States. If you're interested in learning more about Joe Lunch Bucketts common sense solutions to 21st century problems, ranging from the war in Iraq, to Social Security, and Immigration, check out his book entitled "The Big Idea," which you can order on either Barnes and Noble or Amazon.

Forex Trading Advice Don't Take Any Forex Advice Until You Read This

Would you take driving lessons from someone who had never driven in their lives?

Of course you wouldnt!

With forex trading advice people take advice from people who have never traded and never question it, lose their money and are surprised.

If you are taking forex advice via signals or a system there is only one criteria you need to judge the advice on:

A real time track record.

Thats real money, made in the market over a 3 year period or longer.

It does not guarantee you will make money of course, but if I follow advice I like to know the forex trading advice I have taken, has made money and the logic is soundly based.

Forget hypothetical track records.

Anyone can make a profit if they know what the prices did!

Ever seen a hypothetical back tested system that didnt?

My six year old boy could make a profit that way, but not sure I would trust him to trade for me!

I am a trader of 20 years and I see e-books and makings telling me I can easily make 90% accurate trades or 100 pips a day!

Please dont insult my intelligence.

I know making money is not easy in anything and that includes forex trading.

Use common sense!

If forex trading advice looks to good to be true it probably is.

Use common sense and dont get blinded by greed or an easy way to make money you will lose.

Only take forex trading advice from vendors who provide the following:

A real time track record and the comfort of a money back guarantee.

There are plenty out there giving good solid advice that can help you make forex profits, but take a bit of time to seek them out.

Dont fall for the scammers in forex trading advice offering you easy ways, or guaranteed profits. You will lose.

Only a small minority of traders make money and there not the above.

They will simply make money out of you from selling advice that will lose you money.

Accept this fact:

Forex markets can and do make money and there is good advice out there but forex trading makes few traders rich over night.

Forex trading is a long term solid way to make money and good profits.

Make sure you dont fall for the hype of the huge amount of forex advice sellers on the net who have never traded in their lives.

No real track record you know what to do now

In conclusion with forex advice to separate the scammers from the people who make money, get the real time track record.

Thats it - Enough said.

MORE FREE BETTER TRADING INFO

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Commodity Futures Trading - The S&P 500 and E-mini - Preparation For A Big Move Up - Part 2

As traders all we really need to know is when a market is going to stop moving in one direction then turn around and head in the other. The rest is noise. I try to concentrate most of my energy on identifying these times. The day trading information presented here is applicable to longer term position trading. Read on to learn what a market requires to make a turn.

Observation From Trading Notes:

"A significant resistance is broken on chart the beginning of strength. It starts with the previous big pivot point on the 5 min chart."

Of course, theres no way for the e-mini futures market to go to 1200 unless it goes through 1190 first, then 1194, then 1198 and so forth. Its the same with previous pivot points. You need something to hang your hat on as a reference point. A logical point in a decline is the previous swing high on a 5-minute chart. This may be too early a warning for longer term hourly swing traders, but may be perfect for the one-minute bar traders.

There is nothing cast in stone, remember that. Just find some reference point that is tied to real price action and use it as a marker. This does not mean you want to buy if the pivot point gets broken on the upside. It may be just a bear market rally. But, if you are looking at a series of bottoms while other indications are suggesting a big e-mini rally is about to occur, take notice. The break of a meaningful pivot should get you off the pot and into action. Otherwise, these things can slip by us without notice.

You may decide to buy the next correction onto the previous highs or whatever. But, since price is in the bottom forming mode, much of the time the market will come back down many times, even though it may be in a new bull market. The big move straight up usually occurs much later in the move when the shorts panic. Theres exceptions, like if the bottom turns out to be a major weekly bottom or bigger. This can produce huge lift-off moves that give little opportunity to get on board. But they are rare and not worth stalking all the time. Just wait for that correction and then buy.

One time I remember telling a successful trading friend of mine, the e-mini top forming is a big one and could be a major top lasting for weeks. He wisely said, I dont care! Im only interested in the short day swings. What difference does it make if this is THE top? He was right. "This is the BIG top" type of thinking just makes one excessively bearish and biased. Even if correct, major e-mini futures tops still have plenty of bull days and tremendous bear covering rallies to trade along the way down in a major move.

Its too easy for day traders to get, this is it it-itis, start holding overnight, and holding through the corrections, etc. Stay in the now moment all the time. Thats what counts when day trading short-term e-mini futures contracts.

Observation:

"Very few places to enter in yesterdays creeping market."

As a rule, the e-mini futures market will make it easy to get on board the wrong side and hard to get on board the right side. What I mean is that the corrections to buy are shallow and then price lifts to new highs. The e-mini futures market will shift out of character from what it was doing before, to trap participants. In fact, the market usually does what it must to screw the majority and encourage the maximum amount of trading possible.

Filling gaps is a perfect example of seeking out maximum trades. Generally, commodity markets that take off in the opposite direction of a big report's news is another example of maximum trading and screwing the majority. The market is very clever. Actually, the market is you and me.

Part Three of Five Parts - 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.

Thomas Cathey - 27-year trading veteran heads the managed futures division of Thomas Capital Management, LLC. View his TimeLine Trading market predictions and get his complete 44+ lesson, "Thomas Commodity Trading Course" - they're all free. http://www.thomascapitalmanagement.com/commodity/welcome.htm Main site: http://www.ThomasCapitalManagement.com

Judging Whether You Can Profit From a Put Option, Part 3

In this example, you would lose $300 by not following your own standard and bailing out at 4. Even if the stock did fall later on, time would work against you. The longer it takes for a turnaround in the price of the underlying stock, the more time value loss you need to overcome. The stock might fall a point or two over a three-month period, so that you merely trade time value for intrinsic value, with the net effect of zero; it is even likely that the overall premium value will decline if intrinsic value is not enough to offset the lost time value.

The problem of time value deterioration is the same problem experienced by call buyers. It does not matter whether price movement is required to go up (for call buyers) or down (for put buyers); time is the enemy, and price movement has to be adequate to offset time value as well as produce a profit through more intrinsic value. If you seek bargains several points away from the striking price, it is easy to overlook this reality. You need a substantial change in the stock's market value just to arrive at the price level where intrinsic value will begin to accumulate.

Example: Good Trend But Not Enough: You bought a LEAPS put for 5 with a striking price of 30, when the stock was at $32 per share. There were 22 months to go until expiration and the entire put premium was time value; you estimated that there was plenty of time for the price of the stock to fall, producing a profit. Between purchase date and expiration, the underlying stock falls to 27, which is 3 points in the money. At expiration, the put is worth 3, meaning you lose $200 upon sale of the put. Time value has evaporated. Even though you are 3 points in the money, it is not enough to match or beat your investment of $500.

The further out of the money, the cheaper the premium for the optionand the lower the potential to ever realize a profit. Even using LEAPS and depending on longer time spans, you have to accept the reality: The current time value premium reflects the time until expiration, so you will pay more time value premium for longer-term puts. That means you have to overcome more points to replace time value with intrinsic value.

If you buy an in-the-money put and the underlying stock increases in value, you lose one point for each dollar of increase in the stock's market valueas long as it remains in the moneyand for each dollar lost in the stock's market value, your put gains a point in premium value. Once the stock's market value rises above striking price, there remains no intrinsic value; your put is out of the money and the premium value becomes less responsive to price movement in the underlying stock. While all of this is going on, time value is evaporating as well.

Tip: For option buyers, profits are realized primarily when the option is in the money. Out-of-the-money options are poor candidates for appreciation, because time value rarely increases.

Whether you prefer lower-premium, out-of-the-money puts or higher-premium in-the-money puts, always be keenly aware of the point gap between the stock's current market value and striking price of the put. The further out of the money, the less likely it is that your put will produce a profit.

To minimize your exposure to risk, limit your speculation to options on stocks whose market value is within five points of the striking price. In other words, if you buy out-of-the-money puts, avoid those that are deep out of the money. What might seem like a relatively small price gap can become quite large when you consider that all of the out-of-the-money premium is time value, and that no intrinsic value can be accumulated until your put goes in the money.

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Basics of Forex Trading

Foreign Exchange Trading or simply FX or even forex describes the trading of different currencies of the world. The forex market is the largest in the world with trades amounting to more than USD 1.5trillion every day. Typically, most forex trading is speculative, with only a small part of the market activity representing governments' and companies' basic currency conversion needs.

The main centers for trading are Sydney, Tokyo, London, Frankfurt and New York. By virtues of it being a world market, it is a 24 hour market where online forex trading is conducted across the globe. This is a major advantage as it provides investors with a unique opportunity to react instantly to breaking news that is affecting the world markets. The forex market is known to have superior liquidity and thus there are buyers and sellers present perennially to trade in this market. The liquidity factor ensures price stability and narrow spreads and comes mainly from banks that provide liquidity to investors, companies, institutions and other currency market players.

Unlike the stock market foreign exchange trading is not conducted through a central exchange but something similar to the OTC (over the counter market). It uses sophisticated forex trading software recognized globally. The most commonly traded currencies are the EURUSD, USDJPY, USDCHF and GBPUSD. Trading in the forex market means the simultaneous buying/selling of a currency. The combination of two currencies being traded is called cross. Forex trading is done without commissions and thus proves to be a hugely attractive opportunity for investors dealing on a daily basis. Moreover, the forex market is dynamic, and there exists trading opportunities at all times no matter whether a currency is strengthening or weakening in relations to another currency.

The spot market is the largest forex market as it has the largest volume of foreign exchange currency trading. The market is called the spot market because trades are settled immediately. In practice, however, it takes two banking days. There are virtually no restrictions in the forex trading and the forex market thereby allowing you to enjoy trading opportunities during any market condition. If you are a commercial investor, you may need to swap your trade forward to a later date. This is called forward trading and can be undertaken on a daily basis or for a longer period of time. Although the forward trade is for a future date, the position can be closed at any time and the closing part of the position is then swapped forward to the same future value date.

Trading on margin means that you can buy and sell assets that represent more value than the capital in your account. Forex trading is usually conducted with relatively small margin deposits. Leveraging allows you to hold a position worth up to 100 times more than your margin. This is useful since it permits investors to exploit currency exchange rate fluctuations. However, without appropriate risk management high leverage can lead to both large losses and gains.

Spreads and Pips - The spread is the difference between the price that you can sell currency at and the price you can buy currency at. A pip is the smallest unit by which a cross price quote changes. This is shown when you compare the bid and the ask price, for example EURUSD is quoted at a bid price of 0.9876 and an ask price of 0.9879. The difference is USD 0.0003, which is equal to 3 pips.

Up until recently, the forex market, given its large minimum transaction sizes and-stringent financial requirements, was dominated by big professional players like banks, hedge funds, major currency dealers and the occasional high net-worth individuals. However, now several global companies are now offering small companies, traders and investors small transaction trades with the same price movements and rates.

William Brister
http://www.FinanceProGuide.com - An answer to your financial questions.

Pensions and Long Term Care - Why You Should Turn Again to Property

Most people have this plan in life they work for a large (secure?) organisation, for 40 years or more, and then they feel that the organisation will repay their loyalty by providing them with quite a sizable top-up to their State pensions.

How wrong can they be?

Look at the chaos caused over the last few years on both sides of the Atlantic where companies have either illegally or by bankruptcy robbed hundreds of thousands of hard-working, loyal employees, their right to a comfortable retirement Murdock and Equitable Life in the UK; Enron, IBM and now Delphi in the States are just the tip of the iceberg. (Will GM be next?)

Then there is another highly relevant issue that of long term care. In the UK particularly, human rights for older people remains a very uncertain area, and unless you have money or very vociferous friends and relatives, you could become victim of bureaucratic activities. As reported in the Telegraph Money section in February this year, a couple who had lived together since the beginning of the Second World War ( 65 years of togetherness) found that when the husband had to go into a care home, his wife was refused permission to move in with him. Enforced divorce by the Welfare state? Luckily the couples family rallied to their rescue, and Gloucester County Council relented and the couple are now reunited.

What is the common theme in this reassurance that control of our twilight years will not be taken out of our hands by some faceless bureaucrat?

Financial insecurity of course.

In an attempt to overcome this uncertainty, many people are turning back to one of the bedrocks of financial security property.

But to many average people, the thought of investing in property is seen as a privilege that only the very rich and therefore those totally unaffected by the pension crisis can afford to indulge in.

However, many of these folk are already into property investment, and dont yet realise it. One thing most of us are brought up to believe is that we should, as soon as we are able, get a foot on the property ladder and buy our own house. But then it all goes a bit pear-shaped.

Most of us live in this house we have bought, usually with a really low cost, long term mortgage, and we then have this urgent desire to pay off the mortgage as quickly as we can, so when we retire, we can live rent-free in our own property. That is what we are taught to do in school, by our parents, by society in general.

Very commendable but what about our standard of living on retirement? Or our choice of care homes when the inevitable happens? We may have a nice house to live in, but if all of a sudden, we are only getting a fraction of our usual income, due to retirement or long term illness, what happens to the nice car, the good holidays, the freedom to go and see all the family when we want to?

Over the lifetime of the mortgage the average property - wherever it is situated, has been increasing in value by around 8% every year. With the average price of a house in the UK now at 150,000, that represents a growth of around 12,000 every year. After 10 years, that will amount to some 120,000 (about $205,000 to our US cousins), so you could have at your disposal a lot of this money by refinancing your house.

With the average deposit needed to buy another house as an investment in the UK being around 15%, and the average UK home costing 150,000, another house would require you to raise around 22,500 deposit, so in theory, you could go out and buy and 5 more houses using the equity in your existing house, and each house growing in equity by 8% (12,000 each per year), you would see your net worth grow by around 60,000 every year!

Thats all good and dandy, but now you have 5 extra mortgages of around 127,000 each, each one costing around 550 a month to service. This is what most people find is still the most daunting, and even terrifying prospect, of investing in property.

However, there are organisations around who specialise in locating property both in the UK and in places such as Spain where properties can be brought for very low amounts of money down, and for the uninitiated, full rental guarantees for up to 10 years can be provided in some cases. OK, there the trade off is that there would be little or no rental income, but the mortgage would be paid with no worries, and the capital growth after 5, 10, or more years would provide a very tidy capital nest egg indeed.

But and there is always a But where there is money to be made, sharks tend to circle, and before anybody rushes out and starts to buy low money down property, they should seek sound financial advice from an independent financial advisor.

Copyright 2006 Geoff Morris

Geoff Morris has built up a multi-million dollar property portfolio in less than 18 months. He has written a number of articles aimed to help others follow the same path to financial freedom. Imagine the peace of mind that you would achieve if you follow the advice to be found in his Free reports and consumer guides to be found at http://www.propertyprofits4you.com. If you want to take part in his latest Florida campaign this can be accessed at http://imnosey.com/dv.

Regressive Property Taxes Make Owning a Home Increasingly Unaffordable

State and local politicians at city hall write their bloated budgets based on the extra revenue assessments while property owners who realize they are about to be fleeced prepare their appeals. Engaging in a property tax appeal is one way to lower your tax burden, but more need to be done.

Retired taxpayers have lost their connection with the means to pay. Taxes based on a propertys estimated value is unfair and punitive. Too many taxpayers are becoming land poor in that their property value no longer is proportional to their income. Older person on a fixed incomes often have to sell their house to pay the taxes on it. Or, in other cases, sometimes feel trapped in old homes because their taxes would go up dramatically if they moved.

Property tax is a tax on capital. It should occur only on when you sell the home just like an individual stock in the stock market. One only pays taxes on the realized gain or loss for a stock when it is sold.

An annual property tax is the most regressive, destructive tax there is. It takes from rich and poor alike, irrespective of age, family status, health or income. Property values fluctuate and municipal taxes and budgets are never lowered, it seems. Rising property values have driven up taxes for all property owners. If property values decrease, does that mean taxes will go down?

Perhaps the ebb and flow gets resolved in the Wizard Of Oz but not in most US municipalities. Most governments are addicted to a tax and spend mentality and act like the characters in the Oz movie. The lion big show where the state develops its own pet private enterprise for the good of the community. The tin man no heart that ignores the plight of the average taxpayer, the elderly and retired perhaps throwing a few crumbs of tax relief their way but a deaf ear in they way of budget cuts and overall lower taxes. And lastly the straw man with no brains who over-hires and over-compensates their employees with benefits fit for kings and queens when they should be equal to Costco and Home Depot perks and employee policies.

Many homeowners who look on property as an investment, dont perceive the value of their property to be the price at which they purchased the property. They see it as the price for which they think (or hope) they could sell it for. Little do they remember the lessons from history. In the 1800s the stock market crashed and it took nearly 50-years for markets to recover. The 1929 crash took 25-years for markets and real estate values to recover.

Even the best intentioned investments can become wrong and long agonizing stretches can occur without an underlying asset regaining its former value. After the basics in Maslow's Hierarchy of Needs are met and your shelter transforms from the basics and takes on the shape of an investment, were beyond necessity and into speculation.

That brings up some interesting ethical questions. Should a basic shelter (like a trailer) not be taxed similar to milk, eggs and potatoes or is it an investment? Should speculations such as stocks and investment homes be not treated the same? If they are the same, should they not be treated tax-wise the same and taxed only on appreciation? Regressive property taxes make owning a home increasingly unaffordable.

Property Taxes, Property Tax Appeals, Home Appraisals Determine house values for purchase, sale or how to win your own property tax appeal without the cost of an appraiser or attorney.

You can triple the chances for winning your property tax appeal and also cut your prep time in half. I've been doing this for years. After countless appraisals and tax appeals I decided to make something affordable and useful for anyone deciding to appeal their taxes.

4 Benefits of Long Term Trading vs Short Term Trading

Both short term trading and long term trading can be effective trading strategies, however, long term trading has several significant advantages. These include the effect of compounding, the opportunity to earn from dividends, reduction of the impact of price fluctuations, the ability to make corrections in a more timely manner, less time spent monitoring stocks.

1. Compounding

Time can be investors best friend because it gives compounding time to work its magic. Compounding is the mathematical process where interest on your money in turn earns interest and is added to your principal.

2. Dividends

Holding a stock to take advantage of payouts from dividends is another way to increase the value of an investment. Some companies offer the ability to reinvest dividends with additional share purchases thereby increasing the overall value of your investment. Additionally, dividends are more a reflection of a company's overall business strategy and success than volatile price fluctuations based on market emotions.

3. Reduction Of The Impact Of Price Fluctuations

In the long term investment the persons is less affected by short term volatility. The market tends to address all factors that keep changing in the short term. So a person involved in long term investment or trading will not be affected as much by short term instability due to factors such as liquidity, fancy of a particular sector or stock which may make the price of a stock over or undervalued. In the long term, good stocks which may have been affected due to some other factors (in the short term) will give better than average returns.

Long-term investors, particularly those who invest in a diversified portfolio, can ride out down markets without dramatically affecting his or her ability to reach their goals.

4. Making Corrections

It is highly likely that you could achieve a constant return over a long period. The reality is that there will be times when your investments earn less and other times when you make a lot of money in short term. There may also be times when you lose money in short term but as you are in quality stocks and have long perspective of investment you will earn good returns over a period of time.

There are always times when some stocks do not perform and it is the wise choice to pull out of an investment. With a long term perspective based on quality stocks, it is easier to make decisions to change in a more timely manner without the urgency that accompanies short term and day trading strategies chasing volatile changes.

Investors that begin early and stay in the market have a much better chance of riding out the bad times and capitalizing on the periods when the market is rising by taking a longer term view using long term trading strategies.

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A Little About Lot Sizes In Forex Trading

understanding lot sizes in forex trading is very important to help you avoid the pitfalls of trading on a leveraged account. Forex trading involves the use of dramatically leveraged accounts and before you put one dime into a live forex account you need to understand how leverage works and what is happening in all the different sized lots. Also what is the optimal size lot to use when learning forex trading.

Let me talk to you a little about forex lot sizes. OK I am reaching with a play on words there but a lot of people who read my articles should know by now that I think forex trading should be fun and profitable.

normal Lot: Many forex brokers will require $10,000 to open an account and on it you can trade a normal lot size. There is usually a 1 lot minimum trade.The normal lot is worth $100,000 in currency and when you trade a lot it is 1:100 leverage. What this means is that you are getting a loan from the broker to control $100,000 for your $1,000. Now lets look at this leverage thing a bit more because so many people make a big deal about how wonderful forex trading is due to the leverage you can get. I completely agree that leverage is one of the many benefits of forex trading but it seems to me not many people properly understand the concept.

as an example you have a standard account with 1:100 leverage then for every 1 Pip you gain there is $10 in profit for you ( basically not factoring spreads commissions etc. ). Now leverage is a 2 way street and for every 1 pip the forex market moves against you then you lose $10 and this is what makes leverage fascinating to many. The fact is that you must understand both sides before getting into forex trading. Most markets swing up to 100+ pips a day easily and this means at 1:100 leverage you can in theory gain 100 pips in 1 day thus taking a $10,000 account to $11,000. Now for the bad news you can also lose 100 Pips on most markets and take $10,000 to $9,000 in a day just trading 1 lot. So when you hear people talking about 1:400 leverage they better be very accurate with their forex trading.

Mini Lots: Ok now lets look at a Mini lot and how leverage works with it. Most brokers require at least 1 mini lot to be traded. The mini lot is worth $10,000 this means you are trading with 1:40 Leverage. Let's do some math and I promise it want hurt much. $250 x 40 = $10,000 and since $10,000 is 1/10 of a standard forex lot this is why for every 1 Pip in your favor you earn $1 profit. Conversely for every 1 pip that moves against you forex trading you lose $1.

Micro lots: Now some brokers allow micro lots where you can do forex trading at 1:4 leverage again lets hit the math book a second. $250 x 4 = $1,000 which is 1 / 10 of a ($10,000) mini lot

and this means for every 1 pip in your favor forex trading you will make 10 cents profit and of course conversely for every 1 pip against you then you will lose 10 cents. I know to the novice this does not sound like much but if you had only $100 and traded an account with 1 micro lot then every 10 pips in your favor will mean 1% gain on your account. The micro is in my opinion a great size to trade when learning in a small account if your Broker allows this. Practicing forex trading with micro lots will give you room for forex market swings and time to develop your skills as a forex trader.

That is just a little about forex lots and I hope it clears some things up and explains some of the risk and rewards of forex trading.

For more information visit at http://www.digital-intuition.com and Download your free copy of forex flows the best forex trading software available using computerized A.I.

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Online FOREX Trading - Profit Opportunities Live Update

Yesterday we looked at 3 trading opportunities. Today, we are going to look at one shaping up in the euro currency, a possible profit opportunity and update the others. Lets take a look first at the euro. We are using the chart service futuresource.com and indicators RSI, Bollinger bands and stochastic in making our observations. This report is written at 10AM Central European time.

Euro
The euro is in a firm up trend against the dollar and prices have recently retreated from contract highs. Prices are now at the middle of the Bollinger band and are looking to hold around this level. RSI has fallen back from overbought levels and stochastics are down, but oversold. Support lies at 1.34 and 1.32. Watch for stochastics to bottom and cross with bullish divergence to indicate a shift in momentum, accompanied by rising RSI. This looks like a correction in a bull market. Wait for the correction to run its course, by watching for the above indicators to give you a signal and shift the momentum back to the bulls.

Other trades we looked at yesterday were:

US V Canadian Dollar
Same comments apply as before:
We expect a bounce. RSI very oversold and the dollar is trying to hammer a bottom out above the key 1.10 level. Stochastics remain flat. If they cross with bullish divergence, expect a move up. A close below 1.10 means all bets are off.

US V Japanese Yen
We expect the dollar to hold above the breakout point. Stops should be below the breakout if long if not, to go long look for stochastic to turn up with bullish divergence. The yen is the weak currency of the majors against the dollar and we would expect the dollar to hold its up trend.

Today, should give a clearer indication of near term direction. Short term momentum is down in the dollar. Watch the breakout point and stochastic momentum.

British Pound V US Dollar
The trend in the pound is up but short term momentum is down. We expect the pound to move up after the recent correction, but need to see a shift in near term momentum.

Prices have broken the mid Bollinger band and are drifting lower. RSI is no longer over bought. Stochastic momentum is over sold and down. To enter a long trade watch for a cross in momentum on the stochastic with bullish divergence and also a rising RSI. With all trades dont predict wait for confirmation of shifts in near term momentum before attempting positions.

Good luck and good trading.

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FOREX Trading: Risky Business

You can see the claims on some FOREX web sites, implying that FOREX is a risk-free pastime. No investment is risk-free.

In FOREX you are trading substantial sums of money, and there is always a possibility that a trade will go against you. There are several trading tools that can minimize your risk, yes, but eliminate it, no. With caution, and above all education, the FOREX trader can learn how to trade profitably and minimize loss.

The Scams

FOREX scams were fairly common a few years ago. The industry has cleaned up considerably since then. Still, you should exercise caution before signing up with a FOREX broker by checking their background.

Reputable FOREX brokers will be associated with large financial institutions like banks or insurance companies, and they will be registered with the proper government agencies. In the United States, brokers should be registered with the Commodities Futures Trading Commission or a member of the National Futures Association. You can also check with your local Consumer Protection Bureau and the Better Business Bureau.

The Risks

Assuming you are dealing with a reputable broker, there are still risks to FOREX trading. Transactions are subject to unexpected rate changes, volatile markets and political events.

Exchange Rate Risk: refers to the fluctuations in currency prices over a trading period. Prices can fall rapidly, resulting in substantial losses unless stop loss orders are used (see below).

Interest Rate Risk: can result from discrepancies between the interest rates in the 2 countries represented by the currency pair in a FOREX quote. This discrepancy can result in variations from the expected profit or loss of a particular FOREX transaction.

Credit Risk: is the possibility that 1 party in a FOREX transaction may not honor their debt when the deal is closed. This may happen when a bank or financial institution declares insolvency. Credit risk can be minimized by dealing on regulated exchanges, which require members to be monitored for credit worthiness.

Country Risk: is associated with governments that may become involved in foreign exchange markets by limiting the flow of currency. There is more country risk associated with "exotic" currencies than with major countries that allow the free trading of their currency.

Limiting Your Risk

FOREX trading can be risky, but there are ways to limit risk and financial exposure. Every trader should have a trading strategy; i.e., knowing when to enter and exit the market, and what kind of movements to expect. Developing strategies requires education, which is the key to limiting risk. At all times follow the basic rule: Never use money that you cannot afford to lose.

Every FOREX trader needs to know at least the basics about technical analysis and how to read financial charts. He should study chart movements and indicators and understand how charts are interpreted. There is a vast amount of information on FOREX trading available both on the Internet and in print. If you want to be successful at FOREX, then educate yourself.

Stop-Loss Orders

Even the most knowledgeable traders, however, can't predict with absolute certainty how the market will behave. For this reason, every FOREX transaction should take advantage of available tools designed to minimize loss.

Stop-loss orders are the most common way to minimizing risk. A stop-loss order contains instructions to exit your position if the price reaches a certain point. If you take a long position (expecting the price to rise) you would place a stop loss order below the current market price. If you take a short position (expecting the price to fall) you would place a stop loss order above the current market price.

Stop loss orders can be used in conjunction with limit orders to automate FOREX trading. Limit orders specify that an open position should be closed at a specified profit target.

Ron King is a full-time researcher, writer, and web developer. Visit FOREX4U to learn more about this fascinating trading vehicle.

The Major Players in the Foreign Currency Exchange Market - FOREX

Since the US dollar is the centerpiece of the market, it is normally considered the 'base' currency for quotes. In the "Majors", this includes USD/JPY, USD/CHF and USD/CAD. For these currencies and many others, quotes are expressed as a unit of $1 USD per the second currency quoted in the pair. For example, a quote of USD/JPY 123.50 means that one U.S. dollar is equal to 123.50 Japanese yen.

When the U.S. dollar is the base unit and a currency quote goes up, it means the dollar has appreciated in value and the other currency has weakened. If the USD/JPY quote listed above were to increase to 124.01, that would mean that the dollar is stronger because it will now buy more yen than before.

Some exceptions to this rule are the British pound (GBP), the Australian dollar (AUD) and the Euro (EUR). In these cases, you might see a quote such as GBP/USD 1.4366, which means that one British pound equals 1.4366 U.S. dollars. In these three currency pairs, where the U.S. dollar is not the base rate, a rising quote means a weakening dollar, as it now takes more U.S. dollars to equal one pound, euro or Australian dollar.

So if a currency quote goes higher, that increases the value of the base currency. A lower quote means the base currency is weakening. Currency pairs that do not involve the U.S. dollar are called cross currencies, but the premise is the same. For example, a quote of EUR/JPY 127.95 signifies that one Euro is equal to 127.95 Japanese yen.

Chuck Cox is a Technical Writer and Industrial Scientist by professional with a background in statistics. He has used mathematical and statistical methods to invest and trade in the stock, futures, and options markets. Chuck has owned various businesses and presently operates several websites. To investigate a new business idea, visit his website, http://www.earncashathometoday.com/trading-FOREX.htm