Option Spreads - Credit and Debit Spread Trading

People who trade options often will engage in trading spreads. A spread is the buying and selling of the same type of option. A Call Option spread is buying and selling (writing) call options. A Put Option spread is buying and writing puts. The purpose of engaging spread trading is to either make money on the premium difference (money spent and received) or to earn profit on the options themselves being traded or exercised.

Debit or Credit Spread

A debit spread is when the options that are bought and sold result in a loss on the premiums. The investor has spent more for the option purchased than the option shorted.

An example of this would be:

Long (buy) 1 ASD SEP 40 CALL@4 and Short (sell) 1 ASD SEP 45 CALL@2

This is a debit spread since the $400 paid exceeds the $200 received. There is a $200 Debit on this spread. The investor in this case is looking to make a profit on the future value of the options. Since these are call options, the investor is bullish on the market (wants the market on ASD to rise).

The market rising will allow the investor to take advantage of the increased premium or to exercise the options. The long option allows the investor to purchase the stock at 40 and the short option carries an obligation to sell at 45. If these were to happen, the person could make 5 points on the stock (strike price difference) minus the initial debit loss ($200). This equals the maximum gain potential ($300). The maximum loss is if both options expire worthless, resulting in a $200 loss.

A credit spread works the opposite way. The investor is looking to gain on the premiums and then is hoping the options expire worthless. Using the same example above, the numbers are the same, but the gain and loss would be reversed. The person would be Long the 45 paying $200 and Short the 40 call, gaining $400. The $200 is now a credit and is the gain. If the options were exercised, the 5 point difference in the strike prices would be a loss (buying at 45 and selling at 40). The trader would be bearish on the market for a call credit spread like this. Trading of credit call spreads is higher in a bear market.

Vertical Spread

A vertical or price spread is when the strike prices are different, but the expiration months are the same. The above examples would be considered vertical spreads.

Horizontal - Calendar Spread

A horizontal spread is when the strike prices are the same, but the expiration months are different. The trader can make money on this type of spread because even thought the strike prices are the same, the option with the longer expiration month will have a higher premium, so there is still a "spread".

Diagonal spread

When a spread has months and strike prices that are different, it is defined as a diagonal spread. The options are vertical and horizontal at the same time.

All in all, spreads are fairly conservative - as far as options are concerned. A long position is covered by a short position, so large or unlimited losses do not normally occur.

Learn more about Spreads and other Strategies here

Happy Trading

Nick Hunter is the President of American Investment Training (AIT) and writes for Brokerjobs.com - A financial career website with investment education information.

Ruined Rural Economy - Failed Party and Nation Part - 15

Contribution of Congress led ruling alliances is more in Bleeding the Nation; rather than Building the Nation in last four years

I feel indebted when I find that the readers world over have expressed sympathy for poor Indian and Asian farmers who have been committing suicide due to bad economic policies of Congress led government which has ruined Indian Agro and Farming Sector (IAFS) in totality. The MM-PC-AS trios Economic Think Tank (ETT) have really not only destroyed the entire agro economy but also embedded last nail on the burying coffin of farmers by importing over 30 lakh tons of food grains. What a reprehensible decision of Indian Agriculture Minister, Mr Sharad Powar, who has added more salt to their already bleeding wounds due to bad and anti-farmers oriented Congress and so called secular opportunist and chair hungry third front. Mr Powar is busier in playing cricket off the field; rather than managing his portfolio as Agricultural Minister of Union of India. Similar policies are also evident in many other countries where poor farmers are forced to commit suicide. A multi millionaire Sharad has no time for poor farmers.

What a pity on the nation of a billion; that they choose irresponsible leaders.

When first time, the Congress led amalgamated government was formed under Mr Man Mohan Singh as Prime Minister and Sri P Chidambaram as Finance Minister, I have predicted that the pace of so-called Economic Reforms in India (ERI), these leaders have conceived with World Bank and Western Economy Development Oriented Model (WEDOM) that Indian Agro and Farming Sector (IAFS) is going to be ruined. I am still firm that as both the leaders have, time and again, reflected the deep embedded influence of WEDOM in their mind, they would ruin India. Who knows it is a well conceived conspiracy to destroy IAFS from grass root level and for which the present government is capable. The contribution of Congress led ruling alliances is more in Bleeding the Nation; rather than Building the Nation in last four years.

The WEDOM, which encourages capitalism; and discards Social Economic Progressive Model (SEPM) conceived by Sri Jagan Nath as Gram Sarpanch in fifties and implemented in small village of Piplia of erstwhile Nainital (now US Nagar) district of Uttrakhand, is unsuited for Asian Nations. The deep rooted imprint of WEDOM on the minds of MM-PC-AS trios thinking has already drained out lot of blood of poor Indian farmers at Nandigram in West Bengal. The present Khichari (Multiparty) Government of various parties has systematically ruined IAFS in planned manner, which none of them can deny. The crocodile tears of present Congress leadership including her president on continuous suicides of farmers are nothing more than a gimmick. It is a discreditable splotch on our Agricultural Ministers approach in handling such a sensitive issue of farmers suicide.

How pathetical it is, that the present government is just dumping money to buy suicide? The recent Indian Express report of PMs panel finding faults with the PMs liberal package of rupees 17,000 Crores to alleviate farmers debt problems has infact become a rich harvesting opportunity for corrupt officials. The India TV exposure of distribution of financial assistance to farmers of rupees ten, twenty and above shows the real concern of our leadership. After hearing about reservation in 1948, Sri Ramji Das Mehta said quote These incompetent, inefficient and stumpy mentality reserved people would rise and occupy most of the top positions in administration, police and various other departments after fifty years; and thereafter downfall and destruction of India would begin unquote. He was right in his prediction than, which is proving true in every aspect even now what I feel. I too maintain that so called low caste people can meet all the challenges of life in far better way; provided they are educated and grown in better environment. Rising of a slum dweller from a normal citizen to be a collector through quota would certainly make him corrupt which is the truth today.

Why Indian Prime Minister or Finance Minister is so careless towards IAFS growth. Throwing of hundreds of tons of tomatoes in ocean, rotting of similar amount of onions in Maharashtra is of great concern. There is a need to review Indian economic policies which is slowly drifting towards capitalist economy. The present trend of privatization of every second responsibility of government has really shifted the power block from public to businessmen. Today, most of the FM economic policies are guided by Tatas Birlas, Ambanis and Mittals and not the basic requirement of over 80% poor peasantrys daily needs.

My readers would agree with me that most of the economic policies of Congress led government are to favor 20% of rich people. The sky rocking prices of essential commodities have, by and large, nearly criminalized Indian poors. The Congress has very tactfully filled her party coffin through highly unstable market index. Mahatmas vision of making 80% villages prosperous has gone on deaf ears. The WEDOM influence on Indian ETT can be seen that every economic policy is to benefit Western consumers and not the poor Indians.

The recent decision of Agricultural Minister to Import wheat, sugar and even onion is really a cause of great concern for farmers of Maharashtra, Punjab and Central India. I only perceive the motive of importing over 30 Lakh tons of agro products is nothing beyond the Pandora box of commission, perks and five star treatments.

Why Government of India (GOI) is ready to import wheat which ultimately costs over rupees 1650 per quintal but not ready to pay over rupees 900 per quintal to own farmers. The Common Ordinary Man (COM) plight is beyond once perception. The criminalization of society is at rapid pace. Why ratio of juvenile crimes has risen dramatically needs detailed study; other wise Future of Indian (FOI) would always live under threat of crime.

I would suggest that the GOI should first:
One; create enough opportunities for farmers to sell the products and not dump over hundreds of tons of tomatoes, potatoes, onions and other food grains in ocean;
Two, take market to the farmers and not farmers moving to the market;
Three; ensure every square inch of cultivating land has irrigation system. If irrigation canals do not exit then make a five year plan after fifty years of independence which is still not late;
Four; ensure high yield verity of native seeds without patent right gimmick of foreigners specially United State of America victimizing tactics of world;
Five; provide high quality but low cost fertilizers to farmers. In fact, I would suggest that Indian and Asian farmers should follow my husband rule of One-Third Land Cultivation Cycle (OTLCC) of crops. He has invented and successfully practiced. In this method, a farmer divides his entire land mass in to three parts. One piece of land is ready for harvesting, another one third is having natural animal dung and wild grass weeds growing such as Sanai and Dhancha to the height of three to four feet; and one third land piece is being tilted, cultivated and prepared to sow green compost fertilizer seeds. The biggest advantage of this system is that land never losses her fertility as compare to chemical fertilizers.
Six; remove middle man but use not corrupt but honest officials to buy proceeds;
Seven; move banks to the villages and not villagers to the bank to avoid corruption and commission of bankers, middlemen and corrupt government officials;
Eight; encourage co-operative way of harvesting of single variety of crop specialization in a particular state or region such as rice in West Bengal, Assam and South India and so on.

In fact, every Supreme Court of world must ban all politicians having portfolio to hold any other office so that these elected representatives should do justice with their portfolios

Though, I have expressed my views but I hope that all these views are neither against and party, leader or government but for the benefit of Indian and Asian farmers and peasantry who mostly live in villages. My endeavor to revive IAFS and compare WEDOM is totally directed to give a new life to Indian farmers. In fact, every Supreme Court of world must ban all politicians having portfolio to hold any other office so that these elected representatives should do justice with their portfolios. The amount of time and political stunts which Mr Powar had played in defeating Mr Birla, if he would have spent even one percent of that, Indian farmers suicide would have been stopped. They are senseless and insensitive because none of their own family member committed suicide. The pain, miseries and unhappiness of grieved family is not seen by Ministers.

My entire series of articles on Ruined Rural Economy (RRE) is aimed to awaken the large Ajgar (Python) type Indian leadership; who is sleeping carelessly after swallowing a dear. I would request readers to share their views to eradicate Asian farmers agony. The bad government policies effect is evident on every common man in this country. Feedback at som_kalpna@yahoo.com

I, S Kalpna Sharma, am a freelance journalist who frequently write on various issues relating human values. My impetus of debate has been always focused on current issues which affect human beings life and social behavior. As always try to bring out debates on human values, my readers support base become large.

Futures Day Trading - Patterns in The S&P 500 and E-mini Futures Contracts- PART 1

Identifying patterns that repeat in the futures market, then jumping on them, is what it's all about. These patterns can be rather complex, requiring an accumulated library of observations. The best way to do it is through your own intuition. There's no better computer trading program than your own trained mind.

When do we start talking about the S&P 500 futures contract patterns that repeat over and over throughout the day? Right now! Theres so many. Just to give you an example of what Im talking about, from June to December 2005, I filled up about 55 typewritten pages with 240 different examples describing the general futures patterns I saw. And Im still adding to them. I then read them into a tape recorder and often listen to the tapes to reinforce these observations.

Its so easy to forget what weve seen. Going through a futures bull market" lasting 5 days can easily erase ideas we learned about the last mini-bear market the week before. The idea is to sit in front of the screen and watch the market unfold. You need to be constantly scanning the various charts, one-minute, five minute, sixty minute and daily bars to look for these patterns and set ups. Your mouse should always be moving and clicking. Take visual snapshots every five minutes. Scan your instruments and environment, just as a pilot does in an airplane .

These futures price patterns can sometimes each take two paragraphs to describe. They can involve COMBINATIONS of price formations, volatility, dullness, spikes, erosion, persistent strength, tick patterns, premium patterns, relationships to other markets, wave structure, volume, time counts and other subtle combinations. They all add up to that magic signal inside your head that the market is about to make a worthwhile turn. One or two indications dont mean much. In addition, they must be in context to the futures market position. Dont get caught swinging from one or two tree branches.

For example, let's say the market goes dull and quiet. This can be very bullish at a bottom. Or it can be very bearish at a top. Or it can mean nothing if the market is in a middle range like when the traders go to lunch between 12-1PM east coast time. Proper context is the key when interpreting these signals into meaningful pattern combinations.

These signals are decoded using "fuzzy logic" - your brain. Digital software can't compete! There's no way to program these complex patterns with a computer or neural net. Ive tried it and have come up with some effective systems, but I've always done better using the human mind for integration.

Part Two of Three 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 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

Auto Trading the Forex Market

Most often when trading foreign exchange the trading is done by humans, but some people like to develop automated systems of trading forex. The most common and best reason for this is that a trading system can be developed that removes the "human emotion" from trading and improves the results.

At least that is the idea.

In reality an automated trading system can be fraught with risk. Since it is trading automatically, little glitches in the program can cause financial loss. The broker usually does not care if you are trading forex automatically or "manually". If you lose the trade you lose.

Therefore careful testing, both forward and backwards in necessary for any automated trading system. In some cases results can be better than humans, especially where an inexperienced human trader is pitted against a sophisticated automatic or "expert advisor"

Trading software such as Metatrader allow automated trading to occur. But not all brokers will allow the use of metatrader. Metatrader is actually a free program. The forex broker pays the cost. If the broker uses Metatrader then you can do automated forex trading with that broker.

Some Metatrader enabled brokers include: Alpari, InterbankFx and North. You should research and read forex broker reviews though - before you open accounts with them. Some have particular rules that makes automated trading difficult.

What I have covered here is the start and some pointers to places where you can begin on your journey to understanding automated trading. You will not necessarily find better information in an ebook but like me are more likely to gain the required understanding by reading from many sources. Forex forums are a good place to pick up information on this subject.

Copyright 2007 Graeme Sprigge is the web master of Forex Broker Reviews the first dynamic and community driven forex broker review site. He is a part-time forex trader and investor and has been active in investing for many years. This article may be reprinted provided this copyright and notice remains intact - all rights reserved.

Mini Accounts: A Great Way to Get Your Start in Currency Trading

Currency trading is a risky but potentially profitable means of earning more money in addition to your regular income. There are many ways of going about it, but if you are a beginner to currency trading, I strongly suggest starting with what is called a mini Forex account. You can open a mini account with a minimum investment as small as $250, and some brokers will even allow you to open an account with a $100 minimum investment. With a mini account, you will still enjoy many of the same privileges as a regular account holder.

Let's look at the difference between a mini account and a standard Forex account. In a standard account, the lot or trading contract size amounts to 10,000 units of the base currency--in the case of USD, that would amount to $10,000. A mini Forex account will handle only a percentage of a single lot, which means that mini account contract is one-tenth the size of a standard Forex account contract. The pip values in mini Forex trading are also one-tenth the normal value.

Mini account trading does involve engaging in marginal trading. That means that you are making use of leverage, or in other words, borrowing money to be able to perform a trade without having to invest the full amount required for a single lot. The investment that you pay for out of your own pocket is called a marginal lot. For a mini account, the marginal lot for every $10,000 lot is $50, which is a 200 to 1 leverage. On starting a mini account with a minimum of $250, you are trading five mini lots with your investment.

Should you be concerned that the mini account requires a high degree of leverage as compared to other forms of trading? For example, stock market day trading has a leverage ratio of 4 to 1 in a trading day, which is far lower than the leverage ratio of mini account trading is 200 to 1. But this is the standard practice in mini Forex trading and traders and brokers do not see it as over-leveraging.

When you look at what happens in mini Forex trading, you will find that the traders risk on a mini account can be compensated by the smaller amounts of potential losses in mini trading. An average loss in mini account trading is one-tenth the amount that would be lost in an equivalent trade on a standard Forex account. That makes it easier for mini Forex traders to follow a disciplined trading strategy, since a trader normally finds it simpler to let go of a small loss, whereas a greater loss may prompt an investor to hold on longer than one should to a declining currency. The high leverage in mini Forex trading also gives an investor more options and trading strategies in currency trading.

A mini Forex account is the recommended investment choice for traders who want to invest $10,000 or less in currency trading.

Learn more about getting into Forex trading. View our latest articles about the Forex market at http://www.faso06.com

Have You Ever Wondered What Stocks Are and How Stock Market Investments Work?

To many people, the stock market is like a fuel injected engine; they are familiar with the term, but have no idea what it means. We hear about stocks daily. The evening news reports on the Dow while the daily activity on the New York Stock Exchange takes over several pages of your newspaper. But what do all of those numbers mean? And just what is a stock? For that matter, what is the stock market? While the technicalities of these terms would require volumes in order to explain them sufficiently, the general definitions can provide a brief view and introduction into this fascinating world - and perhaps it will serve to whet your appetite for more.

By definition, a stock (also called equities, securities, corporate stock or equity) is an instrument that denotes a position of ownership in a corporation. The stock is a representation of the claim on the corporation's proportional share in its profits and assets. The number of shares that a person owns, when divided by the outstanding total number of shares, determines that person's portion of ownership in the company. For instance, if a company has 10,000 shares of outstanding stock, 500 of which the person owns, then he or she owns 5% of the company. Often the person who owns the stock has voting rights which means that the shareholder has a vote in decisions regarding the corporation that is proportional to the amount of shares that they own.

The only type of company that issues stock is a corporation. Sole proprietorships and limited partnerships do not distribute stocks. The corporations publicly trade stocks on stock markets such as the Dow and the New York Stock Exchange. The term stock market is a broad, general term to describe an organized for the trading of stocks. This is done through exchanges and OTC (over the counter). Securities that are traded OTC are not able to be traded on an exchange because they do not meet listing requirements or for some other reason.

There are several different types of securities, stocks are just one of the types in this group. Mutual funds are a collection of stocks, bonds or other securities of which investors purchase shares. The shares in mutual funds fluctuate on a daily basis and the investor is able to sell their shares at any time. A mutual fund, though, carries less of a risk than a stock because of the diversity of the stocks in the fund and the failure of one will likely be balanced by the returns on the rest of the stocks in the fund.

Trading stocks can be lucrative and there are many different opportunities for getting good returns. For instance, money market instruments carry virtually no risk while individual stocks are considered more of a high risk. There is also the Forex which is the trading of foreign currency. This is an exciting world, and there is something for just about every type of would-be investor. Explore the various options in the stock market world and you are sure to find something that will appeal to you.

For lots more free information about the Stock Market check out the articles at http://www.stockinvestingforbeginner.com/sitemap.php

3 Types Of Websites

Are you looking to design your own website? Well, before you start designing your website you should first decide which type of site is right for your particular interest. There are three different types of websites you should be aware of, they are the Informational, Interactive and Trading (e-commerce) sites.

The most common, least expensive and easiest site to design is the Informational site. This site is designed to give web surfers valuable information on a particular subject you may want to share. If your going to design such a site, it must be designed to a target audience. For example, if your subject is geared towards beginners in Autobody repair then the information must be for beginners. Informational sites may also generate revenue by using Google Adsense and Google search if designed correctly. These types of advertisements are placed on your site by Google that focus on the information you place on the site.

The next type of site is the interactive. The interactive sites are designed to allow web surfers interact with the site by leaving feedback, requesting information, downloading software, hardware or images. Surfers can also interact with each other through chat rooms, blogs or message boards. These site can also be profitable by using Google Adsense and Google search.

The third type of site is the Trading (e-commerce) site. Trading sites are becoming more and more popular in the market place. They are designed to sell a particular service and/or product. The Trading sites can be very expensive due to their database design but can be a very profitable marketplace for your product or service. If you are planning on designing such a site my advice would be to get a professional to help you unless you have taking hours of programming.

Creative Design Solutions - Graphic Design, Custom Web Design, Photo Editing

Copyright 2006, Lonnie Niver All rights reserved.

Investing Is Like Dating, Marriage And Marriage With Children

In Robert Kiyosaki's series of books on managing your money, he quotes Rich Dad as comparing investing in stocks like dating, buying investment properties like a marriage, and starting up a business like being married with children. I am beginning to find out how true it is.

Why are buying stocks like dating? For a start, you can get in quickly and easily. With some capital, you just need a broker, or an online account, and you can start buying stocks right away. There is no huge commitment involved. You can get out as easily, almost instantly if the price is right. For many, the initial decision as to which stock to buy does not involve much thinking or time invested at all. The returns may be small compared to the other investment vehicles though.But once purchased, the stocks themselves require very little maintenance.

My first experience with investing was buying stocks just based on hot tips from friends. As expected, I lost money. Fortunately, I was able to get out fairly quickly though it was an expensive lesson. I have since learnt to be a little wiser. And while I am not of the level to be considered a professional investor, I do hope I am now nearer being called an investor than a gambler. Fans of Warren Buffett will not agree with the above analogy, of course. A true fundamental investor puts in a lot of leg work and spends a lot of time reading and understanding companies before he buys them. And when he buys, he is confident enough to make a substantial investment, and then to ride out the market's ups and downs. Such an investor's holding time is forever.

Now buying a property is quite different. Certainly, it does take a lot more time and running around to find a property that is suitable. One has to find a property in a decent location. The property has to be in a decent condition, with a good rental yield. Some basic work needs to be done to make it suitable for rental. Bankers have to be consulted as not many have the cash to pay for a property without taking a loan. Calculations have to be done to see whether the rental income after deducting costs of the loan, maintenance and so forth make the investment worth the while. But once all the initial groundwork has been settled, most of the time, the investor can then sit back and reap the reward of his efforts as he collects his rental cheque every month.Once in a while, parts of the property break down, or tenants may give some trouble, necessitating some work on the investor's part. It does seem to be a bit like a marriage.

So why is starting a business like being married with a baby? I guess it means you are now totally committed and stuck! You have to give birth to a business, nurse it as a baby, pouring time and money into it to help it grow, all this while, not expecting much from it, in the anticipation that one day, it will grow big enough to support you many times over. To take money out of a business too soon would kill it. And just like real children, there is no guarantee the business is going to turn out as you hoped. In fact, nine out of ten businesses fail. It is like bringing up a child only to find he has turned into a useless ungrateful adult who refuses to leave home and prefers to live off his aging parents. With such dismal statistics, people who think about starting businesses are advised to plan to fail! It has to be factored in. Failing is not enough. One has to learn from the mistakes and change. So following through with this logic, the faster one fails and learns from one's mistakes, the faster one can progress. There is no need to know all the steps to getting from Point A to Point B, as long as you know where Point B is. The steps will slowly come.

So why advise someone to go into a business at all? It really depends on what the person hopes to achieve in life. For someone who values security, the risks may not be worth it. It may be better to find a good mutual fund and let the professionals handle it. But for those who value freedom, the potential rewards of a good business returning unlimited amounts of money so freeing them from having to work may be worth the risks.

It is up to the individual to decide whether he wants to continue dating for the rest of his life, or commit himself to marriage and possibly children.

Karen Cheong strongly believes that we all need to be educated financially in order to become financially free.

She shares what she has learned about making money, investing and personal finance in her blog http://www.whymoneymatters.blogspot.com

Why Hedge Foreign Currency Risk?

International commerce has rapidly increased as the internet has provided a new and more transparent marketplace for individuals and entities alike to conduct international business and trading activities. Significant changes in the international economic and political landscape have led to uncertainty regarding the direction of foreign exchange rates. This uncertainty leads to volatility and the need for an effective vehicle to hedge foreign exchange rate risk and/or interest rate changes while, at the same time, effectively ensuring a future financial position.

Each entity and/or individual that has exposure to foreign exchange rate risk will have specific foreign exchange hedging needs and this website can not possibly cover every existing foreign exchange hedging situation. Therefore, we will cover the more common reasons that a foreign exchange hedge is placed and show you how to properly hedge foreign exchange rate risk.

Foreign Exchange Rate Risk Exposure - Foreign exchange rate risk exposure is common to virtually all who conduct international business and/or trading. Buying and/or selling of goods or services denominated in foreign currencies can immediately expose you to foreign exchange rate risk. If a firm price is quoted ahead of time for a contract using a foreign exchange rate that is deemed appropriate at the time the quote is given, the foreign exchange rate quote may not necessarily be appropriate at the time of the actual agreement or performance of the contract. Placing a foreign exchange hedge can help to manage this foreign exchange rate risk.

Interest Rate Risk Exposure - Interest rate exposure refers to the interest rate differential between the two countries' currencies in a foreign exchange contract. The interest rate differential is also roughly equal to the "carry" cost paid to hedge a forward or futures contract. As a side note, arbitragers are investors that take advantage when interest rate differentials between the foreign exchange spot rate and either the forward or futures contract are either to high or too low. In simplest terms, an arbitrager may sell when the carry cost he or she can collect is at a premium to the actual carry cost of the contract sold. Conversely, an arbitrager may buy when the carry cost he or she may pay is less than the actual carry cost of the contract bought. Either way, the arbitrager is looking to profit from a small price discrepancy due to interest rate differentials.

Foreign Investment / Stock Exposure - Foreign investing is considered by many investors as a way to either diversify an investment portfolio or seek a larger return on investment(s) in an economy believed to be growing at a faster pace than investment(s) in the respective domestic economy. Investing in foreign stocks automatically exposes the investor to foreign exchange rate risk and speculative risk. For example, an investor buys a particular amount of foreign currency (in exchange for domestic currency) in order to purchase shares of a foreign stock. The investor is now automatically exposed to two separate risks. First, the stock price may go either up or down and the investor is exposed to the speculative stock price risk. Second, the investor is exposed to foreign exchange rate risk because the foreign exchange rate may either appreciate or depreciate from the time the investor first purchased the foreign stock and the time the investor decides to exit the position and repatriates the currency (exchanges the foreign currency back to domestic currency). Therefore, even if a speculative profit is achieved because the foreign stock price rose, the investor could actually net lose money if devaluation of the foreign currency occurred while the investor was holding the foreign stock (and the devaluation amount was greater than the speculative profit). Placing a foreign exchange hedge can help to manage this foreign exchange rate risk.

Hedging Speculative Positions - Foreign currency traders utilize foreign exchange hedging to protect open positions against adverse moves in foreign exchange rates, and placing a foreign exchange hedge can help to manage foreign exchange rate risk. Speculative positions can be hedged via a number of foreign exchange hedging vehicles that can be used either alone or in combination to create entirely new foreign exchange hedging strategies.

John Nobile - Senior Account Executive
CFOS/FX - Online Forex Spot and Options Brokerage

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.

Forex Market Heats Up For The Individual Trader

There has been a plethora of new financial instruments coming on stream for individuals in recent years. A few provide more leverage than just buying and selling stocks. Among the most rewarding markets opening up to traders is the FOREX (Foreign Exchange Market).

Why? Money or currency is the ultimate commodity. Every time a company or government buys or sells products and services in a foreign country, they are subject to a foreign currency trade, the exchanging of one currency for another. May individuals and organizations also trade currencies for speculative purposes. In contrast to the worlds stock markets, foreign exchange (Forex) is traded without the constraints of a central physical exchange.

Transactions are instead conducted via telephone or online networks. With this transaction structure in place, the Foreign Exchange market has become by far the largest marketplace in the world. With all these currency transactions going on daily, it is no wonder that the foreign currency exchange market (known as Forex or FX market) is the largest financial market in the world. It is much bigger than all the US Stock markets combined with a daily trading volume larger than that of all the worlds stock markets put together!

In addition, it is the least regulated market providing the greatest liquidity to investors. Trillions of dollars of foreign exchange activity takes place very day. From 1997 to 2000, daily Forex trading volume surged from US$5 billion to US$20Trlllion. The Forex market continues to grow at a phenomenal rate. This high volume is advantageous from trading standpoint because transactions can be executed quickly (with minimal slippage) and with low transaction costs. (Small bid/ask spread).

Before the Internet, only corporations and wealthy individuals could trade currencies in the Forex market through the use of proprietary trading systems of banks, often through private banking.

These systems required about $1Million to open an account. Thanks to the proliferation of the internet, today self directed investors with only a few thousand dollars and smaller financial firms can have access to the forex market 24 hours a day with the same liquidity as larger market participants.

For traders, Forex trading provides an alternative to the stock market trading. Whilst there are thousands of stocks to choose from, there are only a few major currencies to trade (Dollar, Yen, British Pound, Swiss franc and the Euro are the most popular). Forex trading also provides a lot more leverage than stock trading and the minimum investment to get started is a low lower. In addition, you have the ability to choose flexible trading hours (Forex trading goes on 24 hours a day!) and lower margin requirements.

As a result, foreign exchange trading has long been recognized as a staple and superior investment vehicle by central banks, major banks, multinational corporations (MNC), individual investors and speculators, institutional funds and hedge funds.

Trading or speculation makes up 95% of the daily volume. The other 5% of daily volume consists of governments and commercial companies converting one currency into another from buying and selling goods and services. The other 5% of daily volume consists of governments and commercial companies converting one currency into another from buying and selling goods and services.

More individual traders are jumping on this Forex Market bandwagon as it opens up opportunities to trade a global market on a flexible schedule and low barrier of entry.

Alvin has been an active investor in the equity , derivative and forex market. Get more articles and resources he has compiled at http://www.oneminuteforexinvestor.com

Differences Between Products And Services

What are some of the main differences between products and services? And when are these relevant?

Tangibility versus Intangibility

Products are tangible. You can buy pork as a tangible product. You buy it, you ship it and sell it. In the same way as you buy stamps, cigarettes and cars. Financial service companies however, make it possible to exchange pork bellies Futures, on the Chicago Mercantile Exchange (CME). A future is (not the most simple example of) a service with which you can hedge your risk. In this last case, most of the people trading on the CME will never see or smell the pork bellies.

The ownership between products and services is different. A stock could be called a financial product that you own. You can place a stock order which might result in a transaction later on. You bank services a depot fee for saving you a lot of work. You cannot own a service.

Where the product is much more standardized, the service is tailor-made. Companies differentiate in offering products and services, but the variations between similar products of different producers are less prominent than the variations between services.

You can count products in the same way as you can count your money (or have your service you this information). A service is not countable, but is leveled; better than the best service is not possible. There is a limit in what a service can offer.

A product is produced by a manufacturing process. A service is offered by the utility element of companies; you subscribe to a service in the same way that you subscribe to your gas and electricity supplier.

And this brings us to the essential of these differences; changing from one (product approach) to the other (service offering) is very complex, because of the last mentioned differences. Not only the process is different but the style change you need to support this change Good Luck.

2006 Hans Bool

Hans Bool is the founder of Astor White a traditional management consulting company that offers online management advice. Astor Online solves issues in hours what normally would take days. You can apply for a free demo account

Is the UK Running out of Homes?

The simple answer could be "yes, unless more properties are built". However looking at research on the historical growth and future projections, there are some very interesting facts to consider. Firstly, with reference to 2006, let us look at the growth over the last 15 years, and the projections for the next 15 years.

Since 1991 there has been an estimated increase of 13% in UK homes from a figure around 22.4 million in 1991, to a projected 25.3 million for 2006. A similar rate of growth is predicated up to 2021 with an estimated 27.9 million homes required. This rate of growth should be sustainable providing that sufficient land and property are made available for development or redevelopment.

However with respect to the rental sector it is interesting to explore the underlying factors behind the projections of growth in homes required, of which there are probably two key factors. Firstly there is a continuing trend of net immigration into the UK. For example in 2004 it was reported that over 140,000 people were granted British citizenship and this number has been increasing each year since 1999. Additionally most new immigrants are of a relatively young age (recent statistics identify around 80% between 15 and 44 years of age). It is likely, although no evidence could be found, that a higher proportion of immigrants will seek rental accommodation.

Secondly there is a reduction in the average number of people living in a household, and this trend is expected to continue over the next 15 years. According to UK research the average size of a household in England (data not found for other countries) has fallen from 2.47 in 1991 to a projected 2.29 in 2006 and 2.15 in 2021. To look at it another way, over the 15 years from 2006, the number of homes required are projected to increase by 10.4%, whilst the population (based on average per household) will increase by only 3.75%.

So what does this really mean for the rental sector? Simply put, if we expect a 10% increase in homes built over the next 15 years, and a reduction in the average persons per household, then there is likely to be a proportional increase in rental properties required with the focus on smaller homes (such as flats or apartments). However for the private rental sector there could be an even greater impact if it is assumed that the government does not invest in expansion of social sector rental properties.

Consider the following argument. In 2005 there was an estimated 6 million rental properties, of which approximately 2.4 million were reported to be in the private rental sector. If we assume that a projected 10.4% increase in households by 2021 applies equally to the rental sector this would indicate a further 620,000 rental properties are required (social plus private). But if the total social housing stock does not increase then this demand will fall onto the private sector with an additional 620,000 homes required, representing a 25% increase on 2005 (when private rental homes were circa 2.4 million), or to put it another way an average of 40,000 new private rental properties to rent will be required each year. Is this an interesting opportunity for the private landlord?

This article is one of many researched and written on the UK property market by Simple2rent.co.uk, a company that specialises in UK property to rent. http://wwwSimple2rent.co.uk is a free service UK property website for the private landlord, letting agents and tenants, to advertise or find properties to rent in London and throughout the UK.

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.

The Role Of Brokers In Online Stock Trade

The online stock brokers play a significant role in online stock trade for those who want to invest but do not possess a good amount of amount to play. They are different from the traditional stock brokers in terms of investing and managing money.

Significant Role Of Online Stock Brokers

In the world of financial ups and downs, it has become a difficult task to know the best method of investing your money. Stock exchange has always acted as a platform between the stock traders and the companies in the form of buyers and sellers respectively. The invested money of the investors is always utilized by the company in further expansion of the business to increase profits.

In the traditional method of stock trade, the investors were assisted by the stock brokers in the process of buying and selling of stock and in building the financial portfolio of the investors. But since the discovery of internet, a new easy method of stock trade has come up which is known as online stock trade and it only requires the turning ON of your computer. The online stock brokers play a significant role in the market of finance by helping the online traders to hit their financial goals.

There are numerous online stock brokers in the stock market but the most commonly used ones are Ameritrade, ETrade Financial, Fidelity, and Schwab. These stock brokers work in a very systematic way as they estimate the financial condition of the investor, they execute the financial plan, and assist the investors in investing in the stocks.

Online brokers keep on updating the investors with the updated and latest news and information in terms of stock quotes, performances of each stock, and companys financial status via online accounts created through online brokers. This information really helps the investors in investing and coming out with the profitable results.

How To Select Online Stock Brokers

The online stock trade has proved to be very much beneficial with the assistance of online stock brokers. But it is in your hands to choose the best stock broker in order to be on the bright side in the world of finances. Therefore, you should consider the following points while choosing your online stock broker.

1 - It is always recommended to begin with a full service broker for the beginners in order to become confident and knowledgeable in the market of finance therefore you should not consider discount as the standard requirement if you are a beginner.

2 - You should keep on checking the website performance especially during the peaks hours so that you should be very much familiar with the site in order to clear the confusions else it may lead to mistakes.

3 - You should always opt for the broker who can be accessed by some different modes other than internet. For e.g. via telephone, fax, etc.

4 - It is always suggested to have a proper survey of the finance market in order to get an apt stock broker.

5 - It is recommended to go for the brokerage firms that require a minimum deposit for opening an account. There are many firms that do not possess any minimum deposit at all therefore you can enjoy the liberty of depositing and withdrawing amount according to your wish but the account will remain open.

6 - You should prefer to open an account with the broker offering lowest commission cost.

7 - You can opt for the broker who not only deals in stock market rather offer other financial services like CDs, municipal bonds, mutual funds, gold or silver certificates, etc so that you can withdraw profits from these financial services also.

8 - You should confirm beforehand that the brokerage firm in with which you are going to deal with should possess 24 x 7 hours customer care service in order to assist you every time whenever required by you.

Therefore, anyone can enjoy the thrill of online stock trade but should always begin this business of finance with the assistance of a good brokerage firm in order to be on the profitable side of the stock market.

For more online stocks information please visit http://www.aboutonlinestocks.com - a popular online stocks website that provides tips and online stock resources. Don't forget to check out our page on online stock brokers.

It Must Be Joe Cocker's Market

Agonizing displays of poor theatrics failed to entertain my mind one recent Saturday evening. I scrolled across several television channels hoping for an engaging program. Finally, one particular concert intrigued my senses. There on the stage performed one of rock and roll's most expressive singers.

With every bit of his legendary convulsive style, Joe Cocker belted out each song with passion and enthusiasm. A solitary man represented by a dull silhouette and expressions of life's complicated sorrows braided through words of reassuring simplicity. The foggy stage complimented his smoky voice as his lyrics invited every listener to share his soul. He was an elder musician with lessons to teach.

The English born Cocker, now in his early sixties, has been delivering the same spasmodic "air-guitar" performance for decades. His music has endured critics, fads, and lifestyle changes. Who can resist the tunes of "Heard It Through the Grapevine" or "Up Where We Belong?"

Perhaps some people mock his unique musical delivery, but his melodies speak to the soul.

At times, his twitching becomes somewhat distracting, yet in the end, his concert is a magical blend of R&B influences, solid rock and roll, and rhythmic gospel.

In the end, this diversified musician has prevailed through the good times and the bad.

Well, it must be Joe Cocker's Market.

At times, the current stock market is intolerable and difficult to watch. Like Cocker, it sometimes seems contorted and out of control. The ups and downs can be disturbing, yet in the long run, the concert delivers tunes of delight. When the show finally concludes, the audience cheers for an encore.

As an investor, you may be cheering for an encore. Interest rates seem undesirable and the stock market volatility may have you curious about the future.

Keep your focus on a pre-determined game plan. Ignore short-term distractions and learn to invest in range bound markets. Do not allow the ups and downs to discourage you and by all means avoid making judgments by sight alone. Know your positions and the reason for inclusion in the portfolio. Longevity is the key and your risk tolerances, time horizons and/or goals must be prioritized. Together, you and the market may live in harmony.

Wardlaw's belief is that familiar life elements best illustrate practical investment strategies; not typical investment jargon. With that philosophy, the author assists financial planners/advisors, brokerage firms, periodicals, and other investment information syndicates create informative and entertaining articles. For comments and questions, please contact the author at tools2invest@yahoo.com or visit http://www.tools2invest.com

Introduction to HYIP

HYIP stands for High Yield Investment Program. As the name implies, these kinds of investment programs usually come with high returns on investment made by investors and there is usually high risk involved.

The popularity of HYIPs came about when e-currencies like e-gold, stormpay, etc were introduced. Investors are allowed to invest in small amounts which made the programs very popular and easy to follow.

Over 94% of HYIP sites are SCAM and these scam sites use the ponzi scheme or pyramid scheme in which new investors' money is being used to pay existing investors. This process will be continued as long as new investors are found, which explains why even fraudulent funds are able to provide the promised payouts initially and once there are no more new investors, these programs disappear. This is the reason why most people refer to HYIPs as SCAM and as a result they are afraid to invest, afraid to take calculated risks and afraid to loose money.

People are afraid to take risks not because the investment is risky but because they themselves are risky.

Why do I say this?.......

The problem always is that while more people are investing, very few of them are enlightened and well educated investors. When you fail to get the facts about investing and refuse to learn/study all you can about how to go about HYIP investing, then you are willingly putting yourself at very high risk. However this site is determined to provide lots and lots of the information you'll need to invest wisely and intelligibly. Feel free to post your comments and questions.

By now you should be asking,..... So which HYIPs are worth investing in and which ones are SCAM/PONZI?

Before answering that question, one thing you should note is that if there was no money to be made in HYIPs, then they'll not be so many scam sites trying to copy the already existing reliable and stable HYIP investment programs. The scammers know the potentials in HYIP investment are very real and high and they utilize the human factor of greed for making quick, immediate and fast cash to tactically dupe people of their hard earned money.

Now that you also know that you can make money from HYIP investment the next is to know which ones are for real and which ones to avoid. The answer to these questions cannot be completely answered in this article but it is a learning process that will continue as long as we still breath, since on a daily basis new improvements are made. This site will therefore provide you with answers on a daily basis to the happenings, news, DOs and DON'Ts of HYIP investment programs.

When investing with HYIPs, note these;

1. Never every dream or plan to get rich withing a short period of time.

2. Be prepared to loose money.

3. Don't quit.

4. Diversify.

5. Get back capital ASAP.

6. Research and research again.

7. Be Skeptical.

8. Be alert for warning signs.

9. Don't be greedy.

10. Visit this blog daily. (lol)

To begin opening any HYIP investment account, you'll first of all need to get an e-gold account. It is FREE. After which you'll need to also open an e-currency exchange account (also FREE) to enable you exchange money in US Dollars for gold either using a credit card, wire transfer, Direct debit, Bank account, etc.

More about e-gold account and e-currency exchangers tommorow. Happy Investing. Learn more about it on my blog http://richesurinternet.blogspot.com

How to Choose the Best Forex Trading Course

Before a person drives a car they learn how to drive. Before they achieve a professional license such as those needed by doctors, lawyers, insurance agents and real estate agents, a person must have training and education. It only makes sense that a person involved in the serious financial world, such as those involved in foreign currency trading, should gain knowledge and the best way for most people to do that is through a forex trading course that teaches the basics.

Just a few years ago the only people involved in forex trading were the financial elites. Now the world of forex trading and the large potential profits that can be realized from it are open to all investors if they simply have a home computer and access to the Internet. But having the ability to engage is forex trading as an investment option doesnt do a person very much good if they are ignorant of the market trends, the strategies and the options available in the market. These skills can be learned with a forex trading course, and these courses are often available online, using that indispensable tool of forex trading, the Internet.

What do you learn in a forex trading course? You learn how professional traders makes profit in the currency market. You also learn the differences in trading techniques that separate the professionals from the amateurs. Forex trading allows an investor to trade at all hours of the day or night, 24 hours a day. It also offers the ability to gain a 100 to 1 leverage on money invested. Very few other types of investment have the large profit potential of forex trading, and the ability to multiply investments many times over in a short period of time. With so much at stake, it only makes sense for a serious investor to take a forex trading course.

Forex-Resource-Pro.com - The Internet's Ultimate Forex Resource!

The 3 Types of Income Taught By Adam Khoo

The 3 Types of Income Taught By Adam Khoo (self-made millionaire) are:

Earned Income - obtained from working for someone or a company.
Passive Income - income generated from business.
Portfolio Income - income generated from investments.

Earned Income comes from having a job in a company or in someone elses business. You get paid for your time and services rendered.

This indicates that the income an employee can generate from working for an employer is limited. There is the possibility that an employee may devote extra effort thinking the employer will pay him/her more.

Whatever additional profit gained by the employer as a result of the employees extra effort, the employer will get the bigger slice of the pie. You are, in effect, making someone else rich through your added effort.

Im just stating a fact. Its likely that you will be telling yourself mentally: Hey, thats not fair. Fair or not, thats the way life is, when you work for money.

If you are an employee, you get your money or paycheck after everything else. If the amount is not enough, you are bound to borrow, which makes you debt-ridden if it accumulates. Now, this is one big mistake. Dont ever get debt-ridden. It is the quicksand to poverty.

Earned Income is a safe way to generate an income. There is not much thinking to do. Except for a few high paying, high profile jobs, your work is mostly concentrated on a few things where you keep repeating the same functions. Unconsciously, this discourages creativity, so boredom starts to set in.

It is because of this boredom that getting to work every morning is such a drag and you keep on looking forward to weekends, holidays, and vacations.

Unless you really love what you do without consideration to the income it generates, or unless you are highly paid, or unless there is a lot more to learn in your job, or unless financial security is of no importance to you, there is no reason for you to stay long in the rat race.

The earlier it is to get out of the trap, the better chances you will attain financial success.

Passive Income is generated from businesses. You can sell products or offer services, or a combination thereof. Examples are buying/selling real estate, trading merchandise as in wholesaling and retailing, etc. In many cases, you need not be physically present in your place of business.

There are also small businesses like vending machines where you hardly require an employee to visit those machines for refill (since you can do it yourself). You can also go with franchising; either be a franchiser or a franchisee. The list is endless as long as you do what you love to do.

The beauty of going into your own business is that you work for you, not for someone else.

Another advantage of going into business, especially in your own corporation, is that you earn and spend before tax is deducted, unlike being an employee where you are taxed before you spend.

Portfolio Income, just like passive income, is making money work for you. Portfolio Income is generated from paper assets like bonds, stock market, certificate of deposits, and mutual funds. They are called paper assets because literally, they are businesses that revolve on papers.

It is in portfolio income where financial knowledge is of vital importance. Your intellect interacting with creativity can either unmake or make you rich.

Ben Rosario is an aspiring entrepreneur and independent NLP enthusiast. If you found this article interesting and would like to learn more, please visit: Secrets of Self-Made Millionaires by Adam Khoo.

Forex2u Forex Strategy On Successful Forex Trading

The essence of the FX2u Forex strategy is that it does not have any Forex trading system but could forecast the market trend accurately.

Every set of Forex trading system available has its disadvantages. The market trend could not be forecasted. If the market could be forecasted, by depending on the RSI, PAR, MOM analysis techniques and some other theories, Forex traders could easily make a fortune.

Many Forex traders could not obtain the anticipated outcome by using these analysis tools, and suffer huge losses. The main reason is relying on some imperfect tools to forecast the unpredictable market trend is just a waste of effort. Therefore the FX2u Forex strategy spirit is to abolish the entire subjective analysis tool.

To survive in the market is to follow the market trend, following the market trend is the essence of the FX2u Forex strategy. By using the opposite theory to enter the market, will only lead to lost. The reason is that if the market rises, it may continue to rise. If the market drops, it may continue to drop. No one is able to forecast when the market trend will stop.

By following the market trend, the market risk could be reduce to the lowest, the FX2u Forex strategy will advance the following the ten principles:

fully understand the how market function and the market trend, else dont trade

After entering the market, the Forex trader MUST immediately put a market stop.

If the stop order has been hit it MUST be executed immediately, NEVER make changes by lowering the stop order price.

If the forecast is wrong, Forex traders should leave the market immediately, then analyze again.

If the forecast is wrong, Forex traders should stop loss and should not increase trading.

Forex traders should admit mistakes, do not continuously make mistakes.

All analysis tools are imperfect, mistakes could always occur.

If the market rises Forex traders should buy, if the market drops Forex traders should sell, always follow the market trend.

Forex traders should not forecast the market price because such forecast will not be as easy as forecasting the market trend.

If the forecast is wrong, once the loss reach 10%, Forex traders must stop loss immediately, do not let it surpasses 10%, otherwise it would be difficult to recoup the capital again.

Alvin Han is the editor of http://www.forex2u.com; http://www.forex2u.com/fx2u-forex-strategy.html

How to Get Non-Reciprocal Links and Improve Your Page Rank

Ever since Google began placing importance on its Page Rank system, website owners have been scrambling to get incoming links to their websites, usually through the means of trading links. Incoming links are important in the Page Rank system, because they are seen as votes for your site, and the more votes you get, the more important your site is considered, and the higher it is placed in Googles search results. However, if you study the details of the Page Rank system you will find that not all incoming links have the same weight, and that the non-reciprocal links to your site, the ones you didnt have to trade for, are given more importance. So, website owners should also spend some time building up these non-reciprocal links. Here are five methods you can use in this effort.

1. Get your site listed in the major directories: The two most important directories at the present moment are Yahoo and the Open Directory Project (www.dmoz.org). Yahoo is the old stalwart of the Internet and despite the rise of Google, the addition of a hefty $299 fee, and changes in the way they display their listings, a link to your site from Yahoos main directory (and its regional variants) can boost the standing of your website much more than a few links from an obscure website.

The other major directory, the Open Directory Project is free of charge and is edited by volunteers. It is sometimes difficult to get a listing because they scrutinize listings and do not list sites that dont offer original content. If your site consists only of affiliate links, then the editors will reject your application. In addition the volunteer editors have been unable to keep pace with the amount of sites to be reviewed and they can take months to process your entry. Compounding the problem are technical glitches which sometimes make it difficult to even submit the form. Despite the problems inclusion here is well worth your effort, and you should persist. Inclusion in both Yahoo and the Open Directory Project can mean the difference between a page one or a page five showing for your site in search results, especially in competitive categories.

2. Get your site listed in directories relevant to your particular product or service: There are many resource directories that serve particular areas of interest. If you offer software that would be helpful to webmasters, for example, then do a search for webmaster resource directories and you will find sites where you can add your URL. Do you have a hotel? Then, find travel directories, and apply to be listed. You will have to spend time, but once again persistence will pay off, not only in improvement of your page rank but listing in specific industry or product oriented directories will bring you targeted trafficpeople particularly interested in what you have to offer.

3. Write articles for Publication on Other Web Sites: There are millions of websites on the web, and many are hungry for quality content. As you have published your own website and have something to offer, that makes you an expert in your particular field. Use this expertise to write simple, but useful articles in your field and send these to other webmasters. If they publish your article, they will include your resource box with a link back to your site. The link will once again boost your Page Rank, but just as importantly, it will establish you as an authority in your field and will help brand your product or service. You dont have to write to hundreds of webmasters individually to get your article published, go to www.yahoogroups.com and do a search for Internet Articles Publishing and you will find many groups that will enable you to reach webmasters looking for articles.

4. Get Your Product or Service Reviewed by other Websites: Have you published an e-book or written software? Then offer a free copy to websites whose themes are similar to yours. If they write and publish a review, then you will get a link back to your site. In addition, you can publish their reviews on your own site, which will add a lot of weight to your own claims about the validity of your product or service. Look around for sites in your field and make your offer. In the process you will also build potentially important alliances.

5. Beef up the Content on Your Own Site: the original concept behind the Page Rank system was to try to highlight the websites that are really valuable, and offer something unique to the Internet. If you publish an Internet version of your company brochure, no one is going to link to you unilaterally. However, if your site is filled with interesting articles, reports, data and reference material then you will get links without even asking for them. You can add content to your site, by writing and publishing your own articles, the same ones that you will offer to other sites, as well as by publishing the articles of others. Once again, the article publishing groups at www.yahoo.com or sites such as www.articlecity.com will provide you with a wealth of material.

If you apply some of these methods you will not only get some high-quality non-reciprocal links but you will also boost the quality of your website in the process.

Donald Nelson is a web developer, editor and social worker. He has been working on the Internet since 1995, and is currently the director of A1-Optimization http://www.a1-optimization.com, a firm providing low cost search engine optimization, submission and web promotion services.

Facts of Day Trading

Are you thinking of entering the fast-paced world of day trading? Arm yourselves with the information from this fact sheet on day trading.

What is day trading?

Day trading is an investment tactic that does online daily stock trading with a relatively short investment. Those who do day trading usually buy and sell securities during the same market day and, as a general rule, do not hold stocks overnight. Many day traders make dozens of trades every market day hoping to capture profits that arise from small intraday price fluctuations.

How is day trading different from swing trading?

Day trading relatively holds the stock for only the day. After the stock market closes, a day trader has no stock in his hands. Swing trading holds a stock for at least a few days, waiting out for the best price before dumping it back to the market. Day trading is much more stressful and requires guts and a keen business sense. Once you get good at day trading, you can earn up to $50,000 from your initial investment.

How much capital would you need for day trading?

You need an investment equivalent to buy 1000 stocks. That is roughly around $20,000. Because the chances are small that you will find a marketable stock with a price of under $20, this is enough to get your day trading underway. However, you must remember that this is a 100% risk capital so do not worry too much if you lose this amount very early.

What are the general rules for day trading?

• Always trade with the trend.

• Cut losses short

• Never get emotionally involved in your trades.

What are the most suitable stocks to trade for day trading?

It is advisable to trade high volume stocks. Go with the trend with the popular stocks available. It'll be easier for you to sell those stocks at the end of the day trading.

How does a usual day trading transaction occur?

For example, at 10:00 AM a day trader might buy 1000 shares of stock XYZ just as the price begins to rise on good news, then sell it at 10:04 AM when it's up by 1/2 ($0.50). The day trader makes $500, minus commission. With today's cheap commissions of $29.95 or less per trade, that's a quick $440.10 or better, excluding taxes.

Most people who deal with day trading spend all of their time in front of the computer, watching the slightest change in the stock price. As the prices go up and down, the day trader must be alert as to when to sell his stock or wait for the moment to hold on it. This can be a very stressful lifestyle as a mere second could mean an increase of half the stock price and missing that moment for any person engaging in day trading could mean a loss on his investment.

Day trading is not a get rich scheme. It is serious business where you could lose everything within minutes because of wrong information. Before jumping into day trading, remember to do your homework first. Go to seminars on day trading, use simulations if possible and practice reading market indicators. To be a successful day trader, don't just need luck. Knowledge and experience counts. Welcome to the world of stock markets and investments!

About The Author
Michael Sanford For More Information and articles about day trading check out http://www.forex-trading-center.info

How To Make Money Trading Forex

To make money trading forex requires a forex broker to have discipline in following the rules of the game. If you can stay focused and follow a system regardless of the market conditions, then you can make money trading forex.

Forex trading as with other types of financial investing is risky. Since the FX market is volatile, it can be difficult to predict whether the market is going down or up. That is why proper financial practices is important specifically your money management skills.

In my opinion, many new traders often fail to make money trading forex because they are lured by the easy prospects of making millions of dollars and are confused over the hundreds of indicators and forex financial terms. With tons of data and indicators constantly changing, it can be difficult for new traders to grasp the underlying trends and that will lead to poor trading decisions.

In general, the forex market is easier to predict in the long term than in the short term. However, most new traders often lose sight of the big picture and instead concentrate on recent upward and downward trends. They get too caught up with the latest news and focus on the 1 hour and 4 hours charts believing easy money is made by seizing the right opportunity. That in my view is more like gambling and not investing.

Though the forex market is volatile, very rarely do currencies devalue to the point it becomes worthless, therefore if you have deep financial standing, you can easily wait for the currency to rebounce and make a profit. Sometimes, it may take weeks, months and even years. That is why savvy traders often make a large part of your money liquid rather than tied down by anyone currency.

Another mistake some new traders make is believing there are insider secrets or information that can make them rich. Due to the nature of the forex market which is liquid and having such huge transactions (trillions of dollars are transacted each day), it is almost impossible to have any kind of insider information. Plus, with rapidly changing data and indicators updated almost instanteously, there is no chance of even an insider secret.

If you want to make money trading forex, start to take a long term view of forex trading instead of being the opportunistic investor.

Ricky is the owner of learn-forextrading.net where he teaches new traders how to make money trading forex.

My Experiences Trading Cotton and Lumber Commodity Futures Contracts and Options

Cotton Futures and Options

COTTON futures and options trade on the NYBOT. (The New York Board of Trade) Cotton has low to medium volume and liquidity; just enough to get by. An account margin of $1300 controls 50,000 pounds of cotton, worth about $30,000. One full point of price movement equates to $500.

Day trading cotton futures can be difficult. At times, the short-term charts can make little sense. Cotton futures fills (order execution price) often have significant slippage while the option fills are slow coming back from the floor. Market orders will get you filled immediately but you may not be happy with the results. Obviously, the main problem with short-term trading cotton is liquidity.

Liquidity is not really a problem with long-term cotton position trades lasting weeks in duration. Low liquidity will make little difference in your overall results because of infrequent entries and exits. Effectively using limit orders in cotton will solve the slippage problem, but makes entry and exits more challenging.

Normal moves of five to ten cents are common in cotton. ($2500-$5000) Over the last few decades, the cotton market has cycled within a large price range. The extreme lows are 28 cents to highs of $1.17 a pound. The goal of many long term traders is to catch big moves like this.

Weather is always a consideration when trading cotton. Droughts, floods, disease and insect infestation (boll weevils, etc) can propel prices. There's times when cotton trades counter to the other grains. (wheat, soybeans, corn, etc) What may be good growing conditions for cotton may be adverse to the other grains and visa versa.

LUMBER

LUMBER Futures and options are traded on the (CME) Chicago Mercantile Exchange. An account margin of $1700 controls 110,000 board feet of lumber worth about $27,000. One full point in lumber equates to $110.

Lumber's forty year low in the 1970s was $94. It's all-time high was $493.50 after the Mt. St. Helens volcanic eruption blew out vast amounts of timberland. A $100 move in lumber over several months is typical. ($11,000 a contract) Limit moves up and down are a very common occurrence. The liquidity in lumber futures is a problem but tolerable. Market orders are sometimes necessary, but there is a big chance of slippage.

Lumber options are illiquid. They are hard to buy and sell. A series of limit moves in your direction will help you liquidate with a nice execution price and profit. Effectively using limit orders in lumber will solve the slippage problem, but makes entry and exits more challenging

Lumber prices can trend well since supply and demand are based on various long-term trends. These include U.S. housing demand and the supply trade agreements with Canada.

Short term trading is possible if you are nimble. Look for a five-dollar swings as an objective. ($550) If you get a limit move in your direction, you may want to get out of your futures contract. Reversals are common after big moves. However, if the move is supported by long term bottoms and major time cycles, you may want to hold on for what could be a big ride.

STRATEGY

Here's how I look for opportunities in the cotton and lumber markets: First I generate a TimeLine forecast that shows a strong move up or down in cotton or lumber. The TimeLine is based on time cycles and other preprogrammed patterns. I then determine if the move is expected to be choppy, trending, and for how long. This helps us focus on possible directional futures/option positions or writing options in a range, or even writing options with the trend.

Next I use automated option software to search for the best of 1600 strategies based on the expected market move. I compare these option to option combinations against futures to options combinations. At some point I will find a compromise between risk, profit and simplicity in one or two strategies. In hindsight there's always a best strategy we could have used. Keep this is mind when narrowing down the choices. When finished, we want to have one or two potential trades to work with. We call the selected few, "high probability, low risk trades."

Remember there is more to planning a trade than just coming up with a forecast. The market may move as predicted but we can still lose by choosing the wrong trading vehicles. Pick the right vehicles and strategies that will allow us to stay in the market without excessive fear, but still carrying calculated risk.

We NEED to take on calculated risk or the market will not pay us for our services. In addition, the vehicle has to move far enough to make a profit without letting the expense of protection eat us up. Excessive protection (risk avoidance) can come in the form of option premiums, too close-in stop loss orders - and overdone, complex spread strategies. Matching a forecast to a strategy is an important skill to succeed in commodity trading.

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

Dedicated Support - Superior Products - Software Company Still In Business After 20 Years

Twenty years is a long time in the investment software industry. What is the key to AIQs success?

Much of the success of AIQ is due to the dedication and experience of our staff; they are key to providing outstanding support to our clients and to building better products. The average tenure of AIQ staff members of over 10 years is a reflection of the commitment of the AIQ staff to the company. AIQ has always been more than just a software vendor. We strive to provide the best service possible to our clients by listening to their needs and acting on those needs as quickly and efficiently as possible.

We dont bake cakes or build cars; we provide powerful trading tools and trading systems and support these tools with educational newsletters, seminars, tutorials and webinars (online seminars). Our goal is to help our clients become better traders and investors.

How have AIQ products evolved over the years and was this crucial to the company's success?

AIQs first product, StockExpert, was introduced in 1987 and provided basic charts, Expert Ratings, and some technical indicators. MarketExpert, a market timing system, quickly followed. Each of these packages included one of AIQs signature features, the Barometer Control Panel that gives a quick visual assessment of each of the technical indicators. Demand for derivative software les to the creation of OptionExpert and IndexExpert being added to the product line solely for options analysis. All of these products were very successful and provided the impetus for the development of TradingExpert.

Critical to AIQ's success was the decision to combine many of our packages into one suite, similar to the approach Microft does with Office. With the advent of TradingExpert, AIQ combined the strengths of MarketExpert and StockExpert into one powerful package and added group and sector analysis, a revolutionary concept at the time. Finally, a Portfolio Tracker was included and AIQ had one of the first really comprehensive trading packages on the market. Over the years, more and more powerful features were added to TradingExpert, including the Expert Design Studio, AIQs trading system writing and testing tool. This tool allowed our users to create their own trading systems and their own custom indicators.

In the late 1990s, AIQ merged all the add-on products into the TradingExpert software to create a power package that became known as TradingExpert Pro. While TradingExpert continued as a basic analysis tool, most of AIQs clients moved to the new combined systemTradingExpert Pro. Today, some 10 years since TradingExpert Pro was first introduced, it remains our premier package.

How has your industry changed over the years?

Times change, and few investment software companies have succeeded as long as we have. Product is shipped on CDs now rather than 5 inch floppies. Data is delivered over the internet rather than using computer modems. Todays computers are lightning fast, allowing retail investors to employ tools that were only available to elite institutional investors.

There is no doubt that charting is now a de facto commodity provided by almost every investing or trading software service. Many of the free charting tools available on the internet provide basic price bars, including even Candlesticks and moving averages. However, while these tools provide good looking charts, they lack the power tools that the informed investor and trader needs.

Most brokerage companies also provide some technical analysis tools for their clients. However, very few offer high-end analysis tools like those incorporated in AIQ TradingExpert Pro.

The industry has also experienced big changes in software and data prices. AIQs four stand-alone DOS products originally sold at about $1500 each. And to use the software you had to subscribe to a data vendor. In the early 1990s, data cost anywhere from $60 to $100 a month but fell in price steadily over time. The biggest change in pricing for AIQ came about in the late 1990s when AIQ first offered TradingExpert Pro bundled with myTrack as a monthly subscription service. The software no longer had to be purchased with data paid for separately. Instead, you paid one monthly fee for the data and software combined. And the other bonus was never having to pay for an upgrade again.

What do you consider are the strengths of AIQ and what have they contributed to the success?

The depth of knowledge and experience of the AIQ staff is our most invaluable strength. Our experience and knowledge has led to the development of many of the unique and powerful features in TradingExpert Pro.

Our industry group and sector rotation features were revolutionary when TradingExpert was released, and they remain unmatched today. We have powerful breadth management tools that are useful in identifying market tops and bottoms. Market Breath Builder and Breadth Analyzer allow users to create breadth and volume statistics on any set of stocks or any set of indicators. Other software packages now have back testing capabilities but none are as easy as AIQs. We realized most people dont like to program code, even if the language is supposedly easy. To that extent weve created over 250 pre-built rules that users can cut and paste as they create and test trading systems. Portfolio Simulation was another pioneering breakthrough that has given AIQ an edge. As many traders and investors have discovered, back testing only goes part of the way when youre developing a trading strategy. Something more realistic was needed, so our programmers developed a new tool called Portfolio Simulator. Portfolio Simulation does real life walk forward testing under real trading conditions. Only through this kind of testing can you prove that a strategy works for your trading style. What sets us apart is our desire for our users to become successful traders. We dont just give you the tools, we provide educational support and most of the support is free of charge.

We also offer a variety of webbased seminars every month covering a wide range of technical topics. Most of these webinars are free and are archived for viewing at your convenience. They are found at www.aiqsystems.com. Finally, this year we will hold our 18th annual Lake Tahoe Seminar October 1-3 at Harveys Resort and Casino at Lake Tahoe.

Where do you see AIQ going in the future?

Regarding analysis tools, AIQ is currently focused on two directions. First, we are in the final stages of rolling out an automatic Chart Pattern Recognition system. For each pattern found, the system generates supporting information such as strength of confirming volume, direction, and trend. Patterns are also stored historically for back testing as part of a trading strategy. Chart Pattern Recognition will be an add-on service for TradingExpert Pro users.

Second, we are incorporating many of our primary analysis tools into a browser environment so that it will be possible to access your AIQ analysis tools wherever a browser is available.

As our technical analysis tools have matured and advanced over the years, so have the features requested by AIQ clients. Every request is recorded and analyzed for suitability and desirability as a feature in a future release. We value all feedback. It is this feedback from our clients in conjunction with our own ideas that leads to the development of new power features.

Steve Hill is President of AIQ Systems. http://www.aiq.com For the past 14 years he has been involved in all aspects of AIQ Systems, from support and sales to programming and education. Steve is a frequent speaker at events in the U.S. and Europe, talking on subjects as diverse as Portfolio Simulation Techniques, Advanced Chart Pattern Analysis and Trading System Design. Steve is an avid martial artist and cross-country skier. currently holding the rank of Shodan (first degree black belt) in Shito-Ryu Okinawan Karate. He also serves on the board of the Ralph Parks Portfolio Trust.

AIQ Systems is a world leader in intelligent trading software. Their web site can be found at http://www.aiq.com