How I Make Money From Stocks in a Falling Market
I have been making some great money from the stock market over the last few weeks. In this article i will explain my strategy and disect how and why I have been making money despite global indices falling as the full effect of the credit crisis sinks in to the financial world.
The media is absolutely full of doom and gloom about the worlds stock markets at the minute. Most of the major indexes like the Dow Jones or FTSE have fallen significantly over the last few weeks. Many people will tell you that it is the worst time to be owning stocks in years. This is not exactly true. What is not publicised by the media is that volatile markets such as these present very strong opportunities to make money from the markets. I will explain how below.
Many of the markets that focus on smaller companies (non banks) are not affected by the negative news coming out of the banking sector. As a result my penny stock investments have been unaffected by the current crisis. In fact they have been doing better than usual, I suspect as a result of many investment managers moving some of their portfolio funds from major indices to smaller cap firms and penny stocks in order to limit their losses.
My investment strategy is very simple. I am subscribed to a stock list that provides me the results of a detailed computer program/analysis tool. This gives me a massive head start to picking winning stocks as it saves me wasting the majority of my time investigating stocks that I end up not investing in. This subscription (which cost me under $100) dramatically improved my investment success alone.
Once I have the shortlist I simply hit Google and look at recent articles about the company in the press. Key signals I look for are recent announcements concerning new contracts signed, possible take over targets, anything really that indicates they are a company on the rise. Next i usually head to their website and compare it to their competitors sites. I ask myself the simple question "if i was a possible customer, would I choose them or their competitors?". If I choose them I will go ahead and invest once the stock reaches the target price in the list I received as mentioned above.
The great thing about this strategy is I no longer get bogged down in all of the details and numerical analysis I used to spend days and days performing.
By James McKerr
The media is absolutely full of doom and gloom about the worlds stock markets at the minute. Most of the major indexes like the Dow Jones or FTSE have fallen significantly over the last few weeks. Many people will tell you that it is the worst time to be owning stocks in years. This is not exactly true. What is not publicised by the media is that volatile markets such as these present very strong opportunities to make money from the markets. I will explain how below.
Many of the markets that focus on smaller companies (non banks) are not affected by the negative news coming out of the banking sector. As a result my penny stock investments have been unaffected by the current crisis. In fact they have been doing better than usual, I suspect as a result of many investment managers moving some of their portfolio funds from major indices to smaller cap firms and penny stocks in order to limit their losses.
My investment strategy is very simple. I am subscribed to a stock list that provides me the results of a detailed computer program/analysis tool. This gives me a massive head start to picking winning stocks as it saves me wasting the majority of my time investigating stocks that I end up not investing in. This subscription (which cost me under $100) dramatically improved my investment success alone.
Once I have the shortlist I simply hit Google and look at recent articles about the company in the press. Key signals I look for are recent announcements concerning new contracts signed, possible take over targets, anything really that indicates they are a company on the rise. Next i usually head to their website and compare it to their competitors sites. I ask myself the simple question "if i was a possible customer, would I choose them or their competitors?". If I choose them I will go ahead and invest once the stock reaches the target price in the list I received as mentioned above.
The great thing about this strategy is I no longer get bogged down in all of the details and numerical analysis I used to spend days and days performing.
By James McKerr
posted by John Efetobor - Stock Trading Strategist at
11:03 AM
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