As it goes that trading in a bull market is much comfortable and lots of money making is much easier than trading in a bear market. Though making profits in bullish markets is easy going but to trade successfully or find profits in trading during bearish market is an art let me quickly give you some tips on that!

During the transition of the market from bullish to bearish, accept this fact gracefully and then make your future plans otherwise you will never be able to come out of that fright and would end up bearing losses. Shoulder the responsibility of your own trading action and do put the blame on your broker or your friend who has given you the "tips" that led to your losses.

Make sure that if you are confronted with losses from a sudden crumple in prices; admit that it is your liability to now set up action to get out of these circumstances with profits.

During bearish markets it is not advisable to buy stocks that are in initial outbreaks and just holding them and coming back again after a few days to reap profits, the way you normally do in bullish markets.

For making with profits trading with trend is the key in bullish markets, on the contrary, in bearish markets, the market freezes, and trends are "shorter" in duration or the market will go into a sideways direction, with prices fluctuate between ranges. So it is always that during bearish markets, range trading is better rather than trend trading. Adapt yourself to this quickly else you could be caught with short term trend changes and suffer whipsaws and lose money trend trading during bearish markets.

Experience of the old players of this field suggests there is no scope for careless trading during bearish markets. The margin of error for a trading signal is much lower when trading in a bearish market. In bearish markets, people are satisfied with lesser profits, but trading more often and in higher volumes. To aid in their margin of profits, they are able to negotiate the lowest brokerage terms possible with their brokers or to use low-priced online trading platforms.

So in nutshell the wise trader would profit himself by range trading by taking advantage of the shorter and quicker recoil that occur as stocks get oversold and retrace upwards.

http://myinvestinginfo.com is a investing and finance information portal founded by Jakob Culver. To find out more information about this topic and more visit the website: http://myinvestinginfo.com

Unfortunately for a lot of people who start trading, the majority of them will find success difficult to achieve. Often quoted figures suggest that around 80% of traders fail in the market and higher figures are used when discussing futures trading. One can only wonder what the 10 – 20 % of people are doing right as opposed to the vast majority who leave the market with less money than what they had when they started trading.

So what is it that separates the successful from those who fail? If you ask anybody who has studied trading for any period of time, they will answer ‘psychology’. They will add that ‘your psychology’ is what will make or break you as a trader. In short, your mental ability to manage losses and profits, the good and the bad times in trading, manage risk, to not become too greedy and many others are all encapsulated under the heading of ‘trading psychology’.

An interesting observation can be made about traders generally either following or not following the rules. It is widely accepted that there are no secrets to what makes a successful trader and the rules that have stood the test of time and do work. Yet most people fail to follow them. Why?

Interestingly, many studies suggest that humans are naturally inclined to fail at trading. People are naturally inclined to break all of the time tested trading rules. Probably the biggest reason for not following the rules is that people generally do not like to lose. Nor can they bring themselves to accept that they are wrong.

As an example, there may be a certain type of person who is very confident in themselves and their own ability at different ventures, and this attitude and confidence naturally carries over to their trading.

This potentially is a problem because there will be many occasions when a trade they enter does not head in the anticipated direction. The time tested rule of ‘cutting your losses’ would be most applicable however for those who have strong self-confidence may find it difficult to close the trade at a loss because doing so acknowledges that they got the trade wrong in their own minds. This may be a difficult situation to digest so the easier option will often be to not close the trade at a loss and therefore violate probably one of the most important trading rules there are. To most traders, the idea of not closing a trade at a loss means that they haven’t had a loss despite the fact that they may have a large unrealised loss.

The bottom line is that humans are naturally inclined to break the time tested trading rules. If this is the case, then those who do succeed trading are totally committed to their trading and are able to focus on the task at hand. They are able to exercise great internal control and discipline and do as their trading plan would have them do. If you were to isolate the reasons why people do not follow the rules, you would most likely conclude that it is a lack of discipline and involving too much emotion in the decision making process.

Stuart McPhee is recognized as a leading trading coach and expert when it comes to developing solid and profitable trading plans.

Discover what most traders never realise which leads to their downfall. Learn about the importance of having the right trading mindset, sound money management and a solid method - The 3 Ms! Click Here ==> http://www.trading-plan.com

Receive Stuart’s free trading tips by signing up for his ezine at: ==> http://www.trading-plan.com/ezine_registration.html

When the market is highly volatility, Buying deep in-the-money (ITM) options is favored over at-the-money (ATM) and out-of-the-money (OTM) options as when market begins to come back down to more ‘normal volatility’ levels the ATM and OTM are going to suffer.

Quick facts about Deep in-the-money (ITM) options

Deep ITM options have very modest time value and it is the time value or ‘extrinsic’ value of an option that is an outcome by increasing or declining implied volatility.

During volatile markets, if your timing is slightly off but right about direction then using deep in-the-money options can be more forgiving. For example if you have a stock with a strong essential uptrend that has experienced a healthy improvement and you enter a little too early by buying Calls before the stock starts trending up again.

ITM options have very small time premium, so they have the potential of ‘buffer’ should the stock move against you slightly or move sideways for a period before it starts trending again.

ATM and OTM both are critically determined by time value and therefore your timing in regards to the direction of the underlying needs to be precise and accurate. During high implied volatility, any phase of oblique movement, or a ’slowing’ to how much a stock is rising or falling, can result in sizeable wearing down in the time value premium for both at-the-money (ATM) and out-of-the-money (OTM) option holders. This is because both fall in implied volatility and also time decay.

Counteracting the outcomes of volatility, buying a deep in-the-money (ITM) option can be very successful.

It is questionable by many traders that buying deep-in-the-money (ITM) options are costly; also they are vulnerable to greater slippage due to a wider spread. But the fact remains that ‘expensive’ is not associated with deep in-the-money (ITM) options. The fact that they require a higher premium is due to their ‘existent’ inherent value. In regards to the wider spread, this is in most cases due to market makers not advertising their ‘true’ buy/sell price.

To sum up penetrating deep enough in the money, where the delta is 1 for calls and -1 puts, these alternatives will move point for point with the underlying stock. Certainly for sure it is beneficial for ’short-term’ directional traders.

To find additional information like this or about share trading visit – http://myinvestinginfo.com

http://myinvestinginfo.com was founded Jakob Culver. Jakob has a background and large knowledge in and about Invetsing.

Hey Guys,

Do any of you remember? When people were selling Nokia Corp. like crazy? This happened about 2 years ago. The stock was at 22 and within 4 months it was down to 12. You were hearing in the news that Nokia was losing market share in europe. Their style of hand phones was outdated. SELL!, SELL!, SELL! This all was the cause for the manic selling.

Go two years back and look at Nokia Corp. finances. Two years ago they had no debt, their free cashflow was huge, about 2,000,000,000 at all times. Their revenues were growing every year by billions and still is. Remember, when people said they were losing market share? Well, They were actually gaining market share, overall in the world. It was just in europe. Where they were losing a few percentage points of market share.

I am telling this story becuase there is a lesson to be learned here. Do Your Own Homework. The news, reports, and etc. were saying stay away from nokia. While at the time I was trying to convince my Aunt to Buy!, Buy!. She likes to invest a little. Also, she didn’t listen either, lol. Now, the stock is up about 100% in two years.

http://allaboutstocks.wordpress.com

As oil prices climb economic growth slows and stocks become volatile. Add in problems in the Middle East and the terrorist threat and the outlook for your mutual funds could be very bleak.

So what mutual fund alternatives are there that can produce strong gains with low downside risk?

A great investment is Costa Rica land its been trending up for years and providing investors with solid gains way in excess of mutual funds but more importantly its been doing it with lower risk.

Land investment in Costa Rica is cheap and easy to do and offers you the following

• 10 years of solid growth
• Low downside volatility
• Its tax efficient
• Its liquid and easy to buy and sell

What gains can you expect?

This depends on location but many investors are achieving 30% annual gains and some are making even 100% or more.

Why the Costa Rica land boom will continue

The fact is many of the problems that are causing trouble in the US, are boosting land values in Costa Rica. Americans are buying in record numbers to get property that’s 70% cheaper than in the US and a better standard of living.

The baby boomer generation is buying into Costa Rica and investing record amounts.

This is causing a building boom and buying prime land is a solid low risk investment.

Try this investment and you could make far better gains than your asset manager, with this mutual fund alternative with far less risk.

Low risk and high returns not dependant on stocks

If you have never considered land as a mutual fund alternative investment then you should as it is the ideal high return low risk investment to provide solid growth regardless of what the stock market does.

Check out the facts and decide for yourself.

FREE REPORT

For a FREE report on making big profits investing in land and to get all the facts you need on this great high return low risk investment go to: http://www.netplanet.org/costarica.php

Typically when a company decides to buy another corporation, due to the prospect of growth and cutting cost and the possibility of a bidding war, the company that is desired buy another company will skyrocket in terms of price. Since the stock market is a rational expectations market, such information will be heeded immediately and positioned to bolster the price of a stock instantaneously. Now unless you happen to own that particular stock, typically when you do find about the prospective information, the potentially acquired stock price will already be inflated, discouraging buyers to get into the action. While such a process may be disappointing to investors looking for profits, as evidence shows, buying such a stock when a rumor or solidified information comes up may not be such a bad idea.

Now the question is will I make as much money as if I had already owned the stock. The truth is probably no but there is still opportunities to gain a large profit in this M&A frenzy. Probably the most common occurrence would be if a bidding war begins. Like in the 1980s when such applications were frequent and presented options for millions of profits to be made, such a possibility would assure a dramatic increase in the potentially acquired stock causing for large capital gains if such a stock is bought on the issuance of rumored or true material. If the bids are high enough and the companies involved have good credentials there is large potential of tremendous gains increasing your profit related to the original price by a large margin.

While such ideals are not as frequent as they were a few decades ago, a lot of the potential gains usually come in the period before the actual purchase, barring no competitors. Examples of such occurrences are found both domestically and internationally citing true examples of how one can make incredible amounts.

Domestically, looking at the past two to three years there are a few deals which has caught my interest in terms of potential gains. One of these deals is the one proposed in February of 2004 when Cingular Wireless bought AT&T in a widely acclaimed telecommunication agreement. During the two and a half year period AT&T’s stock escalated almost 37% from a price of near $21.00 to close to $30.00 in the early month of August 2006. Such a dramatic increase, especially from a large cap stock, is rare in such a short duration, and now when brokers and investors are becoming bullish on such sized stocks, there is even more potential for AT&T to grow. While more than likely, unless you owned the stock prior to the announcement, you would not have made such a large margin in terms of gains, an increase of 20-30% is still opportune for investors, citing one example of where an investor can bring in large gains from a potentially late purchase.

Another good example of how an investor can increase his or her capital gains can be attributed to the Kmart acquisition of Sears for 11.5 million during November of 2005. As the deal seemed strange to many investors as both companies have fallen relative to their glory days, the situation still did not mean it was not a good time to buy some stock of Sears. Since the merger, stocks of Sears rose almost 16% from near $119.00 to $138.00, a decent gain for another large cap stock. Again, like the situation with AT&T, while you probably would not have received the full 16% increase in capital gains, a 10-13% gain is still excellent for such a period of time and should continue to increase in the following months with the reportedly bullish mindset of investors on large cap stocks.

While such a situation may be ideal domestically, with the emergence of new global markets, there is a potential to acquire such capital gains abroad as well. A few examples would be in 2005, the company NTL bought English company Telewest Global which furthered the price from near 1254.00 to 1322.00: nearly a 5% increase for such a high priced equity. In Germany, EMC bought the foreign company, Captiva Software which raised the stock from 14.50 to near 18.60 close to 28% increase. Again, while it may be tough to gather all the potential capital gains from each M&A activity, if you are able to get into the action after such information is put out, there is still a wide potential for future earnings.

The M&A world is a both a very risky but rewarding venture. Known for its controversial episodes in the 1980s with arbitrage and criminals of Milken, Boesky, and Levine, there is a lot of risk for both the company and investor when such a situation arises. However, if things do go smoothly there is a tremendous opportunity for a dramatic increase for your portfolio percentage wise, and while you may not be able to acquire such amazing games each time, there will always be an occasion where you will get lucky and win big time.

Dennis Biray presents advice on all kinds of topics ranging from finance and investing to fitness to sports. For more information email him at dbiray@gmail.com, or to view other articles written by him visit http://www.biraynetworks.co.nr/.

With such a rudimentary phrase famed by the famous commercials of years past, Dell has been one of the most prominent kings of computer production. However, while this large cap stock has remained relatively stable during the last five years, 2006 proved to be an onus to Dell shareholders with continued amounting capital losses as the stock neared a five year low. However, if you look pass such negativity and focus on trends and technical analysis, you will convincingly find Dell as a bargain for a price under 25 dollars.

Typically during the fourth quarter of seasons end, Dell prices have followed an upward trend towards large capital gains. Such achievement is usually attributed to strong fundamentals which spawn from the sales from the company’s popularized notebook and desktop computers along with accessories during the back-to-school months of August through October. With such a seasonal increase in revenue and profit, transcending to earnings, the outlook for Dell shares characteristically remain strong through the fall and winter months. The last five years have proven to provide such evidence as shown through technical assistance. Last year during this time period, the stock increased nearly 10%, the year prior to that: 20%, during 4th quarter 2003: 5%, 4th quarter 2002: 15%, and during the 4th quarter of 2001, when the price of Dell was at a number similar to this year, the price went up nearly 100% for the duration of that period. One of the key fundamentals in making profits with equities is to follow trends, and Dell provides a positive inclination which will inevitably yield high capital gains.

While an argument can be made that the economy is showing some indication of a slowdown which is not favorable for technology stocks, during 2001 and 2002 when similar accusations were held, the price of the stock did not adversely heed such information and garnered gains at a rapid pace. With a price near the 20.00-25.00 range, and with the prospect of an exciting fourth quarter ahead, I look for Dell to prove many critics wrong when smart investors are racking up a cornucopia of profits around January.

Dennis Biray presents advice on all kinds of topics ranging from finance and investing to fitness to sports. For more information email him at dbiray@gmail.com, or to view other articles written by him visit http://www.biraynetworks.co.nr/

How do you know if you are trading well? One way obviously is to monitor the balance of your trading account, but how else can you keep track of your performance? How do you know that you can’t do better and make better decisions? It is imperative that you monitor your performance and keep track of how your trading is going.

When was the last time you reviewed an old trade? What were your last three poor trading decisions and what impact did they have? If you can answer these questions, you may already have a process of reviewing past performance even if it is subconsciously. A methodical process by where you thoroughly review your past trades and even positions you considered but did not enter will allow you to learn from your mistakes, but equally, reinforce the good decisions you did make and the positive consequences those decisions had.

It is well accepted that this is a characteristic of the best traders in the world. They have a passion for their trading and will often and periodically review all of the trades that they have conducted including all the profitable and losing trades, and learn from them. At the end of the trading day or week, that does not mean for them that they stop thinking about their trading. They will always be interested in learning new ideas and looking to build upon their trading and information systems they already have in place.

There are a number of ways in which you could structure a review process. In most trades, including profitable ones, there is most likely a lesson to be learnt, which over time can only benefit your development into a professional and disciplined trader. What you may end up identifying are patterns in your own behaviour. If you can identify a pattern, or some strengths and weaknesses in your own behaviour, you can look to work on those and improve different facets of your whole trading approach.

When considering how to implement a review process, it may be prudent to ensure that you do not review a trade within hours of it being closed. Clearly any emotions that you had with the decision to exit the trade will still be fresh in your mind, and consequently there is little doubt that your objectivity will suffer. With this in mind, it is important to separate the review of a trade from the trade itself with a reasonable amount of time, i.e. enough time for it to have cleared your mind. You will find a period of time between reviews that is appropriate for your own frequency of trading.

The maintenance of a trading diary will facilitate the review process. In your diary you could note specific details about your decision to enter a trade, including why you entered the position, any feelings or emotions at the time of the decision and your initial stop loss. This information is important so that in the future when you come to review the trade, you can be reminded of the relevant details and adequately review the trade.

Stuart McPhee is recognized as a leading trading coach and expert when it comes to developing solid and profitable trading plans.

Discover what most traders never realise which leads to their downfall. Learn about the importance of having the right trading mindset, sound money management and a solid method - The 3 Ms! Click Here ==> http://www.trading-plan.com

Receive Stuart’s free trading tips by signing up for his ezine at: ==> http://www.trading-plan.com/ezine_registration.html

Holding a stock (day or swing) trade into earnings can very often lead to some fairly large profits. However, it can also lead to some very large disasters…so large that it just may be the last trade you ever make.

When I was still an active day trader and now as moderator of Daytraders.com, I have witnessed both sides of this phenomenon from each perspective. I have lost big and was lucky enough to catch a few winners. Yet, after years of experience, observation and unscientific analysis of this practice, it is my opinion that I was just that…lucky.

First of all, holding overnight or even a few hours during the day waiting for an earnings report has removed you from a pure day trader status to a swing trader. There are merits of both methods of trading, which is fodder for a future article. Moreover, I will mention, that as common sense would suggest, that the longer you hold a stock as a trader, the more apt it is to move against you.

Most people, including most analysts, don’t really knows what is going to happen until the company releases their earnings. Sure, there are a lot of folks that will profess to be a genius at predicting such things, but I haven’t seen it. In fact, I have yet to see anyone really much more accurate, if any, than that famous sitcom parrot that used to pick stocks using the Wall Street Journal lining the bottom of his birdcage. Yes, I said parrot, as in, “Polly wants a cracker!’

When someone asks me if they should buy such and such stock because they are about to release earnings, I always tell them the same thing, “As a trader, holding onto earnings may be the single most dangerous thing you can do.” I suggest that if you are not willing to hold that stock for the next three to four months and into the next earnings period, then you should avoid the trade. If you hold into earnings and it misses their numbers, you may forced to hold the stock until the next reporting period or selling it a big lost. Or it could mean holding into, yet, another earrings report, and the beat goes on. If that be the case, you are not trading now. You are an investor, and as an investor you should have done your due diligence on the stock or not invested!

Too many traders focus strictly on the numbers, rather than what the company made or lost and how their actual numbers compared to analyst and company estimates. However, very often these numbers will have little of no bearing on how the stock will react to other information that is released at the same time. Guidance, where the company sees the future, may be the bigger item to be considered. Beyond that there is often “bomb shell” news in the reports that is all too often overlooked in the first few minutes or even hours or days after the release. These might be items like investigations by the SEC or some other law enforcement agency. They could be announcements of lost contracts, lawsuits, patent disputes and on and on. Any number of negative factors can far outweigh how the stock will trade as this information is dissimulated and digested by the street.

Adding to the additional risk of trading stocks on earnings is the somewhat questionable practice of some companies. They try to soften the reaction to what they know will be seen as earnings by releasing good news a few days or even a few minutes before releasing the bad.

I have seen companies release news of a huge contract win the day before they report earnings, and I watched the stock move up a considerable percentage. They know darn well that the next day they will be releasing a poor earnings report that will send the stock much lower. These positions can fall 8-10%, and in some cases I have seen stocks lose 25-30% of their value.

Traders that find themselves holding these shares will take a huge loss in their trading accounts, and all too often it will put them out of the trading game.

If you feel you just have to take the chance and try for the big gain on earnings, I suggest you don’t hold a very large position. Maybe ½ or ¼ the number of share you would normally buy. If the stock moves against you, you can cut your loses with minimal damage or buy in at the bottom and try to average out.

I also suggest you only do this if you have some extra money lying around, money you don’t mind losing. And if you do have some extra money you don’t mind losing, can you please send some of it my way? I have been around a long time, and I have yet to see any of that money. I have seen a lot of just plain ordinary money, but I’ve never seen “any” money that was “extra” enough for higher risk behavior like holding into earnings.

My final piece of advice is: Don’t Do It!!!

Happy trading!

No permission is needed to reproduce an unedited copy of this article as long as the About The Author tag is left in tact and hot links included. Send all comments and questions to: floyd@TraderAide.com.

Floyd Snyder has been trading and investing in the stock market for three decades. He was on the forefront of the day trading craze that swept the nation back in the late 1990’s, both as a trader and as the moderator of one of the Internet’s largest real time trading rooms, http://Daytraders.com He is the owner of http://www.TraderAide.com and Strictly Business Magazine at http://www.sbmag.org

Berkshire Hathaway’s subsidiary National Indemnity Corp, owned by Warren Buffett acquired 6.9 million shares at $40/share of USG Corp as of 08/02/2006. This was part of the “Rights Offering” Agreement. Now, Berkshire Hathaway owns 15% of USG. There are limitations and other agreements involved with USG and Berkshire Hathaway.Which some limitations and agreements could last for the next 7 years.

At the end of 2005 USG claimed for chapter 11. Due to many asbestos lawsuits. Since, then USG Corps. stock has dropped approx. 50%. Now, they recently made agreements to pay differ amounts in the billions. There are several hundred more cases of asbesto still pending.

It will be interesting to see. What will Berkshire Hathaway do later on. Warren Buffett has been known to take advantage of companies during setbacks. The thing here is that USG was a pretty solid company. Actually, USG is continuing to grow there revenues, despite the set backs. So, I think USG Corp. is worth watching in the next several years.

Berkshire Hathaway owns more than 60 types of businesses worldwide. They own the insurance company called Geico. Also, has major investments in Coca-Cola, and Wells Fargo & Co., and American Express

USG Corporation, through its subsidiaries manufactures and distributes building supplies all over the world.

http://allaboutstocks.wordpress.com/