Standing far back and looking out on to the stock market one will see a very complicated world with a lot of seemingly scary numbers that constantly run back and forwards. Looking closer, though, the stock market becomes a lot more clear and it is seen that it really isn’t that difficult to understand after all.

The stock market is just that. A market where one can purchase or sell stocks. To understand the stock market, therefore, is not much different than understanding a fish market. The more people want them, the more they cost. They less people want them, the less t hey cost. But should you want this one or that one? Well, using the fish market analogy, you can not really understand what to buy at that market unless you understand something about fish.

So before you can zero in on just what stocks to buy at the stock market you must understand at least something about what the stock actually is. A stock, in another word, is a share. It is a share of a company that wants to allow anyone in the public sphere the opportunity to invest in a piece of their business.

A company offering shares for public trade would no doubt offer thousands of shares, but to better understand it assume that it only offers a hundred. If you buy one share for yourself then you own, in essence, one percent of that company. As a one percent owner you have one percent weight over some of the more important decisions the company makes. This is done by voting and attending stockholder meetings. The more shares you own the greater say you have.

The reason people buy shares in companies is so they can make money. As a part owner the investor makes money when the company makes money. The money the investor earns comes to form in several ways.

Firstly let’s look back at the company that the share is in. That company will earn a certain amount of money in a given period of time. That money has to be used to pay for its operating costs, paying salaries and the like. Whatever money is left over from that is in one form or another distributed to its owners; or, share holders.

Most companies pay out dividends at various points throughout the year. These are chunks of the profit being distributed to the people who own the shares. If you own that one percent then you get one percent of the dividends. What does not get paid out in dividends goes back in to the company so that it can grow.

When a company is doing very well then a lot more people will want to buy themselves a piece of it. To do this they will need to get themselves a share. If there are only those hundred shares though, then there are not a lot to go around. That kicks off the effects of supply and demand and, as such, the price of each share will rise.

If you choose that time to sell your share in the company, you will make a profit because of that rise.

Mika Hamilton is the editor of the Global Investment Institute Read More Free Investment & Wealth Creation Tutorials & Reviews at http://www.Global-Investment-Institute.com

Penny Stocks can be a great investment, but you have to know what to look for, or sometimes more accurately, what to look out for. Buying Penny Stocks based on a recent email you received, or what you heard from someone you barely know, is not usually a good idea. Penny Stocks have historically been a source of wealth for many investors, but conversely have been the source of countless lost small fortunes. Determining what is good advice, mixed with all the hype, can sometimes be a very difficult process. You don’t have to be a stock market guru or brilliant investor to make a killing with Penny Stocks, but you do have to be willing to do your homework, and use a great deal of common sense to stay alive when you are swimming with the sharks in what can be dangerous waters.

There are many great small companies in existence today, struggling to stay afloat, that are tomorrow’s rising stars. Without the capital to grow and expand very few of our current generation of conglomerates would be more than a forgotten flash in the pan. Selling shares of a company can inject the needed capital into a niche business that may take it into the next level. However not all, if not most, of these tiny corporations will be around for very long. This creates an interesting situation for us, the investor or speculator. While the company in question may not be worth much today, what might that company be worth tomorrow? Hence the term speculation, which is the lifeblood of any Penny Stock trader.

Unfortunately, within this world there are a few unseemly characters, who seek to part you from your hard earned dollars. And, they will go to nearly whatever means is necessary to achieve their goal. PR firms, or Investor Awareness firms, are sometime hired to promote a small corporation’s stock in hopes of raising the share price. This in itself is not necessarily a sign of ill intent. Many times a small company may be very good at what it does, but for whatever reason finds itself unable to generate enough press interest in their successes to generate buying activity of their stock shares. However, this is occasionally done with the sole purpose of raising prices rapidly in an attempt to make quick profits on a very hollow company, one that has no real market or solid foundation. Hence the phrase, pump and dump. Pump and dump in a nutshell means, exaggeratedly "pumping" up the company in question with the primary intent of "dumping" their shares once the share prices begin to rise.

What can you do to protect yourself from being caught up in a pump and dump scenario? Most importantly you must use your own due diligence to wade through the hype. Ask yourself a few basic questions about the company in question. Are they making money? Are they creating new products? Are these new products going to be valuable in the future? The rules for trading Penny Stocks aren’t much different from those of trading large cap stocks. However, the risks can be much larger, but the rewards can be as well.

If you aren’t willing to do at least a bit of homework, investing in any stock is not a good idea. Never rely entirely on anyone’s advice, especially when dealing with Penny Stocks. But, if you take the time to research your investments, investing in Penny Stocks can be a very financially rewarding experience.

Arthur Browning is a long time stock investor and author, who actively contributes to the Penny Stocks website http://www.1centstocks.com.

As a market timer, the one thing we must always remember is that the markets can, and most definitely will, throw every possible hardball, curve ball, fast ball, knuckle ball, etc. at us.

The reason we invest in the stock market is because we recognize the huge potential for profits. But we are not in safe money market funds. We are timing in a freely traded market that is subject to the emotional whims of traders. And when money is involved, those emotions can, at times, be extreme.

We became market timers because we have realized that not only is there "no easy money" but also that the stock market will do all it can to "relieve us" of our money.

We are more than uncomfortable with the buy-and-hold approach to investing, and realize that although buy-and-hold may be fine if you are willing to wait 20-30 years, it can lead to huge losses over shorter time frames. The most current example being 2000-2002 when the S&P 500 gave up 50% and the Nasdaq Composite declined 80%. Huge losses.

The stock market is the ultimate of Big Leagues, and there are traders who understand the psychological warfare you are facing, and know how to use it to take your money.

Understanding those Big League rules, will put the winning odds back on your side. The timing strategies at FibTimer are designed to identify and follow trends. They allow profits to ride and cut losses short. This is what the professionals do, but most individuals have great difficulty doing.

Market Timing is Unique

Market timers face psychological battles that very few people ever face in their entire lives. There are so many differences between the emotions experienced in trading the financial markets, and what we experience in our lives, that it can easily interfere with our ability to trade.

If we can identify those emotions we can take steps to protect ourselves from them, stop them from influencing us, and become winning (profitable) market timers and traders.

For example, in the workplace, working hard and expecting to be justly rewarded for it are part of the American dream. Who would argue with the logic?

But in the stock market, work as hard as you can and the markets will still reverse on you and give you losses. Make the perfect trade and it can still go bad.

This is because timing the markets is not about our work ethic. It is not about genius or luck. It is about numbers and probability.

Numbers and Probability

Toss a coin 50 times and you can expect 25 times it will land heads up, and 25 times it will land tails up. But there is no rule that says the first 7 tosses will not all come up tails.

Once we realize that over time the numbers "always" add up in our favor, we can more easily endure the short term swings. The market "hardballs."

Being prepared for all that the market can throw at us, helps us to stick with our trading strategy.

Once you face the fact that market timing isn’t easy money, or that you won’t become rich overnight, you will be able to prepare yourselves mentally for the long haul.

If you expect that at times there will be losing trades, you won’t be disappointed when they happen. You will have your eyes set on the big picture, which puts the odds in your favor over time.

Numbers And Probability

There are two important aspects of any successful market timing strategy or trading plan, and both need to be considered.

1. Probability - We know that over time, that if we flip that coin enough times, it will land 50% heads up, and 50% tails up. We can count on this. A string of tosses that have the same outcome mean little, as long as we keep tossing the coin.

2. Risk vs. Reward - Potential rewards (profits) must be greater than risk (losses).

Knowing that the laws of probability are on our side over time, if we can establish that risk vs. reward is in our favor, we can use these odds to create a trading strategy.

By looking at the history of the stock market over many years, we see that most of the time it is either trending up, or it is trending down. The "fact" that trending markets are the norm, is our market timing "trading edge."

If each toss of the coin has even odds, but some tosses remain "profitable" for long periods of time, while those tosses that are unprofitable are of short duration and limited un profitability (losses kept small), we know that we will win over time as long as we make all the tosses.

At FibTimer we trade all trends. No one knows ahead of time which trend is the one that will continue for many months and make the big profits. All we know for certain is that the markets will spend more time "trending" than they will spend in trendless sideways trading.

The RISK is that trading all trends produces some losses if the trend does not follow through.

By trading "all" trends, we keep losses small because we do not stay with a losing trend. If the trend changes, we reverse position or go to cash according to the strategy used.

The REWARD is that we will never miss a trend, and since the markets are in trends more than they are not, and we make larger profits when the markets trend than the small losses from trend failures, we are profitable more often than not.

It is the in between times (trendless markets) that require market timers to understand this logic. Stay the course, make all the coin tosses, and over time, you win.

Conclusion

Scary ideas are no longer frightening after you’ve acknowledged them and know not only to expect them, but that they are will not harm you if you hold true to your course.

The more you can identify the scary aspects of market timing (or any trading), and prepare for every possibility, the more likely you’ll be able to persist in the face of adversity.

Market timing is challenging. Many who start fall by the wayside after they realize that it is not going to make them rich in days or weeks (amazing, but some really do expect that), or after one or two small losses.

Remember, there are many timers out there who have met the challenge and have the winning track record to show for it.

Look at FibTimer’s historical trading numbers. No emotion is involved so they look great over the years. But in the short term, there were many small losses.

Focus on the war, not the small battles along the way. Stick with the trading plan and you will be successful.

Editor FibTimer.com market timing services.

Looking for some tech stocks to add to your portfolio? Here are three technology stocks that are well positioned for the remainder of FY2006.

TKO: AMEX

Telkonet, Inc. (TKO) is a small cap company that develops and sells proprietary equipment that enables the transmission of voice, video, and data communications over existing electric utility lines within a building at a very cost-effective price, often even less than a typical wireless setup. TKO offers the Telkonet iWire System product suite, a technology that enables the delivery of commercial high-speed broadband access from an Internet protocol platform.

Last year, TKO’s technology was awarded the “Best of FOSE” at the Federal Office Systems Expo (FOSE) in Washington D.C. In February 2006, TKO acquired a 90% share in Microwave Satellite Technologies, Inc. which allows them to provide wi-fi solutions as well as voice, video, and data solutions to residential, commercial, and institutional clients. So why have you never heard of them? Because as of April 16, 2006, their market cap is under $200M, their average daily volume over the past three months is only about 350,000 shares, and their stock is trading at roughly $4 a share, all parameters too small for the big investment houses to ever consider.

CSCO (NASDAQ)

Cisco(CSCO) demonstrated many of the solutions used by the U.S. Food and Drug Administration at FOSE (federal Office Systems Expo) 2006 and these demonstrations generated quite a bit of excitement among government employees that attended the conference. The Cisco network provided a central platform that allowed FDA employees throughout their campus buildings to access the same data and share information quickly and easily. Using the Cisco Internet Protocol (IP) phone system and integrated messaging features, employees had the capability to access, store, and forward voice and e-mail messages from any PC.

CSCO’s IP phone system also facilitates the establishment of communications systems for corporations undergoing reorganization, as is common in large agencies such as the FDA. As opposed to the CSCO system, during reorganization, traditional phones systems would require employees to place an order with the local carrier for each move, which can take four to six weeks. Furthermore, each move would bear a cost of about $50 to implement. With the Cisco VoIP phone system, employees do not need to place an order with a local carrier. Instead, they can simply take their phone and its associated extension number with them and plug it into the new location with no additional hassle. "Cost savings are a fundamental benefit of Cisco IP Communications solutions, but even more important is how this technology helps users work more efficiently and do an even better job in this dynamic, information-sharing environment," said Patrick Lugenbeel, Cisco account manager.

Cisco should be a solid stock as a long term holding.

CSR.L (London Stock Exchange)

CSR plc is a leading British company in global bluetooth technology. Bluetooth was the buzz a couple of years ago and these stocks, for the most part, went nowhere. Finally, this industry is starting to reap the benefits of the buzz from a couple years back although no one seems to be paying attention now. With its 2005 fourth quarter revenue up 105% year over year, its fifth generation launch of its BlueCore suite, and its widespread manufacture of its fourth generation BlueCore devices, CSR has positioned itself nicely for the remainder of 2006. BlueCore technology is featured in over 50 per cent of all Bluetooth devices shipped and over 60 per cent of all qualified Bluetooth enabled products and modules listed on the Bluetooth website. Furthermore, industry leaders including Nokia, Dell, Panasonic, Samsung, Sharp, Motorola, IBM, Apple, LG, NEC, Toshiba, RIM and Sony all implement BlueCore devices in their range of Bluetooth products. The Bluetooth market is estimated to more than have doubled in unit terms during the past year. Growth in this market does not seem to be slowing down. And CRS.L is the global leader.

Afterthought: Though TKO and CSR.L may not be tracked by any of the big investment firms, the point is that in order to achieve superior gains, you must do your own research. For example, I saw a buy recommendation initiated on April 16, 2005 on Chinese advertising company Focus Media from an investment house at a price of $61 a share. I bought into this position more than six months ago at $31 a share when many of the big U.S. investment firms had not yet started to grant this company any serious attention or complex analysis.

Ok, that’s it. Three technology stocks to consider.

Disclaimer: Readers should be aware that the above analyses were written on April 16, 2006 and that price movements of the above three stocks or new material news since the writing of this article may make the above stocks more attractive or less attractive. The above does not constitute a recommendation to buy, sell or hold any of the discussed stocks. All investment decisions should be made under the consultation of a professional, with explicit entry and exit strategies in place when investing in riskier stocks.

© 2006 SmartKnowledgeU.com™

This article may be freely reprinted on another website as long as it is not modified, changed, or altered in any way and as long as the below author byline is included along with the active hyperlink exactly as is.

J.S. Kim is the Managing Director of SmartKnowledgeU™. He has over thirteen years of experience in finance and financial services, and has earned a BA in Neurobiology from the University of Pennsylvania, a Master in Public Affairs from the University of Texas at Austin, and an MBA with a concentration in finance from the McCombs Business School, University of Texas at Austin. He is the inventor of the revolutionary MoneyPing™ investment strategies, a novel approach to learn advanced wealth planning techniques and how to build wealth, not dreams.

To learn more at J.S. Kim’s blog "The Zen of Investing", click the following link, Advanced Wealth Planning Techniques and Achieve Financial Freedom Ideas

Micro-cap Stocks are much maligned for being too volatile for the average investor. But, as experienced investors know, highly volatile investments can yield the best investment returns. A quick look at the best-performing stocks of 2005 proves this fact.

The Best Stocks of 2005 Were All Micro-caps

Of the 25 stocks that performed best in 2005, only Nutri/System (NTRI) had a market cap of $100 million at the start of the year. Ocean West Holding (OWHC), which was up an astounding 2,170% for calendar year 2005, ended the year with a mere $59 million market cap (that’s after returning 2700%).

To be sure, micro-caps are volatile, (Ocean West is down over 50% after the first quarter of 2006, erasing most of 2005’s incredible gains), but the potential returns still make them a worthwhile risk for a small portion of your investment portfolio.

Of the 25 top-performing stocks of 2005, all of which returned at least 510%, 13 were down as of this writing (April 15, 2006), and 12 were up. The average stock that was down had lost 19.93%, which represents about one-quarter of its 2005 gains.

Of the 12 stocks that were up in the Year-to-Date period, the average return was 88.68%. Half of those stocks had already returned over 100% returns (CanWest Petroleum; U.S. Gold; BioTransplant; Warrior Energy Service; Stem Cell Innovations; and Transnational Automotive Group).

An equal investment in all 25 of these stocks on January 1, 2006 would have yielded a 32.20% return by April 15.

Don’t Let Your Guard Down

Much of the criticisms of micro-caps are true: they are highly volatile; they are potentially the targets of pump-and-dump schemes; they can be difficult to liquidate due to low trading volume.

For these reasons, due diligence is extremely important. A company whose SEC filings are habitually late, or one that issues amendment after amendment for important filings like the quarterly or annual reports is usually not a solid investment.

But these are just red flags, and the company’s fundamentals are the ultimate arbiter of its worth. In times of rising interest rates, the balance sheet is particularly important, since high levels of long-term debt can cripple small companies as rates rise.

Finally, micro-caps should not represent more than 10% of any individual portfolio, but ignoring these tiny gems will deprive investors of potential breakouts.

B. Patrick Regan is a freelance writer and a staff writer at StocksAndMutualFunds.com.

It’s safe to say that anything that seems to be too good to be true probably isn’t, but that doesn’t stop scam artists from trying out their ploys on unsuspecting cell phone users. Many more people are finding unsolicited text messages on their phones, offering stock tips that will make them rich, but are these messages really designed to help the phone user out?

While email messaging can be filtered with junk mail filters, text messaging isn’t able to do so. Scam artists are finding this mode of communication most effective in getting their scam to someone who might think that it’s well-intentioned. Because the cell phone user believes that their number can only be used by those that they have sanctioned, they initially believe that the information is coming from a truthful source.

The scam is known as the ‘pump and dump’ whereby the scam artist gives the victim misleading information about a stock (this is the pump part). When enough people have taken this information and used it, the demand for the stock then goes up and thus so does the price. The scam artists will then sell the shares that they purchased in this same company, lessening the price and leaving the victims with worthless stocks.

A stock tip scam is easily identified when a person takes the time to use their common sense. If a person should receive a tip about a stock that will rise in price and value significantly, that may be an indication of a scam. The text message may also include a low priced stock (often fifty cents or less) that can be more easily targeted. These identifiers along with a pressure filled message and approach are almost definite signs of a scam on stocks.

It’s always smart not to take the advice of anyone that you have not requested information from. Unsolicited advice is something that can be misleading in an attempt to fraud the recipient of the message.

While it might seem simple enough to ignore the message, a person can also report the source in order to possibly stop the text messages to everyone else. These messages can be forwarded to the NASD via email. Other possible ways to block the transmission of such messages is via the government’s Do Not Call list. More than one number can be registered so long as the person has a working email address.

Some text messages may include options to opt out of further messages, so a person can also complete those forms to be left out of the next round of stock tips. Other people find that avoiding chances to opt into third party offers on websites that they have visited is a great way to cut back on the unsolicited messages. Leaving a false phone number is another way to avoid receiving these kinds of annoyances.

There are laws that are in place to prohibit this kind of scam, but vigilance is the best defense as is using common sense.

Joel Arberman is the Managing Member of Stock Aware, LLC. We publish a free investment research and analysis newsletter and offer investor relations and investor awareness services. Learn more at StockAware.com

Excuse me for saying so what appears that General Motors loss of $323 million in Q1 is no time to celebrate. However analysts say that they beat the Street, as their losses were expected to be a lot worse. I find a troubling that someone would consider this to be good news. In fact I am appalled at the lousy business media coverage on this issue.

Failure is not an option, weakness is not an American trait and GM’s loss is not a good thing. In fact their dismal performance and excuse ridden rhetoric is typical of something you’d find coming out of Washington D.C. and not the largest automaker in the world.

But apparently investors are happy to see the GM only lost $323 million; this news insanity. General Motors failed to adapt and their labor relations are terrible, while their vendors are out for them selves and GM has over $10 billion and under funded pensions. Excuse me but what’s wrong with this picture?

Their Chief Executive Officer Rick Wagoner is reducing pension contribution costs and reneging on prior promises, while trimming health-care benefits and over 35,000 jobs. Additionally they’re building six plants in Mexico to build cars. It seems rather odd that anyone ever said; “what’s good for GM is good for America” because today from where I stand it appears to me that what’s good for GM is much better for Mexico then America.

Due to General Motors failure to time the market and learn from the Deming years, may have given 10 percent of their market share to Toyota; how can they sit here today and say they’ve made a few mistakes, but they have everything under control. As far as I am concerned it looks to me like GM is toast and they will continue to lose market share to the Japanese automakers and God help them with the Chinese start importing cars in 2007. Consider this in 2006.

"Lance Winslow" - Online Think Tank forum board. If you have innovative thoughts and unique perspectives, come think with Lance in the Online Think Tank and solve the problems of the World; www.WorldThinkTank.net/

The definition of penny stocks, also known as micro-cap stocks, varies. A stock is termed as a penny stock based upon its market capitalization and share price. According to the US Securities and Exchange Commission (SEC), a stock is termed as penny stock if its share price is below $5. However, many in the investor community believe that a penny stock is one with the share price of $1 or less. As junk bonds are compared to investment grade bonds in fixed income market, penny stocks are compared with blue chip stocks in stock markets. Trading in penny stocks are far more riskier and speculative than trading in blue-chip or other mid-cap or large-cap stocks. Several investors believe that investing in penny stocks is like gambling, that one has to be prepared for losing money. Moreover trading penny stocks can be more expensive. Penny stocks are usually traded in the Over-the-Counter exchange or on the pink sheets.

If you intend to invest in penny stocks you should know the differences between penny stocks and other stocks, such as blue chips and mid-caps. While the performance of mid-cap and large-cap stocks is driven primarily by fundamentals, several analysts believe that the performance of penny stocks is driven primarily by investor speculations. If you analyze the fundamentals of 100 penny stocks, perhaps only two or three would be generating superior returns.

Despite the issues associated with penny stocks, several investors intend to invest in penny stocks, since they believe many of today’s blue-chip stocks, such as, Microsoft (Nasdaq: MSFT) and Wal Mart (NYSE: WMT) were once penny stocks. However, the share prices of these companies were almost never trading for pennies, however it appears that way when one looks at the price adjusted for stock splits. Many investors ignore this fact.

Since many penny stocks are traded on the pink sheets and are not scrutinized by the SEC, you will find it more difficult to find credible information about them.

Penny stocks often lack liquidity, which means investors would find it difficult to buy or sell. A lack of liquidity often helps fraudulent investors to manipulate the share prices. The SEC itself in Schedule 15G states “Investors in penny stock should be prepared for the possibility that they may lose their whole investment”.

A penny stock traded on the over-the-counter exchange has a higher chance of being delisted for lack of compliance. If the particular company is unable to list its stock on another exchange or become re-instated, you may lose 100% of your investment. You should consider this seriously, if you intend to take long positions in a penny stock.

Several new investors are attracted to penny stocks, given their low price and potential for substantial gains. There have been instances where penny stocks rose more than 1000% in a few days in the past, but this is extremely rare and often the price is not sustained. There are historical evidences that most penny stocks lose their entire value. If you are a new investor, you need to be aware of the risks involved.

If you still want to invest in penny stocks, do the relevant research into the company’s fundamentals and ignore the pre-conceived theories about the successes of the penny stocks in the past.

Joel Arberman is the Managing Member of Stock Aware, LLC. We publish a free investment research and analysis newsletter and offer investor relations and investor awareness services. Learn more at StockAware.com

It is surprising that many traders fail to take into consideration their own risk profile and also trading psychology in trying to find a winning stock market trading system that they can use daily to make consistent profits from the stock market.

On one occasion a trader approached me for some advice to create his own winning stock market trading system. Flushed with funds, he had invested in a copy of an advanced stock market analysis program that had won awards for some 5 consecutive years as the best technical trading system for stocks and commodities. Costing over $5,000 this software would be a trader’s dream in tracking and trading the markets.

The use of the software involved re-learning a process of trading. The software had trading systems based on a combination of advanced WD Gann and Elliot Wave Techniques, and soon this trader was familiar and able to input his trading system into the system tester to track, analyse and trade.

But was he happy with his system?

One week later, he rang me up on the phone and said." Why is it that the stock pick list from the system does not change for 4 days? Why are the stock picks not moving anywhere…even after 4 days they have been identified."

You see, he has not considered his trading needs, his personal risk and trading psychology.

Here he was, a trader who thrives to trade and can take more risk. Here was a trader who loves the trading action. He would be best seen making trades every day, and not sitting down there at the trading room or in front of his own trading desk observing and watching for the best moves to develop before he places his trades.

Instead, he has invested in a software that delves into the longer term trading system of elliot waves, of trading with the trend, of watching for trading opportunities to set up when time and price meets for a change in trend according to the teachings of WD Gann. All these take time to develop, chart patterns take time to form and meanwhile this trader is unable to just sit and wait!

So if you are a trader who can take more risk and you want action - you want daily action - then choose a trading system that involves outbreaks of price and volume, rather than trading systems that are based on longer term setups involving time, price and pattern.

Of course, you can drop down to a lesser time frame to trade, so instead of using daily data to track your stocks with the trading system, you can move down to a lesser tracking time frame by using intra-day trading charts and trade the setups from the intra-day charts.

In the end what did this trader do? Did he chose to trade intra-day with intra-day charts?

No, this trader merely shifted his focus to an outbreak system of price and volume with a cheap software costing less than $500 and has been enjoying his trading ever since.

So if you are a trader, and are looking to work out a trading system with a software, consider your own trading psychology and risk profiling, and how often you like trading action.

Peter Lim is a Certified Financial Planner and had previously acted as a registered dealer representative for stocks and shares for over eleven years. He is the author of "Swing Trading for Gigantic Profits" which reveals how you can be a winning swing trader at http://www.signaldot.poolofwisdom.com/swingbook.phtml He also provides free informative trading tips and resources for aspiring traders at http://www.online-guides.info/Swing-Trading

A growing trend in today’s inconsistent financial times is self-research and planning. Taking control and planning one’s financial future has become very important for many people.

There are some investors that don’t believe stock research is that important. They instead relay on stock tips and other unreliable sources. However, if they are concerned about their financial future, analysis is crucial for spotting stocks that can make their small amount of money go farther than in any savings or money market account.

Stock research is important because taking the time to look over the financial history of the companies that one is thinking of investing in, will give the prospective buyer a better sense of the future. While no one can say with certainty that a stock will go up in value, taking the time to evaluate the past few years of the company’s growth can give some insight into the possibility.

When someone is putting their hard earned money into a stock, they need to research that stock in order to make sure that the company is not laden with too much debt, is generating sufficient, have satisfied customers, are growing cash flows, investing in their future and are trading at a reasonable market valuation.

By reviewing the stock’s financial reports, one can make an educated decision whether the company is stable, growing and has an improving future. There are far too many people who invest in weak companies hoping for a turn-around. Often, the best investments are made in stocks of companies that are already doing well and have a strong basis for continued growth

Investors should be wary of companies with negative cash-flow, large and increasing debt, declining revenue or management turn-over. These are all signs that one or more aspects of the company have serious issues. Since there are plenty of good companies to invest in, investors should consider whether investing in weak companies is prudent.

No one wants to choose a stock that will do poorly. By taking the time to look at the company’s stockholder reports, news releases, industry publications and other publicly available information with an eye like a financial analyst, the financial future doesn’t have to come as a surprise, but rather as the product of a well-planned financial strategy.

While this can be easily done with professional help, anyone can crunch the numbers to make sure that their money is being well-spent; all it takes is an eye on the future as one looks at the company’s past history.

Joel Arberman is the Managing Member of Stock Aware, LLC. We publish a free investment research and analysis newsletter and offer investor relations and investor awareness services. Learn more at StockAware.com