Tuesday, November 22, 2011

New to stock market, any advice?

****it's short term, talking about 2 months.New to stock market, any advice?
Honey, that's simulation, not stimulation. Also, it definitely not true that what comes down must go up. You would be surprised to see how many so-called blue-chip companies in the last 50 years have disappeared altogether.


You belong to an important sector of the market. See what businesses you are interested in do well even in hard times. It might be a clothing chain, a fast-food outlet or a product such as coke. What does your family always buy automatically? Do other families buy the same thing? In other words, invest in things that you know at least a little bit about.New to stock market, any advice?
In the real world if you were using real money I would be suggesting companies like IBM and Coca Cole, but you need high risk/high return companies to win the game and if those companies don't succeed it's not going to cost you real money you earned.





The strategy you're suggesting is no good for the simulation. People who buy shares going down are looking for long-term growth in dividend paying companies that are in good financial shape. Dividends are payed quarterly.





You need to find speculative companies going up. Generally, a trader will wait for a stock going down to start going up before buying. If you invest in a company going down, it will probably go further down and you'll lose





Some companies shares never go back up. If a company goes bust, the shares become worthless.





For 2 months in a simulation where you're not losing your own money, it's best to buy speculative stocks to win, and if you lose it's not the end of the world. Probably tech stocks, pharmaceutical/biomedical stocks and mining and energy stocks.





Put $25,000 on each of these and you should be able to at least double your money:-





Pharmaceutical %26amp; /Biomedical:-





ANPI - Angiotech Pharmaceuticals


AVRX - Avalon Pharmaceuticals





Information Technology:-





SIRF - Sirf Technology


WSTM - Workstream








The goal in the game is to multiply your money, but in the real world protecting it with risk management strategies is more important.
I had the same opportunity in college to do the same thing you are doing now. I outperformed my colleagues and averaged a 24% return on investment with my ';pension plan'; which was $100,000,000 for the year. I chose stocks that were what I classified as ';can't do without'; commodities. These included companies that were in the gas and oil fields, Kimberly Clark, Johnson %26amp; Johnson, Ameren UE, Amoco, Shell, among others. Think of companies that people can't live without and you should do fine - and keep these picks to real basics, energy, staples of everyday living, etc. You'll do fine!
wht uneed to do is instead of investing in one stock u should invest in 3 stocks..and u shoudl not buy all at once..


buy in incremenets...





so a good stokc tht is going to go up is


coin (converted organics)


some other ones u can look at


yge (yingli green)


jpm (jp morgan)


ms (morgan stanley)


agu (agrium)








now in terms of buying increments lets take a look at yge


its trading around 6 bucks


so u can do a buy at 6


buy at 5.50


buy at 5


buy at 4.50





ok so lets say you want to invest in 4 stocks you have 100,000 bucks


so lets allocate 25,000 to each stock


and 5,000 for each increment giving you 5 increments





now lets say the stocks you pick are


COIN


YGE


MS


MCD





COIN is trading around 3 bucks right now


so you can do the following





Buy at 3.30 5000 bucks worth


Buy at 3.00 ';


Buy at 2.70 ';


Buy at 2.40 ';


Buy at 2.10 ';





YGE trading around 6 bucks


7.00


6.50


6.00


5.50


5.00





Get it?

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