Investing strategies

June 26th, 2008

Some investors like to compare the stock market to a supermarket: you go through the isles, pick up the products you like based on marketing and price comparison and buy it. In case you do not like the product- you return it for (hopefully) a full refund of the purchase price.

Needless to say, in spite of the similarities the two markets are not exactly the same. When you buy (or sell) stocks, options, bonds and other securities, you pay commission to your broker for executing your orders. Unlike the supermarket where a full refund can be expected upon return of a defective item, when selling a stock in one of the exchanges you will get a “refund” at the current price of this stock. This could be higher than the initial buying price, in which case you profit; on the other hand, it could be much lower and you lose a part of your savings.

The purpose of investing in the stock market is to choose winning stocks, sell them at a profit and increase your capital. Therefore, it requires that you develop a trading strategy or blend of strategies in advance, a strategy that will fit your plans and tolerance for risk. This can help you avoid making mistakes while potentially bring you profits.

Yalicoo is a unique arena that can assist you achieve this purpose. We do it by letting you practice variety of strategies using real time quotes, and without the risk involved in investing real life savings.

In general, there are two main branches of analyses which are used by investors: fundamental analysis and technical analysis. The fundamental method concentrates on the business and the financial numbers while the technical strategy deals with the technical details such as the behavior of the stock price over time or the trading volume. Each strategy is composed from many sub-methods. For starters, let us first understand the general concept behind each strategy and review the sub-methods used by investors in the stock market.

Last 5 posts by Yinon Arieli

• How cheap are stocks now? - October 26th, 2008
• New Wall Street Terminology - October 18th, 2008
• What does Warren say? - October 15th, 2008
• Should you buy now or wait for a better time? - October 2nd, 2008
• Understanding Fundamental and Technical Analysis - September 27th, 2008

Entry Filed under: Stock Trading Investing strategies