Six rules to follow as a stock trader

If you want to become a successful stock trader, there are some essential guidelines you ought to stick to. This article will outline six of the most important ones. While there is no foolproof way to achieve success in the markets, following these tips should put you on the right track. So, without further ado, let’s get started.

Rule one: do the research

Choosing the right stocks is crucial, and that involves thorough research before making any purchases. This includes examining a company’s financial statements, management team, business goals, business model, and short- and long-term objectives before investing your money. Armed with this information, you can better identify the best growth stocks for the next 10 years or even longer.

Furthermore, while it might be tempting to invest in the latest and hottest stocks, sticking with more established companies is often a wiser move. Established companies typically have a more reliable financial history and are less prone to sudden drops in value. It’s a strategy that emphasizes stability and long-term growth potential.

Rule two: understand market trends

To be a fruitful investor, you need to know which trends are popular in the market. What stocks are rising? What stocks are falling? And more importantly, why? These are all questions that you need to be able to answer before you make any investment decisions, and it goes without saying that you need to be able to read market charts and identify trends and patterns as a trader.

 

Luckily, there is an abundance of online resources available that can help you keep on top of the latest market trends. Financial news websites, stock analysis tools, and even social media can be used to track the market and better understand where it’s headed. If you are trading with a broker, you can very often also find they will provide educational content of their own, such is the case with Saxo.

Rule three: stay disciplined and patient

To be successful in any field, it is essential to maintain a high level of discipline and patience. This is important because it allows you to focus on your goals and work towards them without being sidetracked.

 

Staying disciplined and patient in stock trading means not selling your shares immediately whenever you see a tiny drop in the market. It also means sticking to your choices reasonably and not being over-excited and purchasing hot trends as they come.

 

Maintaining discipline and patience can increase your chances of achieving long-term success in any field, and this does not exclude in stock trading.

Rule four: use stop-loss orders to limit your losses

As we get down to the nitty-gritty of stock trading, stop-loss orders are a vital tool for investors.

 

By placing a stop-loss order when you trade, you can limit your losses on a security to a predetermined amount. For example, if you purchase a stock for $100 per share and place a stop-loss order at $90 per share, you will sell the stock automatically if it falls to $90. This can be favourable if the stock price falls sharply, and you cannot sell it manually.

 

Stop-loss orders can also help ease your anxiety about potential losses, as you know your loss will be limited. However, it is essential to remember that stop-loss orders are not guaranteed, as they may not be executed at your desired price in fast-moving markets. Despite this, when used correctly, stop-loss orders can be a helpful way to limit your losses and manage your risk.

Rule five: don’t overtrade

Over-trading is a common mistake made by novice investors. It occurs when an investor trades too frequently, often to seize opportunities in the markets. Over-trading can lead to a trader having too many open positions to properly manage, increased transaction costs and fees, and emotional decision-making. When you are tempted to seize any opportunity that comes your way, you may end up making rash decisions that hurt your portfolio in the long run.

 

When trading stocks, it is fundamental to remember the rule: don’t over-trade or trade impulsively. By sticking to this rule, investors can help avoid common pitfalls that can lead to poor investment decisions.

Rule six: have a solid investment plan

When it comes to investing, there is no one-size-fits-all approach. Every trader has different goals, risk tolerance, and time horizon. As a result, it is crucial to develop a solid investment plan tailored to your unique needs and objectives before you begin to place any trades.

In summary

Anyone can become a stock trader, but it takes discipline, research, and expertise to be a successful stock trader. If you are dedicated to learning and practising the strategies outlined in this article, you can increase your chances of becoming good at trading stocks.

Can Something Stop the Downward Momentum of Cryptocurrency Values?

After having enjoyed almost two years of value increases, the cryptocurrency market is experiencing heavy losses across the board. The values of crypto assets are plummeting, cryptocurrency investors are stuck with really expensive – yet downgraded crypto coins, which they cannot sell and the real economy is once again seeing cryptocurrencies as something that causes toxicity in the financial world. The longer this situation develops, the more investors are wondering if there is something that can put an end to this historic “crypto winter”.

 

 

Investing in cryptos is a little bit like playing games of chance. You can play your favourite games at an online casino and potentially win real money, but at the same time, there can be a day during which Lady Luck will not be on your side. After all, the odds are not always in one’s favour and in the case of cryptocurrencies, there is no “Return to Player” setting that can restrict the amount of money one can lose. Bitcoin investors saw BTC’s value reaching the 70,000 USD mark a few months ago, but now they are seeing the asset underperforming while being under the 20K mark.

 

With Bitcoin trading lower and lower over the last six months and with the coin’s value dropping at its lowest during the first days of September, crypto traders are trying to understand where the situation is going. Many are hoping that this downward momentum is going to end towards the end of the year and that BTC will start recovering at a very high pace, but there are also those who believe that all the new restricting policies taken by the Central Banks of the world’s biggest economic powers, will push “high-risk” assets even lower.

 

 

Can New Technologies Be the Way Out for Struggling Cryptocurrencies?

 

It is no secret that crypto assets are built on relatively modern technological foundations. This means that their advanced technology allows for further developments, which can be replicated and implemented in multiple industries. The more these assets are switching to more efficient and sustainable technologies, the more things are going to improve in terms of their value. However, if those who develop this technology continue to avoid being “extraverted”, the situation will continue to remain as unstable as it is today.

 

The global economy is not very big on trusting new assets and when the most powerful people in the crypto world are communicating with closed cameras, through avatars or through private networks, things can only get harder. The “crypto” part in the name of these assets does, of course, make a point about the nature of the product, but at the end of the day, earning trust comes by allowing the world to get to know you.

 

If the world’s economic leaders work together with those who have built the foundations of the crypto coin technologies, then the changes that will come to the global economy will be ground-breaking. All it will take is a little bit more extraversion from the crypto-front and a little bit less conservatism from the front of the real economy.

 

Why You Should (Broadly) Ignore the Markets When It Comes to Crypto

Elon Musk, a man who has been in the headlines recently, tweeted the following financial advice:

Buy stock in several companies that make products & services that *you* believe in.” 

He added:

Only sell if you think their products & services are trending worse. Don’t panic when the market does.”

It was hardly an original sentiment from the new owner of Twitter. Many successful investors preach that you should only invest in products that you believe in. But Musk’s statement raised an interesting question about investing in products that not only might we not believe in but that we might not fully understand. And the most typical example would be cryptocurrency. 

 

Now, you can take it as a given that many of those who invest in cryptocurrency do so because they believe it will make them money. The product, in many cases, isn’t important to them. Instead, it’s the fact that they believe those lines on the charts will continue to go up. 

2022 has been terrible for crypto so far

Of course, in 2022, many of the lines on the charts have been trending downwards. Almost halfway through the year and Bitcoin, for example, is about 40% down from its highs of 2021. The same can go for all the other major cryptocurrencies, including Ethereum. As economic conditions worsen around the world, and many are tipping a recession, you can be sure that we will see many crypto investors cut their losses. And many experts will – once again – predict that the party is over. 

It should be noted, however, that cryptocurrency does not only exist in the mainstream investor ecosystem. In fact, it’s created its own ecosystem. If you consider things like lending pools and yield farming, for instance. Those are methods to make crypto work for you without relying on the value of the underlying asset to always increase. Yes, some might compare yield farming to the offering of casino bonuses, in that there is no underlying guarantee of success – it’s a gamble, despite the initial reward you receive. But it’s a fair example of how crypto can work outside of the traditional buy & sell on the market. 

Always invest in what you believe in

But getting back to what Musk said about investing in stuff that you believe in. When it comes to cryptocurrency, it means you are, therefore, looking for crypto assets with utility, i.e., that actually do something beyond being digital money. And there are many examples of this. Filecoin, for example, works as a cloud storage solution; MANA is the currency for the ever-growing gaming metaverse of Decentraland; Ethereum, well, it’s the backbone of the decentralized web3 movement. 

Now, the point here is not to say that these cryptocurrencies – battered as they have been in 2022 – will eventually succeed. Instead, it’s to go back to what Musk said and state that they represent projects that many people believe in. People don’t buy MANA simply because they think the hocus pocus of the market will see it keep rising over time; they do so because they believe that Decentraland will be one of the most significant ‘metaverses’, perhaps even rivalling the Horizon Worlds from Meta/Facebook. 

Conversely, many cryptocurrencies do nothing beyond existing. You can also put some – the stress is on some – NFT projects in that bracket, too. A lot of the investment in these projects is placed only because the investors think it will make them money. There’s nothing wrong with wanting to make money, of course. But it goes back to what Musk said about backing projects you believe in. Whether it’s Dogecoin or some badly pixilated NFT ‘art’, can you really say that you believe in the product?

In the end, if you are one to follow Elon Musk’s advice, then it can be applied to crypto. You should invest in projects that have utility – those that can make a significant impact in the real – or virtual – world. Crypto is likely here to stay, but those projects with little worth will likely fall by the wayside. If they are good enough, the others might weather the storm that has hit them in 2022. 

Why Suburban Boroughs are ideal for your first home

There’s a lot to consider when buying your first home and from the carpet to the curtains you may have your hands full when it comes to pleasing everyone. But there’s a good reason many suburbs are seeing steep rises in house sales and you may want to keep these areas in mind for your first move. Whether you’re a single young professional looking to get on the property ladder on your own or you’re a growing family looking for a place to settle down, a home in a suburban borough may be the perfect spot for you.

 

Plenty of green space

 

One of the best parts about moving to a London borough or a suburban area is the plethora of green space you have access to. Spending time in nature is key for mental health, physical health and general well being so ensuring you have an abundance of it is pretty important. With shared ownership homes in Kent providing plenty of natural landscape and blissful countryside to enjoy you can get on the property ladder here with those boxes being ticked. Perfect for kids and plenty of picnics and run arounds in the park to be had, a home surrounded by nature is always a winner.

Alternatively, moving to a small town also features the availability of more spacious homes and properties compared to the dense urban core. This is particularly appealing for first-time homebuyers looking to get the most value for their money. For example, if you are considering new homes near Fenwick Island, Delaware offers ample living space and land at more affordable prices than what you’d find in the nearby larger cities. Community homes developed by reputed builders can also feature semi-custom single family homes that could be suitable for you.The area happens to provide an attractive suburban alternative, with its small-town charm and proximity to the coast, while still offering modern amenities and easy access to urban centers when needed. This makes it an ideal location for first-time buyers seeking more space, value, and a high quality of life.

 

Good schools

 

Another reason to get on the property ladder in a suburb is the great schools and educational opportunities they offer. If you have little ones to think about, shared ownership homes in Berkshire could be ideal, with plenty of schools to choose from in the area as well as having great connections to the capital. With plenty of parks, golf courses, sports facilities and historical places to visit, this suburb is one to keep in mind if you have kids.

 

Safety and community

 

Living in a suburb will always feel different from living in the centre of a city and one of these reasons could be safety. With a close community and a friendly neighbourhood, suburbs are welcoming and supportive and can have you embracing a little more peace of mind when it comes to letting the kids play out or go out with their friends. Shared ownership homes in Surrey are greatly popular and with a great reputation, very high performing schools and plenty of Kent countryside, this suburban home is pretty ideal.

 

Housing schemes

 

One of the best reasons to move to a suburb may be the number of opportunities you have when it comes to buying a home there. New developments are always cropping up in these areas from shared ownership homes to help to buy properties, so you can find something that fits your future plans and your budget. Housing schemes are growing in popularity for the access they provide to the housing market for first time buyers and whether you’re browsing shared ownership homes in Hampshire or help to buy properties in Brighton, these schemes are a great place to start if you’re a first time buyer.

The Latest Housing Trends for First Time Buyers

As 2022 edges ever closer, a view of the past year and the latest home buyer trends is becoming ever clearer. Bearing in mind what the latest housing trends are can be helpful in terms of deciding what’s best for you when it comes to buying your first home.

From the type of homes being purchased to the way people are buying their first home, a lot has changed over the last year. In the United States, custom homes are said to be a very lucrative option for first-time buyers right now. With beautiful custom lake houses (https://waredesignbuild.com/custom-home-builders-lake-geneva-wi/, to suggest one) available across the country, home buying has never seemed more personal. Additionally, with plenty of schemes out there to help first-time buyers find just what they need, getting to know your options could save you a lot of money. Keep in mind that when you are browsing the options for a new house, make sure that it aligns with your preferences and the latest housing trends. Staying informed about emerging patterns in home design, technology integration, and sustainable features can not only enhance your living experience but also contribute to the long-term value of your investment.

Furthermore, interested buyers can conveniently explore the listings of homes for sale from Lowcountry Real Estate or similar platforms to understand market prices, trends, and available properties in their desired locations. Moreover, by taking this approach and seeking the guidance of a real estate broker, they can streamline the home-buying process, gaining valuable insights into the current real estate landscape, potential investment opportunities, and the best strategies for navigating the market successfully.

Luxury Homes

In the dynamic landscape of the housing market, a prominent trend gaining considerable momentum is the growing preference for luxury houses. Astute homebuyers are drawn to residences that offer a blend of opulence, state-of-the-art amenities, and exclusive features. Luxury homes transcend mere shelter; they epitomize a lifestyle marked by sophistication and comfort. The surge in demand for such properties mirrors a discernible shift in the population, seeking not just a dwelling but an elevated living experience. Notably, an abundance of exclusive homes for sale in St Johns Wood and other locations is a testament to this trend. These residences often showcase cutting-edge design, advanced technologies, and spacious layouts, catering to the preferences of those who value the finer aspects of life. The inclination towards luxury housing underscores a change in consumer preferences, emphasizing a yearning for distinctive, high-end living spaces that capture both status and indulgence in today’s real estate market.

Shared Ownership

A key way in which young people and families are now buying their homes is through shared ownership. Allowing you to part buy, part rent a property, shared ownership involves buying a share in a property rather than purchasing the entire value of the home. Cutting down the deposits and minimising the mortgage, shared ownership is a great option if you want to get on the property ladder quickly without worrying about those hefty initial costs. With many of these homes being new builds and in some top areas across the country from shared ownership homes in Surrey to Tunbridge Wells, shared ownership is a real winner.

Outdoor space

One of the most important features that first-time buyers have been prioritising is the amount of outdoor space available to them. From gardens to countryside views, the outdoors has become a key factor in deciding whether to buy and making that move on the property market. And with shared ownership homes available in Derbyshire and plenty of other areas rich in natural landscape, first-time buyers are jumping at the opportunity to buy a home with plenty of space while saving money. Shared ownership homes in East Sussex are also proving popular with everything from the Kent countryside to beaches nearby.

Great Connections

Ensuring you live just within reach of the city is a big priority for first-time buyers this year. While many of us have switched to working remotely, being able to easily get into the office or out for lunch is a top priority on the list. With shared ownership homes in Cheshire putting you well within reach of Manchester while being surrounded by countryside is a real winner for first-time buyers. And should London be your city of choice there are plenty of London boroughs now transformed into young professionals’ haven. With shared ownership homes in Bedfordshire promising plenty of space with trains to London by the hour, getting the balance right is something everyone has taken into consideration this year after a significant time spent within their own four walls.

Help to Buy

Another option first time buyers are opting for is Help to Buy. With a 5% deposit and 20% equity loan that carries 0% interest for the first 5 years, buying a home with help to buy takes the pressure off your finances in those first initial stages. And if you’re looking to buy a home in London you can get a 40% equity loan, reducing your mortgage to just 55%.

With plenty of new priorities, opportunities and considerations for the new year, it may just be the time to start thinking about what you want from your first home. So have a think and really consider what’s important to you when imagining your dream home.

Using a Stochastic Indicator Successfully

In the financial world, there is a lot of pressure on performance. With markets being highly volatile in recent times, fortunes have been made and lost overnight. Against this backdrop, retail traders have to be either very good or very lucky to make consistent gains from market trading.

 

A stochastic indicator measures the momentum of the price action. It shows whether an asset’s price is currently overbought or oversold, representing high momentum and, therefore, high risk.

 

One of the most popular techniques used by forex traders worldwide is ‘stochastic trading’, which is derived from the momentum strategy for stock trading. This approach has been introduced to forex trading with variable success rates.

 

Locate the Stochastic Indicator

 

When you open up your trading platform, look for the stochastic indicator. It may be under “indicators” or named differently depending on the platform.

 

Determine Your Timeframe

 

The default setting of the stochastic indicator is usually %K and %D with a specific time frame (for example, 5/15). First, make sure you are using the timeframe that is right for you. For example, if you are day trading, perhaps use a 1-hour timeframe instead of a 15 minute one. Next, check whether it’s set to %K or %D (sometimes both will be there) – they both measure similar things but in different ways.

 

Determine Your Trading Setup

 

Now that you have located the indicator and set your timeframe, it’s time to see what it is showing. Usually, the default setting of %K and %D for 15 minutes will be a good starting point. The lines on the chart should go up and down, getting higher as %D rises and lower as %K rises.

 

Draw Your Signals

 

You are not limited to selling at 76.8%; there are many other ways to draw signals for yourself, depending on your strategy. A good indicator that some traders use is drawing multiple SMAs of K and their values, which allows them to make more complex decisions on when they should buy/sell.

 

Make Your Decision

 

Now that you know what exactly your stochastic indicator is showing, it’s time to make a decision based on it. So, for example, if you see that it has just given a buy signal, this might be an excellent opportunity to place an order as there seems to be upward momentum in price. However, if your stochastic shows a sell signal, this would mean selling as there seems to be downward price pressure.

 

Place Your Order

 

Once you’ve decided on whether to buy or sell, it’s time to place your order. Set up a chart for the same timeframe as before and wait for the price to hit the entry point you have identified (based on your trading setup). For example, if your indicator is giving a buy signal and you use a 15 minute time frame, then set up a 15-minute candle chart and wait until the price hits the area of resistance which seems indicated by the indicator. Placing limit orders can be used so that you automatically get in at a price shown by the stochastic indicator. Usually, your broker will execute your trade once this happens, and you can sit back and let your money grow.

 

In Closing

 

Like many other time and price-based indicators, stochastic indicators can help you understand how the forex market is likely to move in the future. When using a stochastic indicator on its own, it is essential to remember that they provide only an indication of how likely different price levels are.

 

You can use stochastic indicators both over longer and shorter duration charts. Still, traders tend to find them particularly useful on intraday charts where small movements in price can occur rather than more significant trends that last for days or weeks at a time.