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Then the stock often sold off hard, pounded by short sellers back down to $20 or lower and the poor souls who bought at $50 were left holding the bag. But for serious day traders with the proper tools and nerves of steel, it was heaven. Today you don't see those point gains because the price of most stocks is much, much lower. Article: Do you remember the “frenzy” or “froth” moves that were toward the wildest aspects of the late-1990s bull run? In those days it was commonplace to see gains of 20 and 30 points or more in one session. A stock might open at 120, promptly run to 150, settle back to 130, and then sprint to 150 or higher at the close. The true frenzy plays popped at the open on a bit of news or rumor. The excitement spread, pushing the stock ever higher. Suddenly, the entire market realized that maybe the news wasn’t all that great and maybe shares that were selling at $20 yesterday really weren’t worth $50 today. Then the stock often sold off hard, pounded by short sellers back down to $20 or lower and the poor souls who store at $50 were left holding the bag. But for serious day traders with the proper tools and nerves of steel, it was heaven. Today you don’t see those point gains since the price of most stocks is much, much lower. But gains of 20-30% in one day do come up from time to time. We’re all human and say to ourselves, “Wow, I wish I had been in that thing!” when XYZ stock pops from nine to 12 at the open. But you shouldn’t be too eager to buy into a rocket unless you have the proper day trading tools. Why? now the news or hype that drove that stock at the opening bell could dissipate at the moment you place your order. All too often, XYZ will jump from nine to 12 and then head back to nine or even into negative territory as the traders who got in early cash in their profits. You’ll probably be forced out of your position at a significant loss as the pain becomes too great. If you hang onto the shares, you could be stuck with a loser for a long, long time. So if you sense a frenzy building, hop on while it is still in the scope of reality and take the ride up. But once it’s over, it’s over. Get out and walk away. If you missed the initial upswing and the 9-buck stock is at $12, the prudent thing is to stay away. Sure, it could go to $20, but it’s more likely to go back to $9. Keep your powder dry. There will be other frothy plays on other days. Auto Submit To 3,000,000+ Websites. - Blast Your Ad to 3,000,000+ Classified Websites! Plus Huge Array of Marketing Tools. Affiliates Earn 60% Holdem Pirate. - Promote the most desired product on the market. Complete Poker Tool Software, qualtiy product with high conversion rates. Article Index: | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | 21 | 22 | 23 | 24 | 25 | 26 | 27 |
More Articles:1. Top Ten Investment Mistakes By Barbara Kimmel Summary: Holding onto a peaked stock a/k/a 'Trees don't reach to the heavens, and companies don't continue growth beyond reason'. Too much margin a/k/a 'Living on borrowed time brings a rush of excitement, but it's a quick trip when time expires'. Too many options a/k/a 'In life there's always options, (but timing makes the difference'). Many times investors lose money on their transaction even after they followed correct assumptions.Mr. Kimmel i… 2. Seven Investment Terms Everyone Should Know By Tim Gorman Summary: When investing money you must determine the amount of money you can lose before determining how much money you will invest and where you will invest it.* Compounding-Money made from an investment that will then be reinvested into the same or another investment to generate its own earnings.* Bonds-Money that is loaned to a company or the government at a specified interest rate. Article: For those who have never given their financial fut… 3. Pairs Trading: What Is That? By Larry Potter Summary: So, if you go long a stock putting out good news, while simultaneously shorting their competition, you will often see something like this happen:The stock putting out the good news pulls the sector higher. If you are long the news stock, and short the weakest competitor in the sector, chances are good that both will be winning plays.This isn't a new concept, but one that lost favor in the 90's, as everyone simply went long. Article:… 4. Caveat Emptor: You May Owe Taxes Despite 401(K) Losses! By Dr. Scott Brown, Ph.D. Summary: One among many ways you lose money in non-indexed mutual funds is the tax trap. If the stock was held for more than a year, in other words long term, the tax is 20%.There are a couple of reasons why mutual funds pay taxes. The best way to avoid these taxes altogether is to restrict your purchases of mutual funds to your 401(k) and try to only buy indexed mutual funds such as the Vanguard 500 (FINX). Article: One near many ways you … |