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Review

“This book gives futures and options traders hundreds of innovative ways to take profits out of the market and gain an edge on every trade.” (Technical Analysis of Stocks & Commodities Magazine )

The Encyclopedia of Trading Strategies is for traders who want to take the next step to consistently profitable trading. The authors–themselves seasoned veterans of the futures trading arena–pinpoint the trading methods and strategies that have been shown (more…)

Review

You could have no prior trading experience and still be part of Alan Northcott s targeted readership… The Complete Guide to Investing in Short Term Trading, a modest paperback, packs abundant information within 285 pages, and much of it is beyond the novice level. Because it does invite the uninitiated to come aboard, either as full or part time traders, there s some well-covered ground, such as fundamental vs. technical analysis and the psychology of fear and greed…No (more…)

Trade the trend and you can trade for a living If you’re going to play the stock market, play to win by using a fundamental strategy of most hedge fund managers-trend trading. In Trend Trading for a Living, the trading coach and hedge fund manager known on Wall Street as “Dr. Stoxx” shares his personal strategies for analyzing markets, picking stocks, and knowing when to buy and sell. This step-by-step book offers a practical road map to get yourself familiari (more…)

This concise, to the point, and waffle-free reference lays out everything you need to do to build a successful trading business. It includes: How to maintain discipline and accurately run your trading business. How to allocate capital to your trading systems. How you should use simulation in your trading. How to create, develop, and test your trading systems. What good contingency planning looks like. What should be in your business plan. This book is a “must-read” for anyone se (more…)

A smart trader needs to know what other traders are thinking and doing. Professional traders and investors use a wide range of indicators—some well-known, some not so well-known—to gauge the state of the market.Market Indicators introduces the many key indicators used by professional traders and investors every day. Having stood the test of time, these indicators will alert the trader to market situations that offer the best chance to trade profitably.Richard Sipley is a por (more…)

Typically, When I’m researching a company for a potential investment, This is the checklist I use. Note:  The questions pertain to fundamentals and technicals.  I believe both are necessary to execute a successful trade.

1. What does the company do?
2. How does it make money?  How many products/services does it sell?
3. How much do those products/services contribute in revenue?
4. What sector does it operate in?
5. How are it’s peers doing?
6. Compare to it’s peers, the industry, how does this company fare?
7. What are the margins for their products/services?  Are they growing? or are they shrinking?
8. Is it a cyclical business?  Does it depend on a commodity? does it depend on demographic trends?
9. Are it’s products price sensitive? or inelastic?
10. What’s the current market share of the company?  How many players are in the industry?
11. In terms of porter’s five, is it a concentrated industry, or fragemented?
12. Does gov’t policies affect their business, what are the current regulations in the industry?
13. In terms of valuation, Is it rich or cheap?
14. Technically, is it trading in a range, trading up or down? What is the current chart pattern/
15. Where will the company be in the next 5 years?  what will make the company keep growing at this rate?
16. Where will the industry itself be in the next 5 years?
17. What are the main variables that affect this company?
18. How many customers contribute to the revenue of this company?
19. Does it have the ability to raise prices?
20. How does mgmt get compensated, stock options?
21. What are the institutional holdings of this company?
22. What was the total return of the stock in the last 5 years,  what factors contributed to that! Will those factors still be around in the next 5 years?
23. Looking at depreciation patterns? accounts receivables?  How’s the earnings quality?
24. What is their working capital in a given year?  Has it been going up, why?  Has it been going up more than free cash flow?
25. Have they been buying back stock?
26. What is the current capital structure of the company? how has it changed in the last 5 years?
27. What are the disclosures in the footnotes of the company?
28. What is the future strategy of this company? Intrinsic growth? growth by acquisition?
29. Looking at previous annual reports, has mgmt delivered on their strategy.
30. Does the company depend on financing to expand their projects?

So, these are some of the questions you need to ask before you invest in a stock.  In a later post, I’ll provide a detailed example of company analysis.