Essential Investment Books

This book by Jim Paul and Brendan Moynihan is a book any trader should read The book correctly states that there are lots of different ways to make money and only a few ways to lose it. Therefore you need to concentrate on not losing first

If you have not read this book you will see the markets in a completely different light and one that could lead you to bigger profits and is simply one of the best investment books ever writtten.

What I Learned Losing a Million Dollars is a fascinating, insightful, easy-to-read true story of Jim Paul's rise from a humble country background to jet-setting millionaire trader and Governor of the Chicago Mercantile Exchange.

It is an examination of the lessons he learned from losing a million dollars in the market which brought about his demise and then covers his rise from the ashes.

This book contains no technical theories and really focuses on how NOT To lose money there are plenty of ways to make money so how come most traders lose it?

The answer lies as we have stated that:

It's not how you make money that's important there are many ways to do that, but are only a few ways to lose it and if you are mindful of them and don't make losing mistakes - you can emerge a winner.

The book is essentially divided into two parts:

Section 1

The first half of the book about Jim's life makes you feel close to him and the experience he is facing as his world crashes around him. It's both funny and sad in equal measure and is a superb fiction story.

Section 2

After the loss and its aftermath, comes the authors views of what he had learned and this really is original, thought provoking and insightful. The authors show you how to identify and manage the risks, both monetary and emotional that is part of any decision making including trading.

Playing great defense

The authors covers the key areas ALL losing traders fail in, that let losses get out of control.

Key areas covered are:

- The three biggest mistakes traders make and how to avoid them.

- Why the most important part of building wealth is not losing it.

- The psychological pattern which all losses take in a traders head, regardless of the position size

The discussion on the risk/reward ratio, and why most other books get it wrong is perhaps the most interesting part of the book.

This point is worth the books price alone as the aothor explains

Why you have to take into account the PROBABILITY of return, and PROBABILITY of loss, when trading and not simply divide the size of your expected return by the size of your expected loss, as most authors suggest if you do you will lose!

This really is the key point of the book if you want to keep losses under control as it states in the preface.

This book is a case study of the classic tale of countless entrepreneurs: the risk taker who sees an opportunity, the idea that clicks the intoxicating growth, the errors and the collapse. Our case is that of a trader, but as with all case studies and parables the lessons can be applied to a great many other situations.

If you want a book to show you the importance of emotional discipline and the art of risk management, then this is it.

This book has recently gone out of print, so get your hands on a second hand copy or get to the library and read it.

How To Research Stocks: 5 Stock Researching Techniques To Stop Being An Investment Loser

Are you trying to discover how to research stocks? As soon as you confirm which business cycle the economy is at present in you are able to start studying for a trade. It's best to get some sort of a system in place that shall be employed prior to each particular transaction. Here is a straightforward 5 Step formula to help get you going.

5 Steps For How To Research Stocks And Investing On the web:

1. Discover a stock

This is the single most obvious and most troublesome step in stock trading. With in excess of 10,000 stocks to trade a good guideline to consider is time of the year. For instance, as I write this, it's the beginning of springtime. It'd be sensible to think about stocks that traditionally make runs, or slide if you're bearish, throughout this point in the year.

2. Basic Research

Many short term traders may hold a different view with the requirement to carry out any Basic Research, however understanding the chart patterns from the earlier period and the news relating to the stock is pertinent. An example would be earnings season. If you're planning on playing a stock to the upside that has missed its earnings target the last three quarters, caution could be in order.

3. Technical Analysis

This is the part where indicators can help. Stochastics, the MACD, volume, moving averages, RSI, CCI, support levels, resistance levels and all the rest. The batch of indicators you select, whether lagging or leading, can rely on the area you receive your education. Keep it straightforward when first beginning, utilizing too many indicators in the beginning is a ticket to the kingdom of big losses. Get very comfortable using 1 or two indicators in the first instance. Understand their details and you may be sure to create more improved trades.

4. Follow your picks

Once you have placed a number stock trades you should be handling them properly. If the trade is supposed to be a temporary trade view it faithfully for your exit signal. If it's a swing trade, watch for the indicators that notify you the trend is on the move. If it is a long term trade do not forget to set each week or per month checkups on the stock. Make use of this time to keep on top of the reports, confirm your share price targets, set stop losses, and keep an eye on other stocks that you might wish to own too.

5. The overall strategy

As the saying goes, all ships rise and fall with the tide. Being aware of which areas are heating up stack the chips to your advantage. For example, if you're long (expecting the share price to go up) on an oil stock and the majority of the oil area is rising then more likely than not you're on the correct side of the trade. Several trading platforms will offer you admittance to sector-wide information in order that you are able to get the education you require.

How To Research Stocks - Conclusion

Prior to take the leap and invest your hard earned money into a specific stock it is critical to do your analysis correctly. the internet has made it a good deal more straightforward for everyone to invest and produce an income from their investments. However it is still as easy to lose your money if you go about it the incorrect way and do not have a firm strategy for investing. The above advice should put you on the right road when answering the question how to research stocks.