Sunday, August 14, 2011
Our Mission:
Potential investors too often view investing as a black box. I desire to provide advice that will illustrate pitfalls unknowing investors may face, so that they will become better engaged in making money. My goal is to present information backed by top authorities and combed through my decades of experience to best aid you in your financial decisions.
The Role of Money Management in Investing
In the past years, there has been very little attention paid to this aspect of financial planning. This is the main reason that people do not make the returns that they would like to make from their investments. The best advice that we could get in the past was, “Don’t put all of your eggs in one basket” or “Investing is like a three-legged stool; put some money in stocks, some money in mutual funds, and some money in bonds.” This advice might have been of some help, but probably would not give you the comfortable retirement lifestyle that you would like to have.
Money management is the most important factor in making money by investing. It is really difficult to keep your mind clear and your eye on the ball when the market is soaring and all investments are rising in price or when the market is falling fast and most investments are losing value. What do you buy and what do you sell? This is not a good situation in which to be. Buying and selling decisions should be planned and made with a clear mind. This is where money is made or lost.
It is best to have a set of rules that you use to base your buying and selling decisions on. This should keep emotional and greedy decisions in check. Remember: “Bulls make money, Bears make money, but Pigs don’t.”
Bill Astrop, President of Astrop Advisory Corp. in Atlanta, Georgia, recommends a minor revision of the 10% loss-cutting plan. He thinks that individual investors should sell half of their position in a stock if it is down 5% from their costs and the other half once it is down 10%. If followed, this strategy will provide you with funds to get back into the market when the economy changes.
Money management is the most important factor in making money by investing. It is really difficult to keep your mind clear and your eye on the ball when the market is soaring and all investments are rising in price or when the market is falling fast and most investments are losing value. What do you buy and what do you sell? This is not a good situation in which to be. Buying and selling decisions should be planned and made with a clear mind. This is where money is made or lost.
It is best to have a set of rules that you use to base your buying and selling decisions on. This should keep emotional and greedy decisions in check. Remember: “Bulls make money, Bears make money, but Pigs don’t.”
Bill Astrop, President of Astrop Advisory Corp. in Atlanta, Georgia, recommends a minor revision of the 10% loss-cutting plan. He thinks that individual investors should sell half of their position in a stock if it is down 5% from their costs and the other half once it is down 10%. If followed, this strategy will provide you with funds to get back into the market when the economy changes.
Money: Today & Tomorrow
“Money management” may seem like a rather self-evident moniker for those processes which we perform daily related to the income and disbursement of money, but the management of money in investment is a special ordeal of its own. Investment is not an exercise in making one choice and seeing that decision to fortune or bust. Money management is a core matter that will decide how well you ride the waves of gains and losses, and whether you will be able to re-enter the market following a catastrophic market change.
Money management is a key to ensuring survival in the unsure world of investing. Without having a necessary grubstake through which to re-enter the market, you may not only not have the opportunity to re-enter financially, but you may also be permanently soured on the prospect. Money management is about having money to start over.
Money management is also the control of purchases and sales with a clear mind. It may be human nature to ride what appear to be sharp rises and falls, as though they were manias or depressions that would level. The management of money is the knowledgeable and formulaic treatment to investment that avoids the pitfalls of gut feelings and tips probabilities of success in your favor both today and through tomorrow.
Money management is a key to ensuring survival in the unsure world of investing. Without having a necessary grubstake through which to re-enter the market, you may not only not have the opportunity to re-enter financially, but you may also be permanently soured on the prospect. Money management is about having money to start over.
Money management is also the control of purchases and sales with a clear mind. It may be human nature to ride what appear to be sharp rises and falls, as though they were manias or depressions that would level. The management of money is the knowledgeable and formulaic treatment to investment that avoids the pitfalls of gut feelings and tips probabilities of success in your favor both today and through tomorrow.
Penny Stocks: Friend or Foe
The Denver and Canadian markets list many stocks that trade for pennies per share. These seemingly cheap securities are more appealing now that we are all a little short on cash. However, there is a usually a flip side to whatever seems like a really good deal and penny stocks are no exception. William O’Neil, in his most recent book “HOW TO MAKE MONEY IN STOCKS, Complete Investing System” when discussing penny stocks, states, “I strongly advise that you avoid gambling in such cheap merchandise, because everything sells for what it’s worth. You get what you pay for.”
Although it seems like we could buy a very large quantity of these stocks even with the limited funds that we have available, the penny stock market is fast-moving and volatile which makes it very difficult to make a high-volume trade at your desired offer price. The market may get away from you and you could end up buying at a higher price than you wanted to pay and selling well below the price that you need to make a profitable trade. You have to add to the mix that if you are buying or selling a large quantity of stocks in this market, you can also move the market against yourself and end up making even less on the trade.
However, if you happen to own some penny stocks at this time, I feel that it would be best to use the 10% loss-cutting plan (as advised by Bill Astrop, President of Astrop Advisory Corp. in Atlanta, Georgia). I think that individual investors should sell half of their position in a stock if it is down 5% and the other half once it is down 10%. This strategy should assist you in preserving remaining funds with which to further invest.
Although it seems like we could buy a very large quantity of these stocks even with the limited funds that we have available, the penny stock market is fast-moving and volatile which makes it very difficult to make a high-volume trade at your desired offer price. The market may get away from you and you could end up buying at a higher price than you wanted to pay and selling well below the price that you need to make a profitable trade. You have to add to the mix that if you are buying or selling a large quantity of stocks in this market, you can also move the market against yourself and end up making even less on the trade.
However, if you happen to own some penny stocks at this time, I feel that it would be best to use the 10% loss-cutting plan (as advised by Bill Astrop, President of Astrop Advisory Corp. in Atlanta, Georgia). I think that individual investors should sell half of their position in a stock if it is down 5% and the other half once it is down 10%. This strategy should assist you in preserving remaining funds with which to further invest.
This Is The Best of Times – This Is The Worst of Times For Our Country
The other day, I was looking for some books on the Internet when I ran across Jim Rogers’s new book, A Gift to My Children: A Father’s Lesson for Life and Investing. The thought came to me as how wonderful it would be if we parents had this book and took time to relay the messages to our children, especially at time in history when we are letting the politicians over-spend, increase the budget and then print more money. This debt will then be left to our children to pay off after we die or they will lose the country and their freedom.
I would hate to think how many more people would be homeless right now if we all managed our financial obligations in the same manner that the United States is managing theirs. Day by day we are all trying to learn to live within our monthly income. We do not always succeed but at least we try. This is more than I can say for our government.
I started reading Rogers’s investment books back in the 1980’s when I first got interested in the stock market. I have bought and read almost all of his books since then and he has become one of the leading authorities on investing today. His investing style is similar to Warren Buffett and Peter Lynch. Perhaps we could tip the scales of the future toward the best of times with a bit of Rogers’s advice and by taking a moment to instill those values into those who will champion that future.
I would hate to think how many more people would be homeless right now if we all managed our financial obligations in the same manner that the United States is managing theirs. Day by day we are all trying to learn to live within our monthly income. We do not always succeed but at least we try. This is more than I can say for our government.
I started reading Rogers’s investment books back in the 1980’s when I first got interested in the stock market. I have bought and read almost all of his books since then and he has become one of the leading authorities on investing today. His investing style is similar to Warren Buffett and Peter Lynch. Perhaps we could tip the scales of the future toward the best of times with a bit of Rogers’s advice and by taking a moment to instill those values into those who will champion that future.
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