1. Options
When the trading indicator is triggered, the investor may buy a call option for long, or buy a put option for a short signal. Alternatively, the investor may buy or sell short stock and sell a covered call or put against the stock.
2. Stocks
A. Market Trends
Always check to see what the trend of the overall market is and of the stock over the longer period.
B. Sector Analysis
It is usually best to pick the best performing stock from a good sector.
C. Strong Fundamentals
Be sure to check a stock's P/E ratio among other fundamentals so that the company you invest in has a good base.
D. Sound Technicals
Learn to use sound technical analysis on which ever stock(s) you are interested in. Including Trendlines, Elliot Wave, Fibonacci among a host of others.
E. Good Institutional Money Flow
Watch where the institutional money is going. They have a lot more money that the average investor. It is usually best not to fight the way the money is flowing.
F. Pick Stocks
After going through the above steps carefully make your stock picks.
3. Currencies: The Ultimate Hedge For Your Portfolio
Currency trading involves the exchange of one currency for another; for example, US Dollars for Euros. Currencies trade in pairs and a trader buys the currency that he thinks will appreciate in value relative to the other.
Since there are only a few major currencies to trade (versus tens of thousands of stocks), it is a lot easier for a trader to focus on a few pairs. The ability to trade currencies 24-hours a day (from Sunday afternoon to Friday afternoon), flexible leverage (increasing leverage increases risk), and difficulty to manipulate the market, are just some of the many advantages that, in our opinion, are rapidly making currencies one of the most popular trading vehicles of choice for the 21st century.
Forex trading involves substantial risk of loss and is
not suitable for all investors.