Online Stock Option Trading, Online Forex Trading, Online Commodity Trading
The Pink Sheets is not a stock exchange. To be quoted in the Pink Sheets, companies do not need to fulfill any requirements (e.g. filing financial statements with the SEC). With the exception of foreign issuers, mostly represented by ADRs, the companies quoted in the Pink Sheets tend to be closely held, extremely small, or thinly traded. Most do not meet the minimum U.S. listing requirements for trading on a stock exchange such as the New York Stock Exchange. Many of these companies do not file periodic reports or audited financial statements with the SEC, making it very difficult for investors to find reliable, unbiased information about those companies.
For these reasons the SEC views companies listed on Pink Sheets as “among the most risky investments” and advises potential investors to heavily research the companies in which they plan to invest.
Buying Pink Sheets shares is supposed to be difficult. Broker-dealers are enjoined to weed-out unsophisticated investors who may get an e-mail or word-of-mouth tip about a small stock. Many Pink Sheets stocks may only be registered for sale in one state so that the only way to purchase the stock is to make a DRIP/business/unsolicited/accredited or other sophisticated form of investment. Many registered representatives do not even know how or if they can sell them.
OTCQX market tier
OTCQX is a premium market tier offered by Pink OTC Markets that aims to raise the visibility of OTC-traded companies that, although not traded on a stock exchange, have operating businesses and provide substantial disclosure to the marketplace. The Pink Sheets has provided online stock tracking for many companies in its long history of online stock trading . Similar to companies quoted on the Pink Sheets, OTCQX companies are not required to be fully SEC reporting companies (i.e. current with all SEC filings). Despite this, OTCQX companies must provide audited financials and certain disclosures to Pink OTC Markets.
OTCQX has two subcategories, PremierQX , the highest tier, and PrimeQX for companies that are too small for PremierQX, but otherwise meet the reporting requirements. The two categories are further differentiated into International and Domestic (US) companies.
Pink Sheets market tier
Effective August 1 , 2007, all Pink Sheets traded companies that are not able or willing to meet the standards of OTCQX will be placed in one of the following disclosure categories: Current Information, Limited Information or No Information. This categorization system was designed to increase the amount of information available in all Pink Sheets traded companies. However, these disclosure categories do not signify issuer quality or merit of any security. Categorization is based on the level and timeliness of a company’s disclosure and any category can include speculative, distressed, or questionable companies. Investors are encouraged to use caution when considering these companies for investment.
Current Information
Indicates reporting companies that submit filings to regulators with powers of review and that make the filings publicly available or non-reporting companies that make current information publicly available on the Pink Sheets News Service. The Current Information category is based on the level of disclosure and is not a designation of quality or investment risk. This category includes shell companies or development stage companies with little or no operations as well as companies without audited financial statements and as such should be considered extremely speculative by investors.
Limited Information
Is designed for companies with financial reporting problems, economic distress, or in bankruptcy to make the limited information they have publicly available. The Limited Information category also includes companies that may not be troubled, but are unwilling to meet Pink Sheets’ Guidelines for Providing Adequate Current Information. Companies in this category have limited financial information not older than six months available on the Pink Sheets News Service or have made a filing on the SEC’s EDGAR system in the previous six months.
No Information
Indicates companies that are not able or willing to provide disclosure to the public markets – either to a regulator, a stock exchange or Pink Sheets. Companies in this category do not make Current Information available via Pink Sheets News Service, or if they do, the available information is older than six months. This category includes defunct companies that have ceased operations as well as ‘dark’ companies with questionable management and market disclosure practices. Publicly traded companies that are not willing to provide information to investors should be treated with suspicion and their securities should be considered highly risky.
Caveat Emptor – Buyer Beware
There is a public interest concern associated with the company. This may include a spam campaign, stock promotion or known investigation of fraudulent activity committed by the company or insiders. During a spam campaign, any stock that is not in the Current Information category will also have its quotes blocked on pinksheets.com.
OTCBB
The OTC Bulletin Board (OTCBB) is a listing of securities similar to the Pink Sheets, but operated independently. Many OTCBB companies are also listed on the Pink Sheets.
Grey Market
Securities that are not listed on any stock exchange, the OTCBB, or the Pink Sheets are considered to be in the Grey Market. Transactions are processed independently and not centrally listed or quoted. Trades are reported to a Self Regulatory Organization (SRO) who then passes the data on to market data companies.
Commodity Trading
Online commodity trading transactions on the commodity exchanges fall into two broad categories: cash contracts and futures contracts. Accordingly, the commodity exchange may be a cash market or a futures market, or may combine both. The cash contracts for the purchase of commodities are those which call for payment of the full contract price, in cash, on delivery. Such contracts are also referred to as physical contracts, in the sense that they deal in actual or physical products. The cash or physical contracts may be sub-divided into two sub-classes: spot contracts and forward contracts.
Spot transactions are those cash contracts which involve the payment by the buyer and the delivery of the specified grade of goods by the seller immediately, or within a short time. These contracts relate to the purchase or sale of commodities on the spot. The essence of such contracts is the ready delivery and acceptance of the delivery of the goods sold. Forward dealings are those cash contracts made in the cash or physical market, which call for the delivery of goods and payment of the price after a specified period, on a fixed date.
As against cash contracts, which require the payment or cash against the physical delivery of goods immediately on the spot or after a specified period, a futures contract is a special type of agreement made strictly under the rules of a commodity exchange, which may or may not call for the actual delivery of goods and payment of price in cash on a future trade.
A future contract can be defined as a contract for the future delivery of some commodity without reference to specific lots, made under the rules of some commercial body, in a set form, by which the conditions as to unit of amount, the quality and time of delivery are stereotyped and only the determination of the total amounts and the price is left open to the contracting parties.
Option Trading
By Rob Forbes
Options trading is a strategy that is not dependent on the market direction, and in fact does better in volatile markets. That is what makes now the best time to trade options. So, why would you trade options?
Options trading does not need to be risky or a gamble. It is true that there are some people who do gamble with options, but they quickly lose their shirts and leave the field. Options trading gives you a wide range of strategies that have varieties of profit and risk potential. In fact, many strategies are significantly less risky than “buy-and-hold”, and most are significantly more profitable than just about any stock trading strategy that you can name.
When trading options, most of your portfolio is in cash for most of the time. In fact, even when you are actively trading, you can still have your whole portfolio in cash!
When trading options, your trades are by definition short term, and you do not need to hang around for months and months to see whether you make a profit or not.
Options work in ANY market – up, down, or stagnant.
Which strategies are best to use during a recession?
Despite the massive leverage and profit potential of buying and selling calls and puts, it can look too much like gambling. In fact, if you don’t have a watertight strategy, it can be extremely risky. That is why it better to look at other possibilities.
Selling credit spreads. This strategy can bring in 15-20% profit on your portfolio per month, with no cash outlay, although you do need to put up margin. You can start with $1,000, and the only technical knowledge that you need is to be able to run a simple trend analysis. No trade lasts longer than a month, and you have an 80% or better chance of winning your trade.
Selling naked puts. You effectively get paid to buy your favorite stock, or in other words, you can buy stocks at greatly discounted prices. Or you can treat them like credit spreads, and run trades every month in an upwardly trending market.
Selling covered calls. If you own a stock, you can sell a covered call on it every month. In a downward trending market, this helps you recoup your losses. In a stagnant market, it helps you reduce the net cost of your stock. In an upward trending market, you can lock in your profits on a stock and move on.
These are all very low risk strategies, that can easily bring in a monthly income of at least 10-15% on your portfolio. You will not need to be glued to a computer screen day after day, and all three of these strategies can be accomplished with less than one hour per month in front of your computer. Each of these strategies takes advantage of time decay, the concept by which options lose value very quickly as their expiration date approaches.
There are other strategies such as Iron Condors, Straddles, Strangles and so on, which can be very effective, but none are as reliable nor as safe as these other three. In addition, they often incur higher brokerage fees.
Strategies such as DITM (Deep-in-the-Money) options trading can be useful if you favor a swing trading type stock strategy. You effectively buy stocks at about half price. Buying and selling calls and puts is hugely profitable, but highly risky. Both of these strategies are very susceptible to the effect of time decay.
An option is simply granting someone the right to buy or sell something in the future. In the case of Dow index futures options, when someone buys a Dow call option they are buying the right to purchase that underlying Dow future at a specific price, known as the “strike price,” at a future point in time, known as the “expiration date.” When an investor buys a put, they are essentially selling the market; a call essentially buys the market. Likewise, selling a put essentially buys the market; selling a call essentially sells the market.
Oil Future
As the nation emerges from cold weather and reaches toward the summer months, more of us will be thinking about vacations to far away places, and maybe even some short trips to the beach if we live within a reasonable distance to the coastline. Past experience teaches us that we can expect an increase in crude oil future prices around the time that people begin to get serious about some holiday traveling. Everything from gasoline to airfare will increase around this time. At times, the increase is attributed to slow production due to some production facilities being understaffed, while at other times there is speculation about crude oil being hoarded by the this nation or that. Regardless of the reason, there is always at least once factor that leads to an increase in prices as the weather begins to warm.
Just as predictably, any occurrence of natural disasters during the summer months will bring about increase in petroleum prices. Tornadoes and hurricanes that impact the production ability of offshore rigs and onshore processing plants will surely result in prices going up, even if people are not really in a good position to handle the increase. Keep your bicycle tires pumped up just in case.
As we begin to go into the autumn of the year, we will see crude oil future prices begin to level off and perhaps even dip a bit. It is usually not a god idea to get too excited with any significant change we see, as it will most likely be short lived. From the decrease, we can expect a small rebound to a slightly higher price, which will most likely be fairly constant for the winter months, barring any type of major problem somewhere in the world.
Predicting crude oil future prices based on past experience is a fairly reliable way for the consumer to plan for any upcoming changes that may have to be made in order to accommodate the shift in pricing. Make sure you watch the current status of the prices, and let history be your guide in planning your upcoming budget.
Types of Day Traders
There are two major types of day traders: institutional and retail.
An institutional day trader is a trader who works for financial institution. This type of trader has certain advantages over retail traders as he/she generally has access to more resources, tools, equipment, large amounts of capital and leverage, large availability of fresh fund inflows to trade continuously on the markets, dedicated and direct lines to data centers and exchanges, expensive and high-end trading and analytical software, support teams to help, and more. All these advantages give them certain edges over retail day traders.
A retail day trader is a trader who works for himself, or in partnership with a few other traders. A retail trader generally trades with his own capital, though he may also trade with other people’s money. Law has restricted the amount of other people’s money a retail trader can manage. In the United States, day traders may not advertise as advisors or financial managers. Although not required, nearly all retail day traders use direct access brokers as they offer the fastest order entry and to the exchanges, as well as superior software trading platforms.
In the past, most day traders were institutional traders due to the huge advantages they had over retail traders. However, since the technology boom in the second half of the 1990s, advances in personal computing and communications technology, realized in the accessibility of powerful personal computers and the Internet, have brought fast online trading and powerful market analytical tools to the mainstream. Low, affordable commissions from discount brokers as well as regulation improvements in favor of retail traders have also helped level the trading playing field, making success as a retail trader a possibility for many and a reality for some.
E-Mini S&P, often abbreviated to “E-mini” and designated by the commodity ticker symbol ES, is a stock market index futures contract traded on the Chicago Mercantile Exchange’s Globex electronic trading platform. The notional value of one contract is US$50 times the value of the S&P 500 stock index.
It was introduced by the CME in 1998 after the value of the existing S&P contract (then valued at $500 times the index, or over $500,000 at the time) became too large for many small traders. The E-Mini quickly became the most popular equity index futures contract in the world. The original (“big”) S&P contract was subsequently split 2:1, bringing it to $250 times the index. Hedge funds often prefer trading the E-Mini over the big S&P since the latter still uses the open outcry pit trading method, with its inherent delays, versus the all-electronic Globex system. The current average daily implied volume for the E-mini is over $140 billion, far exceeding the combined traded dollar volume of the underlying 500 stocks.
Following the success of this product, the exchange introduced the E-mini NASDAQ-100 contract, at one fifth of the original NASDAQ-100 index based contract, and many other “mini” products geared primarily towards small speculators, as opposed to large hedgers.
In June 2005 the exchange introduced a yet smaller product based on the S&P, with the underlying asset being 100 shares of the highly-popular SPDR Exchange-traded fund. However, due to the different regulatory requirements, the performance bond (or “margin“) required for one such contract is almost as high as that for the five times larger E-Mini contract. The product never became popular, with daily volumes rarely exceeding 10 contracts a day.
The E-Mini contract trades 23.5 hours a day, five days a week, on the March quarterly expiration cycle.
Stock Analysis Software
Stock analysis software works a lot like technical analysis software, it’s a program that helps you manage and control your money that you have invested in stock. There are many different kinds of stock analysis software out there and some can cost your thousands of dollars. You have to find a happy medium with the stock analysis software you choose can do the job you need it to and what your wallet can handle as well.
Once you have picked the right stock analysis software, its then time to know what exactly you are doing when using stock analysis software. Here are some different ways to navigate you through using stock analysis software.
Fundamental Analysis of Stocks, which is when the investors analyze stocks when considering the financial information of the companies that are releasing stocks. The most common form of Fundamental Analysis of Stocks found in stock analysis software is the CANSLIM method. The CANSLIM method is defined as the analyizing of stocks by looking into the companies that offer high buying demand and above average growth in earnings.
Technical Analysis of Stocks within the Stock Market, which is when investors study price activity of the stock market by way of using the quantitative techniques and also a variety of charts (line, bar, candlestick, etc.). The main purpose behind this technique is to predict overall price trends. This is the most used and most popular technique that stock analysis software has to offer, especially in this economy.
Up next is Index Method, which is when investors increase the value of their portfolios by create diverse investment plans of action as investment portfolios are weighted by the market capitalization. This form of stock analysis software, the investor finds ways to lower the risk of taxes, maximizing the trend of the general stock market, and also makes “outside the box” investment.
All this complex information may make a first time or novice investor a little wary. But that’s what stock analysis software is all about. Stock analysis software is very user friendly. The form of stock analysis software below may be the best for rookie investors.
Online stock market analysis, a very new age stock analysis software, will help to do the research and in turn helps stock decisions in an easy to follow and also logical manner. If an investor has always been confused by how to select certain stocks, understanding stock options, and also other securities, they you might not be doing the correct amount of analysis of the portfolio and overall average market trends. By doing analysis on the stock market, the businesses you have invested into, and also your stocks will be able to help determine whether it is time to buy, to sell, or hold it down.
In closing, here are some helpful tips when investing and using stock analysis software:
-Perform an in depth research companies and businesses before you buy into their stock,
- Be very careful where you get your advice, there are many people online that don’t know any more than you do.
- Buy into companies and businesses that you trust, go with your first gut instinct
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You don’t necessarily have to trade low priced hot stocks all the time. But you can learn how to take advantage of them when you encounter the best opportunities while at the same time limiting your risk.
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Online Forex Trading
Online Forex Trading brokers are considered to be the middle man of the trading game. They are the ones who provide you with crucial information on you current line of business. You may have spent some quality time with your own forex trading business but the expertise that these professionals can provide you with is still exceptional. This is because they have everything that is necessary for your business to get boosted. They have the technical expertise, the forex acumen, and the networks to move around the forex market.
Here are some useful tips you can use to find forex trading brokers
Look online – These days, the foreign currency trading game has seen a lot of growth in the internet sector. Most people have discovered how transactions can be done much faster if its made through the internet. Just the same, expect forex brokers to ride on this promising bandwagon. Those considered to be experts in the said field would have taken advantage of the internet to promote themselves and their services in the form of blogs or online columns. The internet also allows you to make quick comparisons among different forex brokers.
Ask for references – Getting a forex broker is almost the same as finding an applicant to fit in a job you need to get accomplished. Credentials are crucial and you also need to have a way to assess if the person you are considering for the said work can indeed deliver some good results. The best way for you to be able to do that is to talk to their previous clients. Get in touch with their existing or past customers so you can have a clearer view and perspective on how it might be like to work with them. This is also a good way for you to identify if they have a clean record in conducting business transactions.
Get in touch with regulatory agencies – The forex market has plenty of government and non-government agencies which have their own policies that help develop and continue to sustain the market scene. The best you can do is to primarily coordinate with these people since they may have forex broker organizations wherein you can tap your possible forex partners. This helps ease up your background research process because the people you will get from these agencies are most probably certified to have clear professional records.
Trading platform to be used - You should also check out what type of trading platform is being used by the forex broker you wish to hire. The two most popular versions these days are the downloadable software and the web based application. If the forex broker uses a specific software, you should care to ask its specifics especially if you use one yourself. This will help smoothen out compatibility issues and make information dissemination much easier for both of you. Web based application are usually open source programs that are accessible when you go online. Forex trading brokers who use these might be able to give you better rate deals because most of these open source programs are free.
Automated forex trading is defined as the ability to trade forex with the help of a trading program or solution. Automated forex trading is done using robots which are created by high-level developers. Automated forex trading is one of the way to leverage due to. Automated forex trading is another option for many forex traders.
Forex markets provide multiple opportunities to trade and profit within a 24 hour period. Forex trading tools that deliver fast and accurate data in a timely manner is the key ingredient to trading success. Forex trading online can be challenge without the right tools that guide you to the right way. Forex forecasting is the key to profitable trade – Forex forecasting helps a trader predict price movements in the highly volatile forex market. Forex trading can be done at your convenience.
Trading this way is easily the fastest way to turn a profit but in the past, traders relied on a great deal of guesswork before algorithms, making trading much more risk prone without it.
Automated Forex trading is one of the leading methods of making money online, that is, if you have the best programs at your disposal and the right information, of course. Automated forex trading will allow foreign currency traders to be able to trade in real time. Automated trading makes possible for you to trade in different markets, and also in diverse time zones. Automated trading software allows you to cancel all open orders and flatten all positions automatically at the end of the day. Automated forex trading is done using robots which are created by high-level developers. Automated forex trading really favors day trading and swing trading as profiting from these trading styles require fast trading. Automated FOREX trading is exactly what it sounds like.
Online forex trading allows you to trade at your convenience – There was a time when forex trading was limited to banks and large financial institutions. Online Forex brokers will come with various trading platform software as well as tools to make trading easier on you. Online trading is not difficult to learn, the fact is when one using the foreign currency software, to trade online it becomes so easy. Online Forex Trading is Quickly Becoming a Booming Business Online Forex trading is more popular now that most everyone has access to a computer and internet. Online trading is the easy way to buy and sell shares from the comfort of your home.
Foreign Currency Trading is the world’s largest enterprise and the rise of the Internet allows anyone to trade and the rewards are great, but 95% of traders lose and in most cases is because they do not understand the facts closed …. Foreign exchange market operates 24 hours a day seven days a week.
Making Money On Forex Online Without Bank Wires Online has become a meeting place for most advantageous financial and Internet technologies. Making money from money you’ve already earned from your investments is known as ‘compounding interest’.
Automated FOREX trading is exactly what it sounds like. Automated forex trading is a relatively new concept that is rapidly growing in popularity among retail forex traders. Automated Forex Trading is an option to be availed by an investor in the international currency market. Automated Forex trading is where some or all of your Forex trades are decided by a computer program.
Online Forex Trading Profits
Online Forex Trading is the short form for foreign exchange and makes up an exciting line of work that is increasing in fame. In foreign exchange, one currency of a nation is traded for another. The foreign exchange market place is one of the largest markets because foreign exchange transactions happen between big banks, central banks, government agencies, multinational corporations etcetera.
On an average, transactions of the volume of US $2 trillion take place globally day-after-day.
In addition to that the transaction volume in the derivatives market is 1.26 trillion, day-by-day. That shows the size of the market place and the potentiality it has for the players involved. Though retail traders who take part through brokers and banks form a small fraction of the total participants the Forex market holds a high potential of profit for the participants.
Online Forex Trading Videos
A Forex video training course is one of the most effective learning tools for enabling students to master the art of trading. As opposed to live seminars which are also more expensive, Forex training videos can be viewed at any convenient time and replayed again and again. There may be sections that warrant repeated viewing while other sections can be viewed briefly or skipped. The video format for learning has proven to be extremely effective for learning trading principles quickly.
Should You Learn Trading?
Learning Online Forex Trading is not that hard in that there are a lot of systematic courses conducted by many institutes/universities all over the world. When an entrepreneur commits to learn trading, she will be mainly exposed to two types of analysis. One is technical analysis and another is fundamental analysis.
Technical Analysis
Technical analysis is the market-generated data utilized for forecasting price movements. Tools like price charts and graphs are being used to illustrate the concept. The forecasting is based on three postulates viz., the market data contains all the fundamentals, volatility of the market and market sentiments. The possible market trends are up, down and sideways. More often than not the market moves in predictable patterns. The ultimate aim of technical analysis is to unravel this pattern basing upon the past trends.
Fundamental Analysis
Fundamental analysis assumes a country to be like company with economic reports that reveal the financial health of that countys currency. The value of a countrys currency depends upon the products and services it supplies to the international market. The more it supplies and is able to sell them the more of a demand is created for the currency because of its need by the purchasers of the product and services. Fundamental analysis takes into account the countrys potential to generate international trade. Fundamental analysis is found to be more effective when the learner uses the same judiciously. Learning the trade in these broad categories help the traders perform well in the market
Forex trade holds high prospects for profit as well as the potential for loss depending upon the traders skill and understanding of the market. Learning Forex trade provides that knowledge which should be analytically used for achieving better performance. The trader who has a more thorough understanding of the market has a distinct advantage and greater likelihood of creating consistent profits. As with any business, education and training are the first step toward long term success.
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