When it comes to personal finance and creating wealth, there is no better long-term investing strategy than the stock market. For example, between March 2009, when the markets bottomed, and the end of 2014, the NASDAQ increased 275%, the New York Stock Exchange (NYSE) 160%, and the Toronto Stock Exchange (TSX) 95%. Not surprisingly, the biggest indices followed suit; the S&P 500 has increased 210% and the Dow Jones Industrial Average has climbed 175%.
Will the stock market continue to do well in 2015? It depends on how you look at it. There is more to investing than the old adage of “buy-low, sell-high;” in fact, there are different investing strategies that can help you make money whether the markets are going up, down, or sideways.
The More You Know, the Better Prepared You Are
At the most fundamental level, most people know how to look up a stock ticker and analyze the price movement of a particular share. But if you don’t know how to determine the health or value of a company, you won’t know what makes the share price move up or down.
The only way to learn about a company and what makes it tick is to do your homework. It doesn’t matter if you’re a seasoned investor or new to investing; when it comes to understanding a particular stock, most investors follow two schools of thought: technical analysis and fundamental analysis.
Those who look at technicals believe that chart patterns and past price performance can predict future price movements. This can include price data (open, low, high, close), moving averages (50-day and 200-day), volume, the relative strength index (RSI), and the money flow index (MFI)—anything to do with price.
Those who take a fundamental approach look at a company’s financial statements to predict a trend. Here, investors focus on any forward-looking data that could impact the price of a stock: this includes quarterly results, cash flow, debt levels, and press releases—in other words, anything to do with the actual company.
Ultimately, the more you learn about a company, the more confident you’ll be investing in it.
There’s More to the Stock Market Than Stocks
While buying stocks is one of the most obvious ways on Wall Street to invest, there’s more to the stock market than stocks. And that’s a good thing; after all, the stock market is only as strong as the companies listed on the individual exchanges.
The stock market would be pretty limiting if the only way to make money were to sell to eager buyers during a bull market. So, what do you do if the markets are down? Or what if you have a hunch about what’s going to happen in the next six months or year? Being aware of different investing strategies can open up a new world to investors, one where they can profit during bear and bull markets.
In addition to investing in stocks, investors can also profit from trading options, futures, commodities, short-selling, the foreign exchange (forex), and precious metals.
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No matter what your investing experience, Learn-To-Trade.com Inc. has developed a system that helps Members make better trades and preserve capital. For information on Learn-To-Trade.com Inc.’s trading courses or Lifetime Membership, or to sign up for one of our free two-hour trading workshops, e-mail us at email@example.com or call us at 416-510-5560.
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