Money Making Schemes

Nagesh answers:

If you are trying to have people hand you answers on which stock to make quick profits from, you would have a better chance putting all of your money on red or black at roulette.

Learn how to do some very simple Technical Analysis, follow stocks that take large plunges as every now and then they are unwarranted and correct upwards very shortly after. (Focus on good, reliable companies)

I would suggest learning about Bollinger Bands, Stochastics (Fast for quick flips), P/E ratios, volume levels, volatility, and lastly read the individual reports on your brokerage’s site, focusing on stocks in the neutral to outperform sectors. Use your screener tools to find stocks with low short interest, low P/E’s, and possibly around their 52-week low.

Lastly, even though I flip stocks occasionally, I only trade in companies that are turning a profit and look to continue to do so, therefore you may want to screen for EPS > .01

Good Luck!

Nagesh answers:

Small companies can move faster. Large companies like GM take a long time to get anything done where the consensus of dozens of people is required to produce a new product. Large companies are so entrenched in we’ve been doing it this way for ## years and making money so we’ll keep doing it this way. GM had been developing the Volt for 2 years before the board of directors or the stock holders (not sure which) approved the entire project for production. Until then it was just a research project that when completed will end.

Small companies like Tesla only have a couple of people to make decisions and are more willing to take major risks. They have no solid business model so new products can be developed quicker.

Also when large companies fail to adapt a small company can move in to fill the void. GM didn’t want to make electric cars so they only made enough to keep the regulatory agencies of their back. As soon as GM no longer had to make the cars they destroyed them. This left a void that entrepreneurs like Tesla recognized and exploited.

Nagesh answers:

Don’t fall for the temptation to leave your losing side open in the hopes the stock will make a reversal. #1 rule – Don’t turn trades into investments and don’t turn investments into trades. Whatever your plan was originally, stick to it. I assume that if you are putting on a straddle you are expecting the stock to make a big move, but you just aren’t sure of the direction.

I put on the straddle expecting one of the sides to be a losing position. However, I look at the total cost and the total profit of the entire position when deciding on when to sell and then close both sides in one order. You can usually get a better price than placing the trades individually.

Nagesh answers:

Well, I use a spreadsheet to help me crunch the numbers when the sources I use don’t provide the specific relationships I like to use when searching for what is going to be next when the current holdings reach their goal.

The nice thing about the programs people speak of is that when they get a bunch of people buying or selling on the same schedule for the same signals then they provide a nudge to the market for a temporary blip that allows the group to profit if they are fast enough. Since most day trading is like a school of fish turning at the same moment, or close to it those who miss the cue are left holding the bag as the market moves away from them. Still, the market is usually too big and too diverse for program buy/sell signal generators to work all the time.

Nagesh answers:

Pretty scant information here.

“Best alternative to invest.” About as broad and general as you could make a question. Are you interested in bonds, options, stocks, cd’s, commodities, foreign instruments, etc? The list is longer than your arm. There are as many hedge funds and mutual funds as there are instruments, and as many ETF’s as there are funds. Another problem with your broad, general question is this: “Best” for whom? Are you young, old, have a lot of money, just a little, do you want high risk, etc.? Again, the questions go on forever.

Your best bet is to get a few books from your local library, do your homework, then if there’s something specific you don’t understand, we can help. But we can’t write a thesis or a book here.

Or type “how to invest first time” in the Search Answers box above.
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“Best alternative to earn money.”

This question is asked every day here. Just type “how to make money fast” in the Search Answers box above and you’ll get hundreds of answers.
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