Sizzling Stock Picks

[Tellin_Fibs]

In an ideal world, market makers want to buy at the bid price and sell at the ask price. This scenario allows them to have very little risk and make “the spread” on each share transacted. Unfortunately for market makers, this scenario is not extremely common due to price volatility – movements in the price of a security.

[Black_NITE]

For thou convenience $ONCI BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/ONCI

[BoomPickens]

Which Form Exists in the Market Today?

Many in academia believe that security prices are semi-strong efficient.

[GreenReeper]

When To Sell A Mutual Fund
If your mutual fund is yielding a lower return than you anticipated, you may be tempted to cash in your fund units and invest your money elsewhere. The rate of return of other funds may look enticing, but be careful; there are both pros and cons to the redemption of your mutual fund shares. Lets examine the circumstances in which liquidation of your fund units would be most optimal and when it may have negative consequences.

Mutual Funds Are Not Stocks
The first thing you need to understand is that mutual funds are not synonymous with stocks. So, a decline in the stock market does not necessarily mean that it is time to sell the fund. Stocks are single entities with rates of return associated with what the market will bear. Stocks are driven by the buy low, sell high rationale, which explains why, in a falling stock market, many investors panic and quickly dump all of their stock-oriented assets.

Mutual funds are not singular entities; they are portfolios of financial instruments, such as stocks and bonds, chosen by a portfolio or fund manager in accordance with the funds strategy. An advantage of this portfolio of assets is diversification. There are many types of mutual funds, and their degrees of diversification vary. Sector funds, for instance, will have the least diversification, while balanced funds will have the most. Within all mutual funds, however, the decline of one or a few of the stocks can be offset by other assets within the portfolio that are either holding steady or increasing in value.

Because mutual funds are diverse portfolios rather than single entities, relying only on market timing to sell your fund may be a useless strategy since a funds portfolio may represent different kinds of markets. Also, because mutual funds are geared toward long-term returns, a rate of return that is lower than anticipated during the first year is not necessarily a sign to sell.

When Selling Your Fund
When you are cashing-in your mutual fund units, there are a couple of factors to consider that may affect your return:
• Back-end loads - If you are an investor who holds a fund that charges a back-end load, the total you receive when redeeming your units will be affected. Front-end loads, on the other hand, are sales fees charged when you first invest your money into the fund. So, if you had a front-end sales charge of 2%, your initial investment would have been reduced by 2%. If your fund has a back-end load, charges will be deducted from your total redemption value. For many funds, back-end loads tend to be higher when you liquidate your units earlier rather than later, so you need to determine if liquidating your units now is optimal.
• Tax consequences - If your mutual fund has realized significant capital gains in the past, you may be subject to capital gains taxes if the fund is held within a taxable account. When you redeem units of a fund that has a value greater than the total cost, you will have a taxable gain. The IRS has more detailed information on capital gains and their calculations in Publication 564: Mutual Fund Distributions.
When Your Fund Changes
Do keep in mind that even if your fund is geared to yielding long-term rates of returns, that does not mean you have to hold onto the fund through thick and thin. The purpose of a mutual fund is to increase your investment over time, not to demonstrate your loyalty to a particular sector or group of assets or a specific fund manager. To paraphrase Kenny Rogers, the key to successful mutual fund investing is knowing when to hold em and knowing when to fold em.
The following four situations are not necessarily indications that you should fold, but they are situations that should raise a red flag:

Change in a Funds Manager
When you put your money into a fund, you are putting a certain amount of trust into the fund managers expertise and knowledge, which you hope will lead to an outstanding return on an investment that suits your investment goals. If your quarterly or annual report indicates that your fund has a new manager, pay attention. If the fund mimics a certain index or benchmark, it may be less of a worry as these funds tend to be less actively managed. For other funds, the prospectus should indicate the reason for the change in manager. If the prospectus states that the funds goal will remain the same, it may be a good idea to watch the funds returns over the next year. For further peace of mind, you could also research the new managers previous experience and performance.

Change in Strategy
If you researched your fund before investing in it, you most likely invested in a fund that accurately reflects your financial goals. If your fund manager suddenly starts to invest in financial instruments that do not reflect the mutual funds original goals, you may want to re-evaluate the fund you are holding. For example, if your small-cap fund starts investing in a few medium or large-cap stocks, the risk and direction of the fund may change. Note that funds are typically required to notify shareholders of any changes to the original prospectus.

Additionally, some funds may change their names to attract more customers, and when a mutual fund changes its name, sometimes its strategies also change. Remember, you should be comfortable with the direction of the fund, so if changes bother you, get rid of it.



Consistent Underperformance
This can be tricky since the definition of underperformance differs from investor to investor. If the mutual fund returns have been poor over a period of less than a year, liquidating your holdings in the portfolio may not be the best idea since the mutual fund may simply be experiencing some short-term fluctuations. However, if you have noticed significantly poor performance over the last two or more years, it may be time to cut your losses and move on. To help your decision, compare the funds performance to a suitable benchmark or to similar funds. Exceptionally poor comparative performance should be a signal to sell the fund.
The Fund Becomes Too Big
In many cases a funds quick growth can hinder performance. The bigger the fund, the harder it is for a portfolio to move assets effectively. Note that fund size usually becomes more of an issue for focused funds or small-cap funds, which either deal with a smaller number of shares or invest in stock that has low volume and liquidity.


When Your Personal Investment Portfolio Changes
Besides changes in the mutual fund itself, other changes in your personal portfolio may require you to redeem your mutual fund units and transfer your money into a more suitable portfolio. Here are two reasons which might prompt you to liquidate your mutual fund units:
• The need to rebalance your portfolio - If you have a set asset allocation model to which you would like to adhere, you may need to rebalance your holdings at the end of the year in order to return your portfolio back to its original state. In these cases, you may need to sell or even purchase more of a fund within your portfolio to bring your portfolio back to its original equilibrium. You may also have to think about rebalancing if your investment goals change. For instance, if you decide to change your growth strategy to one that provides steady income, your current holdings in growth funds may no longer be appropriate.
• Need a tax break - If your fund has suffered significant capital losses and you need a tax break to offset realized capital gains of your other investments, you may want to redeem your mutual fund units in order to apply the capital loss to your capital gains.


The Bottom Line
Selling a mutual fund isnt something you do impulsively, without a great deal of thought and consideration. Remember that you originally invested in your mutual fund because you were confident in it, so make sure you are clear on your reasons for letting it go. However, if you have carefully considered all the pros and cons of your funds performance and you still think you should sell it, do it and dont look back.

[Tellin_Fibs]

Investor-focused companies may use either the OTCQX requirements, SEC Reporting or OTC Markets Alternative Reporting Standard to provide transparency to individual investors and the professional investment community. These services increase the flow of information, raise the profile of OTC companies, improve price discovery, and increase trading and liquidity in the OTC market.

[BoomPickens]

Assist with Entry Point

Technical analysis can help with timing a proper entry point. Some analysts use fundamental analysis to decide what to buy and technical analysis to decide when to buy.

[Black_NITE]

Behold the $GDGI BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/GDGI

[GreenReeper]

Contemplating Collectible Investments
If you have much space for storage, your attic and garage might be stuffed with old furniture, books and other items youve held onto over the years. If this is the case, you may be sitting on a few valuable collectibles just waiting to make you money. That said, you are just as likely to be looking at little more than a pile of junk. In this article well take a look at collectibles as an investment and help you decide whether this emotional market is a good place to park your money.

All Things Old Made New Again
140,000,000 B.C: A young Allosaurus missteps and finds itself mired in a sink hidden beneath the underbrush. Millions of geological ages later, an amateur paleontologist helps him out - or at least what was left of his head. In 2005, the Allosaurus restored skull sells for the high price of $600.

1908: Honus Wagner of the Pittsburgh Pirates hits his tenth home run and ends the year with a .354 batting average, marking one of the best years of his career. The next year, the American Tobacco Company commemorates Wagner by putting a trading card inside its cigarette packages. Less than 60 make it into stores before it is discovered that Honus is vehemently against smoking. In 2000, Wagners cigarette trading card is sold on EBay for $1.1 million.
1962: Stan Lee creates a superhero who has to worry about rent, his ailing aunt and passing his next test - all in addition to saving the world. Peter Parkers misadventure with a radioactive spider hit the stands with a $0.12 cover price. And, in 2006, the first edition of The Amazing Spider-Man is among the most valuable comics with a price around $6,000 or more, according to Wizard: The Guide To Comics pricing guide.

These are all examples of the strange and wonderful world of collectibles. While there is no denying the thrill of owning a juvenile Allosaurus skull, is collecting really a form of investment?

All That Glitters ...
The reason we began by discussing a fossil, a comic and a baseball card is that people have no qualms about calling them collectibles. However, when you speak about diamonds, gold and other precious materials, people tend to call theminvestments . In theory, these materials - and even stocks - could be termed collectibles because their price is based more on what people are willing to pay for them (or market value) than on their actual intrinsic value. But in the practical world, precious metals and stocks have an intrinsic value. For metals, this value is based on rarity and the fact that if you melt it, burn it or bend it, you still have the same atomic substance in the end. For stocks, the value is produced by the underlying brick and mortar company that the share represents - a company that is generating earnings to justify the prices you pay for its stock.

What makes collectibles different is that even a little damage can erase all of a collectibles value. This is because a collectibles value is based on emotional factors like nostalgia. These emotional factors can be as erratic as they are powerful. If you were asked whether people would be willing to pay more for a dinosaur skull or a baseball card, even if you chose one over the other you would give them both a higher value than, say, a torn up baseball card or a box of bone fragments. Those items you would probably call worthless (unless you are an archaeologist or a fan of papier-mâché).
The 20-Year Itch
It is said that nostalgia runs in 20-year cycles. In other words, the things that are popular now will become collectibles in 20 years when people want to reconnect with their past. This doesnt mean that you can buy the top 10 items from consumer polls, incubate them for 20 years and then sell them for a fortune. It means that some items this year will become collectibles if they meet two conditions: rarity and appeal.

Rarity is becoming a harder thing to find as mass production methods allow companies to (over)fill demand without incurring that much extra cost. Beanie Babies have devalued as more and more product lines are introduced. It is profitable for a company to sell as many products as it takes to satiate demand, and that mentality destroys a future collectors profits. (For more on this concept, check out Economics Basics.)

Appeal is also a difficult thing to nail down. To make money at collecting, you have to predict what will become popular in retrospect - perhaps something that is not in high demand now will become popular in the future, either because they are rare or they were not fully appreciated at the time. For example, in the 1950s and 1960s, wing-tipped plastic sun glasses with glass lenses were sold for a few dollars in drugstores, but they can now fetch hundreds of dollars in collectors markets.

Reasons Not To Buy Collectibles
Mark-ups
When you buy a collectible from a dealer, that dealer is usually marking up the price to make a profit. Unlike collectors, dealers do not have the luxury of holding an item for years and years while the value may or may not increase - they have sales to make and a business to run.

Maintenance
Many collectibles require special care to keep them in top condition. These can range in cost from the $1 plastic cover used to keep hockey cards safe to a special room with moisture, heat and light monitors to lengthen a paintings life. On top of the storage costs, there are the added costs of buying insurance for the more valuable types of collectibles as well as paying to have professionals, appraisers, restorers and dealers look at the collectible before you sell it. A collectible doesnt produce income while you hold it, and it may actually eat income while you wait for it to increase in value.
Wear
Most categories of collectibles - from Pokemon cards to antique plumbing fixtures - have a manual classifying how much an item is worth in pristine condition and what sorts of damage degrades it by what percentage of value. For example, a well-read copy of the aforementioned Amazing Spiderman #1 may only be worth 30-60% of the $6,000 list price, depending on what type and what degree of wear it shows.

Counterfeiting
Most museums display dinosaur fossils models - not the real thing. Can you tell the difference between an Allosauras skull made of plaster and cement and one made of fossilized bone? No matter how experienced the appraiser, forgeries do make it to the dealers and then through to the collectors, which could leave you holding a very expensive piece of criminal art.

Low Returns
Collectibles tend to have lower returns than a stock market index fund, a money market account and most bond funds. If you took an average of the returns on all collectibles – which is practically impossible to do given some have little or no market to measure – it would be dismal compared to the S

[Tellin_Fibs]

Be certain that you fully understand the distinctions among these terms, and be certain that the risk level you choose accurately reflects your investment goals. Be sure that the investment products recommended to you reflect the category of risk you have selected.

[BoomPickens]

With these kinds of stats, individual investors would surely be better off simply investing in an index fund rather than attempting to beat the market wouldn't they?

[Black_NITE]

For thou convenience $VIZS BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/VIZS

[GreenReeper]

The Merger - What To Do When Companies Converge
You may hear about it in the financial news - the merger. Its often a situation cloaked in mystery and confusion. Do you know what to do when a company youve invested in plans to merge with another company? In this article, well show you how to invest around mergers and the ups and downs involved in the process.

SEE: Cashing In On Corporate Restructuring

How It Works
A merger occurs when a company finds a benefit in combining business operations with another company, in a way that will contribute to increased shareholder value. It is similar in many ways to an acquisition, which is why the two actions are so often grouped together as mergers and acquisitions (M

[Tellin_Fibs]

Complaints regarding companies should be directed to the SEC, while complaints regarding broker-dealers or other investment professionals should be directed to FINRA.

[Black_NITE]

For thou convenience $WELL BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/WELL

[BoomPickens]

These terms are used interchangeably throughout this and other articles. As demand increases, prices advance and as supply increases, prices decline.

[GreenReeper]

Play The Market Like Tiger Plays Golf
Very few people on this planet have earned the title of greatest ever. In investing , many would argue that this distinction goes to Warren Buffett; in golf, its Tiger Woods. But in this world you do not need to be the best to achieve success. However, we are fortunate that those who are considered the best have laid out lessons for us that can help us become more successful. (Read about Buffett in our articles on The Greatest Investors.)

Both Warren Buffett and Tiger Woods do a few simple things spectacularly well to achieve their goals. While odds are quite high that you will never become Woods or Buffett, you dont have to in order to succeed. There are a lot of subtle yet critical similarities between golf and investing. If you pay attention to how they go about perfecting their craft, you can gain a lot of wisdom that will set you ahead of the pack.

Practice Makes Perfect
How Tiger Woods practices may be one of the most intriguing activities in all of sports. People are often advised that practice makes perfect. In other words, continue to practice, practice, practice, and you will get better. While theres no doubt that practice very often leads to improvement, its not practice that sets Woods apart; its perfect practice.
When Woods is on the driving range hitting balls, he is not just hitting balls for the sake of it. Instead, he hits every single ball with a specific target in mind. Woods will hit 500 balls a day with a specific target for each one.

The parallel for investors is constant discipline. Many investors incorrectly invest just for the sake of investing - without any discipline or specific target in mind. As a result, new investors have no idea how to navigate the course or manage risk. Investors often buy most of their stocks with the same expectations - that the stock price will go up - without giving any consideration to the existing competition, the quality of management and the level of difficulty of the current market layout.

What It Takes to Win
When the course is easy - in a bull market - every shot you take looks like a good one. It doesnt seem to matter what price you pay, the favorable landscape makes you look like an expert. However, the real danger lies in the fact that the longer this persist the greater the likelihood that you begin confusing your investment acumen with what is really going on: favorable conditions. This happened during the internet boom in the 1990s and the majority of people never had a chance to cash in on their spectacular gains. In fact, many actually lost lots of money when things came crashing down.

When the investing layout is hard, as it is during bear markets and recessions, its crucial to understand shooting par could likely be the long-term winner. As stock prices begin to rapidly rise, they often become riskier propositions, but most investors naively do not see it that way and continue to buy. Then when the course gets hard, the wrong lessons they learned on the easy course cost them dearly.

Invest with Purpose
Like Woods, investors should always invest with a specific target in mind. When stock prices rise dramatically without any regard for valuation, ignore the fact that some people may make superior returns over the next several months or year. Very often, the majority of those folks wont have the faintest idea when the goods times will end and all those profits will vanish.

Always invest with a specific target in mind. Be cautious when everyone is excited about buying stocks because that usually means paying a very rich price. Consider bonds, or high quality dividend paying stocks that usually dont attract as much excitement as the Amazons or Googles of the world. Sometimes shooting even par often produces the winning score.

Manage Your Expectations
Theres a saying that goes in order to finish first, you must first finish. There is tremendous wisdom in those words for investors. Success in investing is very often highly correlated to longevity. If you can navigate the market storms and not suffer catastrophic losses, then you are able to capitalize on the opportunities available when stocks prices are discounted. As is so often the case, many investments funds go out of businesses when the markets collapse, which is the absolute worst time to exit the game.

Tiger Woods does a brilliant job of managing his expectations. He doesnt go out on Thursday focusing on the leader board and trying to come out on top that day. Instead he plays his game against the course, fully aware that it is the person who remains consistent during the tournament who usually comes into Sundays round with the best chance to take home the trophy. Of course, during the course of play, Woods, like many investors, will often weigh the risk rewards of a difficult or low probability shot and make his decision based on the benefit gained.

Learn from the Best
Long-term success is not a result of luck. However, discipline and hard work often leads to opportunities that might not otherwise appear, and to outsiders this is often viewed as simple luck. Examine the approach of guys like Tiger Woods and Warren Buffett, learn from their successes and failures and youve already got a head start.

[Tellin_Fibs]

There are a wide variety of companies – spanning all major sectors and industries, with market capitalizations ranging from large cap to micro cap – quoted and traded in the OTC market.

[Black_NITE]

$FTCH BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/FTCH

[BoomPickens]

Once you have chosen a particular charting methodology, it is probably best to stick with it and learn how best to read the signals.

[GreenReeper]

Introduction To Investment Diversification
Diversification is a familiar term to most investors. In the most general sense, it can be summed up with this phrase: Dont put all of your eggs in one basket. While that sentiment certainly captures the essence of the issue, it provides little guidance on the practical implications of the role diversification plays in an investors portfolio and offers no insight into how a diversified portfolio is actually created. In this article, well provide an overview of diversification and give you some insight into how you can make it work to your advantage.



What Is Diversification?
Taking a closer look at the concept of diversification, the idea is to create a portfolio that includes multiple investments in order to reduce risk. Consider, for example, an investment that consists of only stock issued by a single company. If that companys stock suffers a serious downturn, your portfolio will sustain the full brunt of the decline. By splitting your investment between the stocks from two different companies, you can reduce the potential risk to your portfolio.

Another way to reduce the risk in your portfolio is to include bonds and cash. Because cash is generally used as a short-term reserve, most investors develop an asset allocation strategy for their portfolios based primarily on the use of stocks and bonds. It is never a bad idea to keep a portion of your invested assets in cash or short-term money-market securities. Cash can be used incase of an emergency, and short-term money-market securities can be liquidated instantly incase an investment opportunity arises, or in the event your usual cash requirements spike and you need to sell investments to make payments. Also, keep in mind that asset allocation and diversification are closely linked concepts; a diversified portfolio is created through the process of asset allocation. When creating a portfolio that contains both stocks and bonds, aggressive investors may lean towards a mix of 80% stocks and 20% bonds, while conservative investors may prefer a 20% stocks to 80% bonds mix.

Regardless of whether you are aggressive or conservative, the use of asset allocation to reduce risk through the selection of a balance of stocks and bonds for your portfolio is a more detailed description of how a diversified portfolio is created rather than the simplistic eggs in one basket concept. With this in mind, you will notice that mutual fund portfolios composed of a mix, which includes both stocks and bonds, are referred to as balanced portfolios. The specific balance of stocks and bonds in a given portfolio is designed to create a specific risk-reward ratio that offers the opportunity to achieve a certain rate of return on your investment in exchange for your willingness to accept a certain amount of risk. In general, the more risk you are willing to take, the greater the potential return on your investment.



What Are My Options?
If you are a person of limited means or if you simply prefer uncomplicated investment scenarios, you could choose a single balanced mutual fund and invest all of your assets in the fund. For most investors, this strategy is far too simplistic. While a given mix of investments may be appropriate for a childs college education fund, that mix may not be a good match for long-term goals, such as retirement or estate planning. Likewise, investors with large sums of money often require strategies designed to address more complex needs, such as minimizing capital gains taxes or generating reliable income streams. Furthermore, while investing in a single mutual fund provides diversification among the basic asset classes of stocks, bonds and cash (funds often hold a small amount of cash from which the fees are taken), the opportunities for diversification go far beyond these basic categories.


With stocks, investors can choose a specific style, such as focusing on large, mid or small caps. In each of these areas are stocks categorized as growth or value. Additional choices include domestic and foreign stocks. Foreign stocks also offer sub-categorizations that include both developed and emerging markets. Both foreign and domestic stocks are also available in specific sectors, such as biotechnology and healthcare.

In addition to the variety of equity investment choices, bonds also offer opportunities for diversification. Investors can choose long-term or short-term issues. They can also select high-yield or municipal bonds. Once again, risk tolerance and personal investment requirements will largely dictate investment selection.

While stocks and bonds represent the traditional tools for portfolio construction, a host of alternative investments provide the opportunity for further diversification. Real estate investment trusts, hedge funds, art and other investments provide the opportunity to invest in vehicles that do not necessarily move in tandem with the traditional financial markets. Yet these investments offer another method of portfolio diversification.



Concerns
With so many investments to choose from, it may seem like diversification is an easy objective to achieve, but that sentiment is only partially true. The need to make wise choices still applies to a diversified portfolio. Furthermore, it is possible to over-diversify your portfolio, which will negatively impact your returns. Many financial experts agree that 20 stocks is the optimal number for a diversified equity portfolio. With that in mind, buying 50 individual stocks or four large-cap mutual funds may do more harm than good. Having too many investments in your portfolio doesnt allow any of the investments to have much of an impact, and an over-diversified portfolio (sometimes called diworsification) often begins to behave like an index fund. In the case of holding a few large-cap mutual funds, multiple funds bring the additional risks of overlapping holdings as well as a variety of expenses, such as low balance fees and varying expense ratios, which could have been avoided through a more careful fund selection.
Tools
Investors have many tools to choose from when creating a portfolio. For those lacking time, money or interest in investing, mutual funds provide a convenient option; there is a fund for nearly every taste, style and asset allocation strategy. For those with an interest in individual securities, there are stocks and bonds to meet every need. Sometimes investors may even add rare coins, art, real estate and other off-the-beaten-track investments to their portfolios.

The Bottom Line
Regardless of your means or method, keep in mind that there is no generic diversification model that will meet the needs of every investor. Your personal time horizon, risk tolerance, investment goals, financial means and level of investment experience will play a large role in dictating your investment mix. Start by figuring out the mix of stocks, bonds and cash that will be required to meet your needs. From there, determine exactly which investments to use in completing the mix, substituting traditional assets for alternatives as needed. If you are too overwhelmed by the choices or simply prefer to delegate, there are plenty of financial services professionals available to assist you.

[Tellin_Fibs]

SEC filings are available on this website under a company's "Financials" tab and on the SEC's website. Some OTC-traded companies do not have filing or reporting requirements with the SEC. For a detailed explanation of registration and reporting requirements and the exemptions available from those requirements, please see the SEC's Small Business Question and Answer Page.

[Black_NITE]

Behold the $GDSI BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/GDSI

[BoomPickens]

As long as the stock trades within the boundaries set by the support and resistance zone, we will consider the trading range to be valid. Support may be looked upon as an opportunity to buy, and resistance as an opportunity to sell.

[Tellin_Fibs]

Once a broker-dealer receives an order, they often go through the following steps/decisions as part of the trading process.

[GreenReeper]

Market Problems? Blame Investors
Sure, the economy sometimes hits a slump, whether because of a war or unforeseen natural disaster. Of course, these things are beyond an investors control. But turbulence in the market can often be linked not to any perceivable event but rather to investor psychology. A fair amount of your portfolio losses can be traced back to your choices and the reasons for making them, rather than unseen forces of evil that we tend to blame when things go wrong. Here we look at some of the ways investors unwittingly inflict problems on the market.

Following the Crowd
Humans are prone to a herd mentality, conforming to the activities and direction of others. This is a common mistake in investing. Imagine you and a dozen other people are caught in a theater thats on fire. The room is filled with smoke and flames are licking the walls. The people best qualified to get you out safely, such as the building owner or an off-duty firefighter, shy away from taking the lead because they fear being wrong and they know the difficulties of leading a smoke-blinded group.

Then the take-charge person steps up and everyone is happy to follow the leader. This person is not qualified to lead you to the local 7-11, let alone get you out of an unfamiliar burning building, so, sadly, you are more likely to end up as ash than find your way out. This tendency to panic and depend on the direction of others is exactly why problems arise in the stock market, except we are often following the crowd into the burning building rather than trying to get out. Here are two actions caused by herd mentality:
• Panic Buying - This is the hot-tip syndrome, whose symptoms usually show up in buzzwords such as revolution, new economy, and paradigm shift. You see a stock rising and you want to hop on for the ride, but youre in such a rush that you skip your usual scrutiny of the companys records. After all, someone must have looked at them, right? Wrong. Holding something hot can sometimes burn your hands. The best course of action is to do your due diligence. If something sounds too good to be true, it probably is.
• Panic Selling - This is the end of the world syndrome. The market (or stock) starts taking a downturn and people act like its never happened before. Symptoms include a lot of blaming, swearing, and despairing. Regardless of the losses you take, you start to get out before the market wipes out whats left of your retirement fund. The only cure for this is a level head. If you did your due diligence, things will probably be OK, and a recovery will benefit you nicely. Tuck your arms and legs in and hide under a desk as people trample their way out of the market. (For more on this kind of behaviour, check out our Behavioral Finance Tutorial.)

We Cant Control Everything
Although it is a must, due diligence cannot save you from everything. Companies that become entangled in scandals or lie on their balance sheets can deceive even the most seasoned and prudent investor. For the most part, these companies are easy to spot in hindsight (Enron), but early rumors were subtle blips on the radar screens of vigilant investors. Even when a company is honest with an investor, a related scandal can weaken the share price. Omnimedia, for example, took a severe beating for Martha Stewarts alleged insider activities. So bear in mind that it is a market of risk. (For more on stock scandals, check out The Biggest Stock Scams Of All Time.)
Holding Out for a Rare Treat
Gamblers can always tell you how many times and how much theyve won, but never how many times or how badly theyve lost. This is the problem with relying on rewards that come from luck rather than skill: you can never predict when lucky gains will come, but when they do, its such a treat that it erases the stress (psychological, not financial) youve suffered.

Investors can fall prey to both the desire to have something to show for their time and the aversion to admitting they were wrong. Thus, some investors hold onto stock that is losing, praying for a reversal for their falling angels; other investors, settling for limited profit, sell stock that has great long-term potential. The more an investor loses, however, the larger the gain must be to meet expectations.

One of the big ironies of the investing world is that most investors are risk averse when chasing gains but become risk lovers when trying to avoid a loss (often making things much worse). If you are shifting your non-risk capital into high-risk investments, youre contradicting every rule of prudence to which the stock market ascribes and asking for further problems. You can lose money on commissions by overtrading and making even worse investments. Dont let your pride stop you from selling your losers and keeping your winners.

Xenophobia
People with this psychological disorder have an extreme fear of foreigners or strangers. Even though most people consider these fears irrational, investors engage in xenophobic behavior all the time. Some of us have an inborn desire for stability and the most seemingly stable things are those that are familiar to us and close to home (country or state).

The important thing about investing is not familiarity but value. If you look at a company that happens to look new or foreign but its balance sheet looks sound, you should not eliminate the stock as a possible investment. People constantly lament that its hard to find a truly undervaluedstock, but they dont look around for one; furthermore, when everyone thinks domestic companies are more stable and try to buy in, the stock market goes up to the point of being overvalued, which ironically assures people theyre making the right choice, possibly causing a bubble. Dont take this as a commandment to quit investing domestically; just remember to scrutinize a domestic company as closely as you would a foreign one. (For ideas on how to get involved with foreign stocks, check out Go International With Foreign Index Funds.)
Concluding with a Handy List
Some problems investors face are not isolated to the investing world. Lets look at the seven deadly sins of investing that often lead investors to blindly follow the herd:
1. Pride - This occurs when you are trying to save face by holding a bad investment instead of realizing your losses. Admit when you are wrong, cut your losses, and sell your losers. At the same time, admit when you are right and keep the winners rather than trying to over-trade your way up.
2. Lust – Lust in investing makes you chase a company for its body (stock price) instead of its personality (fundamentals). Lust is a definite no-no and a cause of bubbles and crazes.
3. Avarice – This is the act of selling dependable investments and putting that money into higher-yield, higher-risk investments. This is a good way to lose your shirt--the world is cold enough without having to face it naked.
4. Wrath – This is something that always happens after a loss. You blame the companies, brokerages, brokers, advisors, the CNBC news staff, the paperboy - everyone but yourself and all because you didnt do your due diligence. Instead of losing your cool, realize that you now know what you have to do next time.
5. Gluttony – A complete lack of self-control or balance, gluttony causes you to put all your eggs in one basket, possibly an over-hyped basket that doesnt deserve your eggs (Enron, anyone?). Remember balance and diversification are essential to a portfolio. Too much of anything is exactly that: TOO MUCH!
6. Sloth – You guessed it, this means being lazy and not doing your due diligence. On the flip side, a little sloth can be OK as long as its in the context of portfolio activity. Passive investors can profit with less effort and risk than over-active investors.
7. Envy – Coveting the portfolios of successful investors and resenting them for it can eat you up. Rather than cursing successful investors, why not try to learn from them? There are worse people to emulate than Warren Buffett. Try reading a book or two: knowledge rarely harms the holder.

Conclusion
Humans are prone to herd mentality, but if you can recognize what the herd is doing and examine it rationally, you will be less likely to follow the stampede when its headed in an unprofitable direction.

[Black_NITE]

NITE-LYNX $GELV BarChart Technical Analysis
http://www.barchart.com/technicals/stocks/GELV

[BoomPickens]

No matter how much price movement, each day or week represented is one point, bar, or candlestick along the time scale. Even if the price is unchanged from day to day or week to week, a dot, bar, or candlestick is plotted to mark the price action.

[Tellin_Fibs]

Do not sign the new account agreement unless you thoroughly understand it and agree with the terms and conditions it imposes on you. Do not rely on statements about your account that are not in this agreement.

[GreenReeper]

Callable CDs: Check The Fine Print
If youre looking for bigger yields with limited risk, callable certificates of deposit (CD ) might be right for you. They promise higher returns than regular CDs and are FDIC insured. However, there are a few things in the fine print that you should be aware of before you turn your money over to the bank or brokerage firm, otherwise, you could end up very disappointed.

Just like a regular CD, a callable CD is a certificate of deposit that pays a fixed interest rate over its lifetime. The feature that differentiates a callable CD from a traditional CD is that the issuer owns a call option on the CD and can redeem, or call, your CD from you for the full amount before it matures. In this article, we will provide you with some important terms to watch for in the fine print of your callable CDs , should you decide to invest.

Important Terms
Callable CDs are similar in many ways to callable bonds.

Callable Date
This is the date that the issuer can call your certificate of deposit . Lets say, for example, that the call date is six months. This means that six months after you buy the CD, the bank can decide whether it wants to take back your CD and return your money with interest. Every six months after the call date, the bank will have that same option again. Well get to why the bank would want to call back the certificate shortly.

Maturity Date
The maturity date is how long the issuer can keep your money. The farther in the future the maturity date, the higher the interest rate you should expect to receive. Make sure you dont confuse maturity date with the call date. For instance, a two-year callable CD does not necessarily mature in two years. The two years refers to the period of time you have before the bank can call the CD away from you. The actual amount of time you must commit your money could be much longer. Its common to find callable CDs with maturities in the range of 15 to 20 years.

To Call, or Not to Call
A change in prevailing interest rates is the main reason the bank or brokerage firm will recall your CD on the callable date. Basically, the bank will ask itself if its getting the best deal possible based on the current interest rate environment. (To learn how interest rate changes affect other investments , see How Interest Rates Affect The Stock Market and Its In Your Interest.)

Interest Rates Decline
If interest rates fall, the issuer might be able to borrow money for less than its paying you. This means the bank will likely call back the CD and force you to find a new vehicle to invest your money in.
Example - Callable CD When Rates Decline

Suppose you have a $10,000 one-year callable CD that pays 5% with a five-year maturity. As the one-year call date approaches, prevailing interest rates drop to 4%. The bank has therefore dropped its rates too, and is only paying 4% on its newly issued one-year callable CDs.

Why should I pay you 5%, when I can borrow the same $10,000 for 4%?, your banker is going ask. Heres your principal back plus any interest we owe you. Thank you very much for your business.

The good news is that you got a higher CD rate for one year. But what do you do with the $10,000 now? Youve run into the problem of reinvestment risk.

Perhaps you were counting on the $500 per year interest ($10,000 x 5% = $500) to help pay for your annual vacation. Now youre stuck with just $400 ($10,000 x 4% = $400) if you buy another one-year callable CD. Your other choice is to try to find a place to put your money that pays 5% such as by purchasing a corporate bond - but that might involve more risk than you wanted for this $10,000 . (For more on the risks of these bonds, see Corporate Bonds: An Introduction To Credit Risk.)


Interest Rates Rise
If prevailing interest rates increase, your bank probably wont call your CD. Why would it? It would cost more to borrow elsewhere.
Example - Callable CD When Rates Rise

Lets look at your $10,000 one-year callable CD again. Its paying you 5%. This time, assume that prevailing rates have jumped to 6% by the time the callable date hits. Youll continue to get your $500 per year, even though newly issued callable CDs earn more. But what if youd like to get your money out and reinvest at the new, higher rates?

Sorry, your banker says, only we can decide if youll get your money early.

Unlike the bank, you cant call the CD and get your principal back - at least not without penalties called early surrender charges. As a result, youre stuck with the lower rate. If rates continue to climb while you own the callable CD, the bank will probably keep your money until the CD matures.

What to Watch For
Whos Selling
Anyone can be a deposit broker to sell CDs. There are no licensing or certification requirements. This means you should always check with your states securities regulator to see whether your broker or your brokers company has any history of complaints or fraud.

Early Withdrawal
If you want to get your money before the maturity date, there is a possibility youll run into surrender charges. These fees cover the maintenance costs of the CD and are put in place to discourage you from trying to withdraw your money early. You wont always have to pay these fees; if you have held the certificate for a long enough period of time these fees will often be waived.
Check the Issuer
Each bank or thrift institution depositor is limited to $100,000 in FDIC insurance. There is a potential problem if your broker invests your CD money with an institution where you have other FDIC insured accounts. If the total is more than $100,000, you run the risk of exceeding your FDIC coverage. (To learn more, read Are Your Bank Deposits Insured?)

Wrap Up: Callable or Non-Callable?
With all of the extra hassle they involve, why would you bother to purchase a callable CD rather than a non-callable one? Ultimately, callable CDs shift the interest-rate risk to you, the investor. Because youre taking on this risk, youll tend to receive a higher return than youd find with a traditional CD with a similar maturity date.

Before you invest, you should compare the rates of the two products. Then, think about which direction you think interest rates are headed in the future. If you have concerns about reinvestment risk and prefer simplicity, callable CDs probably arent for you.
Use this checklist when you are shopping for callable CDs to help you keep track of the important information.
Callable CD Checklist
Traditional CD Callable CD #1 Callable CD #2
Callable Date N/A
Maturity Date
Seller Background
Surrender Fee
Issuer
Interest Rate

[Black_NITE]

$GEGP BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/GEGP

[BoomPickens]

In an efficient market, deviations above and below fair value are possible, but these deviations are considered to be random.

[Tellin_Fibs]

Investors in the OTC market vary in their knowledge and experience from large institutional money managers to retail investors. The goal of all of these investors is the same – to generate returns from their investment. OTC Markets Group facilitates information transparency in the OTC market by aggregating and disseminating real-time broker-dealer quote information and operating the platform for companies to provide financial and other corporate disclosure for investors.

[GreenReeper]

Investing Basics: Flight To Quality
Investing in stocks comes with the prospect of earning big returns, but it can also carry some considerable risks. At times of financial market stress, investors will often flee from risky assets and into investments that are perceived as very safe. Investors will act as a herd and try to rid themselves of any risk in what is termed a flight to quality. Whether or not an investor takes part in the flight, it is important to understand the concept, its indicators and its implications for the market.

What is a flight to quality?
A flight to quality occurs when investors rush to less risky, more liquid investments. Cash and cash equivalents, such as Treasury bills and notes, are key examples of the high-quality assets investors will seek. Investors try to allocate capital away from assets with any perceived risk into the safest possible instruments they can find. Investors usually tend to do this en masse and the effects on the market can be quite drastic. (Knowing what the market is thinking is the best way to determine what it will do next. Read Gauging Major Turns With Psychology.)
The Causes
The causes for a flight to quality are usually quite similar, and normally follow or are concurrent with some level of distress in the financial markets. Fear in the market generally leads investors to question their risk exposure and whether asset prices are justified by their risk/reward profiles.

While every market has its own intricacies, most upswings and downturns are somewhat similar: a sharp downturn follows what, in retrospect, were unjustifiable asset prices. A lot of the time the asset prices were unjustified because many risk factors such as credit problems were being ignored. Investors question the health of companies they are invested in and may decide to take profits from their riskier investments , or even sell at losses in order to move into lower-risk alternatives. Unfortunately, most investors dont get out at the early stage. Many join the flight to quality after things start to turn sour and leave themselves open to even bigger losses. (The option to bolster after-tax stock returns through tax-loss harvesting can reverse investor gloom. Check out Tax-Loss Harvesting For An Unsteady Market.)

Once major issues in the market come to light, the bubble begins to burst and panic occurs in the market as participants reprice risk. Sharp declines in asset prices add to the panic, and force people to flee toward very low-risk assets where they feel their principal is safe, without regard for potential return. A flight to quality is often a pretty abrupt shift for financial markets; as a result, indicators such as fear and shrinking yields on quality assets arent noticed until the flight has already begun.

Negative T-Bill Yield
An extreme example of a flight to quality occurred during the 2008 credit crisis. U.S. T-bills are perceived as some of the highest quality, lowest risk assets. The U.S. government is considered to have no default risk, meaning that Treasuries of any maturity have no risk of principal loss. T-bills are also issued with maturities of 90 days, so the short-term nature makes interest rate risk minimal, and, if held to maturity, non-existent.
T-bill interest rates are largely dependent on the federal funds target rate. When the Federal Reserve consistently lowered rates during 2008, eventually setting the federal funds target rate at a range of 0-0.25% on December 16, 2008, T-bills were certain to follow the trend and return next to nothing to their owners. (For more on T-bills, see the Money Market Tutorial.)

But, could they actually return less than nothing? As the flight to quality drove institutions to shed any sort of risk, the demand for T-bills quickly outpaced supply, even as the Fed was quick to create new supply. After taking a bloodbath in nearly every asset class available, institutions tried to close their books with only the highest, most conservative assets (aka T-bills) on their balance sheets. (Learn about the components of the statement of financial position and how they relate to each other in Reading The Balance Sheet.)

The flood of demand for T-bills, which were already trading at near-zero yields , caused the yield to actually turn negative. On December 9, 2008, investors bought T-bills yielding -0.01%, guaranteeing that they would receive less money three months later. Why would any institution accept that? The main reason is safety. If an institution bought $1 million worth of T-bills at the -0.01% rate, three months later their loss would about to about $25. (For more on what happened, see Why Money Market Funds Break The Buck.)

In a time of market panic and flight to quality, investors will take that very small nominal loss in exchange for the safety of not being exposed to the larger potential losses of other assets. Negative T-bill yields are not characteristic of every time the market experiences a flight to quality, but an extreme case of where demand forces down the yields of high-quality assets. (Learn more in The Fall Of The Market In The Fall Of 2008.)

Dont Panic
A flight to quality is logical to a certain point as investors reprice market risk, but can also have many adverse consequences. First, it can help exacerbate a market downturn. As investors grow fearful of stocks that have experienced sharp declines, they are more inclined to dump them, which helps worsen the decline. Investors suffer again as their fear will prevent the buying of risky assets, which after the declines may be very attractive. The best thing for an investor to keep in mind is to not panic and be the last person selling their stocks and moving into cash when stocks are likely hitting lows.
The consequences read through to businesses also, and can affect the health of the economy, possibly prolonging a downturn or recession. During and following a market crash and flight to quality, businesses may grasp cash similar to investors. This low-risk, fear-driven strategy may prevent businesses from investing in new technologies, machines, and other projects that would help the economy.

Conclusion
Just like with bubbles and crashes, a flight to quality of some degree during a market cycle is pretty much inevitable, and impossible to prevent. As investors become jaded with the risky assets, they will seek out one thing and one thing only: safety.

Is there a way to profit from a flight to quality? Not unless you can predict what everyone else will do and do the opposite. Even then, you need to time it perfectly to avoid being trampled by the herd. It may be hard, but dont panic.

[Black_NITE]

Feast thine eyes upon $CLHRF BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/CLHRF

[BoomPickens]

Even though many principles of technical analysis are universal, each security will have its own idiosyncrasies.
Conclusions

[Tellin_Fibs]

FINRA requires member firms to ascertain the best market to execute their customer orders. OTC Link and the OTCBB are the two recognized inter-dealer quotation systems in the OTC market that can be relied upon for electronic best execution if there are two priced quotes. If fewer than two quotations are displayed on an inter-dealer quotation system that permits quotation updates on a real-time basis, FINRA members must contact at least three dealers by phone to obtain other quotations.

[GreenReeper]

Understanding Stock Splits
Say you had a $100 bill and someone offered you two $50 bills for it. Would you take the offer? This might sound like a pointless question, but the action of a stock split puts you in a similar position. In this article we will explore what a stock split is, why its done and what it means to the investor.

What Is a Stock Split?
A stock split is a corporate action that increases the number of the corporations outstanding shares by dividing each share, which in turn diminishes its price. The stocks market capitalization, however, remains the same, just like the value of the $100 bill does not change if it is exchanged for two $50s. For example, with a 2-for-1 stock split, each stockholder receives an additional share for each share held, but the value of each share is reduced by half: two shares now equal the original value of one share before the split.

Lets say stock A is trading at $40 and has 10 million shares issued, which gives it a market capitalization of $400 million ($40 x 10 million shares). The company then decides to implement a 2-for-1 stock split. For each share shareholders currently own, they receive one share, deposited directly into their brokerage account . They now have two shares for each one previously held, but the price of the stock is split by 50%, from $40 to $20. Notice that the market capitalization stays the same - it has doubled the amount of stocks outstanding to 20 million while simultaneously reducing the stock price by 50% to $20 for a capitalization of $400 million. The true value of the company hasnt changed one bit.
The most common stock splits are, 2-for-1, 3-for-2 and 3-for-1. An easy way to determine the new stock price is to divide the previous stock price by the split ratio. In the case of our example, divide $40 by 2 and we get the new trading price of $20. If a stock were to split 3-for-2, wed do the same thing: 40/(3/2) = 40/1.5 = $26.6.

It is also possible to have a reverse stock split: a 1-for-10 means that for every ten shares you own, you get one share. Below we illustrate exactly what happens with the most popular splits in regards to number of shares, share price and market cap of the company splitting its shares.


Whats the Point of a Stock Split?
So, if the value of the stock doesnt change, what motivates a company to split its stock? Good question. There are several reasons companies consider carrying out this corporate action.

The first reason is psychology. As the price of a stock gets higher and higher, some investors may feel the price is too high for them to buy, or small investors may feel it is unaffordable. Splitting the stock brings the share price down to a more attractive level. The effect here is purely psychological. The actual value of the stock doesnt change one bit, but the lower stock price may affect the way the stock is perceived and therefore entice new investors. Splitting the stock also gives existing shareholders the feeling that they suddenly have more shares than they did before, and of course, if the prices rises, they have more stock to trade.

Another reason, and arguably a more logical one, for splitting a stock is to increase a stocks liquidity, which increases with the stocks number of outstanding shares. You see, when stocks get into the hundreds of dollars per share, very large bid/ask spreads can result (see Why the Bid/Ask Spread Is So Important.). A perfect example is Warren Buffetts Berkshire Hathaway, which has never had a stock split. At times, Berkshire stock has traded at nearly $100,000 and its bid/ask spread can often be over $1,000. By splitting shares a lower bid/ask spread is often achieved, thereby increasing liquidity.
None of these reasons or potential effects that weve mentioned agree with financial theory, however. If you ask a finance professor, he or she will likely tell you that splits are totally irrelevant - yet companies still do it. Splits are a good demonstration of how the actions of companies and the behaviors of investors do not always fall into line with financial theory. This very fact has opened up a wide and relatively new area of financial study called behavioral finance (see Taking A Chance On Behavorial Finance.).

Advantages for Investors
There are plenty of arguments over whether a stock split is an advantage or disadvantage to investors. One side says a stock split is a good buying indicator, signaling that the companys share price is increasing and therefore doing very well. This may be true, but on the other hand, you cant get around the fact that a stock split has no affect on the fundamental value of the stock and therefore poses no real advantage to investors. Despite this fact the investment newsletter business has taken note of the often positive sentiment surrounding a stock split. There are entire publications devoted to tracking stocks that split and attempting to profit from the bullish nature of the splits. Critics would say that this strategy is by no means a time-tested one and questionably successful at best.

Factoring in Commissions
Historically, buying before the split was a good strategy because of commissions that were weighted by the number of shares you bought. It was advantageous only because it saved you money on commissions. This isnt such an advantage today because most brokers offer a flat fee for commissions, so you pay the same amount whether you buy 10 shares or 1,000 shares. Some online brokers have a limit of 2,000 or 5,000 shares for that flat rate, but most investors dont buy that many shares at once. The flat rate therefore covers most trades, so it does not matter if you buy pre-split or post-split.

Conclusion
The most important thing to know about stock splits is that there is no effect on the worth (as measured by market capitalization) of the company. A stock split should not be the deciding factor that entices you into buying a stock. While there are some psychological reasons why companies will split their stock, the split doesnt change any of the business fundamentals. In the end, whether you have two $50 bills or one $100 bill, you have the same amount in the bank.

[BoomPickens]

A complete financial model can be built to forecast future revenues, expenses and profits or an investor can rely on the forecast of other analysts and apply various multiples to arrive at a valuation. Some of the more popular ratios are found by dividing the stock price by a key value driver.

Ratio

Price/Book Value
Price/Earnings
Price/Earnings/Growth
Price/Sales
Price/Subscribers
Price/Lines
Price/Page views
Price/Promises Company Type

Oil
Retail
Networking
B2B
ISP or cable company
Telecom
Web site Biotech

[Black_NITE]

For thou convenience $MXDHF BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/MXDHF

[Tellin_Fibs]

The OTC market provides an alternative to stock exchange listing for securities of issuers that either choose not to be listed on a U.S. stock exchange or do not meet the relevant listing requirements. The term ‘OTC security’ is a catch–all phrase for any security that is not listed on a U.S. stock exchange.

[GreenReeper]

5 Reasons To Fear The Stock Market

Even for those who know nothing about investing, theyve heard of the stock market. Each night on the evening news telecasts, the level of the Dow Jones Industrial Average is reported. When there is a significant market move up or down, its often a front page story. This allows for the stock market to hold a kind of celebrity status in many peoples minds. However, for those looking to put some of their hard earned money to work, is the stock market a place to make money or is it a financial wolf in sheeps clothing?



1. The Market Is Rigged
If youre avoiding the stock market because youve heard that its rigged, that is debatable. When we hear stories of Bernard Madoff and the many other cases of insider trading scandals, its easy to believe that the market is made up of greedy people willing to break the law to make a few bucks - that theyre making the money by taking yours.

Barry Ritholtz is a well-known financial blogger who was interviewed by Yahoo Finance recently on this subject. He said that although insider trading certainly takes place, the bulk of the information that may be considered inside or privileged information is nothing more than rumor that is often untrue. Because of that, professional money managers conduct their own research and ignore the rumors. Ritholtz goes on to say that where the individual investor is at a disadvantage is that they lack the tools or manpower to sift through the huge volume of information publicly available. The market certainly has people who are breaking the law, but the pros are just as vulnerable as the little players. (Many would-be, first-time investors in the stock market do not believe it is a fair playing field. Check out Is The Stock Market Rigged?)

2. Computers Run the Show
This is true. Current statistics show that computers are responsible for 70% of all trading volume in the world markets. Millions of stock trades are taking place each second and those computers arent evaluating stocks using the typical screening criteria that is publicly available to the average investor. Proprietary computer programs are often not even fully understood by the people using them. While the retail investor might be evaluating the quality of the management at the company, a computer may be evaluating the mathematics of the price history of the stock.

If computers are controlling 70% of the price action of the stock, how is an individual supposed to forecast the direction of a stock? The modern part-time investor may be best served by long term investing that allows for the characteristics of the company to play more heavily in to the equation.

3. Its too Tough for the Average Investor
This may be cause for fear unless you ask former hedge fund manager and CNBC commentator Jim Cramer. As stated in his book, Real Money, Cramer believes that the retail or part time investor can make money in the stock market by following a set of rules. Among them, conducting at least one hour per week of research for every stock owned. Of his 25 investing rules, others include diversifying your portfolio and buying stocks that are undervalued but not purchasing stocks of damaged companies.

His contention is that many retail investors lose money not because the stock market is too difficult but because part-time investors dont have the time or may not be willing to put in the time needed to make informed decisions in a complicated market.

4. The Economy Is Bad
One of the real reasons to fear the stock market could very well be the economy. The Federal Reserve reports that for every 20% drop in the stock market, gross domestic product is reduced by 1.25% after one year. However, as any seasoned investor knows, the stock market rarely represents in real time the state of the current economy. When the economy is questionable, the stock market tends to be the same way. Investors may see a quick rise in prices presenting a false sense of security only to see it violently drop in value in a short time.
Which penny stocks will rise? Well tell you, free!
A struggling economy is definitely cause for fear of the stock market, and some would recommend new investors wait until some stability in the market and the overall economy is seen. The problem is that finding stability in the stock market may take a long time.

5. It Has Gone Up Fast
Since the 2009 lows, the stock market has risen more than 70%. For many, thats a recipe for disaster. If anything is a cause for fear, this may be it. On one hand, markets that move up fast tend to fall fast - with a market that has been in bull mode for the past year, that should scare any investor.

Others will argue that the market is up drastically because the Great Recession caused it to drop just as violently, which makes the recent uptrend a move towards fair value. So which of these opposing views does the part time retail investor believe? Do they have enough experience and expertise to make an informed choice? Unfortunately, there is no easy answer. (For additional reading, see The Rise And Fall Of The Shadow Banking System.)

The Bottom Line
When investing, the stock market is definitely cause for concern but sometimes a little bit of fear is healthy. Avoiding putting your money to work because of fear probably isnt the best course of action either. If you dont feel that you have the necessary knowledge, get help. Find an independent, fee based financial advisor in your area to help you make a reasonable return while teaching you about the ins and outs of the market.

[BoomPickens]

When stocks move, they usually move as groups; there are very few lone guns out there. Many times it is more important to be in the right industry than in the right stock!

[Black_NITE]

BarChart Technical Analysis NITE-LYNX $IRCE
http://www.barchart.com/technicals/stocks/IRCE

[Tellin_Fibs]

The Caveat Emptor symbol is displayed in place of the OTC marketplace identifier on all OTC Markets’ platforms and is distributed on market data feeds. The symbol is displayed wherever OTC Markets’ quote data is available. It is used by investors, broker-dealers, clearing firms and other industry participants when they make trading decisions.

[GreenReeper]

Will Corporate Debt Drag Your Stock Down?
When you invest in a company, you need to look at many different financial records to see if it is a worthwhile investment. But what does it mean to you if, after doing all your research, you invest in a company and then it decides to borrow money? Here we take a look at how you can evaluate whether the debt will affect your investment.

How Do Companies Borrow Money?
Before we can begin, we need to discuss the different types of debt that a company can take on. There are two main methods by which a company can borrow money :
1. by issuing fixed-income (debt) securities - like bonds, notes, bills and corporate papers
2. by taking out a loan at a bank or lending institution.
• Fixed-Income Securities
Debt securities issued by the company are purchased by investors. When you buy any type of fixed-income security, you are in essence lending money to a business or government. When issuing these securities, the company must pay underwriting fees. However, debt securities allow the company to raise more money and to borrow for longer durations than loans typically allow.
• Loans
Borrowing from a private entity means going to a bank for a loan or a line of credit. Companies will commonly have open lines of credit from which they may draw in order to meet their cash requirements of day-to-day activities. The loan a company borrows from an institution may be used to pay for the company payrolls, buy inventories and new equipment, or to keep as a safety net. For the most part, loans require repayment in a shorter time period than most fixed income securities .

What to Look for
There are a few obvious things that an investor should look for when whether deciding to continue his or her investment in a company that is taking on new debt. Here are some questions you can ask yourself:

How much debt does the company currently have?
If a company has absolutely no debt, then taking on some debt may be beneficial because it can give the company more opportunity to reinvest resources into its operations. However, if the company in question already has a substantial amount of debt, you might want to think twice. Generally, too much debt is a bad thing for companies and shareholders because it inhibits a companys ability to create a surplus in cash. Furthermore, high debt levels may negatively affect common stockholders, who are last in line for claiming payback from a company that becomes insolvent.
What kind of debt is the company trying to take on?
Loans and fixed-income securities that a company issues differ dramatically in their maturity dates. Some loans must be repaid within a few days of issue while others dont need to be paid for a several years. Typically, debt securities issued to the public (investors ) will have longer maturities than the loans offered by private institutions (banks). Large short-term loans may be harder for companies to repay, but long-term fixed-income securities with high interest rates may not be easier on the company. Try to determine if the length and interest rate of the debt is suitable for financing the project that the company wishes to undertake.

What is the debt for?
Is the debt a company is taking on meant to repay or refinance old debts, or is it for new projects that have the potential to increase revenues? Typically, you should think twice before purchasing stock in companies that have repeatedly refinanced their existing debt, which indicates an inability to meet financial obligations. A company that must consistently refinance may be doing so because it is spending more than it is making (expenses are exceeding revenues), which obviously is bad for investors. One thing to note, however, is that it is a good idea for companies to refinance their debt to lower their interest rates. However, this type of refinancing, which aims to reduce the debt burden, shouldnt affect the debt load and isnt considered new debt.
Can the company afford the debt?
Most companies will be sure of their ideas before committing money to them; however, not all companies succeed in making the ideas work. It is important you determine whether the company can still make its payments if it gets into trouble or its projects fail. You should look to see if thecompanys cash flows are sufficient enough to meet its debt obligations. And do make sure the company has diversified its prospects. (For more on how to analyze corporate debt and refinancing, read Debt Reckoning.)

Are there any special provisions that may force immediate pay back?
When looking at a companys debt, look to see if there are any loan provisions that may be detrimental to the company if the provision is enacted. For example, some banks require minimum financial ratio levels, so if any of the stated ratios of the company drop below a predetermined level, the bank has the right to call (or demand repayment) of the loan. Being forced to repay the loan unexpectedly can magnify any problem within the company and sometimes even force it into a liquidation state.

How does the companys new debt compare to its industry?
There are many different fundamental analysis ratios that may help you along the way. The following ratios are a good way to compare companies within the same industry.
• Quick Ratio (Acid Test) - This ratio tells investors approximately how capable the company is of paying off all of its short-term debt without having to sell any inventory.
• Current Ratio - This ratio indicates the amount of short-term assets versus short-term liabilities. The greater the short-term assets compared to liabilities, the better off the company is in paying off its short-term debts.
• Debt-to-Equity Ratio - This measures a companys financial leverage calculated by dividing long-term debt by shareholders equity. It indicates what proportions of equity and debt the company is using to finance its assets.

Conclusion
A company increasing its debt load should have a plan for repaying it. When you have to evaluate a companys debt, try to ensure that the company knows how the debt affects investors, how the debt will be repaid and how long it will take to do so.

[BoomPickens]

Can a profit be made? For an established business, the questions may be: Is the company's direction clearly defined? Is the company a leader in the market? Can the company maintain leadership?

[Black_NITE]

This link will help thou $MTLI BarChart Technical Analysis NITE-LYNX
http://www.barchart.com/technicals/stocks/MTLI

[Tellin_Fibs]

Companies create and sell securities in the market to raise capital, complete an acquisition and/or allow selling shareholders to exit their investments.

[GreenReeper]

Is Your Portfolio Overweight?
Over time, the makeup of your portfolio changes as various sectors and stocks perform better or worse than the market. Your original well-planned portfolio allocation evolves to one where the best performing stocks or ETFs become a more heavily-weighted part of your portfolio. Then the stocks that have underperformed make up less of the total allocation of your portfolio. This is a very unappealing - and unhealthy - shape for a portfolio to be in and it signals that its time to make some adjustments.

Get On the Scale
As time passes, it will become necessary for investors to re-examine their portfolios allocation. Being overweight in some sectors may not be the best strategy going forward. Stocks do not increase in value at the same rate. One asset category might appreciate more, causing an imbalance in your original allocation. In a 2000 study by Ibbotson and Kaplan, asset allocation was found to explain 93.6% of the variability of an assets performance. Placing your assets in the right sector leads to overweighting that sector in your portfolio.

Over time, one sector will become the leader and another will lag. For example, during the height of the dotcom boom, technology returned 66.69%, while consumer staples lost 14.49%. In this case, your portfolio would have been overweight in the technology sector. In 2000, as the dotcom boom ended, consumer staples delivered a 26.04% return and technology lost 42.04%. If you adjusted the weight of technology and increased the weight of consumer staples, your portfolio would have thanked you. Adjusting your portfolio to reduce its overweight condition usually leads to success. (Learn more about the dotcom boom and bust in our Market Crashes Tutorial.)

So how can you tell if your portfolio is out of balance? The best place to begin is with your original assessment of the market that led you to form your current portfolio allocation . Some questions to ask are:
• What has changed since your evaluation of the economy, the business cycle and the market? If your assessment has changed, then the weighting of your portfolio needs to change.
• What is the current level of risk in your portfolio and how has it changed since your last assessment? If the risk has increased beyond your comfort level, it is time to adjust your allocation to bring your risk back to levels that are more normal. Often when a sector has risen dramatically, it increases the risk that you might lose much or all of what you have gained. Reducing this overweight condition by selling part of these securities can help to lower the risk in the portfolio.
• Has the splendid performance of one or more stocks caused your portfolio to be less diversified, increasing its dependence on the performance of a few stocks? Diversification is a way to spread the risk across asset classes. As your portfolio over weighs toward one or a few stocks, your first-rate diversification has fallen off. (Find out how to find the right balance of diversification in Introduction To Diversification.)
If answering any of these questions leads you to conclude your portfolio is overweight, it is time to reallocate by selling some of the shares of the securities that have performed well and putting that money to work in stocks or ETFs that have the best potential to outperform in the future.
When to Make an Adjustment
An overweight portfolio requires you to address underperforming stocks or ETFs as well as those that are your best performers. Stocks and ETFs do not grow at the same rate. One asset category might appreciate more causing an imbalance from your original allocation.

When you make an adjustment, recognize that you will be dealing with underperforming stocks or ETFs as well as your best performing stocks or ETFs.

For your underperforming stocks or ETFs, the following are some of the questions you should ask:
• Are there problems with the company missing its earnings or revenue expectations?
• Are there changes in management that raise concern?
• Is the sector likely to continue to perform poorly over the next year?
For your better performing stocks or ETFs, here are some of the questions you should ask:
• Has the stock or ETF performed as expected?
• Has the growth in revenues and earnings slowed or are the prospects for growth still in place?
• How does the stock compare to its peers in terms of growth in revenues, margin, free cash flow and profit?
• Will the sector continue to outperform over the next year or is another sector about to take over? Buying in a bad year can lead to better performance in the next year. Selling after a good year captures profit should the sector have a bad year. It is a good strategy to capture some of your profits by selling your best performing shares.
Most successful long-term investors review their portfolios on a regular basis. While you do not have to make changes every quarter, it is a good idea to reassess your original assumptions and analysis. Moreover, evaluate the risk of a reversal in the course of the market. You goal is to avoid incurring unexpected losses and confirm your current allocation reflects your view of the market.

When to Stay the Course
So far, we have discussed when to make adjustments in your portfolio as the weighting of the stocks or ETFs changes. However, sometimes it is best to stay the course.
During your assessment of your best performing stocks or ETFs, you continue to believe they represent the best opportunities going forward. Often the underlying trend lasts for several years. In this case, should the trend continue, you and your portfolio will continue to benefit from the current overweighting.

Maybe your portfolio is weighted to sectors , funds or stocks that have underperformed. In this case, you might be properly positioned for a rebound. After all, you could have been early. In this case, it makes sense to stay the course or even add to your underperforming segments.

The tax man always has a say on when you can make changes in your portfolio. Capital gains on stocks or funds held for one year or less receive regular income tax treatment, whereas, securities held for more than one year receive more favorable tax treatment. While you should not make a decision to hold or sell a security only for tax reasons, it is one of the factors to consider.
The Bottom Line
A portfolio that is overweight in a sector, fund or stock should cause you to assess whether you should rebalance your portfolio. Simple allocation steps can help you to decide if you should rebalance or stay the course. Being proactive in your assessment will help to keep your portfolio properly aligned with the market, and is a lot better than sitting back and hoping everything will work out.

[BoomPickens]

Because charts provide an easy-to-read graphical representation of a security's price movement over a specific period of time, they can also be of great benefit to fundamental analysts.