A beginner usually feels very attracted to the stock market while for example discovering a stock that’s being reported in CNBC or the news program and watching it rise fast and make new highs from $10 to $35 in just 2 months.

While learning about this successful news story he’s saying to himself … ” Oh boy if I was one of those lucky guys who bought that stock back when it was priced at $10 i easily would have tripled my money by now … That means my 20 grand would transformed in to a whooping 70 K ! hassle free … I would have been able to grab one of those big HUMMERs on the spot and probably pick up a nice Rolex by the way !

The stock market news constantly reports of hot stocks that are breaking out and making tremendous gains on the same day or doubling in price in just a few hours. Back in the bull market of the late 90’s you could easily see a good number of hot stocks sprouting out every week.

Those years surely made it look like every body could easily take LONG SHOTS and make a shiny pile of gold every day in the stock market. But today’s market is a different story. A totally different animal.

Some say that the stock market has gotten more realistic. Fantasy land is over and GAMBLING YOUR WAY TO RICHES is not an option anymore. You might get lucky a few times, but your constant loses can wipe you out sooner or later.

The fact that the bull market period has ended for now doesn’t mean that you can’t make a great deal of money in today’s market. A lot folks from many walks of life keep making excellent profits on a daily basis, pocketing hundreds & thousands of dollars by trading stocks online.

Success in stock trading & investing starts by applying a wiser and REALISTIC methodology for choosing stocks as well as for getting in and out of them with profits in mind.

You need to look at the stock market more realistically. You got to learn that you can benefit when stocks go up and also when they FALL down. You got to WORK SMARTER and get more selective about the hot stock trading opportunities that you choose. You need to embrace the nature of day trading and be fully prepared to take advantage of stocks that are poised for a BIG RISE on the same day.

I think the worst thing that can happen to a beginner stock trader is to get information overload. It’s better to go step by step, and test a simple strategy that can show you how to focus on concrete ways to make money.

For more information on how to choose and approach stocks that can make big gains on the same day visit Chat Hot Stocks today at http://www.ChatHotStocks.com

In the end, stock market investing & trading is all about buying and selling according to your knowledge filter. Once you master and follow youre proven filter parameters like a clock, you can expect to start making serious amounts of cash on a consistent basis.

About the Author

Chat Hot Stocks helps day traders and investors pick hot stock trading opportunities every day at http://www.ChatHotStocks.com

It’s been said that nothing is certain except for death and taxes, but there are likely many people who feel that the fluctuations of the stock market should be added to the list. It is nearly impossible to find a stock or other investment that doesn’t fall in value at one point or another while you own it… some even make a regular habit of it.

In order to get the most out of your investment experience, it’s important to recognize patterns in the performance of certain stocks so that you can get a better feel for how long their occasional fluctuations might last and help you to decide whether or not you should sell the stock or see it through until prices rise again.

Defining Cyclical Stocks

Cyclical stocks, as the name might imply, are stocks that periodically fall in value and then rise again soon after. The apparent cycle of gain and loss can be caused by several different situations, from economic trends and seasonal products to the stocks being issued by companies that do the majority of their business during certain parts of the year such as holidays or tax preparation season. In most cases these stocks don’t suffer a major loss over the course of the cycle, due largely to the recovery that occurs later in the cycle.

Some cyclical stocks perform these actions in reverse, as well… instead of falling in value, they increase the value of their shares for a time and then the prices return to their normal state.

The Fluctuations of Cyclical Stocks

Of course, the fluctuations of cyclical stocks tend to make some investors shy away from making a major commitment to what tend to be at best a form of seasonal investment. Individuals who are looking for good short-term investments often consider these fluctuations to be more of a godsend, however, and are much more willing to invest larger sums during the low point of the cycle in hopes of reaping greater rewards when the value of the stock shares peaks. Of course, this plan isn’t foolproof… changes in the market or the economy can either stimulate or delay the cycle, making the cycle start later or last longer.

Additionally, some cyclical stocks are only temporarily in a cycle so investing in them with the hopes of their repeating of past performance can cause problems with cycle planning when they begin either rising or dropping in value and then fail to recover or if they fail to do either.

Deciding Whether to Keep or Sell Cyclical Stocks

Of course, cyclical stocks can cause undue stress when their value begins to fall… the decision must be made to either hold onto the stocks until the value recovers or sell off at least some of the shares of stock in order to avoid a potentially large loss of investment revenue.

The decision remains up to the investor, but a well-diversified portfolio that contains investments in cyclical stocks should be able to bear temporary losses in stock value without a great degree of difficulty since if the stock is truly cyclical it will recover within a reasonable amount of time anyway.

Cyclical Stocks and Long-Term Investments

Of course, cyclical stocks can be used effectively for long-term investments. The growth end of the cycle is usually increased slightly with each revolution of the cycle, so investors who choose to purchase cyclical stocks and hold onto them for a number of years may find that when they finally sell them the value is much higher than it would have been for short-term investments.

You may freely reprint this article provided the following author’s biography (including the live URL link) remains intact:

About the Author

John Mussi is the founder of Direct Online Loans who help homeowners find the best available loans via the www.directonlineloans.co.uk website.

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About the Author

Smart Day Trading helps beginners stock traders and investors choose hot stock trading opportunities in a practical way every day at http://www.SmartDayTrading.com

Ever hear of no risk, no reward? Well, buying riskier small cap stocks that could return triple digit gains doesn’t have to be a risky proposition. In the first three articles of this small and micro cap series, the first four rules focused on buying strategies. In this last article, the last and fifth rule will cover selling strategies.

Rule Number Five: Remove emotions from your decisions with disciplined selling strategies.

So now that we’ve covered how to buy in to such stocks, let’s review selling strategies because they are just as important. With selling, always limit your downside with stop losses of 10%-15% in long positions and stop losses of 25% with options. Using this strategy eliminates much of the risk from attempting to capitalize on double digit and triple digit gains. In fact, once you become good at identifying opportunities, having winning pick percentages of 70%-85% would not be unusual. And if you attain these percentages, the 15% of picks you lose several hundred dollars in becomes irrelevant when offset by your huge gains. In reviewing what to do about gains, just abide by one rule.

Don’t get greedy and always lock in gains.

If you don’t get greedy, there is no way you should not make money from a stock that has experienced explosive growth. But this scenario does happen. And only one thing causes this to happen. Greed. People will watch 100% profits turn into 20% losses because of greed.

Just as you did with your buy in price, have a predetermined selling price. As opposed to the buy in price range, I would choose a more specific price. For example, let’s consider stock YYY again and assume you bought the stock for $3 a share. Say you set your goal at $5 a share, a 67% increase, but that it blows right through that price two weeks later.

Now what do you do? Hold on or sell?

With sell strategies of rapidly rising stocks, the picture becomes slightly murkier than with sell strategies of stocks that are falling. When a stock passes through your 15% stop loss order (see part I of this article), it will sell automatically, no questions asked, with all emotions removed from that decision. But what do you do when the stock is shooting skyward with seemingly unlimited upside? It depends on what’s driving the price up. If pure speculation is the only thing driving the price, sell half your position and then put trailing stop losses of 20% on the remaining half. In other words, now that stock YYY has risen to $5 a share from my original buy-in price of $3 a share, I sell half my position, and my stop loss price on the remaining half has now moved up to $4.25 a share. This way I’ve locked in my predetermined 67% gain on half of my position of YYY and the least amount of profit I can make on the remaining half is 42%.

Now if earnings and sales are driving the price up, I may take another strategy. Instead of selling half of my position in YYY, I’ll hold onto my entire position, but again institute a trailing stop loss of 20%, moving my stop loss price-point up to $4.25. This is riskier than the first strategy, but the important thing to note is that I am still locking in gains. In this scenario, I still guarantee myself a 42% gain no matter what happens with the stock from here on out.

The key, and I can’t emphasize this enough, is to always take gains off the table or to lock them in with trailing stops. By doing this, you remove your emotions from your decisions. Formulate a disciplined sell strategy and you’ll make a lot more money than you would by trying to forecast the direction of the small and micro-cap stocks you invest in. Plus you’ll save a lot of money on the psychiatrist you won’t have to hire due to all the unnecessary stress you would have caused yourself by not employing these strategies.

So to summarize, always limit your downside and lock in gains with stop loss orders when investing in small and micro cap stocks and you can invest in stocks with enormous potential without the stress associated with the enormous risk of some of these stocks.

? 2006 Global Market Opportunities, Inc.

About the Author

John Kim is the founder of Global Market Opportunities. He has over thirteen years of experience in finance and financial services with two Fortune 500 companies. To learn more about how to identify small and micro cap stocks that consistently and significantly beat the market indices, click the following link, Learn to Invest Money and Achieve Financial Freedom.