Strategies for Trading

Developing a trading strategy is not easy. In fact a strategy can evolve only after thoroughly studying the parameters like the price of stock, the element of risk involved, the volatility of price movements of that stock, its correlation with the market and the time frame for which the stock is planned to be kept.

A series of other factors also come into play and the final strategy reflects their inclusion. But strategies for trading are devised on the basis of a fundamental and technical analysis both of which include the above mentioned parameters:

Technical analysis- This is undertaken to forecast the price trends in the future on the basis of past data available on prices and the volume of stocks traded at that price. They use charts and graphs to study various market indicators, employ models and also study relationships between price and volume.

Fundamental analysis- This is extremely important to gauge the health of a stock by analyzing the company’s financial statements, management, the market it is sold in and its competitors. Fundamental analysis also focuses on historical data to make forecasts for the future. It includes an economic, industry and company analysis to find the intrinsic value of a share, which is actually the share’s true value though it may differ from the current market value. Thus when the intrinsic value is lower than the market price it is time to sell the share and when it is higher, it is wise to buy the share.

On the basis of these analyses, clients would decide on the strategy they would like to adopt-which will be to:

  • Long term strategy to buy and hold
  • Short term investing to make quick profits

Short term trading strategies were once adopted only by active traders who tried to earn profits from daily or intraday transactions and never considered keeping stocks for a long period. Investors trying short term investing have the option of scalping, in which shares are bought and sold within a matter of seconds or minutes, day trading when the shares are bought and sold within a day or swing trading which helps to make money by keeping shares for a few days or weeks at the most.

Short term trading strategies are adopted by those who have a definite exit plan in mind and wish to make their money and get out of a particular stock holding. It requires knowledge, analytical skills, and quick thinking to make snap decisions on seeing share price movements in a particular direction.

On the other hand, a long term trading strategy is meant for those who would like to make an investment and forget about it. Not overly ambitious about reaping profits, they earn on two counts, namely, from dividends declared by the company and the price appreciation of the shares. Such investors do not have a definite exit plan in mind and simply buy the shares and forget about them for a few years.

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Negatives of Using Free Forex Training

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It is serious business that holds promise of making a lot of money, but requires in-depth knowledge and understanding, training and practice under experts and above all, a deep interest. Any entrant into the forex markets needs to know the fundamental trading techniques, the risks involved and how to operate forex accounts. The state of the art trading tools used, the tricks involved, the trading strategies popularly adopted and possible traps, all need to be known so that the right decision can be made to make profits and avoid losses.

The question then is of getting the right forex training. A simple search on the Internet, will reveal thousands of sites offering free courses and making promises that seem difficult to believe. Yet, for the novice looking to expand his knowledge base about forex, there is a choice between free and paid, online courses, and typically, the free courses seem to be more tempting. This is because at the face of it, they seem to be teaching the same things as the paid courses, and the only investment required is time. A closer look and possibly a single experience will highlight the negatives of free forex training, some of which are discussed below.

Websites promise complete training in diverse aspects of the forex markets with some teaching about the forex markets and market movements and others that impart training about trading strategies and trading moves. But some of the features that one must watch out for include:

  • Are there any hidden costs involved?
  • Does the course present a bird’s eye view of the forex market, or does it delve deeper?
  • Are the course timings suitable?
  • Will the course provide backup online support for the initial steps into trading?
  • Will it help to reverse losing trade initiatives and help to make money?

Some of the negatives of free training programs are listed below:

Generalised rather than specialised – It has been found that almost all the free training courses are generalised and contain information meant for the general public with little or no information about the forex markets. While this may suffice to simply become aware about forex, it is not sufficient to train you for taking a step into forex trading, which requires specialised knowledge and a higher skill level.

Overviews that do not improve trading skills – The free training available provides an overview and the fundamental knowledge imparted may already be known. But this is not enough, since the purpose of joining such training is to improve trading skills, how to convert mistakes into stepping stone for success, and how to take the crucial first step in the trading arena. Thus the training will educate but will not be able to chart your route to success.

Back up support not available – Free training is not known to provide back up support once the course of learning has been completed. In the initial trading initiatives, a new trader will tread cautiously and make mistakes. At such times back up support is a big help.

One on one training not possible – Free training is never a one on one learning program where the trainee gets expert attention and education individually. It is such training that is eventually beneficial and helps to overcome fears about joining the trading world.

Mentoring is missing – Mentoring in the initial trading endeavour is desperately needed since it comes as a big morale booster-the knowledge that there is someone to turn to, to set right any mistakes, and someone to hold your hand as you struggle. This may be a luxury missing from free training in forex.

Provide understanding but without implementation – Somewhere along the learning path, the theoretical knowledge, the past trading history, the successes and failures of others, all have to be applied, and the learning has to be practically implemented. How this is to be done, is something you will not learn in a free forex training program.

Do not focus on individual needs and trading styles – The best training courses are those that can be customised according to the individual’s strengths and weaknesses, use the best psychological tools available, and focus on developing a distinct trading style in the trainee. This is unlikely in a free training course, which is meant for the masses to read and absorb, and implement in any way they deem appropriate.

The negatives of free training in forex distinctly reveal the need for a personalized and customized training program that deals with individual needs and helps to convert losses and floundering steps into firm trading moves that bring profits.

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Moody’s Investor Service

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Moody’s Investor Service is the second largest credit rating agency that forms part of the well-known Big Three in the world of credit ratings. Moody’s forms an integral part of global capital markets and contributes significantly in ensuring that financial markets maintain transparency and function smoothly, through its research and analysis, which puts the right information in front of investors. Owned by Moody Corporation, its primary responsibility is to analyze and conduct research on government and commercial agencies, rate the credit worthiness of borrowers on the basis of a globally accepted and standardized scale. Moody Corporation was started in 1909 by John Moody who came up with the novel idea of compiling a detailed analysis of America’s railroads, which was later extended to include privately owned securities as well. With a 40% share in credit rating services, its ratings and recommendations are taken seriously by potential investors. Moody’s Investor Services has received awards for its portfolio of credit risk management software and services. It has served all kinds of markets including credit sensitive ones. It provides all investors with an unbiased analysis of stocks and companies, bonds and other types of securities. With a clear picture of credit risks linked to fixed income securities, and the assessment of these risks provided by Moody’s, investors are able of ward off potential financial losses.

Ratings provided by Moody’s

Long term obligation ratings- These include the top investment grade ratings ranging from AAA to BAA3, each rating revealing the level of risk involved. High risk long term ratings are termed speculative grade and range between BA1 to C. Some special ratings include P for provisional rating, NR for Not Rated and WR for withdrawn rating.

Short term taxable ratings- these range between P-1 to P-3 reflecting the issuer’s ability to repay the short term debt obligations they are accepting, or NP which means Not Prime or that the issuing company does not fall in any of the prime categories.

Short term tax exempt ratings- These are specifically for short term municipal bonds, and Moody’s has opted for a separate category for them. The rating is on the same lines though.

Bank ratings- These ratings reflect the financial strength of banks, though the rating are distinctly different from the bank’s deposit ratings, since they focus on the likelihood of the bank requiring external assistance for meeting their obligations. The bank ratings range between A and E.

Moody’s Investor Services also came in for a lot of criticism during the global financial crisis, and has since modified its modus operandi to ensure that more stringent checks and controls are in place to provide a more accurate picture through their ratings for financial purposes.

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The world’s first online trading service was launched in the 1990’s.

 

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In Malaysia, it was only possible to trade online after the Country’s Information Technology evolved with better internet infrastructures and facilities in the early years of 2005. Able Trend(ATFX) ,  with registration number 465780-W, a Malaysian company located in Selangor, established in July 1998,  was set up with aim to provide Malaysian the essential Knowledge & Skill to Trade the Financial (Forex) Market successfully with direct to the point approach.
“Trust & Sincerity” is our core business values that we preach and uphold. Consider us as your “Personal FX Consultant” as trading is indeed, personal.

ATFX are committed in offering traders a level of professional customer service. Our objective and business is providing a comprehensive Financial (FX) Education and Live Market Trading Services (LMTAS), not currently found in any retail FX Market.ATFXis managed by an individual group of dedicated, talented and knowledgeable Traders who are very passionate in Trading the Financial Market themselves.
As traders, they understand what information is required to enable their clients trade the Financial Market successfully and without fear. Let ATFX assist you to eliminate your fear with knowledge, while you develop your skills at your own pace with
their unlimited mentorships. A great way to learn added with ATFX mentorship for FREE when ever you require for it.
Providing the complete from A to Z, forex educationto clients is ATFX commitment to ensure clients will be able to enter, trade and exit the lucrative forex market safely with confidence and success.Because ATFX understand “How the Financial Market Work Inside and Out” we now offer Traders who has the trading knowledge and experience to become part of our Individual Trading Groups.
“Train the trainer program” is a program for those interested not only to trade for themselves but also to enable them gain passive income at the same time by being their own Introducing Brokers to their clients. This process will go on as their clients will gain the necessary knowledge and experience and later would want to be on their own just like you did. This is our aim at the end of day. Knowledge should be spread to all traders in Malaysia. “Trust and Sincerity” is our core business values which differentiate us from the rest. Let us know your interest and your need for more information on this program.
We will assist and mentor you from A to Z. That’s our commitment to you for your trust in us.

At ATFX we are flexible, our experience in trading and as an educator specializing in the Forex Market has tought us many, the advantages and disadvantages in dealing with brokers Worldwide. We offer our expertise and our advises for the convenience of clients. Clients have the options to open their trading account with us or clients may choose to open separately on their own. Trading platforms are abundantly available in the internet.For added convenience to clients, ATFX act as an IB to Global Currency International Financial Limited (GCI), registration number 489574, who is a broker to act as our clearing firm and carry our clients’ accounts. In its capacity as a clearing firm, pershing receives cash deposits made by ATFX clients, executes customer orders and generates periodic statements.

The ability to deal directly from live bid/ask quotes is the centerpiece of GCI customer-oriented service. Publishing real-time prices ensures that clients always receive a firm, fair price for their Forex transactions which facilitates instantaneous deal execution. With GCI, there is no waiting for a broker to respond to your request for a dealing price, and therefore no missed market opportunities. Depending on your Internet connection, normal execution times, including confirmations, are just a few seconds. GCI dealing software updates each trader’s position in real-time, tracking profit and loss and displaying current account balances.

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Share Trading Facts

atfx tradingShare trading is a simple act of buying and selling shares with the intention of making profits. Shares are very small units of ownership of companies and organizations that are available for ownership by the common man, and though initially public offering is in very large numbers, over time, the transactions of purchase and sale of these shares reduce in number. Depending on the success and stature of the company, the demand for its shares drives its prices.

At any point in time, millions of people trade in shares, and share trading is a lucrative business, provided it is done intelligently and the right rules and methods are followed, based on solid facts and correct information, rather than tips and hunches. It is possible for anyone to start share trading with a small amount of money, so as to minimize losses due to mistakes made or a downslide in the share market.

Shares are traded in the stock market. A stock market is a place where shares of all listed companies are available for purchase and sale. Every country across the globe has multiple stock exchanges.

Shares can be bought and sold only through government approved brokers. The process has been simplified and made transparent since physical shares have been replaced with dematerialized shares. That is, shares are also held in bank accounts from where they are withdrawn or deposited into.

  • Many banks facilitate online share trading and act as brokers for the transaction.
  • Share trading helps in making money if share holders are able to buy at low prices and sell at higher prices.
  • Buying shares after a thorough investigation of the company, its future prospects and its financial position, is the only sensible way.

It is not possible to make a profit on every share trading transaction. If the whole portfolio of transactions shows positive returns, it should suffice. This is possible if the profit made on some trading transactions is higher than the losses made in others.

Only shares of listed companies should be purchased.

Holding shares for a longer term offers returns in two ways-through dividends declared by the company, and the appreciation in the price of shares. Long term investing involves a time span of around five years between buying and selling the shares.

Inactive shares must be avoided, since there are no buyers for them, and it may be impossible to sell them off.

Share trading is serious business and requires a lot of time and access to information that needs to be absorbed and analyzed before starting.

Fundamental analysis refers to studying relevant data like cash flow, returns on assets, track record, profit history of previous years and so on. This is what gives an indication whether a share must be bought and when it must be sold.

A technical analysis which means studying the price trends of shares in the future available with the aid of statistical tools, charts etc. This provides insights into the best price range to buy in.

Share trading is addictive that becomes difficult to leave once initiated, especially after a few profitable transactions, but consistent profits are difficult to achieve.

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