Author: The INO.com Team

The Biggest Mistake I See New Traders Make Is This...

Posted on by The INO.com Team

They Have No Game Plan!!!

This is an important element in trading and one that should not be brushed to the side. When you have a game plan it allows you to get in and out of the market in a non-emotional way.

So often I see new traders jump into the markets based on emotion, hearsay, and rumor. This is the worst possible way to trade and the quickest way to lose all of your money.

In my humble opinion, nothing is more important than a game plan and sticking with it.

By creating a game plan, you are setting yourself up to be prepared emotionally. No matter what happens to a particular stock or futures market, you have a pre-planned way to enter and exit the market. Having a successful exit strategy is enormously important.

With the kind of volatility that we are seeing in the marketplace today, having a game plan has never been as important as it is right now.

Creating a game plan is very easy and you can do in a matter of minutes. Here are the key steps to creating a very basic game plan:

1) Write down your reasons for buying or selling a particular market.

2) Write down your entry point for the market you're about to trade. Why are you getting in? Did you see a technical set up?

3) Write down when you are going to exit this market. Why and when are you going exit? Was your profit target reached, or were you stopped out?

4) Do not make market decisions during trading hours. It may sound easier said than done, but watching the daily ticks can cause your emotions to go haywire.

5) Review your game plan every day to see if things are going according to your plan. This allows you to adjust your money management stops and your target zones in a non-emotional way.

It couldn't be easier and it's only costs is a sheet of paper and some of your time.

So there you have it ... five easy steps that can both make you money and save you money in the future.

Every success in training and in life,

Adam Hewison
President, INO.com
Co-creator, MarketClub

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Jim Cramer Throws In The Towel

Posted on by The INO.com Team

Last week I wrote a blog on Jim Cramer's recessionary stock picks. This blog posting showed the five stocks that he thought would be recession proof and ones that he would suggest you buy. This was on the 8th of January, 2009.

I just happened to tune into Mr. Cramer's show on Thursday night. He basically announced that he was throwing in the towel and that it would be best to get out of these positions.

So let's see how he did with his picks. All of his hypothetical stocks purchases were made on the 8th of January using the closing price.

Caterpillar: Purchased at $44.08 - Sold at $31.58
Home Depot: Purchased at $24.38 - Sold at $22.12
Johnson & Johnson: Purchased at $59.02 - Sold at $58.18
Hewlett - Packard Co.: Purchased at $37.61 - Sold at $36.13
Verizon Communications: Purchased at $32.42 - Sold at $30.45

Here's what we are going to do... we'll take the closing price last  (1/08/09), and the opening of January 30th to see just how Mr. Cramer's recessionary  stock picks worked out. The good news is that Mr. Cramer was five for five. The bad news is, those five stock positions lost money.

I have often said that I am a fan of Mr.Cramer, as he is a very entertaining man. I've also have commented that he never places a stop loss on any position that I've seen. If you have other information to the contrary, please share it with me and the readers of this blog.

Here are the results:

Caterpillar (NYSE_CAT) lost: $12.50 / 28.35%
Home Depot (NYSE_HD) lost: $2.26 / 9.26%
Johnson & Johnson (NYSE_JNJ) lost: $0.84 / 1.42%
Hewlett-Packard Co. (NYSE_HPQ) lost: $1.48 / 3.93%
Verizon Communications (NYSE_VZ) lost: $1.97 / 6.07%

I have to say this is not an impressive lineup of stock picks. By using our "Trade Triangle" Technology, you would have avoided all of these stock picks that Mr. Cramer recommended. So here's my challenge to you: if you watch Mad Money, always check with our technology to see whether you should be purchasing a stock or just standing aside. I think you'll be amazed at the improved results.

Every success in the markets,

Adam Hewison
President, INO.com
Co-creator, MarketClub

The Best Kept Market Secret in the World

Posted on by The INO.com Team

Two months ago, I wrote a blog that many people are still talking about. It was about a trading rule  I learned over 30 years ago in the pits of Chicago and one I still use today.

How this amazing rule works is way beyond my pay scale, but I can say without hesitation that it works.

It works on intraday charts, daily charts, weekly and monthly charts. I do not know why it works in the financial markets, and through all my reading and research I've never found a reason that explains why this particular rule works.

Anyway, I'm going to show you in this intraday video on gold how this rule works. I also recommend that you watch the video I made two months ago using the exact same tools on a daily gold chart.

This is something that you should really look for when a market has a correction, as it will allow you to enter a position with very little risk.

So enjoy, there is no charge or registration required to watch this video. This is part of MarketClub's educational trading video series to help you achieve greater success in your own personal trading.

All the best,

Adam Hewison
President, INO.com
Co-creator, MarketClub

How To Conquer The Forex Market & Laugh All The Way To The Bank (New Video)

Posted on by The INO.com Team

Today, we are dissecting and examining one of my favorite markets ... the Forex market. The Forex market is the biggest in the world and is traded on a 24/7 basis.

What makes these markets so exciting is the fact that they have a very strong tendency to trend, that is, once they get started in one direction they tend to continue in that direction for some time.

I learned how to trade Forex in the trading pits of Chicago where I was a member of the IMM, a division of the Chicago Mercantile exchange. The CME has grown dramatically over the years, and I have many fond memories of trading in the old exchange in Chicago. Today, you can trade the stock of the CME (NASDAQ_CME). That's a good idea for our next video, let us know if you would like to see a video on trading the stock of the CME.

I digress to today's video.

Today we are exploring the relationship between the Euro and the Dollar (EURUSD). In this short video, which we are making available without cost or registration, you'll catch a glimpse of a conservative way to trade the Forex markets. This approach will detach you from your computer screen and show you how to enjoy your free time without having to worry about the markets.

I would not recommend this movie if you are risk adverse. Trading in Forex, the futures markets, and in any market for that matter always has an element of risk.

I hope you enjoy this educational Forex trading video and that you're able to see the value in this approach.

Every success in the markets.

Sincerely,

Adam Hewison
President, INO.com
Co-creator, MarketClub

7 Things You Can Do To Protect Your Portfolio Right Now!

Posted on by The INO.com Team

Today I've asked the team from The Correct Call to teach us a bit about how we can weather the current storm we're in. Just this morning, I heard of another "mini-Madoff" that took millions from hard working Americans in the northeast! So what can we do protect what we've got??

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There have been some alarming descriptive phrases used in the news headlines lately. "Crash," "Massive Catastrophe," "Spinning Out Of Control,"... are these Chicken Little warnings? Or, are the dark clouds gathering again to unleash another fierce financial storm?

The truth is, we don’t pretend to know one way or the other. It is vital to remain objective and take what the market gives you. The Correct Call takes a top-down approach and sees what the market is saying and invests accordingly. We are not afraid of negativity or overwhelmed by optimism. As a result, we believe there are always great opportunities out there no matter the environment.

That being said, many of our readers have asked us, “what can I do to protect my portfolio in this market?” So we did our research looking for investments that have little, no, or negative correlation with US stocks; meaning, investments that don’t necessarily move in tandem with stocks. They have their own free will, so to speak.

We have identified 7 things you can do to protect your portfolio RIGHT NOW!:

1.    CASH is KING:

Don’t be afraid to move some money to the sidelines. Selling losers makes a lot of sense. It can take years for many of these companies to recover. We are still waiting for many of the tech darlings of the late 90’s and early 2000’s “to get back to what we paid for them.” How long before Qualcomm gets back to $88, let alone $1000.

Some of the things you should be looking at when determining which of your stocks are cash candidates include:

Earnings Misses
Bad News
Management Shake-Ups
Deteriorating Fundamentals Relative to its Peers
Desperate for an Infusion of Cash

Once you have decided which stocks make sense to sell, you might consider matching your loses with some of your gains. Don’t be greedy, eventually today’s winners will give way and be replaced by the next hot thing.

When the markets - be it Real Estate or Stocks - hit rock bottom, you will need cash on hand to take advantage of these bargains. It is in these discarded investment misfits that triple digit returns will be found.

2.    BUY GOLD:

Investors worried about mounting losses can possibly stem the tide by adding Gold to their portfolio. According to a study titled, “Is Gold a Hedge or a Safe Haven? An Analysis of Stocks, Bonds and Gold” by Dirk G. Baur and Brian M. Lucey, gold is an “ideal venue to park money during periods of uncertainty.”

Their analysis found that in the US, Gold and stock returns are negatively correlated and that Gold acts as a hedge at all times. That means when stocks go down, Gold usually goes up.

Conservative investors should buy iShares COMEX Gold Trust (IAU), streetTRACKS Gold Trust (GLD) or iShares Silver Trust (SLV). More aggressive investors might consider owning individual stocks or DB Gold Double Long ETN (DGP). DGP’s objective is to give its owners twice the return of Gold’s price changes. With DGP, if Gold moves up 5%, investors can expect see a return of 10%.

Continue reading post HERE.