The Best Global Market For Your Money

The Best Global Market For Your Money

Article SummaryModern diversification requires that we explore overseas markets and not focus just on domestic issues.Compares and contrasts the best developed, emerging and “stealth” market.Exploring opportunities in all three markets can be a great defensive play to global economic shifts.The global economy has changed the way we approach investments. Just a few decades ago, creating an investment portfolio was a relatively simple affair. Mutual funds were the captains of the financial services industry and any stocks owned by individuals were most likely large cap, blue chip, American names. The idea of owning assets outside of the U.S. was considered risky and unnecessary… Read full article at Seeking...
Risk Versus Reward: Measuring Alpha

Risk Versus Reward: Measuring Alpha

Context is everything. Victory over an obstacle needs to have appropriate awards. A win that costs you more than you were willing to pay is known as a Pyrrhic victory – named after the Greek King Pyrrhus who defeated the Romans around 280 B.C. but did so at such a great cost that the Greek King quipped that any more victories would ruin him.In the stock market, similar situations happen all the time. You may succeed in turning the tide on a position and making it profitable, but at such a great cost that you took away from all your other positions to do so and ended up losing out on all the other gains you would’ve had.It’s hard to know if you’ve done well managing your portfolio or not. You may think that simply beating the market averages for the year, a difficult enough feat, constitutes success, but you’d be mistaken. A gambler who bets everything on a roll of the dice and comes up a winner would certainly qualify as beating the markets, but he did so at tremendous risk. Risk that no investor would be willing to take.Understanding risk is critical to being a profitable investor over the long haul. Our measurement of success therefore comes from two parts – percentage gains, and risk assumed.Analyzing RiskWhen you compare your performance to the market average, you generally pick an index that matches your portfolio set-up as closely as possible. It could be anything from the S&P 500 to the Russel 2000 or anything in-between. You need a benchmark to compare not only your performance to, but your...
Dogs Of The Dow And Other Market Strategies

Dogs Of The Dow And Other Market Strategies

Investing in the stock market properly requires a carefully crafted strategy in order to succeed. Most investors are familiar with the biggest two methods: growth investing and value investing. Beyond those two though are a number of other valid strategies that aren’t as well known, but still effective… Read full article at Seeking...
Technical Indicators You Can Actually Use

Technical Indicators You Can Actually Use

On Wall Street, there are two major schools of analytical thought: Fundamental and Technical. Fundamental analysts focus on financial statements, economic advantages, and corporate management in order to determine the intrinsic value of a stock. Hard core fundamentalists view technical analysis like astronomers see astrology – a complex weave of arbitrary numbers and events to magically arrive at a conclusion.In truth, fundamental analysis tells you what a stock is ultimately worth, while technical analysis tells you what other traders are doing with that stock. That’s why value investing tends to be synonymous with long term strategies while “chartists,” people who use technical analysis, trade in short term patterns.When used together, proper analysis won’t only tell you what stock to buy, but also when to buy it and when to sell it. Like all types of analysis, some metrics are more meaningful than others. We’ll take a look at some of the more important ones used in the market and what they mean in regards to the current environment.Why Volume MattersArguably the most commonly looked at piece of technical data is volume. This is the amount of stock that has changed hands on a given day. It’s usually calculated as the average amount over a period of time.Volume tells you how active the stock is. A low volume can mean that there’s little interest in the stock which can result in liquidity issues – if you own a large number of shares, you may not be able to sell them easily. On the other hand, a large amount of volume means that there’s much more liquidity making it easier to...