stock market at Stock Research

Investors buy stock for one simple reason: to make money. The surest way to earn money from investing is to create as di¬verse a portfolio as possible and hang on to it for a long time. To succeed at making money investors need good sources of infor¬mation.
Stockbrokers supply much information. They study market reports and get information on the forecasted financial performance of companies. Brokers usually recommend oppor¬tunities or provide special services such as newsletters. For this brokers charge additional fees.
Sometimes investors prefer to avoid high brokerage fees. They implement their own investment strategy. Serious investors sub¬scribe to investment newsletters and carefully study the stock market. Best investors become an expert in a particular industry.
A simpler investment strategy is to choose some reliable blue chip stocks and stick to them. This strategy is safe and can earn money over the long run. Investors should avoid making com¬mon mistakes, which are:
1) failure to diversify,
2) paying too much for a stock which would not go up,
3) not knowing when to sell a stock going down,
4) paying too much attention to ru¬mors and tips.
There are also several techniques of predicting the stock prices. Most investors begin with fundamental analysis, which is the process of comparing a company’s current financial position and future prospects with those of other firms in the same or different industries. Some investors usually called “chartists” try to identify a specific stock’s behavior charting it over time and then predicting its future price movement. Other investors be¬lieve that prices are random. The random walk theory is based on the assumption that future stock prices are independent of past stock prices. They choose stocks at random. A group of investors has adopted an unusual approach, contrarianism, which holds that the market will move in the direction opposite to that predicted by the general public. In other words, these investors do the opposite of what the general public does.

Yesterday, when I wrote my last article I had a brain-wave. Perhaps common stocks aren’t the best asset to invest money. And I decided to investigate a question about investments in such securities as stock index futures…
As far as I understand investments in stock index futures are similar to investments in weather futures. You should forecast. And your profits or losses depend on your ability to make good prognoses.
It is necessary to remember that the subject of an agreement of stock index futures is purchase and sale of portfolio of stocks; stocks that go to make up this stock index.
Stock index futures show the dynamics of the stock market or its part (for example, S&P and Dow Jones Transportation Average).
As with ordinary future contracts stock index futures can be used as instruments of speculation or hedge buying.
The example of speculative operation with stock index futures can be:
You have $100000 and the forecast is that the index S&P will grow. Let us suppose that the margin requirement is 5%. Dynamics of index (during the position is open) is: 1230
1245
1240
1256
1270
1263
1275
Price of future contract (when we open position) is: 1230*$500=$615000, margin requirement is $30750, so we buy 3 future contracts. The results of this operation per day are:
1st day: (1245-1230)*500*3=$7500 (profit)
2nd day: (1240-1245)*500*3=$7500 (loss)
3rd day: (1256-1240)*500*3=$24000 (profit)
4th day: (1270-1256)*500*3=$21000 (profit)
5th day: (1263-1270)*500*3=$10500 (loss)
6th day: (1275-1263)*500*3=$12000 (profit)
The payments under the stock index futures clear each day the position is open. And if you bear losses you should insert money on your margin account.
The result of our operation is: (1275-1230)*500*3=$52500!!!
So, to my mind it’s very profitable activity to invest your money in stock index futures:).

To my mind, first of all I should gain an understanding of types of securities. As far as I know there are many types of securities. And how can I choose some of them with the highest expected return and liquidity and the lowest risks? I want understand why I should buy or sell exactly this or that type of security. So let’s try to investigate…
            In theory there are several groups of securities:

• Equity Securities;
  
• Fixed Income Securities;
  
•  Investment Funds;
  
• Units & Trusts;
  
• Options, Warrants & Rights;
  
• Futures Contracts.
  

So, equity securities: common shares, restricted voting shares, preferred shares, flow-through shares.
As far as I understand securities of this group have practically the same liquidity. As for expected return: the capital gains potential of common shares is usually higher than for preferred shares of the same company. And return on flow-through shares will depend on the potential tax benefits to the investor. Then risks… The most risky securities of this group are flow-through shares, if I’m not mistaken. But all risks of all of them are moderate to high. So among securities of this group I’ll choose common shares. To my mind the balance of return and risks is the best!
The second group: savings bonds, bonds, debentures, treasury bills (T-bills), Guaranteed Investment Certificates (GICs).

If I’m not mistaken investment of money in treasury bills is more profitable. Yes, among securities of this group I will choose exactly treasury bills.
            The third group and investments funds: shares or units of Mutual Funds, shares or units of Closed-End Investment Funds, units of Segregated Funds and shares of Labour-Sponsored Investment Funds.

Then go units and trusts: limited partnership units and trust units.

Hi, my name is Lubov, and I am a student of Belarusian State Economic University. At the university we study the theory about stock markets, stock exchange, different types of securities, but…
But in our country the stock market isn’t developed. There is only The Minsk Interbank Currency Exchange in Belarus. There are no news blocks or specialized magazines and newspapers in this field.
That’s why the majority of our students familiarize with exchange trade without practical experience. And I am not an exception. Today with the development of communications facilities and Internet we have a good chance to know more about different world-renowned stock exchange, its functioning and even try to be a real stock gambler.
Therefore I chose this topic to try to extend my knowledge and my experience in this sphere. I will study different theoretical information. Then I will try to open an account on Stock Exchange and to earn money (huge amount, I hope)… at least not to lose too much… I’ll describe all my experience here in this blog.
So, I will try to do my best, and I hope that it will entertain you .
Have fun

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