One such system is known as TradingPRO. It has been specially designed to day trade the market indexes or correlated products such as futures indexes, e-minies contracts, options as well as the cash market. This is because it gives you easy to follow trading signals.

Another such system is known as “The Penny Stock Trading System” which has been written specifically for the novice investor. It is still good enough for the more experienced investor to use also. It provides you with strategies that only the more experienced traders know about. Many of the strategies provided in this system have been collected first hand from those with experience along with the collective experience of various experienced penny stock investors. Instead of being taught about “buying low and selling high” they teach you substantive strategies which are extremely effective when carried out correctly. Not only this but this method consists of many small steps which when followed correctly will lead to successful investment in Penny Stocks.

However, today many people who have become online traders find that it is more profitable if they use the services of an online broker. Not only will they manage the accounts for them more effectively they will often charge the person a small fee in order to do it for them. These online penny stock brokers will have all the latest (updated) and relevant knowledge relating to the moods of investors and the movements of the market. They are able to accurately and successfully advise their clients which are the best and most profitable penny stocks for investment.

What this type of trade means is that there is a contract between two companies or people to deliver something for a certain price by a certain time. You are not borrowing anything you are just starting to go into this type of business. You get more out of this kind of business because when you enter into an option it does not cost as much as buying a stock. This process is also less risky than buying stock in a company.

There are two different kinds of trades involved here. One is called a call, and the other is called a put. A call is a right to buy and a put is a right to sell. This may sound simple, but it is actually very complex.

You can call and have the right to buy an asset at a time you decide, but if that stock does not increase before the option is over, you will lose having to by the stock when it is low. There are four different options to pick; the buyer or seller of calls, or the buyer or seller of puts.

There are always risks involved in any kind of trade, just make sure you know what you are getting yourself into. You really need to know what you are doing to be successful with options. You can research it and read up on it and really think about it before you decide to do it. There are lots of resources out there to help you, but it will not be something that you can just jump into.

You have the option to adjust your original trade if something comes up that you think will negatively or positively affect your trade. It can be based on a gut feeling and you do not have to show proof to make a change. Even though there is less risk then buying stocks, options are still risky ventures.

You will usually see a warning on sites that tell you they are not suitable for all traders, and that since they are speculative then you could lose a lot. This risk is increased when you do not have any knowledge of option trading, and you will dig a hole you cannot get out of.

You can find a broker when you begin to trade that can get you started off in the right direction. A good rule of thumb is, remember people who are good at option trading have been doing this for a long time. You will need practice and an education about it to be able to be successful.

Profit is all about to understand the market conditions clearly, before trading and doing right things at the right time. This is said easier than done. For a new investor, the beginning has to be on cautious premises. Choose blue-chips companies, whose reputation is above board and which have been consistently paying dividends and bonus/right issues. Alternatively, in the course of your research, you spot some companies whose share prices are low, it means that you have managed to beat the market and this investment is likely to fetch you good profits.

When you are unable to catch the trends of the market, and move away from them, instead of beating the market, you are beating the retreat. In such conditions, take advice from reputed stock analysts, who can tender appropriate advice, on the basis of the inputs secured from the fundamental and technical analysis. No method provides one with 100% guarantee of success, but workout such plans so that the odds are in your favor. The results of the research before you provide confidence, you understand the market better, and catch the right signals. In addition, your psychology and sentiments are important part of your trading and they are the practical elements in making money. When you provide suitable cut loss limits, they will keep you off trouble and you are able to prevent major losses.

Profit from share trading is not a profound science. The methods to deal with the exchange are amazingly simple. Only you need to employ them effectively and in a timely manner. If you are able to catch the signals of early stage of price rise movements, one can take advantage of the maximum profit opportunity with minimum chances of risk and losses.

Any condition is a good condition for a shrewd investor. The market bows before such investors, and provides them with a series of profit opportunities, whether the shares are moving up, down or sideways. Those are the masters of option trading. Such people wear ‘all weather proof jackets.’ They are mostly stock trading millionaires.

In any given market conditions, as far as possible, avoid day trading. Howsoever great are your strategies, risk looms large in such trades. Intra-day trading in the same security is fraught with great risk. Some one with limited resources and trading experience and with low risk tolerance should not enter this trade zone at all. Those who claim large profits from day trading, are perhaps are conducting their clandestine business to promote a particular share of the company, with some hidden agenda. Even in the normal course of day trading, your competitors are professional licensed traders engaged by securities firms, institutional finance companies and the commercial banks. A small investor stands no chances of engaging them in voluminous trades.

For immediate profits, option trading strategy is less risky and the chances of profits are more. There are many kinds of option trading strategies. Call Option, Sell Naked Put Option, Bull Put Option, Bear Put Spread, Straddle, Covered Call, and Short Straddle etc. Use these strategies as per your specific portfolio needs.

When you think of making profits in all market conditions, it is important for the investor to know, in which condition the market is passing through at a given moment. Unpredictability of the market is well-known to all investors. It so happens, when the well is full, you do not have the drums to store water, and when you have enough empty drums, the well is empty! Such are the tantrums of the share market; one fails to appreciate, its behavior. You can not question it with your reason, only accept the fact and respect the trends. There is no other way to do business dealings in the share market.

Here are my top 5 tips for earnings plays…

1) Determine the relation between the call volatility and put volatility for the current strike and next strike.

High volume and high call volatility is indicative that people are buying contracts for a move to the upside, likewise high volume and low volatility implies people are selling contracts and the stock is likely to go down. This isn’t 100% but it’s one more arrow in your quiver in nailing an earnings play.

2) Look at the institutional block trades in the previous 5 days and ascertain whether the ratio is on the buy side or sell side. This normally gives an underlying clue to what they are doing, the current stock price is often manipulation to hide this

3) Do not buy out-of-the-money calls or puts on a stock if the implied volatility is very high and historically the stock doesn’t move very much. You are really limiting your chances of making big money by not heeding this. You will do better to buy 1 contract in the money than 10 contracts out of the money more often than not.

4) Never put all your capital on 1 earnings trade no matter how tempting. You need to stay in the game. Nobody can get earnings plays right 100% of the time but if you can get a few of them right you can make anywhere between 100-5000% on a single trade. If you get it wrong, you may as well of set fire to your money. Hedge your trades, never put it all on one-side or the other, use 70-80% on the direction you think it will go and 20-30% on the downside.

5) Find stocks that historically move big and take advantage of setups by the market makers in the week or two prior to earnings, sometimes they force stocks down or up so they can either load up or sell of stock before the herd arrives.

The Whole Picture

The recipe for a successful investment philosophy is only as good as the sum of its parts. If your trading plan is solid but you don’t do technical analysis, you going to have problems. If you perform your technical and fundamental analysis but you don’t have a trading system, you will struggle to succeed. If you don’t have the best trading system available, you are likely to leave profits on the table during your futures and options trading. No matter which part you consider, if you don’t emphasize them all, you are going to be weak in a very important facet of your trading.

Trading Plan

This is where it all begins. While you may rely on your trading system to help you ultimately find the targets for you acquisitions, your trading plan is what will get you to the place where you are ready to search. Will you invest in the stock market or commodities trading? What plans will you put in for stop loss strategies? What about your investment philosophy? A well constructed trading plan will help you with these questions and many more, especially when trades are happening quickly and you are tempted to react with your emotions. Just as a trading system is the voice of common sense for your target acquisitions, your trading plan is your voice of reason for your business decisions.

Technical Analysis

After you know what you are going to do and have your plans on how to do it, you can get down to the business of learning. Technical analysis is really about education. If you understand the commodities that you are trading and the factors that affect their prices, you have a distinct advantage in picking profitable trades. You don’t know about pork bellies? Don’t trade them. You have researched oil futures and understand the dynamics of their price movements? Seriously consider investing there. This is important because if you understand a commodity, you are likely to understand the things that make its price move, whether it is the weather, demand or the latest news report on the 6 o’clock news.

Trading System

Once you have a trading plan and you have started performing fundamental and technical analysis, you need to put a trading system into place. The trading system represents your approach to following price movements of your target commodities. Trading systems can be simple like bar charting or more sophisticated like Japanese Candlesticks. Bar charts will give you information like the open and close of a particular stock. With a bar chart you can get a general idea of how a commodity has been trending but nothing about where it is going in the future.

Japanese Candlestick charts offer you much more. This trading system offers opening prices, closing prices, highs, lows and whether the stock was up or down overall for the day. In addition, this trading system offers powerful analysis tools based on several hundred years of use.

Conclusion

Each part of a successful trader’s approach to his or her investments is crucial. The trading plan, the technical analysis and the trading system all contribute to the investor’s ability to create profitable investments.

One powerful technique that can be used in tandem for the increased possibility of success is the use of stock options and trading with Japanese candlestick charts. Stock options lend themselves naturally to the swing trading style of investing. Swing trading simply means buying a stock or option and holding the position for anywhere from a few days to a couple of weeks or possibly a month or two. Swing trading options is not a long term investment strategy since options have expiration dates.

Japanese candlestick charts have been used since the eighteenth century by rice traders to predict rice prices with great success. Candlestick charts have become the most popular type of chart incorporated by traders into the financial markets, used widely in many different trading systems. Once a trader learns the basics and concepts of candlestick charts, the trader can use them to easily identify possible options trade candidates.

Support and resistance areas are very important to the options trader. Stocks follow patterns and usually trade within a wide range between established points of both support and resistance. Because stocks trade within established patterns, options traders have opportunities to capitalize on the movements between these areas of established support and resistance.

Using candlestick charts, a options trader can easily identify these important areas of support and resistance and quickly determine if individual stocks are suitable for an options trade. For example, if a stock recently fell to a strong support level, this could indicate to the options trader by utilizing the candlestick chart that a winning trade may be a possibility. However, the possibility of a winning trade is not guaranteed. A strong support area revealed by the candlestick chart only shows the options trader that the stock has visited this area of support before and has often bounced off the level rather than proceeding downward through the support level. Although chances are excellent that the stock will bounce and reverse direction at strong support, there is no guarantee that the stock will return to previous levels once the stock touches the strong support level.

Using stock options and trading with Japanese candlestick charts can help the options trader identify possible setups for profitable trades and help improve winning ratios. Candlestick charts have been used for centuries and are an important part of many trading systems among not only options traders, but day traders and forex traders as well.

Here are two strategies for higher consistent returns and less risk. These are also opportunities for index beating returns. And high absolute returns which can reach 30% and above if you use margin and have or gain experience.

You can have high absolute returns with a lot of stability by buying bond and stock closed end funds with discount.

Closed end fund is like mutual fund. The difference is that closed end fund have limited number of shares. And they can sell for less or more than sum of underlying securities. Buy fixed income closed end funds with discount. You can go to etfconnect.com and search by discount. The more advanced strategy is to frequently trade the closed end funds and hedge them with options on Treasuries ETFs. This government bond exchange traded funds have ticker symbols TLT, IEF and SHY. Frequent trading can capture short-term fluctuations and significantly improve overall results. If you trade, you might pay attention to shorter duration funds – not just to discount. Closed end funds with average maturates up to 5 years are more predictable from my experience and therefore easier to trade.

Second opportunity is about selling stock puts. You act as mini insurance company by selling insurance (puts) that stock will not be 20-30% lower 0.5 – 2.5 years from the initial transaction. Select the put expiration date as far as possible. Stocks with LEAPS – options expiring up to 2.5 years in the future are preferable.

Approach picking stocks for selling puts like you buy a business or invest for very long term. I consider this strategy as investing – not trading. At least from underlying stock selection perspective. Pick companies you, independent financial publications and/or trusted advisors made a lot of research. Look for cash, real estate on balance sheet. Very important is long-term predictable growth (growth even better then hypergrowth, because it is hard to predict when hypergrowth phase stops). One of the most important factors is management. Best picks may and should include companies run or owned by best managers or money managers. I mean Sears Holdings (SHLD) which is run by billionaire hedge fund manager Eddie Lampert. Eddie Lampert is one of the best and highly respected money mangers in USA. Some people call him modern Warren Buffett. He took about 5 managerial responsibilities at Sears Holdings. And besides being one of the very best money managers he is famous for successful retail turnaround stories.

Second example for stock selection is Hewlett Packard with Mark Hurd as CEO. Look at the outstanding job Mark Hurd did at his previous company – NCR Corp.

Of course one of the most important things is to buy companies with good valuation. Don’t chase good stories, good products, good prospects and even brilliant managers without regard for stock valuation.

With experience you can add turnaround stories to you portfolio, but make sure to thoroughly researching this opportunities. You can sell much more expensive insurance (expensive puts) in this situations.

By employing this two strategies outlined above you can create balanced portfolio with exposure to stocks and fixed income. Both strategies results to buying securities with discount. With selling puts you also have benefit of leverage because you need to put up in margin 10%-20% of underlying securities.

I feel that both strategies might be part of any size portfolio and might be suitable for investors with lower than average risk tolerance.

Another reason for the demand to have a good stock trading system in place is the rise in global stock markets. As a matter of fact, traders/brokers as well as investors/shareholders are finding that the task of trading in equities or shares or stocks is proving to be extremely complicated, considering that newer companies and institutions are being launched all the time. And the Internet has not helped by bringing the world closer to home!

What are the features of a stock trading system?

(1) What is meant by a stock trading system? It is a tool to enhance the success of investments, especially if it works effectively and efficiently. It includes strategies related to investments, market guides and trading schemes.

There are experienced analysts and professionals to guide the trader or investor as needed. This is achieved by providing a constant flow of information and analysis regarding market trends and movements in the stock market arena. Without this in place, it would be difficult for smooth functioning of the stock market.

Lastly, there is a timing system included in the package. Thus, every investor is aware of the time limits for investing in a particular stock.

(2) A stock trading system is not something that can be just bought at any marketplace! There are special individual distributors or operators available–they can be found locally too. These dealers offer a customer much more than just a system. They are truly worth it because they can lessen your headaches! All the more better to go to them if you have linked up with other business partners.

(3) Another option is to check out those special companies offering to sell systems that are dependable and have already been well promoted.

(4) Traditional or conventional methods of transactions are giving way to more modern methods. So there is the automatic/electronic stock trading system which is faster and more interactive in nature.

Since trading in stocks has become a global activity, it is difficult for investors to be present physically at all locations. He/she need not attend auction venues or trading places for the express purpose of buying or selling shares or trading stocks. Hence, the launch of electronic transactions.

This sort of a stock trading system is quick and convenient since it is supported by wireless Internet and wireless telephone. More advanced technology is sure to evolve in future.

Day traders can be grouped into two broad categories as scalpers and momentum traders. Scalpers trade in large quantities completing each trade within seconds or minutes. Most scalpers are usually large financial firms or investors like institutional traders. Momentum traders are usually individual traders who trade according to the stock market trends. The trading volume of momentum traders usually depends on the market condition. Some other popular trading strategies include range trading, news playing and rebate trading.

Day trading can be considered as an offspring of high speed electronic communication networks. Most day traders today trades markets from a distant location such as their home or work area. They use trading software, the direct access trading platform, installed in their computer connected to internet to execute trades in real-time. In order to qualify for the trades, the trader must maintain a margin in the corresponding market. It is the day trading broker who maintains the margin for the trader and provides the direct access trading platforms. Although there are web-based trading platforms available, they are not suitable for day trading.

The most important thing, other than the money, trading system and market account, that a day trader need is the market information. Market data enables day traders to pick suitable products to trade. Day traders need live or real-time market quotes as a small delay in information can cause them huge loss. It is the trading system that they use serve for this purpose. Advanced systems provide these information as graphics and are usually have alerts and triggers to automate trades. Day trading systems also use technical indicators and various mathematical tools to facilitate the picking of stocks, futures, currencies, etc.

As told earlier, there are a variety of products available for day trading. The most popular ones are the stock and the forex currencies. Others include options like stock options and futures options, and futures like currency futures, stock futures, stock index futures and commodity futures. Day trading facility is available for most stock, options and futures market, but note that most brokers offers services for limited markets/exchanges. The trader also must be keen to choose markets according to the product they are trading, their financial status, the brokerage they are affiliated to, the trading system they uses, and their geographical location.

The advantages of day trading include high profit making chance, no overnight risks, high leverage, rapid returns, no margin interests etc. The disadvantages include higher chance of loss (especially to new traders) and the requirement of high concentration levels and time. The requirement to payoff interest on margin and transaction costs can make the situation more serious. It is estimated that over 80% of day traders have to afford loss.