The word FOREX is derived from the words Foreign Exchange and is the largest financial market in the world. The foreign exchange market was initially created for big and institutional players like banks and other financial institutions. But, due to modern age technologies and invention of internet, this exchange is not accessible to anyone who wants to trade in foreign currencies. Technological innovations like the internet have made it feasible for private investors to monitor currency markets and to trade via intermediaries. Forex is the foreign exchange marketplace where currencies from various different countries are exchanged. Forex trades almost $2 trillion per day, a total that exceeds all of the world’s biggest and better known markets.

Usually, the FOREX market is considered to be a high risk and high gain game. The market is very liquid and the traders buy and sell a currency pair like USD/JPY or USD/GBP. While doing FOREX trading, you should consider using FOREX Signals. These forex signals are a great way to enhance the chances of making profit in forex trading.

While doing Forex trading, time is the most important factor. You need to be kept updated every second about the movement in the market. You could make a considerable amount of profit if you are able to react quickly enough to the market movements. On the same note, you can loose similar amount of money if you fail to react to these changes quickly enough.

The forex signals are provided by various forex signal service providers and it is important that you choose the right one as per your needs. Most of these providers provide various packages depending upon the services you need to subscribe like instant notifications, availability of trading platforms, pay per signal, no multi-level target strategies, great customer support, access to multiple currency pairs etc. Forex trading signals are known to rely on several indicators that display current market trend.

In earlier days, an individual investor could not even think of trading in forex market. But, in current times you just need a reliable and fast internet connection, a good trading company and a FOREX account to get started. You can be in remote areas of Asia or Africa and still be able to trade in forex market with the help of forex signals.

Related posts:

1. Forex Made Easy – How Forex market works?
2. Forex Trading Strategy – Different forex trading strategies used by forex traders
3. Forex Signal Service – How to choose the best forex signal service?

What is a Blue Chip Company?

A blue chip company is a term given to a nationally recognized, financially sound and well established company. These companies are generally well respected companies within their sectors and are know for best quality products and services available in the market. Blue chip companies are generally known to ride the wave of economic downturns in a much better way than small caps and mid cap companies. In the longer term, these companies provide decent growth in a steady fashion.

The term ‘blue chip’ comes from the game of poker where the blue chip has the maximum value. Blue chip companies usually follow the S&P 500 index. These companies are less volatile than other types of stocks.

When faced with crisis and uncertainty in the economy and the broader market it is imperative to remember that throughout history, high-quality, blue chip stocks have rewarded patient investors. Those who dared to buy the blue chip stocks during the worst period of recession would be the investors who will gain the most. The long-term building of capital and a growing stream of income from that capital also requires some counter-intuitive investment decisions, such as buying at times of extreme pessimism or selling at times of extreme euphoria.

What are the best blue chips stacks in today’s economy?

After a deep recession, finally the markets are rallying again and analysts see signs of economic recovery. In this scenario let us take a look at a few companies from blue chip department which have the potential to get good returns.

BM (NYSE: IBM)

Altria Group (NYSE: MO)

Johnson & Johnson (NYSE: JNJ)

United Technologies (NYSE: UTX)

Coca Cola (NYSE: KO)

Union Pacific (NYSE: UNP)

Emerson Electric (NYSE: EMR)

Colgate Palmolive (NYSE: CL)

Abbott Labs (NYSE: ABT)

Molson Coors (NYSE: TAP)

AT&T (T)

Warren Buffet’s Berkshire Hathaway (BRK)

Comcast Corporation (CMCSA)

Exxon Mobil Corporation (XOM)

Microsoft Corporation (MFST)

Nestle (MSRGY)

Novartis Ag Basel (NVS)

Pepsi Co. (PEP)

The investor should always be looking for buying some of these best blue chip socks since these are the best long term investments in stocks. These companies are financially stable and provide steady returns over the period of time. The investor can never fail if he uses the buy and hold strategy while investing in stocks of blue chip companies.

Related posts:

1. What are blue chip stocks and have they delivered blue chip returns?
2. Blue chip companies – Top Australian blue chip companies
3. Top blue chip stocks and investing blue chip stocks for long term

Let us look at a few principles which should be followed while following the long term investments strategy.

1. Hold on to winners and sell off the looser – This is easier said than done. Many investors have personal investing rules like “I will sell this stock once I make 30% profit” or “I will hold on to this stock until it gives me the invested value back”. While some of these self imposed rules are good, this strategy may prevent you from reaping maximum benefits. Since you are in for a long term, ride on your winners using buy and hold strategy and get rid of losers.

2. Don’t follow tips from friends and relatives blindly – Many people invest their hard earned money just because their friends got a tip from somewhere. This follow the crowd strategy may end up make losses for you. Many people react n news but the fact is the stock price has already been changed before you would know the news. Always do your own research before following a tip.

3. Don’t invest in penny stocks – Some investors put in their money in penny stocks just because they come cheap. Long term investors should resist the temptation of investing in penny stock without researching the company. Though they can give some nice profits in short term, they are also at a high risk of making your investment to $0.

4. P/E ratio – Investors often give this ratio too much importance. Some investors often decide the buy or sell of a stock based on P/E ratio alone. This is not a right thing to do. Though P/E ratio is important, it should be used in conjunction with other factors of the company.

5. Don’t worry about short term market movements – Many investor panic when there is turbulence in the stock market. A long term investor need not worry about stock fluctuations in short term since he can ride these waves off easily. You should have confidence on your research and the stocks which you have picked. Also, while buying stock you don’t have to worry about pennies in market order versus a limit order. In long term, it hardly makes any difference.

6. Tax implications – Don’t base your decisions based on tax which you need to pay on your investments. Tax on equity gain is an important consideration but it should not alter your decision while selecting the right stock to buy. Tax should be a secondary consideration since there are little taxes to be paid for long term investing.

These are a few things which should be kept in mind while doing long term stock investments. Just make up your mind and follow a particular investment strategy. No two investors are same since their needs and risk appetite are different therefore you don’t need to follow anyone else.

Related posts:

1. Stock investment strategies – Buy and hold strategy
2. Two free stock tips to avoid losing your money in the stock market today
3. Stock market investments – Importance of diversification

The investors may need to know about the historical stock prices of a particular stock to understand how it behaves in particular situations. People may want to know how many times IBM stock has split? Or they want to know how Microsoft (MFST) behaved during the year two thousand bubble burst? Or what was Coca Cola (KO) stock price ten years ago? Or what was the price of Google (GOOG) when its IPO came in? They may also want to follow a particular index like Dow Jones Industrial Average or S&P index to see trends.

There are various websites available today which will provide you with this stock market data. They will let you see the historical stock prices for a particular stock as well as details about any particular index. You can see charts for any given range of time if you want to visualize the data. You can also compare two or more stocks in a single chart by overlaying them which is a great tool to do research. You can see when and how many times have a stock split in last so many years. What more, you can even download the data in a local excel spreadsheet for future reference for yourself.

Though there are many websites available, a few of them are most users friendly. These include Yahoo Finance website and bigcharts.com website. BigCharts is one of the most famous online tools to get the historical information about any chart. You just have to enter the stock symbol and you can get historical stock prices for that stock.

Yahoo Finance is also a great tool which is famous across the world. You can specify the date range while getting the historical stock quotes. You can choose the button for the type of values you want: Daily, Weekly, Monthly, or Dividends Only information. The output will give you data about stock prices (Open, High, Low, Closing Price), and Volume (number of shares sold). There is also an Adjusted Closing Price, to account for share splits, dividends, and any other unusual adjustments.

There are a lot of other very useful sites which provide this information free of cost. These include Investopedia’s research, MoneyCentral etc.

You should use the historical stock prices to make yourself a well informed stock investor. By studying the historical stock quotes, you can become more aware of the stocks and can invest in them in more confident manner.

Related posts:

1. Real time stock quotes – how to get them?
2. Free real time stock quotes
3. Free Stock Quotes – A Good Tool For stock market beginners

These stock market simulators are a great way to trade without actually any risk of loosing any money. There are a lot of advantages of using stock market games. They give the investors the experience and confidence of trading online. They help investors to learn about basic investment concepts, such as how to read stock tables, the impact of market volatility, trading strategies and much more.

There are hundreds of options available on the internet for playing stock market games. Some of them are listed below:

Stock Market Game (SMG) – One of the most popular online stock market games on the internet. Since 1977, the program has given educators a way to improve the learning experience in thousands of classrooms. Teachers have successfully used The Stock Market Game™ program to enliven core academic subjects.

Virtual Stock Exchange – It is another very good virtual stock trading game from Market Watch. With VSE you can create public or private games with a cash balance you set, choose from thousands of available games and test your strategy with a personal portfolio.

Investopedia’s Simulator – Stock market Game from Investopedia. Put your trading skills to the test against other users and see where you rank among the thousands of Investopedia traders.

Motley Fool Stock Market Game – Available on Motley Fool website, this game gives the participants a chance to win $5000.

The Great Game – London Stock Market Game – This is a great alternate for people in UK to play the game on UK stock Market

Stock Track – The stock market game is one of the most comprehensive, online investment simulations. It can be easily implemented into your finance, economics or investments class at an affordable price.

Updown.com – Yet another online stock market game site where you can start your own public or private stock market contest and compete with friends & family.

There are various other options available on the internet. These stock market simulators are being used by stock market investors as well as professors on various business schools as a very successful teaching medium. Some of them are free and some are paid. The paid games have a bit more features and they are more real time. Free games usually have a lag of 15 to 20 minutes from the real stock market.

Related posts:

1. Stock Market Game – Stock Market Simulator
2. Free real time stock quotes
3. Investing in stock market – is it better than investing in real estate?

There are many people who want to start investing in stock market but they are afraid of losses since they don’t have experience of stock trading. Therefore, they don’t want to directly put their hard earned money into online stock trading. Most people think that just reading about stock markets on websites and books will give them enough information to start trading. But the fact remains that you can only learn definitions this way. The right way to gain experience is to actually do some investing.

How to invest without losing any money?

The question arises that how can someone start investing without any risk of loosing money. The answer is stock market simulator. A stock market simulator is nothing but a fantasy simulator which is popular in sports where you have some virtual money. You invest that money in doing trading in the stock market. This trading is a simulation of real trading which gives you experience of real world online trading systems. Since you are using virtual money, there is no risk of loosing it. On the other hand, even the profits are virtual.

The stock market simulators are simple, easy-to-use programs that imitate the real-life workings of the stock market. In other words, it is a program or application that attempts to reproduce or duplicate some or all features of a live stock market on a computer so that a player may practice trading stocks without financial risk. Usually, the software will give the investors a sum (like $100,000) worth of virtual money. Using this money, the investor can build his portfolio after buying stocks at real time market prices from exchanges like New York Stock Exchange (NYSE) or American Stock Exchange (AMEX). The software will also deduct commissions on trades to emulate the real trading procedure so that the investor has a feeling that he is investing in real exchange.

Advantages of stock market simulators

The stock market simulators are a great way to teach student in financial domain about the real life situation that arises in the markets. A lot of teachers use this method of teaching where the students compete with each other after starting at the same time. They would be able to understand their risk appetite and investing strategies. They also understand the financial terms better since they talk in those terms while playing this game. When mixed with fun learning becomes very easy. In the course of this competition, students also learn how to budget money, use comparative math, be part of a team, think critically and make decisions quickly.

There are various stock simulation software’s available in the market today. Some are free and some are paid. The good ones are paid and they simulate the stock market very closely.

Related posts:

1. Stock market games: what are the options – free and paid?
2. Investing in stock market – is it better than investing in real estate?
3. Stock market investments – Importance of diversification

Earlier, you had to depend upon the recommendations of your stock broker while doing trading in stock market. More often than not these brokers used to manipulate your decisions based on their senior management directions and the commissions they used to get on different stocks. Therefore, you could never trust your stock broker to give you an honest and right financial decision.

But times have changed since the internet has come into picture. There are various online brokers which are available on the internet now. You can directly open your account with one of these online brokers and trade from the convenience of your home. There is no physical broker involved. The added advantage is that you can do the trading directly and the trade execution happens in a couple of seconds. Most online traders guarantee the execution of trade within a few seconds of your order. This is a great feature since it saves you a lot of time.

Other major advantage of using the online brokers is that the commission charges are much less now. Since the online broker companies don’t have to employee hundreds of physical brokers to do the trades, their operation costs are low. Therefore they are able to pass on that benefit to you. Most online brokers take a nominal commission between $7 and $10 per trade which is less than traditional brokers.

Opening and managing an online trading account is very easy. Since everything is done online so you hardly have to go to any office to submit your application. The easiest option is to fill up the application form electronically giving all your personal details. The online broker reviews your application and approves it. You can setup your personal savings or checking account with the trading account using an ACH facility. In this setup, the money can be easily transferred from your personal account to trading account when you need money to buy stocks. This makes the whole process of online stock trading easy and free of any physical check writing.

Some people are intimidated by this procedure since they are afraid of online fraud scams which they keep on hearing. Their fear is legitimate since there are a lot of fraudulent websites on the internet. It is recommended to always go with a reputed online brokerage house to prevent any such thing happening to you. Some of the best online broker companies available today are Fidelity Ameritrade and E*TRADE. In another topic, we will cover how to choose the best broker for online trading account.

Related posts:

1. Buying stocks online – How to choose online stock brokers
2. How to buy stocks online
3. Where To buy penny stocks – How buy the penny stocks online

Online stock trading system has eliminated these issues. The stock trading is fast and easy thanks to the increasing use of internet. Not only this, the online trading system is also cost effective. You could save good amount of money since the commissions on online trades are less than physical stock brokers. There are various online brokers available in market today. You have option to choose from hundreds on such online brokerage houses but you should use some discretion while selecting the one for yourself.

There are various factors which need to be considered while selecting the right online trading service. Some of them are:

• The reputation and the customer base of the company. There are a lot of companies which are nothing but scams. You need to do some research and find a company which has a good history and reputation.
• What are the commissions charges per trade of the type of securities which you want to trade?
• Is there any minimum investment amount required by the company before you start online trading?
• Is there any inactivity fee per year in case you don’t want to trade for a specific period of time?
• Is there any guidance tool or telephone support available? Some companies like Fidelity provide these extras.
• What is the financial background of the company? Is it stable? Some good companies which are reputed are generally a bit more expensive than others for the service they provide. Sometimes, this extra cost is worth the peace of mind they offer.
• Lastly, how is the online trading experience in terms of online interface, easy of money transfer etc? For some people, this is one of the major deciding factors.

As mentioned earlier, you have to be aware that there are a lot of companies which are nothing but scams and you need to be vigilant about them. A few online brokers which are recommended by experts are Fidelity, TDAmeritrade, E*TRADE and Scottrade. Buying stock online using these online brokers is easy but dangerous if you are not careful about security of your computer. You should always have latest version update of anti-virus and anti-phishing software which would help you trade in secured manner.

Related posts:

1. Online stock trading
2. How to buy stocks online
3. Discount Stock Brokers – Select the Best

• Buy and hold strategy
• Bottom up investing
• Top down investing
• Defensive investing
• Dollar cost investing
• Contrarian investing strategy

All these strategies are different and have their advantages as well as disadvantages. In this article we would talk about the most commonly used strategy which is buy and hold strategy.

Buy and Hold is a basic investing strategy where investors buy and hold a security for an extended period of time. It is a known fact that stocks give a better yield in the long run than any other investment avenue like bonds, CDs, real estate etc. And this principle is being followed in the investment strategy. Investors believe that if they can find a good security and keep it for an extended duration of time they will get better results than other investments. The belief is that it is better to allow a security the opportunity to grow over time, versus attempting to trade in and out of a stock for quick gains.

However, it is very important to invest in the right stock in this strategy. To do this, first the right sector or index needs to be identified. Once that is done, target the strongest securities within that index. This basic top down approach will ensure that the trader is purchasing into a stock with the greatest chance of growth potential.

Advantages of Buy and Hold strategy

There are various advantages of this investment strategy. Some of them are:

1. Savings on commissions – Since the stock is not being traded actively, you save on the commissions which can be pretty costly. A Buy and Hold strategy can allow a trader to invest large sums of money with minimal costs.
2. Savings on taxes – Since this is a multiyear strategy, you save on the long term gains which keeps you on lower tax bracket. This is again a major advantage.
3. Less stress – Most investors can take it easy once they buy the stocks in this strategy. They don’t have to worry about every price movement since they are pretty sure that they will make money in the long term. This gives them peace of mind.

Disadvantages of buy and hold strategy

As mentioned earlier, none f the investment strategies is without any negatives. Even in buy and hold strategy, there are some disadvantages. Though it looks like a safer bet, it may not give you the best returns possible. Also, bear markets are not good for this strategy since it can take years to get to a break even point. Another major point against this strategy is that you can never be sure of the stocks you have picked especially in current market when a lot of blue chip and reputed companies are going bankrupt overnight.

Related posts:

1. Stock trading Strategies – Listen to the experts and devise your own strategy
2. Long term stock investments – Some tips to get better returns
3. Forex Trading Strategy – Different forex trading strategies used by forex traders

1. White candlestick – White candlesticks or hollow candlesticks signal uptrend movement. These occur in different lengths; the longer the body, the more significant the price increase.
2. Black candlestick – Black candlesticks or filled candlesticks signal downtrend movement. These occur in different lengths; the longer the body, the more significant the price decrease.
3. Long lower shadow – Long lower shadow gives a bullish signal. The lower wick must be at least the body’s size; the longer the lower wick, the more reliable the signal.
4. Long upper shadow – Long upper shadow gives a bearish signal. The upper wick must be at least the body’s size; the longer the upper wick, the more reliable the signal.
5. Hammer – A hammer shows a bullish pattern during a downtrend. The hammer has long lower wick and small or no body. Shaven head hammer shows a bullish pattern during a downtrend & a bearish pattern during an uptrend since it has no upper wick. The Hanging man hammer candlestick shows bearish pattern during an uptrend. It has long lower wick, small or no body; wick has the multiple length of the body.
6. Inverted hammer – Inverted hammer signals bottom reversal; however confirmation must be obtained from next trade. It may be either a white or black body. Shaven bottom inverted hammer signals bottom reversal, however confirmation must be obtained from next trade. It has no lower wick. Shooting star inverted hammer shows a bearish pattern during an uptrend. It has small body, long upper wick, small or no lower wick.
7. Spinning top white – Spinning top white gives a neutral pattern. It gives a normal view until seen with respect to the other candlestick patterns
8. Spinning top black – Similar to spinning top white pattern and gives neutral pattern but in black candlestick. Again becomes meaningful when sees in combination with other candlestick patterns
9. Doji – Doji is a neutral pattern with no body and only shadows, meaningful in combination with other candlestick patterns
10. Long legged doji – This is a type of DOJI but have long shadows. It signals a top reversal
11. Dragonfly doji – As in a normal Doji, there is no body and a Dragonfly Doji signals trend reversal since it has no upper wick and long lower wick.
12. Gravestone doji – Opposite to Dragonfly doji and signals trend reversal. It has no lower wick and long upper wick
13. Marubozu white – Marubozu denotes dominant bullish trades and continued bullish trend. It has no upper or no lower wick.
14. Marubozu black – Marubozu black denotes dominant bearish trades and continued bearish trend. It has no upper or no lower wick.

Related posts:

1. Candlestick Stock Chart Analysis – Introduction
2. MACD technical analysis
3. Technical analysis of stocks