Rabu, 18 Agustus 2021

Find Your Perfect Fit ⭐

 
Liberty Through Wealth

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Wednesday Wealth Recap

  • When you imagine a mentor or role model, Mike Tyson probably doesn't come to mind. However, Alexander Green points out three strategies Tyson uses in the ring that every investor should use in the market.
  • It's hard for small businesses in the U.S to compete in today's market where a handful of companies dominate. According to Nicholas Vardy, it's time consumers take back their freedom to choose.
  • A new debate has sprung up among investors - one our friend and Profit Trends Senior Managing Editor Rebecca Barshop is trying to settle. Whose investment strategy works best, Warren Buffett's or Cathie Wood's?
  • Don't take the financial media's advice! Instead, listen to what our friend Andy Snyder, founder of Manward Press, has to say. According to him, there are two simple trends that will tell you everything you need to know about the market. It's easier than you think.

Note from Senior Managing Editor Christina Grieves: Last week, Nicholas Vardy wrote about the importance of finding your own "holy grail" investment approach - the unique trading system that's exactly right for you. Today, Chief Income Strategist Marc Lichtenfeld expands on that idea, sharing some insights on the differences between short- and intermediate-term trading and how to determine which style fits you.

If the kind of technical analysis that Marc writes about today interests you, make sure you check out the recent three-part chart training series that he released. You can access it here. It's completely free, and Marc covers his favorite chart patterns to help you understand the best times to get in and out of trades.

As Marc says, technical analysis is absolutely fundamental to his trading process, but it can be intimidating for investors. The good news is that Marc has broken everything down into short, simple videos that every investor can understand. The bad news? These trainings are coming down today - so make sure you check them out before that happens! Click here to watch.

THE SHORTEST WAY TO A RICH LIFE

Intermediate- or Short-Term Trading: What's Your Style?

Marc Lichtenfeld | Chief Income Strategist | The Oxford Club

Marc Lichtenfeld

In my 20s, I started out on a trading desk where traders rarely held any positions overnight. They were day traders who got in and out of their trades in a matter of hours - and sometimes minutes.

As my career evolved and long-term investing became my focus, I shifted my goal to owning Perpetual Dividend Raisers for years.

Now I find stocks that my readers should be able to hold indefinitely as the companies raise their payouts every year.

But that's investing. On the trading side, it's appealing to be in and out quickly.

With some stocks, you have to wait a few weeks for a catalyst or technical pattern to play out. And that's fine.

There's nothing wrong with earning double- or triple-digit returns in a few weeks or even months. Most investors would be thrilled with that kind of performance.

However, some traders like the action and don't want to wait weeks for the payoff. They prefer to be in and out in a matter of days, sometimes within the same day.

While trading is more speculative, some risks are eliminated. For example, you can't get attached to a stock because you've held it for a long time or because you believe in the news story surrounding it.

Intermediate-term traders typically own stocks for a few weeks or longer. They're waiting for a story to play out, such as an earnings report, a drug approval or a completed chart pattern.

(I just released a free three-part training series in which I reveal how to trade using my three favorite chart patterns. You can view it here.)

They'll usually set stops that give the position some room to move. That way, they won't get shaken out by market noise, but they also won't suffer too large a loss if the trade goes against them.

Shorter-term traders will hold a stock for a few days or less. They're usually exploiting strong moves in the market or stock.

They'll typically take smaller (but perhaps more frequent) losses in exchange for more frequent trading opportunities and wins.

When deciding what type of trading style is best for you, ask yourself the following questions...

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How much time do I want to commit?

Shorter-term trading - and particularly day trading, when you're in and out of a position within the same day - usually requires you to stay in front of your computer (or at least on your phone) during the trading day so you can make moves all day long.

Traders who expect to be in trades for a few weeks don't have to spend as much time tied to their computers.

What's my tolerance for risk?

Traders who stay in positions for several weeks usually give their positions a wider berth. That way, normal volatility doesn't force them to sell too soon.

It means they have to be able to tolerate some moves to the downside.

Shorter-term traders take smaller losses, but they need to be able to pull the trigger and take those losses quickly.

What strategy makes the most sense for me?

Do you like to trade based on earnings reports, volatility, charts, valuation, or Food and Drug Administration approvals? Certain catalysts will lend themselves to shorter- or longer-term trading styles.

If you like to trade the markets based on volatility, your trades will likely be short term in nature. If you love trading biotech stocks based on upcoming clinical trial data, your trades will have a longer duration.

If you're new to trading, start off by asking yourself which style appeals most to you.

If you're an experienced trader and you're not achieving the results you want, these questions may help shed some light on whether you're trading in a way that best suits your personality.

Good investing,

Marc

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The Club's leader shakes hands with Bill O'Reilly

 

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