Think “stocks investing” or “stocktrading” is way too hard? We actually do it all the time. We put something IN so we can get something OUT that is more valuable. (Hopefully!) Investing is like having a cow for milk and baby cows. Trading is a more active form of investing — to profit from more opportunities, through buying and selling. To make it easier, I like to think about trading as shopping! (Now I’ve got your attention!) OK, I admit, shopping is more on the buying part but a lot of trading concepts apply:
- For instance, you like to buy what is in fashion and would only go for what’s in the new style? You’re in with the trend. In trading, this is called “trend following”.
- You search high and low, visiting several shops, or malls – looking for an item selling at a steep discount. You’re a bargain hunter. In trading, this is called “value trading”.
- You buy when you see a “window of opportunity” or loophole or in shopping terms these opportunities are called “sales” – in trading this is called “arbitrage”.
With investing and trading – your money is put to work, so you have more coming from your own sweat and time.
I suggest learning about money and how you can grow it. Like in my case, I just learn about what I actually use in my life. Warren Buffett, a fixture in the FORBES Rich List, the greatest investor of all time, famously snubbed “dotcoms” because he said he only invests in businesses he understands. What about you?
- Have a thing for bling? Gold, silver, platinum, called “Precious Metals” – you can invest on stocks or funds that mine/process them.
- Walk everywhere? Usually we drive or fly – which burns oil, if the visit to the pump is getting painful, invest in stocks, or funds that produce it to share in the profits from the high demand.
- Love travelling? Learn about countries. There are funds that hold country-specific investments, or see how their currency performs against the US dollar.
- We buy/wear something according to the conditions – sandals for summer/boots for winter – and the same goes for trading. First know the market conditions then decide on strategy. For example, if people are optimistic (this is called a Bull market), you can Buy and Hold, and if people are scared (Bear market) you can sell first then buy later or what is called selling “short”.
The best thing about investing/trading is that the more options you give yourself, the better the results.
Charmel Delos Santos, author of “High Heeled Traders: Understand Trading with Shopping, Fashion, and Shoes!” //highheeledtraders.com “Trading gets extreme… Makeover!”