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Submitted by Van Beek on December 2, 2009 - 13:56

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Which stock market indices increased during November despite Dubai

Submitted by Van Beek on December 1, 2009 - 16:10

Do you know if the whole Dubai issue has made the stock markets close lower or higher at the end of November compared to a month ago? With all the fuss around Dubai, one could easily forget that most stock market indices actually closed higher at the end of November than at the end of October. What does this mean for the Stock Trend Investing investor?

In the beginning of 2010, Stock Trend Investing will launch its membership service. Members will receive on a monthly basis recommendations how to capitalize on the trends in the stock market indices around the world. Till that time, we provide you already with some free insights. Sign up for our free newsletter in case you want to be notified when our new service will be availble exactly.

Now, let’s look at what the Stock Trend Investing system tells us about what happened to the trends in the stock market indices during November.

US Markets

For the US markets, the Dow gives a buy signal but the other indices (Nasdaq, NYSE, S&P 500) tell us to hold. For the Nasdaq and NYSE we still get a very minuscule correction warning. If you want to increase your holdings in the US markets, look first at index funds that follow the Dow Jones.

Gold and India

The Mumbai based BSE (Bombay Stock Exchange) tells us at this moment that there is still a fair chance on a short-term correction. This would be caused by a too high growth in the index during the last 6 months.

Gold is on a roll the last months and actually the whole last decade. We see no indication that this momentum would change. However, the prices have gone above the normal expected trend lines.

 

17 year Gold trend chart from Stock Trend Investing

 

European Markets

The three main European markets (FTSE, DAX, CAC 40) tell us to hold our positions. If we see a positive result during December, we will get a buying signal here again.

East Asian Markets

The Hong Kong Hang Seng Index keeps giving positive buying signals and so is the Shanghai Composite Index. Since the Hong Kong index has increased so considerable during the last half year, we still see some short-term correction risk.

The Japanese Nikkei declined again during November as one of the few indices in the world. Our system gives still the benefit of the doubt and tells us to wait and see for another month. However, trend investors who are confident that the Nikkei index will also drop during December, can just as well sell their Nikkei related holdings now.

Overall, for investors who would like to increase their stock market investment, we recommend to look at China indices and the Dow Jones Industrials Index at this moment.

When you are interested to be notified when the new Stock Trend Investing membership will be launched, we recommend you to sign up for our newletter.

Six reasons why we love trend investing

Submitted by Van Beek on November 17, 2009 - 16:28
Are you aware of all the advantages that trend investing offers to people like you and me? We have money to invest. But we do not have (or do not want to spend) a lot of time on studying boring quarterly financial reports.
 
We also know that you can loose a lot of money when you just buy and keep mutual funds. But what is the alternative?
 
In this article, we will share why we love trend investing. In summary, it is because of the following. Trend investing offers all of us the opportunity to capitalize on stock market trends and to start or continue our journey to financial independence without having to spend a lot of time on it. Let’s go into the different reason behind this.
 
1)      Trend investing offers much better returns than just buy and hold.

What is the best stock market strategy for you?

Submitted by Van Beek on November 11, 2009 - 15:21
Are you the general who has a sound stock market strategy and who is allocating its assets towards the winning direction? Or have you been more an explorer who has been searching and attempting many roads, consuming your assets to see if you can find one road that leads to El Dorado?
 
Explorers sometimes struck gold, if they are lucky. But most don’t. When I invest my savings, my assets, I do not want to be dependent on being lucky. I want to be like the general with a strategy who knows where to go and how to get there.
 
So, what is the best stock market strategy? This depends. I know what it is for me. But every person will have to decide what the best strategy is for them. Let’s have a look at what factors play a role in making this decision.
 
Three factors to consider when choosing a stock market strategy
 
In your choice for the stock market strategy that fits you best, the following three factors are to be considered:
-         Your understanding of the terrain of the stock market
-         Your resources like knowledge and time
-         Your enemies to rational decisions: fear and greed
 
stock market strategyThe first question to ask yourself is if the terrain of the stock market is actually a terrain that you want to enter. Do you know this terrain well enough to understand its pitfalls and do you recognize the natural advantages that this hilly terrain can offer?
 
The second question to ask yourself is how you want to enter this terrain. This has to do with the level of risk you can and want to accept and the resources you have. Do you want to put everything down to one move or do you want to spread your resources over multiple approaches? Do you have the time and relevant professional knowledge to plan and manage very detailed and complex operations, or do you want to keep your approach simple, straightforward and easy to control.
 
Fear and greed
 
Thirdly, you ask yourself how much influence emotions like fear and greed have on you when the pressure is mounting and how you avoid to fall victim to them.
 
Stock Trend Investing is the stock market strategy that is best for me. The trends in the market are like the hills in a terrain. They offer the natural opportunity to make solid gains. Mutual funds and ETF’s offer the possibility to spread resources without having to spend too much time on getting detailed knowledge of individual companies. And the buy indications and sell warnings from the Stock Trend Investing system provide a framework to keep a check on fear and greed while still giving room for individual judgment.
 
What is the best stock market strategy for you and why is that? Please share your comments with us.
 

The secret of stock market timing

Submitted by Van Beek on November 8, 2009 - 03:39
How can correct stock market timing give you a way much better investment result than just buy and hold? One basic investment strategy is to buy stocks and hold them for a long, long time. The rationale behind it is that if you look historically, stocks have made very good returns every year on average. Let’s take the Dow Jones index as an example.
 
The Dow Jones for example is up 267% over the last 20 years. This is thus an average annual compound increase of 6.7%. This means that if you would have invested 20 years ago 10,000 dollars in a Dow Jones index fund, this would have netted an average annual increase of 6.7% and resulted now in a stock holding with a total value of 36,700 dollars. This is excluding dividends.
 
stock market timingHowever, take into account that the Dow Jones index closing for October 2009 is 30% lower than its highest all-time month closing of October 2007, 2 years ago, while still being up more than 37% compared to February 2009, 8 months ago. And consider that the Dow Jones index fell 34% between December 1999 and September 2002, while it increased again 83% between September 2002 and October 2007.
 
 
 
 
 
 
 
 
 
Use stock market timing to turn 10,000 dollars into 72,000 dollars
 
The point I want to make with all these figures is that any investor who started with a Dow Jones index fund 20 years ago and who realized that it was wise to sell in Q1 2000, buy in Q4 2002, sell in Q4 2007 and buy in Q2 2009, would have made way more money than an investor who just buys and holds.
 
The 10,000 dollars from 20 years ago would have become 72,000 dollars now, meaning an average annual increase of 10.4%. Compare this 72 thousand with the 36.7 thousand mentioned above and think which one you would prefer.
 
Thus to me the secret of stock market timing is to recognize when the big trend shifts happen. In hind-sight it is always easy by looking at a historic stock market chart. The important thing is to realize it at that time so that I can act on it. In that way I can capitalize on the stock market trends and continue my journey to financial independence.
 
Rational stock market timing decisions that take little of my time
 
Thus for me, it is not about every hour or day to see how the stock market is doing. The great thing about this is that it takes very little of my time. I do follow the news, but only once after each month I make a decision if it is time to increase or reduce my stock market investment. To make these stock market timing decisions in a rational way without letting fear or greed drive me to do things I would later regret, I use the Stock Trend Investing strategy and system.
 
Have you made any stock market investment decisions that were driven by fear or greed and that you later regretted? Register or login and share your experiences with the Stock Trend Investing community.
 
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