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Financial Eye-Openers

Some of you have been trading your own portfolios with a certain success. Some of you have been successful with professional money managers and brokers. Some of you are just beginning to consider becoming more involved in Wall Street, either by investing or beginning to understand the financial opportunities it represents.

For all levels of financial expertise, there are certain question that we should be asking as we read financial news and watch MSNBC and other such programs.

Are we successful investors? Perhaps it's luck; perhaps it's fate; perhaps it will change! Or is there a fundamental understanding of financial well-being that will enable us to survive and thrive financially.

In future segments we will discuss redirecting income to expenditure ratio. We will also provide trainings for "retrenching". But for now, let us assume that the readership has or will invest in Wall Street. In one capacity or another, you will want to understand the following and if it is appropriate for your own level of financial well-being, you may want to implement some of these strategies.

Whether you consider yourself "rich", "poor", "comfortable", "struggling", "retired" or in the "rat race" these basic rules apply to you. When investing in Wall Street remember that you may be getting exactly what you are or are not paying for. Consider who is watching your portfolio and who is watching your back.

Robert T. Kiyosaki , author of the #1 New York Times bestseller, "Rich Dad, Poor Dad" writes, "Invest first in education: In reality, the only real asset you have is your mind, the most powerful tool we have dominion over. Most people simply buy investments rather than first invest in learning about investing. I go to seminars."

We hope that you enjoy this Free Webinar that is our introduction to financial Wizardry.


Here are the first 8 points to keep in mind when you select a stock. These are the points that money managers normally consider when making a decision for you. If you ignore all this just remember; luck is fickle.

  1. Look for stocks with large increases in earnings. Stay away from companies for whom warnings have been issued. Buy stocks that have growing earnings and revenues. If profits and revenues are growing, the company must be doing something right. Wall Street sets prices for stocks based upon current and projected performance, so if earnings and revenues are shrinking then their stock price should follow suit.
  2. Look at long and short-term trends, for the individual stock and in the stock group. Are you buying a stock that is in a sector that is strong or weak? If the sector is strong and the company you are looking at is growing with or better than the group you have a very good buy signal. If the group is weak but the individual stock you are looking at is strong, than you have to look a little deeper. Why is this company strong? Is it just a temporary phenomenon? What is management saying? If you like the answers to these questions, then buy.
  3. Look carefully at the Profit to Earnings ratio and compare it to the industry group. Is the stock you are looking at in the high range of the group or at the low end? Again this brings questions. If the P/E is lower than the group find out why. Is it a lack of faith in management? Or has it just been missed. This sometimes enables you to purchase a stock at the low end of the price.
  4. Look into changes in management. Has management in the company changed? If it has, did the stock react positively or negatively to the news. This is usually a great indicator of a company; if Wall Street has faith in management they will usually support the company.
  5. Sell loosing stocks; not your winners. Most people tend to sell stocks that show a profit. This is a common mistake. Sell a stock if it falls below your price target or average down if you feel strongly about the stock. Don't sell your "winners" unless you believe that the stock is as high as it is going to go. If you gain new information showing the company in a negative light you may want to reconsider and sell the stock.
  6. If you buy a stock buy in part. Don't buy all that you intend to purchase at once, especially in a volatile market. You don't want to miss out on a stock, but that doesn't mean that you have to buy all of it at once. By buying in parts you protect yourself if the stock makes a move down. In volatile markets you can't know the best time to buy, or when a stock will hit a bottom. Don't try to time the market or you will loose much of the time.
  7. If your stock drops 10% this may be a signal to sell it. Look into why it dropped. If the fundamentals are still intact and you still like the company you may want to sit tight and buy more in the near future. If the fundamentals have changed; take your loss and move onto the next stock.
  8. Be well diversified. Diversification is of utmost importance. Most stocks in most sectors don't all go up or down at the same time; being diversified protects your portfolio. Some sectors like technology are also more volatile than other sectors such as pharmaceutical stocks. When your portfolio is diversified you enable yourself to buy a little tech to help the overall return of your portfolio.

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