Tag: options

Automatic Income Method

Posted on by Betty Brooks

This really is dedicated to those of you who wish to purchase individual stocks. I has shared with you the techniques I have used over the years to pick out stocks i are finding to become consistently profitable in actual trading. I want to work with a combination of fundamental and technical analysis for choosing stocks. My experience shows that successful stock selection involves two steps:


1. Select a share with all the fundamental analysis presented then
2. Confirm that this stock can be an uptrend as indicated by the 50-Day Exponential Moving Average Line (EMA) being higher than the 100-Day EMA

This two-step process enhances the odds that this stock you select is going to be profitable. It even offers a signal to trade Chuck Hughes which has not performed not surprisingly if it’s 50-Day EMA drops below its 100-Day EMA. It is another useful way of selecting stocks for covered call writing, yet another kind of strategy.

Fundamental Analysis

Fundamental analysis may be the study of economic data such as earnings, dividends and your money flow, which influence the pricing of securities. I use fundamental analysis to help you select securities for future price appreciation. Over time I have used many options for measuring a company’s growth rate to try to predict its stock’s future price performance. I manipulate methods such as earnings growth and return on equity. I are finding why these methods are not always reliable or predictive.

Earning Growth
For instance, corporate net profits are at the mercy of vague bookkeeping practices such as depreciation, cashflow, inventory adjustment and reserves. These are common at the mercy of interpretation by accountants. Today more than ever, corporations are under increasing pressure to overpower analyst’s earnings estimates which results in more aggressive accounting interpretations. Some corporations take special “one time” write-offs on his or her balance sheet for specific things like failed mergers or acquisitions, restructuring, unprofitable divisions, failed developing the site, etc. Many times these write-offs are not reflected as a drag on earnings growth but instead appear as a footnote with a financial report. These “one time” write-offs occur with an increase of frequency than you might expect. Many businesses that form the Dow Jones Industrial Average have got such write-offs.

Return on Equity
Another popular indicator, which has been found is just not necessarily predictive of stock price appreciation, is return on equity (ROE). Conventional wisdom correlates a top return on equity with successful corporate management that is maximizing shareholder value (the larger the ROE better).

Recognise the business is more successful?
Coca-Cola (KO) having a Return on Equity of 46% or
Merrill Lynch (MER) having a Return on Equity of 18%

The answer then is Merrill Lynch by measure. But Coca-Cola features a greater ROE. How is possible?

Return on equity is calculated by dividing a company’s post tax profit by stockholder’s equity. Coca-Cola is indeed over valued that it is stockholder’s equity is only comparable to about 5% of the total rate of the company. The stockholder equity is indeed small that just about any amount of post tax profit will develop a favorable ROE.

Merrill Lynch alternatively, has stockholder’s equity comparable to 42% of the rate of the company and requires a much higher post tax profit figure to produce a comparable ROE. My point is that ROE will not compare apples to apples so therefore is not an good relative indicator in comparing company performance.
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Stock Choice

Posted on by Betty Brooks

This really is focused on people which invest in individual stocks. I wants to share along the strategy I have used in the past to choose stocks that I are finding to get consistently profitable in actual trading. I prefer to utilize a blend of fundamental and technical analysis for selecting stocks. My experience indicates that successful stock selection involves two steps:


1. Select a regular using the fundamental analysis presented then
2. Confirm how the stock is definitely an uptrend as indicated by the 50-Day Exponential Moving Average Line (EMA) being higher than the 100-Day EMA

This two-step process enhances the odds how the stock you end up picking will likely be profitable. It also provides an indication to trade Chuck Hughes containing not performed not surprisingly if it’s 50-Day EMA drops below its 100-Day EMA. It is also a useful way for selecting stocks for covered call writing, a different sort of strategy.

Fundamental Analysis

Fundamental analysis will be the study of monetary data for example earnings, dividends and cash flow, which influence the pricing of securities. I use fundamental analysis to aid select securities for future price appreciation. Over time I have used many means of measuring a company’s rate of growth in an attempt to predict its stock’s future price performance. I used methods for example earnings growth and return on equity. I are finding the methods are not always reliable or predictive.

Earning Growth
For instance, corporate net earnings are at the mercy of vague bookkeeping practices for example depreciation, cash flow, inventory adjustment and reserves. These are at the mercy of interpretation by accountants. Today as part of your, corporations are under increasing pressure to get over analyst’s earnings estimates which leads to more aggressive accounting interpretations. Some corporations take special “one time” write-offs on the balance sheet for such things as failed mergers or acquisitions, restructuring, unprofitable divisions, failed website, etc. Many times these write-offs are not reflected as a continue earnings growth but alternatively make an appearance as a footnote with a financial report. These “one time” write-offs occur with more frequency than you could possibly expect. Many firms that make up the Dow Jones Industrial Average took such write-offs.

Return on Equity
One other popular indicator, which I have found is not necessarily predictive of stock price appreciation, is return on equity (ROE). Conventional wisdom correlates an increased return on equity with successful corporate management that is maximizing shareholder value (the better the ROE better).

Which company is a lot more successful?
Coca-Cola (KO) using a Return on Equity of 46% or
Merrill Lynch (MER) using a Return on Equity of 18%

The answer is Merrill Lynch by measure. But Coca-Cola carries a greater ROE. How is possible?

Return on equity is calculated by dividing a company’s net gain by stockholder’s equity. Coca-Cola is really over valued the reason is stockholder’s equity is only equal to about 5% of the total market value of the company. The stockholder equity is really small that nearly anywhere of net gain will develop a favorable ROE.

Merrill Lynch conversely, has stockholder’s equity equal to 42% of the market value of the company as well as a greater net gain figure to create a comparable ROE. My point is that ROE will not compare apples to apples therefore is not a good relative indicator in comparing company performance.
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Stock Choice

Posted on by Betty Brooks

This really is dedicated to individuals who want to spend money on individual stocks. I has shared along the methods I have used through the years to select stocks which i have discovered to be consistently profitable in actual trading. I prefer to use a blend of fundamental and technical analysis for selecting stocks. My experience has shown that successful stock selection involves two steps:


1. Select a standard with all the fundamental analysis presented then
2. Confirm that the stock is definitely an uptrend as shown by the 50-Day Exponential Moving Average Line (EMA) being over the 100-Day EMA

This two-step process increases the odds that the stock you decide on will be profitable. It also provides a sign to trade stock which has not performed as you expected if it’s 50-Day EMA drops below its 100-Day EMA. It is another useful way of selecting stocks for covered call writing, a different sort of strategy.

Fundamental Analysis

Fundamental analysis may be the study of financial data like earnings, dividends and money flow, which influence the pricing of securities. I use fundamental analysis to assist select securities for future price appreciation. Over time I have used many options for measuring a company’s growth rate to try to predict its stock’s future price performance. I have used methods like earnings growth and return on equity. I have discovered why these methods usually are not always reliable or predictive.

Earning Growth
For example, corporate net profits are at the mercy of vague bookkeeping practices like depreciation, earnings, inventory adjustment and reserves. These are common at the mercy of interpretation by accountants. Today more than ever, corporations are under increasing pressure to get over analyst’s earnings estimates which leads to more aggressive accounting interpretations. Some corporations take special “one time” write-offs on his or her balance sheet for things like failed mergers or acquisitions, restructuring, unprofitable divisions, failed developing the site, etc. Many times these write-offs usually are not reflected as being a continue earnings growth but rather arrive as being a footnote on a financial report. These “one time” write-offs occur with an increase of frequency than you may expect. Many companies which form the Dow Jones Industrial Average took such write-offs.

Return on Equity
One other popular indicator, which i’ve found is just not necessarily predictive of stock price appreciation, is return on equity (ROE). Conventional wisdom correlates a high return on equity with successful corporate management that is certainly maximizing shareholder value (the higher the ROE better).

Recognise the business is more successful?
Coca-Cola (KO) having a Return on Equity of 46% or
Merrill Lynch (MER) having a Return on Equity of 18%

The answer then is Merrill Lynch by measure. But Coca-Cola features a greater ROE. How is this possible?

Return on equity is calculated by dividing a company’s net gain by stockholder’s equity. Coca-Cola is really over valued the reason is stockholder’s equity is only add up to about 5% of the total rate of the company. The stockholder equity is really small that just about anywhere of net gain will make a favorable ROE.

Merrill Lynch alternatively, has stockholder’s equity add up to 42% of the rate of the company and needs a much higher net gain figure to make a comparable ROE. My point is that ROE will not compare apples to apples then is very little good relative indicator in comparing company performance.
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Automatic Income Method

Posted on by Betty Brooks

This really is specialized in people who wish to spend money on individual stocks. I wants to share with you the techniques Personally i have tried through the years to pick out stocks that I have found to become consistently profitable in actual trading. I want to work with a mix of fundamental and technical analysis for selecting stocks. My experience has shown that successful stock selection involves two steps:


1. Select a standard while using the fundamental analysis presented then
2. Confirm how the stock is an uptrend as indicated by the 50-Day Exponential Moving Average Line (EMA) being above the 100-Day EMA

This two-step process enhances the odds how the stock you select will probably be profitable. It also provides an indication to trade stock which includes not performed as you expected if it’s 50-Day EMA drops below its 100-Day EMA. It is a useful means for selecting stocks for covered call writing, quantity strategy.

Fundamental Analysis

Fundamental analysis could be the study of financial data for example earnings, dividends and money flow, which influence the pricing of securities. I use fundamental analysis to aid select securities for future price appreciation. Over recent years Personally i have tried many strategies to measuring a company’s growth rate so as to predict its stock’s future price performance. I used methods for example earnings growth and return on equity. I have found these methods aren’t always reliable or predictive.

Earning Growth
As an example, corporate net income is at the mercy of vague bookkeeping practices for example depreciation, cash flow, inventory adjustment and reserves. These are typical at the mercy of interpretation by accountants. Today more than ever, corporations are under increasing pressure to overpower analyst’s earnings estimates which results in more aggressive accounting interpretations. Some corporations take special “one time” write-offs on the balance sheet for specific things like failed mergers or acquisitions, restructuring, unprofitable divisions, failed website, etc. Many times these write-offs aren’t reflected as being a drag on earnings growth but instead show up as being a footnote over a financial report. These “one time” write-offs occur with an increase of frequency than you could expect. Many companies that constitute the Dow Jones Industrial Average have such write-offs.

Return on Equity
Another popular indicator, which I have found isn’t necessarily predictive of stock price appreciation, is return on equity (ROE). Conventional wisdom correlates a higher return on equity with successful corporate management that is maximizing shareholder value (the higher the ROE the higher).

Recognise the business is much more successful?
Coca-Cola (KO) using a Return on Equity of 46% or
Merrill Lynch (MER) using a Return on Equity of 18%

The reply is Merrill Lynch by measure. But Coca-Cola features a better ROE. How is that this possible?

Return on equity is calculated by dividing a company’s net gain by stockholder’s equity. Coca-Cola is so over valued what has stockholder’s equity is just corresponding to about 5% from the total market price from the company. The stockholder equity is so small that almost anywhere of net gain will make a favorable ROE.

Merrill Lynch alternatively, has stockholder’s equity corresponding to 42% from the market price from the company and requirements a greater net gain figure to generate a comparable ROE. My point is ROE will not compare apples to apples so therefore is not an good relative indicator in comparing company performance.
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