Welcome to the second installment on how to learn to trade
stock options successfully. In this article I will cover
the next key, namely obtaining and using good information.
Most people have heard the expression "garbage in, garbage
out". Well that phrase applies to options trading as well.
You will only successfully trade options if you have good
market and stock information. Luckily one of the great
benefits of trading stock options is the fact that good
information is not only easy to find it is also mostly
free. The internet is an extremely powerful tool and most
people these days have a fast internet connection that is
easily accessible. The trouble is interpreting and
discerning the useful information.
I have compiled a list of sites that I visit daily along
with an explanation of just some of the information you can
find on them.
www.finance.yahoo.com
Yahoo! Finance is a great source for all financial news.
Each morning, before the market opens, I check the In Play®
report. This report tells you all of the financial and
company news that has occurred during the night and before
the market opens. It is a great way to find out if there
will be any unexpected market moves, or perhaps big moves
in individual stocks that you can capitalize on. The report
is continually updated throughout the day as is the Market
Overview which gives a running commentary on the
performance of the major indices.
When you enter the name of a stock or ticker symbol, Yahoo!
Finance has an excellent company overview, with current
news and charts, a full profile, key statistics, financial
reports and analyst coverage.
Additionally there is a splits calendar that details the
stock splits that are currently announced and an economic
calendar that not only details upcoming economic
announcements but ranks them according to their importance
or impact they have on the stock market.
www.msnmoney.com
Again, this website is a good source for all investment
news. In particular MSN has a great earnings page that
details earnings estimates, past performance, trends and
growth rates. It also has a very easy to use Research
Wizard that explains and identifies fundamental analysis of
individual companies. The MSN StockScouter report rates
individual stocks according to a proprietary method of
analyzing a stock's potential risk and return.
www.rttnews.com
This website has financial news from around the globe. I
particularly like the breaking news feature that can be
downloaded and placed on your desktop. A desk alert then
pops up with any breaking news as it happens. It can also
be customized so that only the information you want gets
through.
www.tradingday.com
This is a very rudimentary website that has excellent links
to such information as stock gainers and losers, most
actively traded stocks, market statistics, after hours
trades and analyst and broker rankings. All of which is
very useful information when trading short term.
www.prophet.net
Like most sites this has a paid membership service but
there is a lot of great information if you sign up for a
free basic membership. I especially pay attention to the
industry rankings, this is a good indication of where
institutional investors are putting their money and as they
have millions, if not billions, to invest it is often a
good indication of what sectors will either be increasing
or decreasing in value. The historical trends show the
change in ranking over a certain time period, another good
indication of which way money is flowing. For the more
technically minded they have a very complete "Prophet
Signals" and "Prophet Scan" system for analyzing stocks.
As I mentioned in the beginning of this article good
information is key to good trading, remember though, you
must learn how to use this information correctly in order
for it to benefit you. Spend some time familiarizing
yourself with these websites, make sure you know what all
of the terms mean and how to use the indicators and if you
find any other good websites out there please let me know!
If I may paraphrase Benjamin Franklin I will finish by
saying "The best return anyone ever gets on their money is
when they invest in knowledge." Stay tuned for Key #3
coming soon.
US Government required disclaimer: Options involve risk and
are not suitable for all investors. Prior to buying or
selling an option, a person must receive a copy of the
Characteristics and Risks of Standardized Options. Copies
of this document may be obtained from your broker, from any
exchange on which options are traded or by contacting The
Options Clearing Corporation, One North Wacker Dr., Suite
500 Chicago, IL 60606 (1-800-678-4667).
----------------------------------------------------
Roger Cox, born in New Zealand, was President of a large
international freight company in Los Angeles before
starting his own consulting firm. Roger has been
successfully trading stock options for 4 years and teaches
others how to do the same at
http://www.prosperitywithoptions.com
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