Facebook The World

We talk about all the ways that Facebook can increase revenue and one way is through its Facebook-Connect site if it were to charges its members a monthly fee on subscribers that are already using Facebook. Let's not forget that Facebook is a social network with 955 million users all over the world. Facebook Users should think about all the ways that Facebook has at their fingertips to increase revenue. They can and have started by charging businesses for ads. Instragram is now leading Twitter in mobile connections. The users on Facebook are still not recognizing they have it in their power to become an owner of Facebook. Facebook is still not a company that would need advertising or other types of revenue, but to satisfy the banks and stock markets and shut them up about how much Facebook is not getting it done with advertising they have to get the word out about how they are succeeding in advertising.

If the 955 million Facebook Users were to buy even 10 shares of stock it would take all the shares of Facebook stock that are available in all the lock-ups coming and all the of Facebook shares of stock that the top owners have to offer. They say there are a little over 2.7 billion shares with all the ones coming up in the lock-ups, Facebook Users buying 10 shares would be almost 10 billion shares of Facebook stock. They would not need advertising except let Users know what is available for them to buy from themselves.

If you are a user of Facebook and started to think about buying shares of stock, it would be to your advantage to buy from advertising on your Facebook page. When you own stock you are making purchases from yourself. You are an owner of a small portion of the Facebook Company.

The world uses everything from blow dryers to baby seats and if your profile on your Facebook Page says you like a certain blow dryer your advertisement might show the blow dryer you use. Closing in on the user's personal likes to make it easy for the user to find the special items they use and naturally would buy if they needed one. With 1 billion users buying from their advertising on their Facebook page you can see the potential for Facebook stock shares to increase quickly.

It is funny how they media says so many negative things and Facebook stays constant in stock price, but let one good thing get out and the price starts up.

Here is something to consider when Facebook starts to make money from the companies that advertise on your page they also are making you the shareholder money.

Cantor Fitzgerald put a buy to $26.00 dollars on Facebook Stock. That means that investors are going to keep buying stock until it at least reaches the $26 dollar mark. If it does reach that mark next week other investors will start to get in and make a move on the stock.

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Which Type Of Stock Quotes Are Best?

When you hear a stock quote on the news, or you look it up online after work you are typically getting the closing price of that stock for that day. While this information is useful when you are investing in this market, it doesn't tell the whole picture. If you are an investor who buys stock and holds onto it for the long-term this type of quote is probably fine, but if you want to trade stocks this type of quote won't be nearly enough for you to be successful.

Level I

Level I quotes are similar to what you see on the news or what you can find in the paper, only they are in real time. They provide you with the current highest bid as well as the lowest ask price. This type of quote is easy to find and it doesn't require any special software, tools or registration.

Level II

Level II quotes offer a little more detail. They include order size, time of transaction as well as the market maker. This can help because if you know a specific market maker always seems to be successful with a stock you've been watching you can sort by this market maker's buying and selling activity. You can also see where they are setting limits. You can find this type of information via the Internet.

Level III

As you may guess, level III quotes include everything you find in level I or II quotes, but they also allow you to execute orders and send the notice that a trade has been executed. Level III is the data that goes straight to the market makers, brokers and the exchanges. Level I and level II are filtered from this data. Consistent access to level III quotes can make a world of difference if you are day trading or trading penny stocks. For the average person who is investing in the stock market it will be information overload.

So Which Is Best?

The best quoting system will vary depending on your goals and what you are trading. If you are trading volatile or short-term stocks you will want as much information as quickly as possible. In this case level III or at least level II quotes are needed. If, however, you are holding on to stocks for the long-term you probably only need quick checks on the closing price for the day.

While it may seem like more information is better, this isn't always the case. Consider your goals and how long you plan to hold onto the stock before you decide to overload yourself with information that may or may not be beneficial to you.

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Investors Are Not Dumb!

How often do we hear statements like "Most of the 'smart money' is going into energy stocks right now"? Or advice to "Watch what the 'smart money' is doing".

I use the term myself in reference to what usually savvy corporate insiders, institutional investors, hedge-funds, and other professional investors are doing at the time, in comparison to high or low levels of bullish investor sentiment.

Unfortunately, the term 'smart money' has led to increasing use of the term 'dumb money' in some market writing, the implication that non-professional investors must be dumb if only professionals are included in the term 'smart money'.

That is totally unfair and inaccurate. Individual investors are most definitely not dumb or stupid. That would be virtually impossible just given the fact that they are able to be investors.

Individual investors would have to be among the most intelligent, knowledgeable, successful people on the planet to have the success in their chosen careers that provides them with assets over and above that needed to provide well for themselves and their families, assets that can be invested.

You don't get to be a successful artist, attorney, doctor, engineer, scientist, business executive, salesman, small business owner, or whatever, by being anything but knowledgeable, intelligent and even brilliant. Can't be done.

Yet it is true that the so-called 'smart money' buys low, sells high, and thrives from their investing, while the majority of individual investors, while often successful for fairly long periods, either lose money over the long-term or fail to match the gain they would make by simply leaving their money in the bank.

That's clear from numerous studies on the subject.

Research firm Dalbar Inc., published a study in 2003 titled 'Quantitative Analysis of Investor Behavior'. It showed that from 1984 - 2002 the average annual return of equity mutual funds was 9.3%, while the average annual return of investors who invested in those funds was only 2.6% over the same period.

A similar Dalbar Inc. study of bond investors in 2006 showed that over the 20-year period from 1986 - 2005, the Long-Term Government Bond Index had an average annual return of 9.7%. But the average annual return of bond investors was just 1.8%.

So what could be the problem for obviously intelligent and smart individual investors?

According to other studies, the very fact that they are smart, knowledgeable, intelligent and successful - in whatever is their own field of expertise - may be the problem, as it may cultivate over-confidence when they step into money-management, a field that is not their area of expertise.

For instance, a survey by the Securities Investor Protection Corporation (SIPC) in 2001 revealed that 85% of U.S. individual investors (which we've already acknowledged are in the upper percentile of the population for brilliance and success in their lives and careers) were unable to pass a simple five question investment 'survival' quiz.

In 2009, the Investor Education Foundation of the Financial Industry Regulatory Authority (FINRA) conducted a similar investor survey.

Interestingly, 67% of respondents rated their own financial knowledge not as average but as high. Yet by far the majority failed FINRA's test of their knowledge of even the most basic of financial questions.

In 2012, the Securities & Exchange Commission published a report on financial literacy among non-professional investors. Its conclusion was that "U.S. investors lack basic financial literacy, and have a weak grasp of even elementary financial concepts." Of even elementary financial concepts! Yet the majority rate their financial knowledge as high.

It's obviously a potential obstruction to investing success when those suffering the consequences don't even realize they have a problem, and so keep investing the same way in every cycle, making the same mistakes over and over, while expecting the results to be different.

The FINRA Foundation notes that if the majority of investors lack even elementary investing concepts, yet rate their knowledge and competency as high, it makes it difficult to change the pattern of under-performance.

Gerri Walsh, president of the FINRA Foundation says, "There are a lot of people who think they're good at handling their money, but their results tell you otherwise. Those people are going to be particularly difficult to reach and educate because they don't think they have a problem."

The conclusions many investors draw from their investment experiences also do not change. The market is a great teacher, but its lessons are often not learned.

Profits in rallies and bull markets are due to their own talent and 'feel for the market'. However, losses from corrections and bear markets are not their fault, have nothing to do with their degree of investing knowledge, experience, strategy, or 'feel for the market'. It was just bad luck, or more often the fault of the crooked market, or their broker, or the stupid government.

SIPC Vice-President Robert O'Hara said, "We've been at this for more than 50 years, and we see the same problem over and over again. Investors are enticed in during bull markets, but then don't know what to do when things turn sour later. People need to take the time to learn the basics about investing, and how to put them into practice."

It seems like a reasonable suggestion given the statistics.

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The Machine for Computer Automated Stock Picks

Super Computer

At present, there is a fictional network television show about a super computer that was created by a billionaire to predict the future events of terrorist activity. This wealthy character, Mr. Finch calls his computer "The Machine", which does more than just predict the next attack. It goes into detail and predicts minor murders of civilians using the "Neural" network of security cameras, motion sensors and mobile devices used in society. Mr. Finch then is ousted by his government client that wanted him to create the machine in the first place because he opposes their view of citizens being of minute un-importance. Thus his role in the TV show aspires to hiring someone to help him thwart civilians from being targeted as their numbers pop out of this machine.

So, how does this television show tie in with stocks and investment picks?

Enter, "The Machine for Computer Automated Stock Picks"

Pretty much like Mr. Finch's Machine, banks, money managers and other professional traders have used specialized software for picking winning trades. Often times the acquisition of software like this can cost thousands of dollars. These Automated Stock picking programs are also used by insurance companies and cost even more, so much more that they are priced way out of reach of everyday people to obtain. These networks these companies use are called "Artificial Neural Networks" and they do exist.

Simulating a system that is close to our brain, these artificial neural networks are made up of a complex "micro highway system" of artificial neurons, which can relay data that is available from our trading markets. Problems we encounter in an artificially intelligent world can be solved very fast and accurate by artificial intelligent systems. These systems can predict and handle individual stock or general market projections with ease. Many people do not realize that our very own brain is capable of handling a vast array of complex calculations but all too often a person's brain today only handles linear solutions to making predictions with investment decisions. That individual has to sit down with his calculations and spreadsheets and predict one by one which trades are sufficient for him. But, if you are like some who are gifted, (which are few) their brains are on a totally different spectrum of crunching data.

The Conventional, Stock Trading Problem

Companies that make trades using this technology create high volatility in the markets, thus making it hard on single individual investors to move in on a trade and get good positive results. By the time he or she makes their calculations and decides on a trade it's often all too late. Thus making his decision incorrect and also resulting in a loss on his or her investment order. So, the little guy trader resorts to making trades the common conventional way by investigating which stock(s) he wants and then buying those instruments low and later on in the future selling them high or low depending on the type of stock purchase he has made. This method of trading is painstakingly slow and has to weather many uncertainties and pitfalls of bad news we can often times encounter.

Advantage of Institutional Investors

Most of the time these elaborate software programs that are used by insurance companies and banks and other institutions do not take into account corporate earnings, rate of returns and other fundamental factors when making their picks. These programs use reliable short term technical parameters for good results to be presented to their professional investors. Big companies like banks and investment firms use this information for immediate information for their clients.

A Beautiful Solution For the small Trader

So what does a regular little guy do if he wants to compete with the big guys on Wall Street or trade like the big bank institutions? There is available to the public a very viable and reliable cost effective solution. Investment software programs that are very competitive to what these companies use if not better are now available to the general public. These programs use similar programming and sometimes the same algorithms to determine sudden movement in the markets and the direction in which these movements go. Some of these software programs are so robust they can evaluate the Forex markets and even Commodity price market movements at the same time. There are thousands of picks, trendlines, stockastics, moving averages, candlesticks, moving averages, on balance volume, relative strength indicators that can assist anyone in need of this information. That's very good news for us and it is available now.

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A Beginners Guide to Options Trading

Options trading is an extremely popular way of speculating on the price movements of underlying financial assets - most commonly stock prices. I have written this guide to give you a brief overview of how options trading works and to highlight the main benefits of it over other forms of investment.

What is Options Trading?

Options give the trader, the option to purchase or sell (we will come to this later) a pre-agreed number of shares in a company at a pre-determined price. Contracts are built on a 100 x share basis so when you open one contract, you are essentially betting on the price movement of 100 underlying shares in Company ABC. At any point until the expiry date of the contract, you can close out your position at which point you will bank any profit (if one has been made).

Options are so called because the trader is never committed into fulfilling the purchase of the stock - they pay the brokerage a premium that is built into the price. Therefore if the price of the stock goes against you, you can simply let the contract expire. If you have opened a 'call' trade expecting the price to rise and the company goes bust, you cannot lose any more than the premium you have paid to open the trade. This is the beauty of options trading - unlimited profits but limited risk

Other Benefits

One of the other popular attractions of options trading is the leverage that companies offer their clients. Leverage (or margin) allows people to take out positions in a company worth considerably more than the funds required on day one. In many cases you will only be required to put down 10% of the total value of the stock value. In this instance, if you were to open a contract in Company XYZ where the share price was $5, one contract would be worth $500; you would only need $50 up front to open the trade. This is a simplistic example though that does not include the premium that the brokerage will have built into the price.

Although options trading leverage is considered to be a major advantage over other forms of investment, due to the massive profits that can be made, it is also a high risk feature. Huge losses as well as gains can be incurred so caution should be adhered to at all times.

Another attractive feature is that you can speculate on prices going up, or going down. When you physically purchase a company share, you can only really put your money on it going up in value.

Where Can I Trade?

There are an increasing number of brokers for you to choose from and each offers a similar experience. Two of the market leaders are TDAmeritrade and OptionsHouse and it is worth checking out either of these long established companies if you want an overall high quality service. If you are expecting to place many trades though, I would though recommend TradeKing as its prices are very low. A flat fee of just $4.95 for each options contract opened is charged which is cheaper than all of the other leading companies.

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Beginning Investors Be Wary Of This Advice

New investors often get hit with advice from everywhere including family, friends, financial advisors, websites and other resources. While some of this advice may be good, it can be more difficult for beginning investors pick the good advice from the not so good advice. Investing is very personal and what works for one person may not work so well for the next, but anyone just getting started will want tips or advice from people who have been doing it for a while. Unfortunately not all of this advice will be good for them.

Stick With What You Know

While sticking with what you know may initially sound like good advice, this may not be such good advice for beginners. This can work well for people who have a wide scope of knowledge of different sectors of the economy, but if you only know about one or two sectors, like retail or the service industry, you may be missing out on other very profitable industries like technology. Sticking with what you know can be limiting.

Invest In Companies You Like

It sounds nice to invest in companies you like or in companies who make products you like, but this can be a mistake too. Getting too personally attached can be a bad thing when it comes to investing. Not to mention if you like a company whose stock is really expensive, it may not be best to put all of your beginning investing dollars into mostly one stock. Sometimes new investors are willing to overpay for stock in a company they really want to be a part of, but this can be dangerous.

Focus On Short-Term Trading

Short-term trading has become more popular in recent years, due to the 2008 stock market crash. Fewer market experts are recommending a long-term trading strategy and more are recommending short-term trading. The problem is that short-term trading is more complicated as it requires the investor to be able to effectively time the buying and selling of stocks. It can also require more money to make quick decisions.

Invest In Penny Stocks

Investing in penny stocks can be tempting for the new investor for a few different reasons. The price per share is low and if the price suddenly doubles, which isn't uncommon with these stocks, you've quickly doubled your money. But these stocks are very volatile and it is just as easy to lose half or more of your initial investment. You can also suddenly get stuck with shares of stock that no one wants to buy. Keep in mind these shares are low for a reason; some of the companies in this niche are flawed or unstable. This is a tricky area for new investors.

Was It An Anti-Obama Mini-Stock Market Crash, Individual Stocks Down 1 to 2% Across The Board