ultimate remodeling 8 foot ceiling kitchen remodel elmhurst semi finished basement quality painting and remodeling heritage remodeling hoffman estates .. Chicago Drug testing

Enron Cure

Let's hope you did not have any of the Enron stock. Maybe you know someone who did and lost everything, but you certainly might know several people who owned stock that lost almost everything. They probably aren't talking about it.

According to Investor's Business Daily newspaper there are 1,387 companies that lost more than 90% of their value from the highest point during the last 5 years. That is almost as bad as Enron except the folks that own this junk have hopes that someday their stock will go back up. And pigs can fly.

Do you realize that if a stock loses 50% from its high it must gain 100% to get back to the old high? And there are literally thousands of stocks that fall into that category. The people that own these dogs are waiting for them to rally so they can get out "even". What this means is that the stock has an effective cap or ceiling on it's price. Each time it sticks its head up it will meet with thousands of folks who will sell. The chance of it ever getting back to the old high is almost nil, never, nada, zip. From my experience as a professional floor trader on the exchange I can tell you it will take a minimum of 5 years of repeated rallies before the investors who are waiting to get out are finally exhausted.

There is a better plan. Why would anyone buy something and let it go against them 60 or 80%? Why do investors believe the greatest Wall Street lie of Buy and Hold? Psychologically people don't want to admit they are wrong. Your broker tells you you don't have a loss until you sell. Believe that and I have a nice bridge in Brooklyn I will sell you.

If you consider yourself a conservative investor then you must set limits on how much you are willing to lose if the stock you buy does not go up and instead goes down. One of the best rules of thumb is about 10% either from where you bought it or from its most recent high. That 90 dollar Enron stock would have been sold at about $80 and you would have a nice profit instead of a loss.

Your broker will discourage you from putting in a loss limit order called a stop-loss because then he will have to watch it which he won't. You see, and I know you know this, there is only one person who cares about your money and that is you.

Setting small loss limits when you buy something and following up a winner with a stop-loss so you won't give back profits you have made are the way to guarantee that your investments will grow every year.

Al Thomas' book, "If It Doesn't Go Up, Don't Buy It!" has helped thousands of people make money and keep their profits with his simple 2-step method. Read the first chapter at http://www.mutualfundmagic.com and discover why he's the man that Wall Street does not want you to know.

Copyright 2005

al@mutualfundstrategy.com; 1-888-345-7870

In The News:

Trading vs Investing

I often hear from people, "I don't trade. I invest.... Read More

Different Ways of Buying Stocks

Let's say you are interested in this one company. You... Read More

VIX

No, this is not a symbol for some Latin number.... Read More

Online Trading Strategy: Collecting Cash when Stocks Go UP - It PAYS to Know More than Others

When it comes to stock market trading it PAYS to... Read More

An Old Proverb for Investing

"If you don't know where you are going, any road... Read More

Analysts - Do They Really Know The Stock Market?

When you become interested in a stock or mutual fund... Read More

Long Term Investing

In his wonderful book, 'Multiple Streams of Income', best selling... Read More

Traders, Defend Against the Dreaded Death Spiral.

It has often been said that there is only two... Read More

When?

When will the stock market stop going down and start... Read More

Lifestyle Funds Provide Greater Security?

With the stock market stubbornly refusing to settle down and... Read More

Emotional Maturity

If you are going to be a winner in the... Read More

Mutual Fund Honor Roll ? Buy High, Sell Low by Chasing Performance

Buy high and sell low -- It's not a typo.Millions... Read More

Your Trading Objective: Why is that so Important?

You've decided to try your luck at trading stocks or... Read More

How To Buy And Hold

One of the most believed bits of conventional wisdom from... Read More

How Commodity Trading Differs from Stock Trading

There are major differences between trading stocks and trading futures.... Read More

Forces that Move Stock Prices

Among the largest forces that affect stock prices are inflation,... Read More

Price Targets

Every day in any financial publication you will find the... Read More

3 Components Needed for Beating the Market

Time to look back2004 is over, now we are in... Read More

Analyst Reports

When you become interested in a stock or mutual fund... Read More

Bottoms Ups

If you have talked to a stock broker or financial... Read More

Stocks Options Trading

Let's assume that you want to make some serious money... Read More

Choosing A Fund

For years I have been saying you must have a... Read More

Choosing a Stock Broker

If you were to find that you had some severe... Read More

A Good Fund Manager

Every Wall Street analyst, financial planner and broker will tell... Read More

Market Timing?

The recent criminal fiasco in the mutual fund industry is... Read More

neptun lighting street light system Pete's produce ..
neptun lighting street light system Pete's produce ..