Quality management is certainly a key motivation in attracting a reporters attention. This helps persuade the reporter or a radio/TV producer that the proposed interview isnt going to be with someone who has nothing to say or just rehashing a clich or tired, old story. The higher the title and the better known a company, the greater the impingement a PR pitch (thats what publicity people use to sell a reporter) impacts upon a member of the media. If someone from the publicity department at Microsoft calls Fortune magazine to ask about profiling Bill Gates, the pitch will have major impingement value. Few names have this kind of clout, either personally or corporately.

In any event, the senior editor of the major magazine will still inquire about the story angle. The editor will want to know, What are we going to talk about? Ultimately, it is the outstanding story that sells magazines or newspapers, not just the big name. Not all such stories involve a big name speaking or spouting his thoughts for the day. Often, better stories evolve when there is a strong newsworthy angle. Lets look at two recent stories one which involves a uranium company and another one about a coalbed methane (CBM) company, which weve covered in this column.

On Thursday, Pacific Asia China Energy (PACE) was featured in the Financing section of Canadas Globe and Mail newspaper. Headlined High-Energy Performer, the opening sentences told us why the reporter was interested: PACE holds contracts to help China explore for and develop its coalbed methane (CBM) resources fuel China needs to help satisfy its energy demands.

The big story, which drew the newspaper to Pacific Asia China Energy, was China. PACE piggybacked that story because the company may be helping to offer a legitimate solution to the countrys energy mix. Part of the big story is the possible size of the recoverable gas, estimated in a technical report by Sproule International to be as large as 11.2 trillion cubic feet of gas.

Those two items enhanced the reporters interest in PACE. China needs alternative energy sources, such as CBM, to improve their energy mix from a near total dependence upon coal. And, PACE has a potentially huge resource, which could last a good number of years. Such a gas resource could be sufficiently large to make an impact on China. After all, China has proven reserves of a little more than 30 trillion cubic feet. Another 11 trillion cubic feet, should the potential be proven up, would represent a significant increase of available gas in a very large country. By itself, this could later develop into a major international energy story, reported upon by a great number of news media. Another impingement about the reporter is having the satisfaction of reporting upon a good story, well before others write the story.

Chatter in the newsroom:
Did you hear about PACEs gas discovery in China, Bob?
Bobs Reply: Oh that one. Yeah, I wrote about it eight months ago!

Therefore, there are multiple impingement points in this story. Each draw, or a reason to attract eyeballs to the story, is another point the story must score, for the reporter and his editor, to overcome the hurdles of being featured in a major publication. China is a draw. The size of the PACE coalbed methane gas resource is a draw. The potential impact upon Chinas energy mix is a draw. Writing about it before the rest of the pack jumps on the bandwagon? Thats a draw, too. In this case, four draws sufficiently attracted media coverage for this small CBM development company.

Sometimes, the timing is just perfect, and the overpowering big story accidentally introduces a lucky guy onto the worlds stage. On the same Thursday, the PACE story was carried in the Globe and Mail, the Chief Executive of a tiny Canadian uranium company impinged on a Russian news service reporter in Hong Kong. Such was the good fortune for Craig Lindsay, a Certified Financial Analyst, who has spent more than 16 years in corporate finance, investment banking and business development, according to the website of Magnum Uranium, for which he now serves as Chief Executive.

While Magnum has a market capitalization of about $15 million, and Lindsay is neither a geologist nor engineer, RIA Novosti news agency touted him as a well-known energy expert. Admittedly, Lindsay gave a great speech at the Hong Kong Club for foreign correspondents. Cleverly, he announced, Uranium may be the next oil, during his speech. As many other industry experts have predicted, Lindsay also forecast uranium may hit $50/pound by the end of the year. So many are now announcing this it is likely to become a self-fulfilling prophesy.

What elevated Lindsays publicity was not what he said in his speech. Most of his commentary has been already been reported in numerous publications, including in our columns. (What reporters really hate is rehashing old news to give someone publicity!) It was to whom Lindsay was speaking, and especially the timing as to when it was said. Here is how Craig Lindsay got his 15 minutes of fame.

About six hours earlier, the very same Russian news agency reported that Russia and Kazakhstan had signed a uranium deal worth $1 billion. The photos of Russian President Vladimir Putin and Kazakh President Nursultan Nazarbayev appeared as the photo op which goes with such really big stories. This was a major event involving two very big names, and among the biggest names and countries in the uranium sector. This was also Russias first contract to import uranium; Kazakhstan is the worlds third largest uranium producer. All of this is big news.

The clever Russian freelance reporter, who attended the Lindsay speech in Hong Kong, probably text-messaged or emailed his editor by Blackberry, tried to piggyback the Russian-Kazak story with his own story. Yes, that is how timing works. As soon as a major event takes place, other journalists rush to piggyback the event with their story. The Russian reporter scored points with his editor and got his story filed (slang for published).

Two cunning gentlemen, the Russian stringer (slang for freelance reporter), and Craig Lindsay (whose name was spelled Kreig Lindsay in the article), both accomplished their purposes. Mr. Lindsay got his company into the worlds spotlight. The Russian stringer got a great story. The reporter threw up a softball question, for which Mr. Lindsay supplied the desired answer.

What was the question the reporter asked Lindsay? Thats pretty obvious from what the reporter published in his article. Here is a clip from the Moscow News article:

Foreign investors are ready to invest in Russias uranium industry, if Moscow wants this to happen and establishes a necessary legal base, Lindsay said. I believe that Russia is one of the most promising directions for this kind of investments, it is an undeveloped market, full of opportunities. My company will be the first to come to Russia, if the necessary conditions are created, he added.

Nowhere in Lindsays speech did Magnum Uraniums Chief Executive discuss investing in Russia. However, the reporter NEEDED a good quote. It had to tie-in with investing in Russia for uranium development. Lindsay accommodated. He didnt commit to investing in Russia, but he kept the door open. Magnum Uranium recently announced the acquisition of a 1,080-acre land package in Converse County, Wyoming. The company is also exploring for uranium in both Wyoming and the Athabasca Basin. Its finances are probably already stretched from both exploration and acquisition activities. Magnums market capitalization would probably be insufficient to launch investments into Russia, at this time.

However, Lindsay did a great job getting his company this caliber of publicity. And he got the uranium sector excellent publicity. He capitalized upon an impinging story a story that did show up on the worlds radar by correctly supplying an answer the Russian journalist was trying to prod out of him.

This is the essence of how journalists and publicity-seekers work together. If the PR person gives the journalist the story angle he is looking for within the bigger story, chances are it will appear in print. Piggybacking a main event is the most common way to increase ones impingement value to a reporter. And by being a cunning interviewee for his Russian reporter, Craig Lindsay just got Magnum Uranium into this column as well!

A Companys Story Must Carry Impingement Value to Obtain Widespread Publicity is a post from: Finance Blogs | Fabbkhamus.com

Any company the size of Microsoft, with a market-cap of $242 billion, will find growth an issue because of its size. But this is not to say the stock is dead. Far from it, Microsoft remains a viable long-term software company and is cash rich with $34 billion or $3.28 per share in cash. This gives the stock plenty of financial flexibility to develop or buy growth technologies. Microsoft just announced it would spend $1.1 billion in R&D at its MSN Internet unit in the FY07. And according to the Wall Street Journal, Microsoft is exploring the possibility of taking a stake in Internet media company Yahoo (YHOO) to take on Internet advertising behemoth Google (GOOG).

But with an estimated five-year earnings growth rate of a pitiful 12%, the company has its work cut out for it. Trading at 16.30x its estimated FY07 EPS of $1.44, the stock is not expensive but appears to be priced not as a growth stock.

Its PEG on the surface of 1.51 is not cheap, but if you discount in the cash of $3.28 per share, the estimated PEG falls to around 1,0, a decent valuation. Also, if Microsoft can improve on its estimated 12% growth rate, the PEG would decline further.

The fact is Microsoft at the current price deserves a look. If you want to play the stock but dont want to shell out the $2,347 for a 100-share block, you may want to take a look at the long-term options, also known as LEAPS. For instance, the in-the-money January 2008 $22.50 Microsoft Call LEAPS not set to expire until January 18, 2008 currently costs $380 a contract (100 shares).

This means you risk a total of $380 for the chance to participate in the potential upside of 100 shares of Microsoft over the next 20 months. The breakeven price is $26.30. If Microsoft breaks $26.30, you would begin to make money on your LEAPS. Conversely, if Microsoft fails to do anything, your maximum risk is $380 on the initial option play.

Warning: The aforementioned example is for illustrative purposes only and not to be construed as an actual option strategy. Due to the higher risk inherent in options, I recommend you speak with an investment professional before deciding to employ any strategy involving options.

A Cheap Strategy to Play Microsoft is a post from: Finance Blogs | Fabbkhamus.com

Dev Randhawa:
Several years ago, Strathmore Minerals started with the idea of acquiring properties out of the money at very cheap prices in the belief that the uranium prices would recover so that our assets would be worth more. No one was paying attention to the commodity we chose: uranium. Strathmore Minerals is basically a call on the price of uranium. Thats how we started the company. This strategy is similar to what Lumina Copper (AMEX: LCC) used and what Silver Standard used. For example, the chairman of Silver Standard Resources (NASDAQ: SSRI) is on our board of directors. Our first step was to buy every pound we could for as cheaply as possible. The second step is to buy property that we think we can put into production. We are actively looking for those.

Interviewer:
But uranium has a powerful environmental stigma. Why, then, are you enthusiastic about this type of energy source?

Dev Randhawa:
As with most people, when I began investigating uranium, I thought this was bad stuff. I thought of Three Mile Island and everything else. The more homework I did on this, the more I realized that nuclear power is clean and safe. That is primarily what uranium is used for now. It should be known that no one ever died at Three Mile Island. No one actually died at Chernobyl. Yes, people got sick. Compare that to coal or the oil spills in the fossil fuel sector, and the damage it has done to the environment. The problem is no one is championing nuclear energy. Frankly, the greenies have done a great job of burying the story. As I did homework, I found out France relies on nuclear power for about 78 to 80 percent of its electricity needs. I realized that somebody did a great job lobbying and built a very unhealthy picture toward uranium, when really its needed. We dont talk about the cost of coal. We dont talk about global warming. But, look at what coal has done. Global warming is a function of fossil fuels. That is why you are seeing a growing positive response to nuclear power. For example, one company has applied to put a new nuclear reactor into the US.

Interviewer:
To what do you attribute the recent, steep price rise in uranium?

Dev Randhawa:
Since last year, the price of uranium (U3O8) has climbed back steeply back up. At one point, the price was moving up about $1/pound per month. Uraniums price is more in line with the price of oil as opposed to other commodities. For a long time, weve only produced on the average about 90 million pounds, when we needed 140 (million pounds). Theres been an imbalance for a number of years. This extra came from foreign sources, or from internal US inventories. Since the 1980s, weve been using more uranium than we have been producing in the western world. As a result, the extra that weve needed has come from Russia, the US government or inventory that utilities had.

Interviewer:
But most investors, let alone the consumer, dont know that uraniums spot price has nearly tripled, since bottoming three years ago. Why is that?

Dev Randhawa:
Uranium only makes up one percent of the cost of running a nuclear reactor. The biggest factor in why uranium prices can go up, even more rapidly than gold, is that uranium is insensitive to its use. Uranium prices can go much higher. In casual conversations with a few Toronto analysts, some believe it can go up to $80 or $100/pound. For example, if the price of gold tomorrow went to $800/ounce, it will affect someones purchasing decision. The guy might say, I was going to buy this ring and now its up 70 percent because the price of gold is up. Maybe I will buy a silver ring instead. The same occurs with other commodities. People may change their purchasing decision based on a commodity price doubling.

If the price of uranium went to $44/pound, the average consumers electricity bill might go up a few dollars. It is not going to force someone to turn off their power. However, if the price of oil doubled tomorrow, many of us would be driving smaller vehicles. It would make a fundamental difference in how we behave. Thats not going to happen with the price of uranium. Its like buying pencils for your office. Its not going to change the way you do business. Even if no nuclear reactors come onboard for the next few years, the ones already there will need the pounds (of uranium). We have a shortage coming up.

Interviewer:
Why do you believe a uranium shortage is in the cards?

Dev Randhawa:
Bottom line is: the nuclear reactors are going to run out of fuel. You have to know that permitting takes a long time in the uranium industry. Its not like finding a gold property tomorrow and maybe two years from now you are pouring gold. Typically, the permit takes at least three years out. Because nuclear reactors need it, thats what is causing the price rise. Demand has kept going higher, but production has fallen off the chart. In this industry there are only about half a dozen companies exploring for uranium. At one time, back in the late 1970s and early 1980s, there were almost 150 uranium companies. There hasnt been any underground mining since the early 1990s. And that doesnt even include a wild card: there has been talk that by 2020, 90 percent of the nuclear reactors coming onboard will be for China.

Interviewer:
And what would reverse uraniums steep price rise?

Dev Randhawa:
The only thing that could kill this market would be if Russia discovered it had a lot more pounds to sell. Or the US government, through USEG, came up with more pounds. When we first entered the market, eight years ago uranium rose to around $17-$18/pound. Then it fell. What happened was the U.S. government sold their uranium to a private group, who turned around and dumped it into the market, from then until last year. In October of last year, the Russians were also dumping uranium onto the market for their hard cash.

Interviewer:
If replacement value for uranium comes in the form of exploration costs to find and mine this energy source, what would that cost be?

Dev Randhawa:
Realistically, it would be $20 to $22/pound. I know some are going to say they can do it for less. By the time you take your exploration costs, development costs, and so on, you really need to get $22 to $25 for most properties to go into production and still make money. Thats why most of what you see in the market are ISL (in situ leach) projects. On one property we discovered, it would cost between $16 and $17/ pound to pull it out of the ground. But on others, it might take $20 – 22/pound to pull it out of the ground, after labor costs and sell it on a forward contract. Canada is producing the most uranium because of the grades. Some say Canada has the lowest cost, but thats not quite accurate. What they mean to say is that the cash costs are the lowest. People forget that it costs up to $2 billion to put some of these into production. Cameco (NYSE: CCJ) was a creature of the government at one time. They were treated that way.

Interviewer:
Earlier you noted that investing in Strathmore Minerals was basically a call on the price of uranium. Can you clarify what you meant by that?

Dev Randhawa:
As uranium prices, the share price of Strathmore Minerals should rise. If you look at Bema (Amex:BGO), when gold prices were at $265/ounce, what was it worth? As the price of gold moved up, it had value. Has it gone into production yet? No. Silver Standard (NASDAQ:SSRI) is similar, but it has had to tell its story because people are so focused on gold. The key for investors is not to go where the crowds go, but to go where you can find value. If you believe that nuclear power is the place to be, and the shortage is real, you have got to own uranium stocks.

Interviewer:
What sets Strathmore Minerals apart from any other exploration companies in this sector?

Dev Randhawa:
I challenge any junior exploration company to show an individual who has actually put an ISL (in situ leach) uranium mine into production, including Cameco. They just arent around because the industry has been dead since the early 1980s. There arent many experts left in this business. The last standing geologist, which Cogema had, was David Miller, who is now working with Strathmore Minerals, as our head consultant. He is the one who has put the Strathmore strategy together. Weve been looking in southern and eastern Africa. Strathmore is going wherever there are pounds that others have overlooked. Our competitive edge is a database we acquired from Kerr McGee (NYSE: KMD), which used to be number one in the uranium industry. Recently, we announced properties in Wyoming that could be satellite ISLs. We have enough pounds there that we could throw one of them into production. But we still need higher prices. We are still in the acquisition stage.

Strathmore is going to be very aggressive in picking up properties that we think have pounds in the ground or smaller properties that we think can be ISL-able in the US. Everything were looking at in the US is for ISL. In Canada, we have over 700,000 hectares in the Athabascan region. Thats a major asset for us. Its one of the richest areas in the world for uranium. Some of our targets are near existing mines. In Quebec, weve got a large property that was drilled by Uranerz. Robert Quartermain has certainly been a part of that strategy. Thats what he did with Silver Standard, and thats what were doing here. We are aggressively going after properties. When sophisticated investors meet our team, they see the story weve got and they see our management. Youll see why we were able to millions of dollars in financings. Our strategy has been to buy the has-been properties, the low fruit in all the trees. And thats what weve been doing.

*****************************************
Devinder Randhawa

Mr. Randhawa founded Strathmore Minerals Corp. in 1996 and is currently the Company’s CEO. Mr. Randhawa also founded and is currently the President of RD Capital Inc., a privately held consulting firm providing venture capital and corporate finance services to emerging companies in the resources and non-resource sectors both in Canada and the US. Prior to founding RD Capital Inc., Mr. Randhawa was in the brokerage industry for 6 years as an investment advisor and corporate finance analyst. Mr. Randhawa was formerly the President of Lariat Capital Inc. which merged with Medicure in November 1999 and the was the founder and former President and CEO of Royal County Minerals Corp. which was taken over by Canadian Gold Hunter (formerly International Curator) in July 2003. Mr. Randhawa also founded Predator Capital Inc., which became Predator Exploration. Mr. Randhawa received a Bachelors Degree in Business Administration with Honors from Trinity Western College of Langley, British Columbia in 1983 and received his Masters in Business Administration from the University of British Columbia in 1985.

A ‘Call’ On The Price of Uranium? is a post from: Finance Blogs | Fabbkhamus.com

Once you have a reliable set of stock trading rules it is important to keep them in mind. Here is one discipline that can reap rewards. Read these rules before your day starts and also read the rules when your day ends.

Rule 1: I must follow my rules.

Naturally if you develop a set of rules they are to be followed. It is human nature to want to vary or break rules and it takes discipline to continue to act in accordance with the established rules.

Rule 2: I will never risk more than 3% of my total portfolio on any one stock trade.

There are many old traders. There are many bold traders. But there are never any old bold traders. Protecting your capital base is fundamental to successful stock market trading over time.

Rule 3: I will cut my losses at 5% to 15% when I am wrong without question.

Some traders have an even lower tolerance for loss. The key point here is to have set points (stop loss) within the limits of your tolerance for loss. Stay informed about the performance of you stock and stick to your stop loss point.

Rule 4: Never set price targets.

This is a style that will allow me to get the most out of rising stocks. Simply let the profits run. Realistically, I can never pick tops. Never feel a stock has risen too high too quickly. Be willing to give back a good percentage of profits in the hope of much bigger profits.

The big money is made from trading the really BIG moves that I can occasionally catch.

Rule 5: Master one style.

Keep learning and getting better at this one method of trading. Never jump from one trading style to another. Master one style rather than become average at implementing several styles.

Rule 6: Let price and volume be my guides.

Never listen to any opinion about the stock market or individual stocks you are considering trading or are already trading. Everything is reflected in the price and volume.

Rule 7: Take all valid signals that show up.

Don’t make excuses. If an entry signal shows up you have no excuse not to take it.

Rule 8: Never trade from intra-day data. There is always stock price variation within the course of any trading day. Relying on this data for momentum trading can lead to some wrong decisions.

Rule 9: Take time out.

Successful stock trading isn’t solely about trading. It’s also about emotional strength and physical fitness. Reduce the stress every day by taking time off the computer and working on other areas. A stressful trader will not make it in the long term.

Rule 10: Be an above average trader.

In order to succeed in the stock market you don’t need to do anything exceptional. You simply need to not do what the average trader does. The average trader is inconsistent and undisciplined. Ask yourself every day, “Did I follow my method today?” If your answer is no then you are in trouble and it’s time to recommit yourself to your stock trading rules.

10 Golden Rules for Stock Trading Success is a post from: Finance Blogs | Fabbkhamus.com

1. If you believe you invested in the right stock(s), then turn off your computer and do something enjoyable. Exercise is a great stress reliever. The market has already begun its shakeout. If you didnt get stopped out, or failed to place earlier stops, your best opportunity lays ahead in picking up additional shares at a much lower price. Most of the experts weve interviewed tell us the next rally should start sometime between late July and Labor Day. In an attempt to interview the uranium guru James Dines in late May, we were told, Call back in a couple of months. That was a helpful clue that the markets were less than exciting. Mr. Dines is often eager to be interviewed, but recently he was not.

2. Do you believe the fundamentals which engendered the commodities boom have changed? If they havent, then the bullishness is only taking a breather. We dont see any fundamental change in the markets. Russia still wants nuclear power, and its oil production may be peaking. China hasnt announced the end of its nuclear expansion program. India wants to spend $40 billion on new nuclear reactors. If you are invested in uranium stocks, spot uranium jumped another dollar to $45/pound this past week. Hardly the end of the bull market.

3. If you worry about your investment in one stock or another, then stop watching the ticker and focus on the company fundamentals. Is the story still true or has it changed? See #7 A, B and C below.

4. Theres an old clich that the time to buy is when you feel like dumping everything you own in the category. At the exact moment you want to sell your entire portfolio of uranium stocks, it may be wiser to add to your holdings. This applies mainly to the retail investor. Most of the professionals did dump at the top and are now slowly accumulating the shares of the nave who waited until the washout to start selling off.

5. Has a major, earth-shattering event occurred? The last bull cycle in uranium ended with Three Mile Island (TMI). The last decent rally in the precious metals markets fell off a cliff after it was discovered Bre-X Minerals had perpetrated a fraud about its gold discovery in Indonesia. Something significant and newsworthy always transpires, and it is also far-reaching. That is the trigger. As with TMI and Bre-X, those were the first shots which launched a later chain reaction to end those bull markets.

6. Before pulling the sell trigger, ask yourself: Do I really want to give up these shares to a bargain basement hunter, who will make a killing on my losses?

7. Since most of you will still panic, please review the following basics for any of the uranium companies youve read about:

A) How much cash does the company have in the bank? During shakeouts, cash is king. Prescient companies, which completed their financings during the recent and robust rally, are sitting pretty. They can weather the short-term storm and are well-oiled to move forward when this correction bottoms and reverses. Those companies are the strongest ones to check out when this correction looks gloomiest.

B) Has the management remained the same? Unless the top financial and/or technical people blew out the door, in recent weeks, the story probably hasnt changed much. Companies which built a strong technical team are resilient and powerful. They will move forward.

C) Have the properties come up dry? One of the reasons you invested in a uranium company was because it announced it had pounds in the ground. Some companies have more than others. Some went to the expense and trouble of completing a National Instrument 43-101, which independently confirmed the quantity and quality of the uranium resource. If that changed and the company announced, Sorry, nothing there after all, or announced, Hey, we were kidding, thats one thing. If you havent heard that, or read a news release announcing that, then the uranium didnt walk away or move onto a competitors property. Its still there.

Next time, when the markets are racing higher, and you feel like you won the lottery, consider this bit of biblical advice. The old joke goes, When did Noah build his ark? The answer of course is: Before it began to rain.

9 Survival Tips for the Market Shakeout Blues is a post from: Finance Blogs | Fabbkhamus.com

1. Penny Stocks are a penny for a reason.
While we all dream about investing in the next Microsoft or the next Home Depot, the truth is, the odds of you finding that once in a decade success story are slim. These companies are either starting out and purchased a shell company because it was cheaper than an IPO, or they simply do not have a business plan compelling enough to justify investment banker’s money for an IPO. This doesn’t make them a bad investment, but it should make you be realistic about the kind of company that you are investing in.

2. Trading Volumes
Look for a consistent high volume of shares being traded. Looking at the average volume can be misleading. If ABC trades 1 million shares today, and doesn’t trade for the rest of the week, the daily average will appear to be 200 000 shares. In order to get in and out at an acceptable rate of return, you need consistent volume. Also look at the number of trades per day. Is it 1 insider selling or buying? Liquidity should be the first thing to look at. If there is no volume, you will end up holding “dead money”, where the only way of selling shares is to dump at the bid, which will put more selling pressure, resulting in an even lower sell price.

3. Does the company know how to make a profit?
While its not unusual to see a start up company run at a loss, its important to look at why they are losing money. Is it manageable? Will they have to seek further financing (resulting in dilution of your shares) or will they have to seek a joint partnership that favors the other company?

If your company knows how to make a profit, the company can use that money to grow their business, which increases shareholder value. You have to do some research to find these companies, but when you do, you lower the risk of a loss of your capital, and increase the odds of a much higher return.

4. Have an entry and exit plan – and stick to it.
Penny stocks are volitile. They will quickly move up, and move down just as quickly. Remember, if you buy a stock at $0.10 and sell it at $0.12, that represents a 20% return on your investment. A 2 cent decline leaves you with a 20% loss. Many stocks trade in this range on a daily basis. If your investment capital is $10 000, a 20% loss is a $2000 loss. Do this 5 times and you’re out of money. Keep your stops close. If you get stopped out, move on to the next opportunity. The market is telling you something, and whether you want to admit it or not, its usually best to listen.

If your plan was to sell at $0.12 and it jumps to $0.13, either take the 30% gain, or better still, place your stop at $0.12. Lock in your profits while not capping the upside potential.

5. How did you find out about the stock?
Most people find out about penny stocks through a mailing list. There are many excellent penny stock newsletters, however, there are just as many who are pumping and dumping. They, along with insiders, will load up on shares, then begin to pump the company to unsuspecting newsletter subscribers. These subscribers buy while insiders are selling. Guess who wins here.

Not all newsletters are bad. Having worked in the industry for the last 8 years, I have seen my share of unscrupulous companies and promoters. Some are paid in shares, sometimes in restricted shares (an agreement whereby the shares cannot be sold for a predetermined period of time), others in cash.

How to spot the good companies from the bad? Simply subscribe, and track the investments. Was there a legitimate opportunity to make money? Do they have a track record of providing subscribers with great opportunities? You’ll start to notice quickly if you have subscribed to a good newsletter or not.

One other tip I would offer to you is not to invest more than 20% of your overall portfolio in penny stocks. You are investing to make money and preserve capital to fight another battle. If you put too much of your capital at risk, you increase the odds of losing your capital. If that 20% grows, you’ll have more than enough money to make a healthy rate of return. Penny stocks are risky to begin with, why put your money more at risk?

5 Tips for Investing in Penny Stocks is a post from: Finance Blogs | Fabbkhamus.com

5 Steps to Investing Online:

1. Find a stock
This is the most obvious and most difficult step in stock trading. With well over 10,000 stocks to trade a good rule of thumb to consider is time of the year. For example, as I write this, it is the beginning of spring. It would make sense to consider stocks that traditionally make runs, or slide if you are bearish, during this time of year.

2. Fundamental Analysis
Many short term traders may disagree with the need to do ANY Fundamental Analysis, however knowing the chart patterns from the past and the news regarding the stock is relevant. An example would be earnings season. If you are planning
on playing a stock to the upside that has missed its earnings target the last 3 quarters, caution could be in order.

3. Technical Analysis
This is the part where indicators come in. Stochastics, the MACD, volume, moving averages, RSI, CCI, support levels, resistance levels and all the rest. The batch of indicators you choose, whether lagging or leading, may depend on where you get your education.

Keep it simple when first starting out, using too many indicators in the beginning is a ticket to the land of big losses. Get very comfortable using one or two indicators first. Learn their intricacies and you’ll be sure to make better trades.

4. Follow your picks
Once you have placed a few stock trades you should be managing them properly. If the trade is meant to be a short term trade watch it closely for your exit signal. If it’s a swing trade, watch for the indicators that tell you the trend is shifting. If it’s a long term trade remember to set weekly or monthly checkups on the stock.

Use this time to keep abreast of the news, determine your price targets, set stop losses, and keep an eye on other stocks that you may want to own as well.

5. The big picture
As the saying goes, all ships rise and fall with the tide. Knowing which sectors are heating up stacks the chips in your favor.
For example, if you are long (expecting price to go up) on an oil stock and most of the oil sector is rising then more likely than not you are on the right side of the trade. Several trading platforms will give you access to sector-wide information so that you can get the education you need.

5 Steps To Researching a Stock Trade Before Investing is a post from: Finance Blogs | Fabbkhamus.com

Step 1. Decide on the time frame and the general strategy of the investment. This step is very important because it will dictate the type of stocks you buy.

Suppose you decide to be a long term investor, you would want to find stocks that have sustainable competitive advantages along with stable growth. The key for finding these stocks is by looking at the historical performance of each stock over the past decades and do a simple business S.W.O.T. (Strength-weakness-opportunity-threat) analysis on the company.

If you decide to be a short term investor, you would like to adhere to one of the following strategies:

a. Momentum Trading. This strategy is to look for stocks that increase in both price and volume over the recent past. Most technical analyses support this trading strategy. My advice on this strategy is to look for stocks that have demonstrated stable and smooth rises in their prices. The idea is that when the stocks are not volatile, you can simply ride the up-trend until the trend breaks.

b. Contrarian Strategy. This strategy is to look for over-reactions in the stock market. Researches show that stock market is not always efficient, which means prices do not always accurately represent the values of the stocks. When a company announces a bad news, people panic and price often drops below the stock’s fair value. To decide whether a stock over-reacted to a news, you should look at the possibility of recovery from the impact of the bad news. For example, if the stock drops 20% after the company loses a legal case that has no permanent damage to the business’s brand and product, you can be confident that the market over-reacted. My advice on this strategy is to find a list of stocks that have recent drops in prices, analyze the potential for a reversal (through candlestick analysis). If the stocks demonstrate candlestick reversal patterns, I will go through the recent news to analyze the causes of the recent price drops to determine the existence of over-sold opportunities.

Step 2. Conduct researches that give you a selection of stocks that is consistent to your investment time frame and strategy. There are numerous stock screeners on the web that can help you find stocks according to your needs.

Step 3. Once you have a list of stocks to buy, you would need to diversify them in a way that gives the greatest reward/risk ratio. One way to do this is conduct a Markowitz analysis for your portfolio. The analysis will give you the proportions of money you should allocate to each stock. This step is crucial because diversification is one of the free-lunches in the investment world.

These three steps should get you started in your quest to consistently make money in the stock market. They will deepen your knowledge about the financial markets, and would provide a sense of confidence that helps you to make better trading decisions.

3 Steps To Profitable Stock Picking is a post from: Finance Blogs | Fabbkhamus.com

You might be saying to yourself that greed and fear will never get in the way of my trading,
but believe it or not they will be. It is not something to be ashamed of. It is something you
have to admit to, come face to face with, If you are to become a successful stock trader or
investor.

What do greed and fear look like in the stock market trading arena?

You have been watching a particular stock for some time now. It has set up perfectly, so you pull the trigger. You bought it at the perfect price and now it is moving higher just as you thought it would.

Now greed steps up to the plate and says to you, this is going to be a rocket ship. So you buy some more shares. Or your stock moves a few points and goes passed the price that you decided to get out. Greed tells you this baby is going higher tomorrow so you hang on.

When stocks make strong moves to the upside greed from all the cumulative market participants joins the move.

Stock prices usually fall faster then they go up, and when this happens, fear now steps up to the plate.

Lets look at the example above, where your stock went through your get out price and you held on because greed was by your side. The next morning the stock price gaps down. Their is heavy selling all morning long. Greed is telling you to hang in there the price will come back. The price keeps going down, now you get a knot in your gut, and your knuckles are turning white. Fear is now by your side, but by now it is to late, your nice profit has turned into a loss.

Everyone goes through this until they have mastered the ugly faces of greed and fear. Master this and you are well on your way to becoming a successful stock trader.

Greed And Fear is a post from: Finance Blogs | Fabbkhamus.com

To make a less confusing analogy, think about the role of an auctioneer. The auctioneer’s role is to get the highest and best price for each product. Well, the stock exchanges around the globe kinda operate in the same fashion. The auctioneer role, is called a Market Maker. In a stock sale, there is no stable, set price for stocks, but instead, setting the price is the role of the Market Maker.

The price will fluctuate greatly, because the ying and yang of the market, the buyers and sellers, will bid on either the stock going lower, or higher. Usually when you see a stock price go up, it means that the buy price of a stock has increased. This is vice versa when a stock declines in value.

Now I am sure you have seen visuals on the major news networks of how a stock floor looks. You know, the floor where tons of stark raving mad folks, scream numbers and look at monitors and make trades all day. The trading day starts at 9:30 in the morning Eastern Time, and stops at 4:00 in the afternoon Easter Time. Depending on business news, market forecasts, world events, and a few other things thrown in between, can dictate how much volume a market can have in a day.

The last couple of paragraphs have mentioned all of the particulars of two major markets, the New York Stock Exchange(NYSE) and the lesser known American Stock Exchange. But there is a third one too! It is called NASDAQ.
Now what makes NASDAQ quite unique from the other two, is that this market is controlled by computers. Despite the technological advances of this stock market, NASDAQ still has the conventional bidding water of NYSE and American Stock Exchange. The buyers and sellers have their own areas to buy and sell stock, and bid through a quote system called Level II.

The great thing with stock trading, is that in order to be successful with trading stocks, you do not have to be in the pit, bidding like a madman on the hunt for their lives. Not at all! You can now use the very computer in your house, or go to a trading office if you live in a big city and trade stocks. Many different internet based brokerages are out there, and have plenty of materials to get you started on your way to becoming a great stocktrader!

PROFIT ON!

Go Stock Trade . com Primer: What is the stock market all about? is a post from: Finance Blogs | Fabbkhamus.com