• Who is BetterTrades

People have a lot of questions about the stock market. Many of them come to better-trades.com in search for the answers. After all, traders understand that learning to make money is the ultimate goal of any stock market education company.

Making more money is the aim of everyone who gets involved with buying and selling stocks and options. (No one intentionally sets out to lose money, do they?) The company was formed to help people from all backgrounds and levels of education make money in the stock market. Students are not required to have a college degree in finance or banking. A student isn't required to have an MBA. Being good at math is not a requirement to succeed. Only desire and determination to go along with the proper material to follow is needed.

Who does Better Trades benefit the most? Primarily it benefits anyone who wants to learn how to use the stock market. Since the stock market is a great economic engine, it can be harnessed by people are willing to get the proper education and use the material in the manner that it was intended.

The trading population may find the following beneficial:

Day trading

One portion of students who can derive much benefit from Better Trades is the segment known as day traders. Someone who enjoys being involved with the market, getting in and out of trades in a short period of time, is known as a day trader. Typically a day trader will open and close a position in many trades during market hours.

Day trading used to be restricted to professional investors and speculators, but due to the onset of electronic trading accounts via the Internet, day trading is now an option for anyone.

Some day traders focus on very short-tem trading within the day. Sometimes a trade may only last a few minutes. Some day traders focus only on technical patterns, while others prefer to focus on price momentum. Better Trades can help a day trader find the proper market leaders regardless of their approach.

A Better Trades education can be beneficial for day traders for many reasons. Among them:

• Day traders must be properly educated or they risk being crushed by the stock market. It is recommended that novice traders don't immediately jump into the day trading pool. Much skill and experience is recommended for day trading, otherwise a trader could quickly lose all their money.
• Better Trades provides the proper education for strategy and tactics that are necessary to be a successful day trader. Students of Better Trades learn to understand stock market strategies and tactics and how they can be used in any sort of market, whether bearish or bullish.
• Day traders must also have the proper amount of money in their trading account. A student must come up with the $25,000 required to set up a day trading account or otherwise be limited to one trade per day. The key for most people is to take a smaller account and grow it steadily to the point where it becomes large enough to be used for day trading.

Better Trades is all about helping people learn how to become more astute traders. Risk management, trade planning, and trade execution all help a day trader become more competent and prepared in the techniques most commonly used. The techniques include trend following, contrarian investing, range trading, scalping, rebate trading, and news trading.

Novice traders

The newcomers to the world of trading may be the ones who will derive the most benefit from Better-Trades.com. New traders must take their educational skills to the next level and be prepared to trade in the stock market. Just as new animals need time to get their legs under them before they can walk, a new trader needs time to get accustomed to the trading routine before taking stepping into the market. Better Trades encourages all new traders to spend time in paper trades, another name for practice trades or non-funded trades. In a paper trade, a student will enter a trade just like it was happening in real life, with the same directions to place the trade, the same instructions for exits and stops. Don't try to fudge the facts or cheat; you're only hurting yourself. Coming close doesn't count and the stock market doesn't give points just for trying. Be honest and make the corrections in your practice. Once you've made 10 or 20 consecutive successful practice trades you'll probably been proficient enough to put real money on the line.

Novice traders should seek the advice and counsel of other more experienced trader and instructors. Ask about the practicality of trading the market, what works and what doesn't. Ask your experienced friends about finding an online broker, how to set up your account, and let them talk you down from the ledge. Don't take stock advice from friends. No matter how much they know, find your own candidates and trade them. Don't rely on the advice of anyone else – not even Uncle Fred – until you analyze them possibilities for yourself. It may be a legitimate trade. It may also be a dud. Don't be pressured into buying or selling something you don't want.

Novice traders can also learn by visiting informative websites like Better Trades offers. The Wall Street Journal, Forbes, and CNN all have stock market information that can prove to be useful.

Experienced Traders

Perhaps you have been around the trading block one or two times. Maybe you can remember the old days, when conducting a stock transaction required a full-service broker, who took a big up-front fee in order to buy or sell your position. Things sure were expensive in those days, even for people looking to tap into the market leaders. The cost and the lack of access were factors that prevented average people from being involved in the stock market. Most people thought the stock market was only available to those who were smarter or well-heeled than the masses.

Availability to the stock market became easier after access to the Internet became a common occurrence. From the early days, when dial-up service was the only option, to the next step of DSL, it became easier and easier to conduct trading online. Now that most traders can hook up to the internet through speedy means like broadband or cable, it has become even simple to make an online transaction. Nowadays traders aren't limited to conducting business at home, since wireless computers and laptop machines enable users to travel and trade at the same time.

When students of Better Trades get more involved in the stock market, they'll likely want to stay abreast of what's going on. They'll want to know when the market is going up or down and will have specific stocks they watch. But you can't watch all the stocks all the time. You've got other stuff to do, right? So Better Trades encourages students to find a broker who offers the ability to set alerts. Many trading platforms allow a trader to receive an alert message or sound when a stock reaches a specific point. This can be established for a low selling point or a high selling point; you can even set prices at both extremes. Once that price point is achieved, an alert will be sent to your computer in the form of an email or to your cell phone in the form of a text message. When the alert sounds, the trader can look at the charts, refer to the intraday reading, and see if the trade has presented an appropriate entry or exit point. If not, the alerts may be reset as many times as needed. You can set as many alerts as you'd like, but experienced traders know they can't be watching too many stocks at one time. No one wants to check on hundreds of text messages as they start going off.

Technical Traders

Traditional traders of the stock market, as well as day traders, like to look at the technical indicators to see whether or not a stock is presenting itself as a play for the day. Technical analysis is one of the most common methods of predicting the movement and direction of stocks.

All technical traders rely heavily on a stock chart. The price chart is a sequence of plotted prices over a specific time frame. The most common stock charts are viewed in days, although analysts will sometimes look at how the stock has done by weeks, months or years. The daily chart provides a closer look at the immediacy of a stock's trend. A longer period of time can be used to get a proper historic view.

Day traders will look at the intraday charts a stock produces. These can be seen in a variety of time periods. Some day traders will watch the charts in one-minute intervals, while others prefer to make their moves based on a three-minute or, in some cases, a five-minute candlestick. The candlestick charts are the preferable way to watch the charts, as they more accurately exhibit the bullish and bearish tendencies shown by the stock.

Traders usually concentrate on charts made up of daily and intraday data to forecast the short-term price moves. The shorter the time frame and the less compressed the data is, the more detail that is available. Short-term charts don't have a lot of detail and can often be distorted by the volatility in the market that day. Short-term charts are subject to sudden price movements, big highs or lows that can distort the overall picture.

The basics of analysis for a technical trader are support and resistance lines. Better Trades encourages learners to master the ability to set support and resistance lines before going forward with their trading career. Support and resistance represents key places where the forces of supply and demand meet. Prices are driven up and down by supply and demand. Supply is synonymous with bearish moves and demand is synonymous with bullish moves.

Support is the price level at which demand is thought to be strong enough to prevent the price from declining further. The price has reached a level that makes it entice buyers to come back and make a purchase. Technical traders see support as a potential place for the stock to turn and go higher, thus making it an important spot to enter a trade. Think of support in terms of a floor of the house. The floor is there to support your weight and hold up your belongings, so you don't go crashing through.

Resistance, on the other hand, is the area at which selling is thought to be strong enough to prevent the price from rising further. Think of resistance as the ceiling. If you bounce a ball off the floor, it will rise all the way to the ceiling, hit it and bounce back. The ceiling resists the further movement of the ball. A stock's resistance tends to prevent a stock from rising any higher. Buyers see it as a place to jump out and take profits.

Sometimes stocks will break through resistance and continue higher. Sometimes stocks will break through support levels and continue to drop. But historically the support and resistance levels become important areas to watch. This holds true for any stock market company.

Students who come to Better Trades looking for technical help will want to familiarize themselves with many indicators. There are available with most professional charting programs and many can be found with the charts provided by your online broker.

There are hundreds of indicators out there. Any day trader or swing trader could be overwhelmed by the amount of material that can be included. Most market leaders recommend a trader should become educated concerning two or three indicators that they like and forget about the others. Too much technical information can equate into paralysis by analysis.

Among the most popular chart indicators used by a technical trader are: the accumulation/distribution line, the average directional index (ADX), Bollinger Bands, Chaikin Money Flow, MACD, the Percentage Volume Oscillator, price relative, Relative Strength Index, Stochastics, StochRSI, the standard deviation, price by volume, Price Oscillator, moving averages, Chaikin Oscillator, Commodity Channel Index (CCI), Average True Range (ATR), and Aroon Oscillator.

Fundamental traders

In a depressed financial market, the need to understand fundamental analysis has become increasingly important. Many stocks have reached historically low prices, which leaves the buyer seeking to make a Better Trade in need of the proper information. Bad, delayed or inaccurate information regarding the fundamentals of a stock can derail any potential trade.

Fundamental analysis is the means by which a Better Trades investor can research the financial information that determines a company's strength or weakness. Compare fundamental analysis to a piece of fruit: the apple or pear you purchase may look great on the outside, have a nice shiny skin and no apparent blemishes. But unbeknownst to the fruit buyer, the apple or pear may be completely rotten on the inside. And no one wants to buy a rotten piece of fruit, just like no one wants to buy a rotten stock. And even the market leaders occasionally have trouble with rot.

Fundamental analysis might possibly help the traders or day traders determine whether the stock in question is rotten on the inside. There are several tools that can be used to help in the area of fundamentals.

Average Daily Trade Volume: A stock's average daily trade volume is the first thing to consider. Make sure the stock trades at least 300,000 shares per day. If not, be cautious before trading it. And a stock market company will advise you to stay away from buying options on any stock that does not trade at least a million shares each day.

52-Week High and Low: Traders can pick up the pulse of a stock by looking at the 52-week trading range. If the stock is near its 52-week high, a day trader would need to determine if the stock is going to move higher or prepare for a pullback. If the stock is trading near its 52-week low, a trader could use that information to give an indication of how far the stock market company can potentially move.

PE Ratio: A stock's price-to-earnings ratio is determined by dividing its share price by its trailing 12 months earnings-per- share. The PE is a very subjective number and is comparable to other companies that provide the same goods and services. Generally a trader will want a company that has a lower PE ratio than its comparable companies.

Market capitalization: To determine the market cap, multiply the outstanding shares by the stock's price. A large cap is 5 billion or greater; a mid cap is from 500 million to 5 billion; small cap is 150-500 million; and a micro cap is 150 million or less.

The Sector Trader

Another group who benefits from a Better Trades education is sector traders. These are people who focus on a group of stocks that perform the same service or sell the same sort of goods. Some people follow tech stocks, others airline stocks, still others follow manufacturers of heavy machinery.

Why does this matter? Why would the ability to chase sectors matter in our pursuit of making a better trade? The answer is simple: Stocks within the same sectors typically behave in the same manner. If one is showing a bearish trend, the others will likely be in the same mood. Likewise, if one is showing a bullish tendency, chances are good that they will all be pointing upwards. Occasionally there will be a rogue stock that will buck the trend, but generally most stocks within a sector will act in a like manner.

Why is this the case? After all, these stocks are inanimate objects; they don't have feelings. Why should they behave in the same manner? It follows the same pattern because companies within the same industry group are affected in similar ways by market and economic conditions. Individuals who make better trades through involvement in sectors understand the way the groups work in tandem with each other.

It really doesn't matter what sort of stock market companies are chosen to watch. The stocks simply need to produce some sort of movement, which will give a day trader or swing trader some sort of entry point into a better trade.

The sector analysis can be taken a step further, as stocks are also broken down into subsectors. This allows a trader to drill down deeper into the sector and tighten the analysis even further. This allows a sector trader to zoom in even closer on the group of similar stocks.

Let's take a look at a common stock and see how the sector analysis works. Our example is Wal-mart (WMT), which belongs in the Food and Staples Retail sector. It can be placed in a subsector for Hypermarkets and Super Centers; the other subsectors are Food Retail, Food Distribution and Drug Retail. The other companies in the subsector with Wal-mart include Costco, BJs Wholesale Club, PriceSmart, Companhia Brasilieira, and Distribucion y Servicio.

A closer look at the stocks withiin that subsectors will show many similarities. They share the same upward moves and the same downward moves. This is generally because the stocks are affected by the same variables. If gasoline prices rise, each of the companies in the subsector will suffer because of the additional cost to deliver products. If the economy is robust during the holidays, it will likely signal good news and a bullish move for each member of the subsector.

In order to best monetize the sectors, a person in search of a better trade will learn how to find the sector that is moving the fastest, then locate the best stocks within that sector. Sector analysis is often used by investors who are practicing a sector-rotation strategy or by one using a top-down approach to select stocks in which to invest. In the top-down approach, the most promising sectors are identified first and the investor then identifies the individual stocks to be purchased.

Sector rotation simply means shifting assets from one sector to another. Since not all sectors of the economy are strong at the same time, it allows an investor to move money and make better trades on the sectors that are moving. A day trader or momentum trader who gets involved with sector rotation wants to get involved with the market leaders. By jumping onto the stocks moving the most, traders should be able to take most profit from their sector analysis.

Traders who don't want to stick with one stock can buy a fund that will include the different stocks in one particular sector. These exchange traded funds or mutual funds will typically either do very well or poorly, depending on the economic conditions at the time.

A Better Trades sector trader generally doesn't learn to watch the entire stock market. That's too much territory to take in at once. The sector trader likes to keep an eye on the groups of stocks that provide the same goods or the same services. In general, the stocks in a specific sector will move together, either all going up or all going down. Occasionally there will be a maverick stock with a sector, but most of the time the market leaders within a sector are affected by the same conditions and, therefore, will exhibit the same bullish or bearish tendencies.

The sectors are divided into these groups: basic materials, conglomerates, consumer goods, financials, health care, industrial goods, services, technology, and utilities. There are numerous subsectors within each sector, offering even more opportunities to make better trades.

The subsectors within the basic materials group are: agricultural chemicals, aluminum, chemicals (major diversified), copper, gold, independent oil and gas, industrial metals and minerals, major integrated oil and gas, nonmetallic mineral mining, oil and gas drilling and exploration, oil and gas equipment and services, oil and gas pipelines, oil and gas refining and marketing, silver, specialty chemicals, steel and iron, and synthetics.

Subsectors within consumer goods are: appliances, auto manufacturers, auto parts, beverages (brewers), beverages (soft drinks), beverages (wineries and distilleries), business equipment, cigarettes, cleaning products, confectioners, dairy products, confectioners, dairy products, electronic equipment, farm products, food (major diversified), home furnishings and fixtures, house wares, meat products, office supplies, packaging and containers, paper and paper products, photographic equipment, processed and packaged goods, recreational goods, recreational vehicles, rubber and plastics, sporting goods, apparel clothing, apparel footwear, tobacco products, toys and games, trucks and other vehicles.

Subsectors within financials are: asset management, closed-end debt funds, closed-end equity funds, close-end foreign funds, credit services, diversified investments, foreign money center banks, foreign regional banks, insurance brokers, national investment brokerage, regional investment brokerage, life insurance, money center banks, mortgage investment, property and casualty insurance, property management, real estate development, Mid-Atlantic regional banks, Midwest regional banks, Northeast regional banks, Pacific regional banks, Southeast regional banks, Southwest regional banks, Diversified REITs, healthcare facilities REITs, hotel/motel REITs, industrial REITs, office REITs, residential REITS, retail REITS, savings and loans, surety and title insurance.

Subsectors within healthcare are: biotechnology, diagnostic substances, drug delivery, major drug manufacturers, other drug manufacturers, drug related products, generic drugs, health care plans, home health care, hospitals, long-term care facilities, medical appliances and equipment, medical instruments and supplies, medical laboratories and research, medical practitioners, and specialized health services.

Subsectors within industrial goods are: aerospace/defense (major diversified), aerospace/defense products and services, cement, diversified machinery, farm and construct machinery, general building materials, general contractors, heavy construction, industrial electrical equipment, industrial equipment and components, lumber and wood production, machine tools and accessories, manufactured housing, metal fabrication, pollution and treatment controls, residential construction, small tools and accessories, textile industrial, and waste management.

Subsectors within services are: advertising agencies, air delivery and freight services, other air services, apparel stores, auto dealerships, auto parts stories, wholesale auto parts, wholesale basic materials, radio broadcasting, TV broadcasting, wholesale building materials, business services, catalog and mail order houses, CATV systems, wholesale computers, consumer services, department stores, discount and variety stores, drug stores, wholesale drugs, education and training services, electronics stories, diversified entertainment wholesale food, gaming activities, general entertainment, grocery stores, home furnishing stores, industrial equipment wholesale, jewelry stores, lodging, major airlines, management services, marketing services, wholesale medical equipment, movie production, music and video stores, personal services, book publishing, newspaper publishing, periodical publishing, railroads, regional airlines, rental and leasing services, research services, resorts and casinos, restaurants, se

curity and protection services, shipping, specialty eateries, retail specialty, sporting activities, sporting goods stories, staffing and outsourcing, technical services, toy and hobby stories, trucking, other wholesale.

Subsectors within technology are: application software, business software, communication equipment, computer-based systems, computer peripherals, data storage devices, diversified communication services, diversified computer systems, diversified electronics, healthcare information services, information and delivery services, information technology services, internet information providers, internet service providers, internet software and services, long distance carriers, multimedia and graphics software, networking and communications devices, personal computers, printed circuit boards, processing systems and products, scientific and technical instruments, security software, broad line semiconductors, integrated circuits semiconductors, equipment and materials semiconductors, memory chips, technical and system software, domestic telecom services, foreign telecom services, and wireless communications.

Subsectors within utilities are: diversified utilities, electric utilities, foreign utilities, gas utilities, and water utilities.

To make Better Trades, a student should be educated not to overlook the power of sector analysis. Whether a student is a day trader or a swing trader, being able to properly play a sector can mean big profits. This doesn't always mean a trade on one of the market leaders. And skipping sector analysis can be a short-sided decision.

Stock splits can also affect the entire sector. If one stock opts to split its stock, there is a pretty good chance some of the other stocks within the sector will also follow the same direction. Being able to sniff out such potential splits can lead to better trades. Failure to do so can mean money left on the table.