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Sunday, 22 July 2012

London Stock Exchange

If you wish to learn the ancient story and the modern glory about investment options, learn the history and growth of London Stock Exchange. Its background information has to start from 1773, the year it was founded in this river city. This is the world's oldest stock exchanges and one of the top three leaders. New York comes first followed by Tokyo and London. It was reincorporated as a private limited company in 1986. As for the international share trading it is the leader. It has grown like the octopus, its roots and branches have spread to a number of market products. Some of them are:
  • The main Board listing involves 3,000 companies, including 500 international companies.
  • The secondary AIM (Alternative Investment Market), to trade in small, high growth companies was established in 1995.
  • 70+ companies are listed on the AIM Board.
  • With the launching of SETS (Stock Exchange Electronic Trading Services) in 1997, a new listing techMARK is introduced, to meet the specific needs of high technology sector. This service is comparable and competitive with the NASDAQ index.
As for the British, trade and imperialism were the alternative beats of the same heart from the sixteenth century onwards. LSE is part of the colonial history of the British Empire. The development of the share-based empire is the outcome of their trade and territorial expansionist ambitions. Trade was a means to get the political hold in a land of their choice. Organizations by a single individual or partnership of three or four persons, could achieve the limited objectives. The great trade explorations voyages had to be financed through broader channels. So, the first shareholder-based company came to be established in the year 1553. The arithmetic behind this exercise was simple. Divide the risk between a large numbers of individuals by selling those shares. The company thus raised funds that were required for its operations.

The mushroom growth of Exchanges created its own problems, and a need was felt for mutual cooperation and the Association of Stock Exchanges was formed which led to closer coordination between them. At that time, 20 exchanges operated outside of London. Since the small ones amongst them were no more viable, in 1973, smaller provincial exchanges were molded into a single national exchange under the LSE.

LSE faced he real challenge in the 1990s. The internet revolution, led to drastic changes, in the style of operation of the Stock Exchanges, which had far reaching consequences with the approach of the brokers to the clients and vice-versa. The days of telephonic confirmations were dead and gone. The transactions picked up pace and the turnover of buying and selling increased. Trading continued non-stop around the world. A big population began to veer around stock investments. The number of investors and brokers increased to staggering heights.

To be one of the oldest financial institutions is one thing, but to occupy the position of one of the top leaders is creditworthy. LSE fits into the later category. It constantly reviews its functional policies and is willing to change to move ahead with the needs of the time. So, it is a long, long journey from the coffee house of the 17th century London to the topmost financial institution. Presently it is in Paternoster Square close to St Paul's Cathedral in the City of London.

The four core areas of LSE operations are Equity markets consisting of Main Market Alternative Investment Market (AIM), Professional Securities Market (PSM) and Specialist Fund Market (SFM), Trading Services, Market Data Information and the derivatives. The trading sessions are from 8.00 to 16.30 hrs. except on Saturdays and Sundays which are weekly holidays.

For more information please visit www.sogotrade.com , an online stock trading website.

Online Stock Trading Basics

However, there's still a learning curve, and as it's investing with your money, making that learning curve easier to deal with is important. Getting up to speed quickly helps improve your return on time invested in investing.

First, decide what time horizon you're investing for. A long time horizon is "buy and hold" - you're expecting the value of the stock to increase over time, or you're expecting dividends to earn out in your favor. A short time horizon means you're looking for sharp, immediate gains. Different people have different levels of acceptable risk and temperaments; for some, the adrenaline rush of a buy-and-sell strategy is a drug. For others, the security of buying stocks for the long term allows them to plan.

In the long run, the safest payout is the long time horizon; on average, the stock market returns an inflation adjusted rate of return of about 8-9%, compared to bonds which return at 2-4% after inflation adjustment. Most stocks are held in portfolio accounts for 401(k) plans, which allow investment brokers to leverage large amounts of money to make big purchases...and these tend to be conservative, and fairly safe.

If you need to immediately convert a small amount of cash into a larger amount of cash, you have to take a riskier day trading approach. Day trading approaches take considerably greater due diligence and research to pull off. Become a sponge for information that relates to the companies you hold, so that you know when to sit out a round of buying.

Under no circumstances should you berate yourself for not selling at the maximum price - very few people can do this reliably. Nor should you berate yourself for buying a stock that drops in value - a lot of companies are hyping stock prices more than they are their own products, and that's one of the risks you take as an invester.

Always diversify your holdings, and whenever you make a gain, put at least half of it into a long time horizon investment package, to hold on to it. Think of it as pocketing your winnings at the table rather than doubling down every time. Never rely too much on one sector, but do hold on to stocks that match the pace of the index funds.

Check your ego and your emotions at the door. This is a business, these are your savings, and as John Wayne said, "Life ain't for sissies" You're going to lose some. Learn from them. Take time to have a life - it doesn't matter how your stocks are doing if you're just plotting charts and reading investment business daily every day.

Visit www.stressfreetrading.com to learn more about online stock trading basics.

Indian Stock Market Online Trading

There are lot of strategies available to do online stock trading in through Indian stock exchanges. Some of the investors may go for long term investments i.e. they will invest in stocks for years and will forget it. Some of the traders will go for short term investments to generate more returns. Do stock market research and learn stock market using share market tutorial. It is the best time to invest in the Indian share markets and get good returns.

There are two exchanges available in India.

BSE - Bombay Stock Exchange:

It is the oldest exchange and most of the index heavy weight stocks are traded in this exchange. The BSE 30 includes the top 30 stocks by market capitalization and this represents the Indian Sensex.

NSE - National Stock Exchange:

This is an electronic exchange. The top 50 stocks called National 50 or "Nifty" represents the index of the next 50 stocks by market capitalization. This is located in Mumbai.

Day trading and short term investments are strategies that area available in Indian stock markets for getting quick returns, but it is more risky. There are lot of chances to burn your fingers and lose the money which you have invested. But if you are bit careful you can always win.

Read some of my tips to earn returns quickly through Indian stock exchange.

Day Trading Strategies in Indian Stock Markets:
  • Initially do not take much exposure in stocks beyond your capacity, even if the brokerages give you excess exposure limit. Some stocks in India like Reliance Natural Resources Limited might look very cheap so that you can take more exposure. But try to limit within your capacity.
  • Get tips from 2 or more brokerage houses and then analyze the tips before investing. Some of the reliable brokerage houses in India are ICICI Direct, Sharekhan and Motilal Oswal.
  • Before you buy the stocks or sell the stocks on day trading, check the opening position of the stocks through Indian stock market live charts.
  • If the opening is against the brokerage recommendations, then for heaven sake do not take positions.
  • Watch the prices in the share trading software continuously till you close the position. Some of the software that gives the live prices are available in ICICI Direct and Sharekhan.
  • if you feel the stocks breaches the stop loss price, then immediately close the position.
Short term Investments in Indian Shares:
  • This is another type of investment where you can buy stocks and keep it for one or two months and then exit once the price reaches the target. Target some mid cap stocks like Power Grid Corporation and other banking stocks like State Bank of India, ICICI Bank and HDFC Bank.
  • Stock market education is essential to do clear analysis and invest. Investor learning sessions are conducted by leading brokerage houses like ICICI direct and Sharekhan.
  • This is less risky when compared to day trading.
Online stock market trading is the most efficient way to do trading in this modern world. You can also go to www.investmutualfunds.net, they also provide research reports for other financial products like investing in mutual funds.

Online Stock Exchange Trading

A Guide for Selection of an Online Stock Exchange Trading Broker

An online stock exchange broker may be a person or automated. Both choices have their corresponding strong and weak points. Now more than ever, people have gotten more interested in trading stocks and currencies after realizing that there is real money being exchanged back and forth behind all those seemingly obscure numbers and induces.

Should you choose a person or robot?

Now the crux of the issue is at hand. Beginners who have no idea of the market are more comfortable on having a broker doing the trading for them. Naturally, this offers several disadvantages. The first obviously is you do not have control over your account. It takes a lot of gumption to entrust to somebody, a virtual stranger at that, to handle your hard-earned money. It must be noted, however, that the risk is minimized if you go to the best stock market brokers online as they have the history and experience to turn your investment into a profit.

Automated trading platforms, meanwhile, offer you flexibility and total control of your money. Before choosing this artificial intelligence software, you do need to have a working knowledge of how stocks and Forex operate because you cannot rely on stock market brokers to cushion the negative consequence resulting from unfamiliarity.

How much can you risk?

Next, you really have to take a stock of how much can you risk on the volatility of the financial market. Different stock market brokers have their standards on the minimum amount of investment required of you. This can run up to thousands of dollars. In contrast, automated platforms allow a minimal deposit fee and transaction size which allows you to start going with a minimum margin to risk.

Just remember that whether you choose live stock brokers or automated platforms, everybody is still governed by the same rules. You learn all those rules and make them work for you.

Are you a day trader or swinger?

Now, you need to make a decision if you want to be a day trader or you want to be an active trader, or what's known in the industry as a swing trader. If you decide on the former, online platforms are an ideal tool to help you. Day trading involves closing transactions the same day. But there are others who want to sit on their stocks for a longer period of time. They may need the services of stock exchange brokers on this one.

As you can see, there are some hard decisions to make before you venture into interesting world of stocks. You need to study all the quotes and indicators, charts, positions and spread, balance, trailing stops. And that is just for the data feed and order entry system. Then you also have to study geopolitical and economic issues as well as current events that will influence your account. Whether you choose online brokers or automated platforms, you still have to know the ins and outs of stock trading.

See also: www.easy-forex.com