Amazon Founder Cashes Out, Does That Mean You Should Too?

The headline is dramatic – “Amazon Founder Sells $671 Million Worth of Stock.” Other headlines pointed out this is the largest stock sale Amazon CEO Jeff Bezos has ever completed. Speculation mounted after the news broke. Is Bezos worried that Amazon can’t make enough money as a company to justify its high stock price? Does this mean Amazon’s stock price has topped? Although we don’t know exactly what Bezos was thinking, we can be fairly certain he doesn’t believe this is the end of Amazon. While $671 million is a big sale, it represents just 1% of the shares Bezos holds. Bezos ...
Read More
| 0 Comment

Three Cheap Income Stocks in the Energy Sector

Oil is among the most volatile markets in recent weeks with crude oil futures declining more than 15% in July. After dropping more than 25% from its June high, oil is officially back into a bear market. Analysts generally define a bear market as a decline of 20% or more. Despite the fact that the new bear market has only just begun according to some analysts, there might not be much downside risk for oil. Based on futures prices, it’s likely oil is in a trading range and prices could move between $40 and $50 a barrel for some time. Trading ...
Read More
| 3 Comments

How the Election Should Impact the Markets

Between now and November, it is safe to say we will all hear a lot about the elections. News sites will publicize and analyze every word the Presidential candidates say. Commercials will fill the minutes between shows on almost every channel. Whether your favorite shows are on PBS or Cartoon Network, it’s unlikely you’ll be able to avoid hearing about the election. For most of us, this election will actually have an important impact on our lives. This is especially true for investors since news over the next few weeks is likely to impact stocks, bonds and in some ways, our ...
Read More
| 1 Comment

Five Ways to Trade a Rebound in China

In May 2015, China was among the hottest stock markets in the world. By the middle of June, the Shanghai Composite Index, a benchmark for stocks traded in China, was up 60% since the beginning of the year. Within a month, the index was down nearly 35%. Within seven months, traders in China had experienced a bubble and a crash. The 35% decline that began in June was the beginning of a bear market. By February of this year, the Shanghai Composite had lost nearly 50% from its peak and China was one of the least-loved stock markets in the world ...
Read More
| 1 Comment

Lessons for the Stock Market from the Commodities Markets

Financial markets are diverse, offering opportunities to trade stocks, bonds, commodities, derivatives on financial instruments and foreign exchange. Each market is different with its own personality but there are similarities between all markets. One similarity in all markets is that the potential risks of loss are highly correlated with potential rewards. Large rewards generally require a trader to accept large risks. That similarity has led analysts in all markets to search for strategies that can improve rewards while reducing risk. It might be surprising to some stock market traders to learn that many of the most reliable technical indicators were ...
Read More
| 2 Comments

A Sector Rotation Trading Strategy You Can Follow

If you watch any one of the business news channels for more than an hour a week, you are likely to hear an expert proclaim that investors are moving money in or out of particular sectors. They might say “money is flowing out of financials and into gold mining stocks” for example. While it seems statements like this require actual knowledge of what other investors are thinking, that really isn’t the case. Sometimes the comments are based on observations of money flow indicators and other times they might be based on a theoretical sector rotation model like the one shown ...
Read More
| 1 Comment

Four Cheap Large Caps Trading Under $20

Sometimes, as we all know, words can have different meanings to different people. For investors, the word “cheap” is one of those terms that can carry different meanings. To some investors, cheap stocks are those offering value, while others emphasize price when defining cheap. The first group looks at metrics like low price-to-earnings (P/E) ratios or they apply other valuation tools. The second group looks at the market price and calls a stock cheap when it’s trading below $1 a share, or $5 a share or maybe $20 a share. There are advantages and disadvantages to both definitions. Many investors believe value ...
Read More
| 5 Comments

Trade the Dogs of the Dow Strategy Using a Discount Shopping Strategy

You might be familiar with the Dogs of the Dow, a popular investment strategy that identifies stocks in the Dow Jones Industrial Average offering the best value. The strategy was first detailed in a 1991 book, Beating the Dow by Michael B. O'Higgins. The strategy buys the ten highest yielding stocks from the thirty stocks that are included in the DJIA and trades just once a year. These ten stocks are known as the Dogs of the Dow. Theoretically, high dividend yields are a sign of value in stocks as long as the dividend is safe. Large caps stocks included in ...
Read More
| 5 Comments