CHAPTER 1
You need moneyto make money
In Proverbs 13: 22 God's word says, "A good man leaveth aninheritance to his children's children: and the wealth of thesinner is laid up for the just." If you are someone who doesnot do everything this book instructs you to do, then the wealthof the sinners may not be laid up for you. I am talking about yourown personal money tree, or a place you can go to anytime you needmoney.
If you are one who does not need money and dislikes followinginstructions, then just stop reading this book and give it to someonewho will. You can always go back to doing whatsoever you weredoing before you got this book. A just person will not only follow theinstructions given in this book to the letter, but will not let pride orgreed get in the way of letting their money make money for them.
The money that you need to help you make money is not going to fallout of the sky right into your lap. Unless you were born with a silverspoon in your mouth or married to someone who has lots of money orpart of the privileged elite, you have to work for it.
To make the money you want there are things that need to be doneand they are not going to get done all by their self. Until you treatthis like a real job or an investment for your future retirement no onecan do it for you. Ask yourself, What should I do so I can quit my joband live anywhere I want, do anything I want and go anywhere I wantwhenever I want in less than five years? When you are ready to goforward, just continue reading.
The first thing you need to do is find a place for your money tomake more money for you. Just pick up a phone book and look for abrokerage firm in your area or go on line. If you don't have internetservice or a computer you can go to your local library and use oneof theirs. With today's technology you can do almost everything ona smart phone. By the way, this new job or business will allow youto deduct computer and internet service expenses. You need to belooking at the bigger picture.
Some brokerage firms will let you open an account with as little as$500.00 dollars; but, the more money you have the cheaper yourcommission will be. I've see them go from nothing to more than$11.00 dollars per trade. A trade is anytime you buy or sell a stock.You pay that dollar amount or commission every time you make atrade, weather you buy or sell one stock or a thousand stocks. That'show they make money to buy and sell for you.
When you find a place that will work with you, the first thing youhave to do is open an (Rollover) I R A Brokerage Account. Otherwise,every time you sell a stock, you have to pay a large tax on any moniesyour money made for you. This means you will have less money inyour account to make more money for you. The only time you haveto pay taxes on this money is when you take it out of your account.Your money is safe in this account until you reach the age of seventyyears old then you will be forced to take a portion out every year forretirement.
If you have a 401k or any other type of retirement account that youcan roll over into this new I R A Brokerage account do so at this time.This will be the tax free money that you will be trading with and theonly time you pay taxes on that money is when you take it out of youraccount. If you don't have a retirement account and you are 50 yearsold or less, you can start one with as little as $5,000.00 dollars. If youare 50, the most you can open one with is 6, 000.00 dollars. This canbe tax differed on your annual income.
Then every year you can tax defer another five or six thousand. It'salmost like having free money to make money with. The more moneyyou have to trade with the sooner you can retire. If you are married, thenyou can open up two accounts and have twice the money to trade with.
Until you start trading, place your money in a Money Market Fund.When you are ready to make a trade move the money from the MoneyMarket Fund to whatever stock you want to purchase. Any timeyour money is not making money for you, it should go back into theMoney Market Fund. When you want to know how much money youhave available to trade with, just check your Money Market Fundaccount. Whenever you sell your stock(s), instruct your broker toplace your money back into your Money Market Fund. This processmay take three to five business days before it becomes available totrade with.
If you attempt to buy or sell a stock before you have sufficient fundsavailable, they will shut you down up to ninety days or longer. This iswhy it's so important to wait three to five days for your funds to clearso you have money to trade with. You can trade by phone with yourbroker or do it yourself on line.
CHAPTER 2
Finding the rightstocks to buyand sell
The first criteria in find the right stock to buy and sell: It is bestto find a stock that has been around for ten to twenty years.Like the brand name of your favorite food or restaurant that'sbeen around for a long time and not planning to go away at any time soon.
In order to avoid any copy rights and names, I will use BR or BrotherRoland (BR) for all of the charts in this book. This way you will belooking at charts drown up by myself to illustrate or show you whatI'm talking about. On the next page you will find two examples ofwhat to look for. On page 16, chart # 1 shows you where BR has beenaround for less than 3 years. I've been told that more than 50% ofnew company's die or go bankrupt before 2 years.
You want to find stocks that's been around for a while, not here today andgone tomorrow. Like # 2 and # 3 charts on page 17. Because of 911 manystocks took a mud dive as you can see to the right of the graft where thenumber four is on page 21. Please take a minute and study this page and getfamiliar with where everything is you need to know about what your stockis doing. This 35 year chart for Brother Roland (BR) is only an imaginarystock used to illustrate a graft of what you're looking for, and is not one ofover 8,000 stocks you can pull up on the computer anytime you need it.
If you go to any search engine and click on finance it will take you to afinancial page. From that page you will find a place you can get a quote orsearch for any stock, with a box next to it. Just put in a company's nameor symbol in the box and then click (Get Quotes) you will get a picture ofa chart and right below the chart you can click on a day or year, just pickone. It will look something like the chart that is on the next page.
1) This is where you will find the names of the stock you are lookingat Following the name is the symbol or letter(s) used to identify thestock you're looking at.
2) This indicates a dollar amount your stock can go to.
3) This indicates where the stock was at the date indicated.
4) This shows what the stock did from the start 35 years ago up to 15minutes ago.
5) You can click anywhere on this bar to find out what the stock didfrom one day all the way down to the beginning when the stockwas first started.
6) This tells you where the stock is trading at right now. To the rightof this dollar amount you can see what your stock made or lostsince the market opened.
7) This tells you where the stock closed the day before, where itopened at the start of the trading day, it even tells you the 52 weeklow and high your stock did. All of these figures are constantlybeing updated throughout the day.
8) This is your page index. You can click on anything from quotes to abalance sheet. Anything you want to know about your stock can befound here.
9) This is where you can check different stocks using the same chart.Just put in the new stock cymbal or name and the click (Get Chart.)
10) This is when you want to get a quotes on any other stock. Just putin the new stock cymbal or name and then click on (Get Quotes.)Right below this is a indicator showing you how the Dow andNasdaq are doing.
I have taken the time to mark off the important places for you tofamiliarize yourself with. Every search engine has its own financepage. When you find the right charts that work for you, then click onit and send it to your favorites file on your computer and when youwant to use it just click on favorites.
You will be looking for 20 or more of these kinds of stocks for yourportfolio.
CHAPTER 3
You want tofind stocks thathave a dividend
Your next criteria is to find stocks that have a dividend or setamount that will be paid to the shareholders of that stock.Some stocks payout once a year and others quarterly. The setamount can be .01 to $4.00 dollars or more each time for every stockyou own. If you're going to buy and sell stocks, you might as well buystocks that have dividends. Part of my portfolio consists of having over50 stocks that pays out a dividend. I only buy three stocks if it is pricedunder $50.00 dollars and one if the stock is more than $50.00 dollars.(No more than 10% of your whole portfolio should go into this.)
Never keep all your eggs in one basket. This is also a good place tokeep a small amount of your money for three reasons.
1) The dividends will give you 5% or more on the money you keep inthe stocks you are holding.
2) If the stock you're in take's a mud dive or you need extra cash inyour trade.
3) Anytime I look at my portfolio I can see what all of my stocks aredoing at the same time.
The following words on this page may be repeated from a previouschapter but this is not a mistake, I have deliberately repeated thewords necessary to connect you to explaining dividends.
If you go to any search engine on your computer and click on financeit will take you a financial page. From that page you will find a placeyou can get a quote or search for any stock, with a box next to it. Justput in a company's name or symbol in the box and then click (GetQuotes). Now look on the page index and look for dividends. If youcan't find it on that page, type in dividends. It will look somethinglike the next page. If you still can't find it ask your Brokeragefirm how to find it on their web site. You will save lots of time byplacing this web site on your favorites list or even better by placingit on a short cut or making an app. on the screen when you turn yourcomputer on. So all you have to do is click on that app. and this willsave you lots of time when you are looking for the right stock to putinto your portfolio. Click on dividends and you will get a page thatlooks like the next page. Let's have a look, shall we?
This quote page is quoting Brother Roland (BR). As you can see onthe top left hand corner of the page. Right below the Company nameis a box where you can put any stock you want and click on go. Thenall you have to do is click on dividends: located on the left hand sideof your page and something like the example you have on page 27will come up.
Every stock is different; as well as the time you need to own them.
1) This is where you find the name of the stock you're looking at.
2) This is where you would go to change the stock you want to lookat. All you would do is type in the new name or symbol of thestock you want and then click go.
3) This is your index to where you can go back to the summary pageyou was just on or anywhere else you want to go to.
4) This is the date that you make money if you don't sell that stockuntil the following day after that date.
5) This tells you how much money the stock will make on each shareor stocks you own.
6) This is the date you must already own the stock. You must buythis stock one day before that date in order to make money on thisdividend.
Let's say you bought 1,000 shares of (BR) Brother Roland Companystock on 6/12/ 2011 and you sold it on 7/11/2011, how much moneydid your money make for you?
1,000 x .32 = 320.00
What would you have made if the dividend was .50 or 1.00?
1,000 x .50 = 500.001,000 x 1.00 = 1,000.00
Your 29 day investment made you 320.00 dollars. This might be morethan what your bank is giving you for your money, but it's not enoughfor you to retire on ...
Let's look at another example shall we?
So if you buy 1,000 shares of Brother Roland Stock on 3/11/2012 andsold 1,000 shares of Brother Roland Stocks on 4/11/2012 how muchmoney did your money make with a .41 cent dividend?
1,000 x .41 = 410.00 dollars
How much money would you have made if you sold 500 shares ofBrother Roland, Stock on 4/09/ 2012 and 500 shares of BrotherRoland, Inc. Stock on 4/13/2012 how much money did your moneymake with a .41 cent dividend?
500 x .41 = 205.00 dollars
In order to make money from any dividends, you must own that stockbetween the dates given. As you can see the amounts change as wellas dates. This stock ranges from .29 to .75 cents.
Let's take this one step further, shall we?
If you click on Historical Prices on you index, something like yournext page will pop up.
Say you buy 1,000 shares of Brother Roland Stock on 3/9/12 for$30.40 dollars a share and sold 1,000 shares of Brother Roland Stockson 4/11/12 at $31.50 a share how much money did your money makewith a .41 cent dividend?
1,000 x .41 = $ 410.00 dollars1,000 x 1.10 = $1,100.00 dollars
You made a total of $1,510.00 dollars in 30 days. You might be sayingto yourself, That's to good to be true? What if the stock went down$1.10 instead of up $1.10? If you keep the stocks it will make moneyfor you as long as you don't sell them below the price you boughtthem at. Now what if you knew that the price of the stock was goingto go back up $6.00 dollars, but you didn't know when? Lets say youbuy 10,000 shares, how much would you have made then?
$1,510.00 x 10 = $15,100.00 dollars
What if you sold after it went $3.00 dollars, how much money wouldyour money have made for you?
$ 15,100.00 x 3 = $45, 300.00 dollars
Is this starting to look more like retirement to you? How about afterthree or more trades just like that one? Your next chapter will showyou which stocks will move faster than others, so your money isn'ttied up for a long time. Let's have a look, shall we?
CHAPTER 4
You want tofind stocks thatmove faster
Your next criteria is to separate the men from the boys. Youwant to get your money to make more money faster. Themore up and down a stock moves in one trading day in let'ssay 40 days; the faster your money can make money for you. Justthink about the ocean and how it constantly moves up and down.Every stock you own and play should do the same thing. You're goingto find stocks that move more than others, because if the water isstagnant or not going up or down in just a little bit of time it begins tostink and so will you trade. Let's look at the example I have for youon the next page, shall we?
Once you go on your browsers web page and click on finance and putin the stock symbol or name and go there, just click on ...
1) Historical prices.
If you look at example #1 ...
2) Tells us that the stock name is Brother Roland (BR).
3) Indicates how many times the stock went up and down more than.50 cents.
4) Indicates how many times the stock went up and down more than1.00 dollar.
In order to get these *; you need to look at the high and low on eachdate and determine which date did what. I put a * in place wheneverthe stock made .50 cents or more; between column two and three andI put a * every time the stock made over $1.00 dollar between columnthree and four. I have made three examples for you to examine or lookover carefully. Each example shows stocks that are close to the sameprice range. There are seven or more different columns going acrossthe page.
Column ...
1) What the stock did on that date.
2) What price the stock started or opened at.
3) Tells us the highest price that the stock did all day.
4) Tells us the lowest price that the stock did all day.
5) Tells us where the stock closed at.
6) Tells us how many trades the stock was bought or sold throughoutthe day.
7) Tells us the difference the stock did in a % from one day to thenext.
The * lets us know what the stock did and how often. In 40 days (BR)moved .50 cents or more 21 times and $1.00 or more 2 times.
Now let's look at #2 stock example, shall we?
As you can see here, this stock only moved .50 cents two times outof 40. Although this stock had great dividends in payout; and hasbeen around for a long time: it does not have much up and downmovement. This is what I call stagnant water and it stinks. This stockis a good stock to buy for the long term. If a stock does not hit thiscriteria, it should not be played on a large buy or trade.
* Lesson to learn here. *
I played a slow moving stock like this one and made $1,500.00dollars on the dividend payout. But, because the stock lost $1.00.00in the 30 days I held on to it, the $100, 000.00 dollars I bought thestock with would have lost me $8,050.00 dollars. I sold it right after Imade my money back, because I knew where the stock was going. Itkept me holding on to that stock for four months before I could sell it.Needless to say, It seem to take for ever for that stock to turn aroundand make money for me. That's why you want a fast moving stock.Don't make the same mistake I did.
