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“You sell to the bid, and you buy from the ask.”
Si vende dall’offerta e si acquista dalla domanda
The distance between the bid and the ask is called the "bid-ask spread."
A liquid stock is defined as a stock where you can buy or sell a lot of shares without moving the stock too much. Liquid stocks in the U.S. usually have a bid-ask spread of just a penny or two.
The single most important decision in evaluating a business is pricing power. If you've got the power to raise prices without losing business to a competitor, you've got a very good business. And if you have to have a prayer session before raising the price by 10 percent, then you've got a terrible business.
Never buy a growth stock if the stock is trading below its 200-day moving average, or if the 50-day moving average is trading below the 200-day moving average. If either of those two criteria are true, the stock is in a downtrend. There is nothing more dangerous than a growth stock in a downtrend.
Growth stocks perform much better when the entire stock market is also in an uptrend.
good sign that the general stock market is in an uptrend.
I like to look for growth stocks that have a market cap of $5 billion or less. It takes a lot less money to push a $5 billion stock higher than it does a $500 billion market cap stock.
I also like to look for growth stocks, where the float is less than 20% of the total number of shares outstanding.
I also like to look for growth stocks with a high short interest. “Short interest” is the quantity of shares that have been sold short by those who believe that the stock will go down. You can find a stock’s short interest here: https://finance.yahoo.com/quote/LYFT/key-statistics
Now short sellers (traders who are betting that a stock will go down) are usually pretty smart. When a stock keeps hitting new 52-week lows and it has a high short interest, you want to stay away. Valeant (VRX) was a perfect example of this.
Knowing when to sell (at either a loss or profit) can be more difficult. Here are some of the criteria that I like to use: Take profits when you are so excited and happy about your trade that you are losing sleep. Take profits if a stock moves up 100% in 2 weeks or less. Take profits when you are up 300% from your entry price. Take profits when all of your friends
the stock. At this point, the trade has become crowded, and hence much more dangerous. Take profits if a taxi driver or barber tell you to buy the stock. Exit (with a profit or loss) when the stock closes below its 50-day moving average. Use this method to capture shorter moves. Exit (with a profit or loss) when the stock closes below its 200-day moving average. Use this method to capture longer moves. Exit (with a profit or loss) when the 50-day moving average crosses below the 200-day moving average. Use this method to capture longer moves. Use a 10-day or 20-day exponential moving average
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something similar. That is a good way to lock in some profits, while still keeping some exposure to the stock in ...
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If you decide to do a trade like this, just make sure that you use a "sell to open" order when selling the call option. If you decide to exit this position, you'll need to use a "buy to close" order to get rid of the call option. After this order is executed, you are free to sell your stock as you normally would. Just never sell your stock before you have exited the call position, or you'll risk getting yourself in trouble.
Covered Calls Made Easy here: www.trader-books.com
Has a company that you own just reported some really bad news? If so, remember that there is never just one cockroach. Bad news comes in clusters.
you are better off buying fewer shares of a higher-priced stock than a lot of shares of a penny stock.
That is because low-priced stocks are most often associated with lower quality companies.
