Day trading is commonly defined as the rapid buying and selling of securities with the objective of making small gains with each trade that add up to much higher annualized returns than would be realized with a buy-and-hold strategy.  This of course assumes that the trader has superior information and tools that will enable him to win more times than lose.

The information and tools that are easily available nowadays via the latest technology are definitely excellent  and only a few years ago would only be available to well-funded trading houses on Wall Street.  No doubt, the availability of these systems has contributed to the popularity of the day trading phenomenon and it seems that anyone with a computer and a few dollars is able to participate.

It is well to realize here that with all of their enormous resources, even the top Wall Street traders work with odds that are only slightly better than those found at Las Vegas roulette tables and they use sophisticated hedging techniques to control their risk of catastrophic loss.  Even with these resources at their disposal, no Wall Street trader has managed to consistently make winning trades over the long term.

For the private individual, these are daunting odds.  There is almost no chance at all for him to win consistently enough to make this a viable investment strategy.  He simply does not have the resources in psychological training, information systems, options strategies, trade pricing and execution to compete with the guy in a full blown trading house.  The chances that he will win enough times to make a better profit than a buy-and-hold strategy is next to nil over even a 3-to-5 year term  In fact, the likelihood is that he will lose a large amount of money before he quits. Yet there are droves of confident, self-styled day traders coming into the market every day with the hopes of making a living doing this!

A large part of the problem is that this is a very lucrative industry and the providers of trading systems and resources actively encourage and feed the fantasy.  They present day trading in the media as an easy, viable and respectable investment strategy with many successful practitioners who are ordinary Joes from Main Street just like themselves.  Unfortunately, the media appears to be a willing partner in this enterprise and to me at least, this is an inexcusable outrage that leaves one wondering where the consumer advocates are when you need them.

Will farmers be driving Ferraris in ten years? That’s what Jim Rogers, the legendary billionaire investor who founded the Quantum fund, thinks. We’ll have to wait and see if that turns out to be true, but his feeling is based upon a few key factors that continue to put upward pressure on the prices of agricultural goods.3 Factors That Could Effect Agriculture Stock Prices1.) Emerging Market DemandEmerging-market economies like China and India are growing by leaps and bounds, moving the citizens of those countries and creating more demand for higher-end food products. But due to a combination of swelling demand and massive populations, these countries lack the infrastructure and production capacities to satisfy that ‘hunger’. China, for example, is home to 22% of the world’s population but just 7% of its arable land. So in order to fill the gap, these countries will need to swell their imports, which stand to be a boon for long-term gains in the agriculture stocks industry.2.) Inflation HedgeWith the Dollar falling apart at a quick pace, investors continue to flock to companies that trade in ‘hard assets’, and the agricultural stocks complex definitely qualifies. Although corn, beans and wheat are down sharply from last year, prices have recently begun to rebound and move higher. Hard assets are currency neutral and will continue to be a great investment destination for anyone worried about the degradation of paper currencies.3.) Global Weather VolatilityFarmers live in a hazardous world. One season, they spend months praying for rain to feed their crop; then in the next season, the crop gets wiped out because of too much rain. Just this summer, sugar prices soared to a new 28-year high after a drought killed production in India. Ag producers need just the right balance of rain, sunshine and nutrients to produce the desired yield, something that consistently effects production and, in turn, prices.Now that we have a fundamental understanding of the underlying essentials affecting prices and consumption in agriculture, let’s go ahead and take a look at some companies that appear to be well positioned to profit from the trend.4 Agriculture StocksThe Anderson’s, Inc. (ANDE – Analyst Report) is an agriculture producer and transporter in the U.S. The company’s share price took a hit last year but has since bounced back nicely as the economy and its estimates have recovered. With the current-year Zacks Consensus Estimate pegged at $2.22, this Zacks #1 Rank stock offers some value with a P/E of 15X. The Zacks Consensus Estimate for agriculture stocks next year is bullish, projecting 27% earnings growth for this agriculture stock. China Green Agriculture, Inc. (CGA – Snapshot Report) operates as a fertilizer producer out of China. Shares posted big gains this year as China’s economy has remained hot (recently reporting GDP growth of 8.9%). Next year’s agriculture stocks growth projection for the company is a bullish 57%.Zhongpin Inc. (HOGS) has posted huge agriculture stocks gains in 2009, with its share price more than doubling after bottoming out just above $7 in early March. The Chinese-based agriculture producer and Zacks #1 Rank stock offers big value in a very bullish environment, trading at just 10X projected current-year earnings, with a solid 18% next-year growth projection to boot. Deere Co. (DE – Analyst Report) builds and manufactures farming machines and equipment. Farmers will be looking to upgrade their equipment if they’re raking in big bucks, and that will provide shares of DE with a very nice boost. As it stands, the company’s share price is down from its peak in early 2008, but has begun to rebound on a nice earnings beat last quarter and rising agriculture stocks estimates.Agriculture Stocks ConclusionWhen you take a composite view of the agricultural stocks landscape, it’s easy to see that there are a number of macro-level trends that could produce long-term growth prospects. It’s a great way to round out your portfolio and give you a chance to outperform the averages over the long haul.

In part 1 we looked at how human psychology pushes prices away from fair value.

When there are extreme moves away from fair value you can make a contrary trade to the majority and pile up big profits with low risk.

So what tools do you need? Lets take a look.

As a general rule these tools will work in any market not just forex markets.

What sets ups do you look for?

Generally you want a set up that is the news where there is “no end in sight” to a spike move.

This generally indicates that greed and fear have taken hold and the market being looked at is emotionally driven and away from fair value.

This happens all the time:

The recent spike in crude oil, the 87 stock market crash and many others including in the forex market.

First place to start

Is the chart look for huge price spikes in short time spaces accompanied by “experts” and the news telling you there is no end in sight.

Now delve a bit deeper to see the true picture.

Useful technical tools are:

RSI, Sochastics and Bollinger bands

Then add in these sentiment tools to the mix.

% Bullish

This indictor is a poll of people, expert’s, brokers etc that have a view or interest in the market.

When this poll indicates above 70% are bullish the market is in overbought territory and when below 30% is in oversold territory.

In the currency markets we like to look for even more extreme readings of below 20% and above 80%

Commitment of Traders Net – Traders Position Report

This is a tool used for years by futures traders and shows the breakdown of open interest among three main participants.

We will explain what it means in a minute buy here is its definition of the groups.

Hedgers – The smart money commercial traders

Large speculators – These are normally large funds with reportable positions

Small speculators everyone else.

The commercials are long term traders and are close to the fundamentals and move very slowly – they are hedging not speculating and not influenced by greed or far and are the “smart money”.

Speculators on the other hand, both funds and small speculators, are driven by greed and fear

If you see a set up where commercials start to move the opposite way to speculators at a market top or bottom and hold an opposite extreme, then prices have moved to far from fair value.

With the commercials taking and building the opposite position to speculators in a rampant bull or bear market you know prices are probably due to re bound.

You must only use extremes with this tool and this normally means 8 months to 2 years.

Breaking it down

Study chart first, look for experts telling you there is no end in sight to the move, then look at % bullish and then net trader report.

Finally, use the technical indicators to confirm the move.

These moves do not happen often.

Maybe a few times a year.

But when they do

You can zero in on a contrary trade that not only offers huge profit potential but offer low risk.

Forex From the contraction of the words Foreign Exchange, Forex is the nickname given to the universal exchange market, where currencies are traded against each other, exchange rates that vary continuously. Economic Importance This global market, which is essentially interchange is the second market of the world in terms of overall volume, behind the interest rates. It is nevertheless the most concentrated and the first for the liquidity of the most treaties, such as the euro / dollar. To give an idea of liquidity in circulation, the daily volume of trade in 2004, 1 900 billion U.S. dollar, namely: 600 billion in spot transactions and 1 300 billion in futures almost solely in transactions over the counter, according to the three-year study of the Bank for International Settlements (BIS). Transaction volume, were  53% between banks; 33% between a bank and a fund manager or a non-bank financial institutions; and finally to 14% between a bank and a non-financial. In every major bank, the operators (the traders) are the 3 × 8, though generally in different locations. A team based in Asia or Australia succeeds another located in Europe and a third located in North America, and so on. However, despite the global nature and the release schedule between continents, a large (31% of total volume, according to the BIS) of market activity is still physically located in London. In its latest triennial review, the BIS (Bank of International Settlements) has shown that an increasing number of individuals choose to invest in the Forex. Although they still represent a very small minority of transactions and volumes, a dedicated private investors has grown in parallel. Simply record the number of trading platform available to them on the internet as well as tools for real-time information once reserved for professional traders in the rooms. Now, the active trader of foreign exchange market can invest minimum amounts and due to the existence of leverage-trader in almost (!) Similar to those of the professional trader. Information tools in real-time broadcast news and information forex fundamental (economic indicators) and offer individuals the possibility of trading conditions in real time. The foreign exchange market has existed in its present form, called floating exchange rate regime since March 1973 and the abandonment of fixed exchange rates of various currencies against the dollar standard Bretton Woods in 1944. Treated products Spot Cash (called spot), the main parities were processed in 2004, according to BIS: the euro / dollar – 28% the dollar / yen – 17% the sterling / dollar (cable said in English) – 14% Despite the strong development of the euro, the dollar remains the dominant center, present in 89% of transactions (37% against the euro, 20% for the yen and 17% for the pound sterling, all on a total of 200% since each transaction involves two currencies). For a non-European currency XXX, a transaction between the euro and the currency is usually split into a EUR / USD and USD / XXX. Change Term The exchange term is divided into two products, both interbank term dry (it is said outright in English), rather little treaty, and foreign exchange swaps. Unlike other financial markets, futures held were never imposed on the foreign exchange market and remain marginal. Options Exchange Finally, the options market exchange is the most diverse and most inventive of the options markets. He is responsible for virtually all forms of so-called exotic options or second generation (barrier options, Asian options, options on options, etc..). Trading and Foreign Exchange Coverage (hedging) The principle is to take opposite positions in order to cancel the risks. Forecasting This is to anticipate the movements of the market through a more or less advanced financial environment, economic and political. The advantage of anticipating the movements of foreign exchange speculation. For this, many information sources available to the forex trader (Reuters, Telerate, Bloomberg LP) to access to all quotes and financial information for trading. It also has access to economic indicators of major countries and global financial information. It is capable of forming an opinion on prices or rates and to anticipate future movements. Arbitration It is to try to take advantage of price discrepancies or occasional courses on the same medium, the same currency on 2 different markets. The diverter can perform these operations on a single market such as spot-on or several markets such as foreign exchange swaps. Powerful tools (called pricers) allowing it to calculate different prices or interest in a transaction arbitration. This strategy requires a response and stress management in real time from the trader. Exchange Rates Electronic exchange rate between monnaies.Le exchange rate of a currency (a currency) is the price (ie price) of that currency relative to another. Also referred to as the “parity of a currency.” Exchange rates, listed on the exchange markets, vary continuously, they also vary depending on the place of listing. Examples For example, the exchange rate of the euro dollar will be noted: EUR / USD = 1.3120 and the dollar rate will be noted in yen USD / JPY = 89.4454. (EUR = Euro, USD = U.S. dollar, yen JPY =, GBP = pound sterling by International Monetary coding, ISO 4217 distinguishing each currency by a three-letter abbreviation, cf. Complete list) Exchange rate fixed or floating This exchange rate of a currency is: Either fixed, ie constant relative to a reference currency (usually the U.S. dollar or the euro), by decision of the State that issues that currency. The rate can not be amended by a decision of devaluation (or revaluation) of that State. A State may decide not to adopt any exchange rate of its currency. If the fixed exchange rate at a level too high or too low, the exchange rate could be “attacked” on the foreign exchange market. If monetary authorities are unable to cope (through their foreign exchange reserves), they should change their parity. Is floating and determined for each transaction by the balance between supply and demand in the foreign exchange market. This is a global interbank currency, less centralized places specific quotation and trade, as based on links between banks. The exchange rate: is an “spot”, ie “spot” for immediate purchases and sales of currencies. Generally the deadline for delivery of foreign currency is less than 2 days. is a course forward, “ie” forward “for foreign exchange transactions due to future, more than 2 days. The mission is to manage the risk. It is an agreement today to set the price at which we buy / sell the currency. Factors affecting the exchange rate: The exchange rate is determined by supply and demand of both currencies: if demand exceeds supply, the price increases. Since the currency of a country is essentially a claim held on the central bank of this country, detention of a foreign currency can be seen as holding a claim to “view” on the country that has issued. In the short term The exchange rates vary widely during a single day, these variations can not be explained by the theory of Purchasing Power Parity (PPP) previously described. Within this framework of short-term analysis, it is necessary to refer to other explanations. These daily changes based on the concept of early return of deposits in foreign currencies. Economic agents will determine their demand for different currencies depending on the return they expect deposits in these currencies. In the long term Recovery rate of euro-dollar exchange rate from January 1972 to January 1999 from the exchange rate of the franc french or Deutschemark. In the long term, currencies should theoretically be closer to equilibrium parities obtained from structural parameters. Imbalances and, more rarely, the balances in the valuation of currencies, are measured on the basis of purchasing power parities (PPP). It is a complex statistical exercise, which is to compare over time the purchasing power of a consumer model in a country and a range of consumer products up with another consumer-type in a different country and for a range of consumer goods desired close, but correspond to other local practices in terms of lifestyle and cost structure. In practice, generally the U.S. dollar as currency of the joint index and true each time compare the purchasing power of a consumer-type of country X and that of a typical American consumer. The purchasing power parity, if it is useful for international comparisons of living standards, where margins of error of a few percent are not significant, its use in analysis of the foreign exchange market should be done with the utmost caution. Currency crisis A country will suffer a currency crisis when the capacity to repay external debt (public and private) denominated in foreign currency of the country is highly in doubt (crisis of confidence). The outflow of capital in the short term then drop the exchange rate of the currency, making repayment even more difficult. Economic role of exchange rates Exchange rates (and interest rates, which are closely related) are of course on import prices and export. They have an influence on the direction of capital flows between economic areas. As a result, countries and economic areas may be tempted to influence exchange rates, often under the pretext of preventing speculation (in fact these manipulations tend to encourage), and in order to improve (lower rate). Operation of foreign exchange markets Case of the euro / dollar The exchange rate says euro / dollar is the euro figures in U.S. dollars, hence the slash (not to be confused with Eurodollars). Financial instrument is the most active and most addressed the world: 27% of total spot transactions. Its value is an indicator monitored not only by economic and financial circles, but also by the media, both specialized and general, throughout the world. This definition is in fact, the external value of the euro against the U.S. dollar. Profession (FX) Those who conduct foreign exchange transactions are called professional traders. Banks in particular have teams of traders, both to do the clean of these institutions on the market to meet the changing needs of their clients, for example on business, for their international trade. They act as market makers, ie that they “are prices” for a quantity is specified as standard, and provide both when they buy (bid, in English) and to whom they sell (ask in English), for example: 1 EUR = 1.2343 / 1.2346 USD. Round lots The traders expressed the unity of listing an exchange rate on a currency pair in dots called pips. Pip stands for “price interest point” or a “swap” in french. At the outset, as its name suggests, it meant the unit “off” or “report” of the exchange term, but eventually be applied to the unity of the market. It refers to the last decimal used: in the case of the euro, the fourth decimal place. A listing on three “pips,” which is standard on the interbank market of the euro / dollar, will in the first example (EUR / USD = 1.3120) of paragraph 1 above: EUR / USD = 1.3120 (bid ) / 1.3123 (ask). Is a spread of 3 pips in the case of the yen, it will be the second decimal, and a listing four “pips” will be, again to the above example, USD / JPY = 89.4454 (bid) / 89.4654 (ask ). The pip represents a different percentage and not fixed for each parity. This difference depends on the currency in which we choose by convention to express the exchange rate (the “uncertain” of the comparison), the other being taken for unit of goods (the “certain”), the number of decimal listing. These differences between the current “buyer” and “seller” of a currency against another are much less of an individual can see when they wish to conduct a foreign exchange transaction in a pharmacy exchange (or his bank) for a modest amount. In the first instance, the percentage (minimum) to a foreign exchange on Forex of 100 000 euros (the standard transaction is not in the tens of millions), it should be noted that for such a pip amount exchanged is 10 dollars. In the second example, the percentage of a foreign exchange of 100 000 dollars a pip for that quantity is 1 000 yen (about $ 9). Exchange rate mechanism European The exchange rate mechanism in Europe, or ERM, is an exchange rate mechanism introduced by the European Community in 1979 to statibiliser prices of European currencies, to prevent risks and increase confidence in the currency in the medium and long term inflation and promote trade and activity in the intra-EU trade. Originally named “European Monetary System,” it was considerably revised in its operation by the Maastricht Treaty was ratified in 1992 establishing the European Union, in preparation for its economic and monetary union and single currency. Since the introduction of the euro on 1 January 1999, was revised and replaced by the ERM II and is an agreement between the ECOFIN Council, bringing together all member countries of the European Union, the European Central Bank and banks central banks of the Member States of the European Union outside the euro area. ERM II For Member States not participating in the European single currency, a second exchange rate mechanism in Europe, said ERM II, was put in place. During the negotiation of the Maastricht Treaty by the 12 EU members, and 3 new buyers (Finland, Sweden and Austria), it was expected that all members of the previous ERM and all new members join the Union must be in EMU (if eligible) or in ERM II. ERM has ended, but Sweden (despite his signing of the Treaty) and the United Kingdom (which has chosen to retire but was not allowed to do so) have not joined the ERM II. Such exemptions are no longer permitted for new candidate countries, who must first accept the convergence of their economies and participation in ERM II (and the EMU as soon as conditions are met) with a timetable set out in the Accession Treaty. ERM II is based on the euro only, ie on the common unit of the only countries which joined the euro (and not on the ECU which was calculated on all currencies the European Union) and tolerates a difference of 15% around an initial exchange rate between the currency and the euro. This reduction of basis for determining rates of exchange from outside also should help stabilize and distribute the budget on a more equitable. However, this reduction of the base included a risk to the fixing of this budget, if insufficiently European countries joining the euro. This was not the case, and almost all countries of the European Union have all joined since the launch of the euro, which helped to end at the same time to the ECU and therefore also in ERM (at least formally, some financial institutions have continued to calculate until approximately 2001, as a index, but considering the weight of the euro in the old basket of currencies, although the composition of the euro has changed since then, and the methods of calculating contributions to the EU budget). Since the introduction of the euro on 1 January 1999, the parity between the euro and the former national currencies of member countries joining the euro became fixed and irrevocable. Other countries have ratified the Treaty of Maastricht (or its successor) are committed to converge their economies in order to avoid economic distortions related to their exchange rate, not to resort to devaluation, let the market set the price of their currency in terms of their economic performance. To achieve to keep exchange rates stable around a pivot defined by membership in ERM II, the maximum fluctuation of ± 15%, they pursue a common policy of economic convergence criteria, and a healthy managing their public finances in the short and long term. These criteria are assessed by the Council of Finance Ministers of the Union, ECOFIN, in collaboration with the European Central Bank and national central banks of EMU members. If the economic convergence criteria are met for a minimum period of 2 years, the participants receive the approval of the ECOFIN Council to enter the euro, and their national central banks (NCBs) can adhere to the ECB, and finally, when this integration is achieved (by the filing of the signatures of instruments of ratification and financial conditions, the approval of representatives of the NCBs and the money to convert, and the revenue guarantee funds deposited at the ECB), ECB fixed in accordance with the ECOFIN Council, the irrevocable conversion rate between their currency and the euro, taking into account the recent fixations official foreign exchange markets and adjustments based on the assets and international financial commitments of the NCB adhering to the day of closing. All the countries aspiring to join the euro must first subscribe to the ERM II. This was the case for Greece in 2000 and 2001 before joining the euro. This is already the case of Estonia, Lithuania, Latvia, Malta and Cyprus, as well as in Slovakia since November 2005. By integrating the euro zone, Slovenia left the ERM II on 1 January 2007.

For More Details about Forex Robot…Click Here

What is the definition of a financial instrument where the forex market is concerned? Simply stated, it is any type of a financial medium such as bills of exchange, bonds, currencies, stocks, etc., that are used for borrowing purposes in financial markets. When you are discussing the forex market, the following six entities are designated as financial instruments:
1. Exchange-traded fund
2. Forward
3. Future
4. Option
5. Spot
6. Swap
Exchange-traded Fund – referred to as ETF’s. These are open-ended investment companies that have the characteristic of being traded at any time throughout the day. These will oftentimes attempt duplicating stock market indices such as the S&P 500. The ETF’s gain strength as the United States Dollar (USD) weakens against a different currency and therefore replicate currency market investments. Certain funds can track the price fluctuations of the various world currencies as they compare to the USD, and will oftentimes increase in value to counter the direction that the USD moves in. This creates increased interest in the USD for investors and speculators.
Forward – the agreement established between two parties wherein they purchase, sell, or trade an asset at a pre-agreed upon price is called a forward or a forward contract. Normally, there is no exchange of money until a pre-established future date has been arrived at. Forwards are normally performed as a hedging instrument used to either deter or alleviate risk in the investment activity.
Future – a forward transaction that contains standard contract sizes and maturity dates are considered futures. Futures are traded on exchanges that have been created for that purpose exclusively. Just like with commodity markets, a future in the forex market normally designates a contract length of 3 months in duration. Interest amounts are also included in a futures contract.
Option – commonly shortened to FX option from foreign exchange option. Options are derivatives (financial instruments whose values fluctuate based on underlying variables) wherein the owner has the right to, but is not necessarily obligated to, exchange one currency for another at a pre-agreed upon rate and a specified date. When you talk about options in any form (stock market, forex, or any other market), the forex market is the deepest and largest, as well as the most liquid market of any options in the world.
Spot – where futures contracts normally employ a 3-month timeframe, spot transactions encompass a 48-hour delivery transaction period. There are four characteristics that all spot transactions have in common, namely:
1. A direct exchange between two currencies
2. Involves only cash, never contracts
3. No interest is included in the agreed upon transaction
4. Shortest of all transaction timeframes
Swap – currency swaps are the most common type of forward transactions. A swap is a trade between two parties wherein they exchange currencies for a pre-determined length of time. The transaction then is reversed at a pre-agreed upon future date. Currency swaps can be negotiated to mature up to 30 years in the future, and involve the swapping of the principle amount. Interest rates are not “netted” since they are denominated in different currencies.

Mace Horowitz, vice president of operations for Alternative Merchant Processing (AMP), likes to keep things simple and straightforward.

“We provide direct merchant accounts, both domestically and internationally, for hard to place, unconventional or high volume merchants.”

That may sound like a very serious gig, but for Horowitz the company’s actual function is even more basic. “We are a service provider; a true service provider.”

Established circa 2001, AMP is a wholly-owned subsidiary of Boca Raton-based Charge Card Systems, offering merchant services to other high risk industries, such as travel, loan modification and health benefit companies, but retaining a definite soft spot for the businesses and people in adult.

“It’s a great space,” Horowitz said. “The people in it are far different from any other, more like real people than the stuffy suits in other industries that you have to set up a specific time and day just to go hang out with.”

Hanging out is especially enjoyable when in the service of products and services that also are in great demand.

“We offer a direct MID (merchant identification number; a unique number that identifies merchants for reference and billing purposes), no aggregation, no third-party, no ewallet. We give merchants their own MID, with their own descriptor and customer service phone number, which nobody else shares and nobody else is in.”

Still, the bottom line remains providing hands-on service. “We will supply a prospect or merchant with whatever solution they want and can qualify for,” Horowitz said. “If someone comes to me, and, for whatever reason, wants an account internationally, or specifically, a non U.S.-based account, if I can support that based on what the merchant’s needs are, I will.”

He added quickly, “We are not here to reinvent the wheel or force anybody to do anything they don’t want to do, or give them something they’re not already looking for, but as a service provider, we also are not going to convince somebody that they don’t want something if they tell me they want it. I’ll give them an education, and then I’ll ask them the question again, but if their answer is the same, ‘Yes, I want to be offshore,” then, by all means, that’s what I will get them.”

That said, Horowitz does not recommend moving funds offshore. Indeed, he warns those who do that they run the very real risk of not being able to get their funds back.

“It happens,” he said. “Keep in mind; I’m talking about more than just adult companies. We would get phone calls all the time. ‘My money hasn’t been released; they’re not taking my calls.’”

While Horowitz readily admits that some companies have legitimate reasons for wanting to move funds and processing offshore, his advice — indeed, his pitch — is to keep one’s treasure at home, where it belongs.

“Doing transactions internationally gives you a little bit more leniency with respect to chargeback ratios, but there are domestic banks that are willing to exceed the Association thresholds on ratios, because they are able to manage the accounts,” Horowitz said. “So, if somebody tells me they want to go offshore because they can get a higher chargeback rate, first, that raises a red flag, because they know they’re going to be a high chargeback merchant, but also, I know I can get them a competitive rate domestically once we overcome whatever hurdles there are getting their ratios down.”

AMP claims it actually can do much more than that. “We now represent a bank that will do High Risk Merchant Account that we can assure the reader was not there before,” Horowitz said. “We are introducing a solution to the industry that is going to supplement the solutions that they currently have for merchant services, domestically.

“It’s a bank the majority of the adult space does not have, and probably doesn’t even know about,” Horowitz continued. “I’m offering something to the industry that they are in desperate need of, a new bank that will register 5967 (high-risk registration). No matter where they are processing or how much, we are talking here about adding redundancy, the ability to cascade even further, and another way to hedge your bets, so to speak.”

Horowitz noted that a few factors set AMP apart from its competitors.

“We provide full reporting from the bank side, which differs greatly from the reporting you see from gateway companies, which are basically just conduits between the card holder and the acquiring bank,” Horowitz said. “But I’m providing you with reporting on what’s happening on the bank side, and there’s nothing more exact or precise than that report.

“But the thing that separates us the most is that we care. We care about the long-term success of our merchants and I’m sure that’s a cliché; we really are there for them. They know us on a first name basis, they have cellphones and work numbers for us, and they know that we are looking out for their best interests. We ensure that banks stay open and compliant, that there are no issues with the account, we are fair and don’t take advantage of any situations as far as rates and fees, and we’re respectful. I guess my point would be, try us. Let me show you what makes us different. Talk is cheap.”

Horowitz said that he has seen a lot of consolidation in the business, and the economy had got a lot of people stressed out, but he thinks that the global reach and resiliency inherent in the adult industry will see many of its players through, as long as they keep their noses clean and remain in touch, literally.

“As far as advice to merchants,” Horowitz said, “all I can suggest to people, besides doing legal business that doesn’t push the envelope too far, is to be available, because it is all about communication. If there’s a problem with their account and we pro-actively give them a call and can’t find them, it could easily become a problem. Proactive banking, after all, is safe banking.”

Although some people may argue that investing in the stock market is the same as placing bets at the race tracks, these two activities are actually very much on polar ends. To clarify matters further, let us first define gambling; and then investing in the stock market.
Gambling For Profits
Some gamblers claim that they play the field out of fun, but that statement can be misleading. Exactly what the term “fun” is for most avid gamblers is when they make a killing at the race track, at the casino tables and even at the slot machines. In other words: gambling is fun when they win, but not much fun when they lose.
In a nutshell, gambling is when a person wagers something of value (money, material possession, service, etc.) on a particular event with hopes of taking home a profitable exchange, or at least a return of the original wager amount. If you dare a friend to jump a puddle for a dime, hoping that either he would not clear the puddle or he would not make the attempt, then you are already gambling even if the amount is pretty small.
The same is true when you put a $20 bill in a slot machine and pull the handle. You are hoping to get something out of your money, preferably something more than strained muscles from pulling down the machine handle much too often.
Investing In Stocks For Profit
People are also investing in the stock market to gain profits. Brokers and traders usually handle assets or securities. To make a very complicated financial market less complicated, let us just say that people who dabble in this kind of trade buy stuff while its price is at its lowest, hold it for a period of time, and then sell the stuff when its market price is several degrees higher. This is the way brokers or traders earn their keep.
Similarities Of Gambling And Investing In Stocks
Despite what many think, both gambling and investing in the stock market are legal activities at least in most countries. There are however, some forms of gambling that are illegal; but there are also some forms of trading that are illegal in nature. There are also committees for both activities overseeing the works like the gaming (or gambling) commission, and several types of financial regulatory boards.
These two activities are also fraught with risks, and usually, the riskier the venture, the greater projected profit should be. There is also that element of “loss” since we all know that many gamblers and financial investors lose more stakes than those who practice conservative business measures.
Differences Between Gambling And Investing In Stocks
Investing in stocks may be a risky venture, but there are always safe and conservative measures to work with in the trading arena. Some investors prefer speculative trading, which is probably the riskiest form of trade in the financial markets, but there is a greater population of investors who prefer quiet investments with growing yearly interest. A good example of that would be people who dabble in mutual funds.
Investing in mutual funds means putting down money on an erstwhile money-generating company while making sure that part and parcel of the money it earns go into something either environmentally or socially productive ventures.
You definitely cannot say the same for gambling, although many people might argue that a portion of the money does go to a good cause. Gaming commissions donate money to charitable institutions, but this is more for tax cut reasons.
Also, there are no conservative measures when it comes to gambling. Its either you win or you lose. Even in hedge betting where gamblers stake on different players in order to cover all bases, there is definitely no yearly interest growth to look forward to.

How to choose a good forex siginal service and automated system is very important for people who cannot or don’t have the experience to trade themselves. Although there are tons of automated forex trading systems which claim to be succesful, chances are most of them are scams. I have tried several times for these so-called winners, and I have to say “thank God, I demoed it, instead of making it live.” However, even if you find a real good system, it does not mean it is suitable for your trading strategy. You could still blow up your account because of that. Let’s first look at the two main types of auto-systems: third party signal proviers and EAs on Metatrader 4.

Third-Party Signal Providers

Welcome to the world of monkeys. I cannot say most of them are scams, but definitely 90% of them are not as profitable as they claim. Just check the feedback on forexpeacearmy.com. So what they do is they build a website and post some stats and tell you how profitable they are. Don’t fall over their traps. I heard one trader said that the forex signals he got were losing trades, but the website either changed the entry prices afterwards to make it a winning trade, or simply don’t post them on web. I am not surprised if such things happen. It is totally not transparent. And some websites promise they win over 200 pips per month. Please, what is max drawdown? And honestly speaking 200 pips/month is defintely not a good performance for an experienced forex trader. You are overpaying them. You can make 200 pips per week yourself if you know how to do news trading. Enough said about the scams, let’s look at something better.

1. Zulutrade.com

It is a website that people can sign up as forex signal providers freely and send signals to the subscribers. The transactions are transparent, and they give a lot of stats like maximum drawdown, win ratio etc. And it is completely free. It is your broker who pays for the service. And of course your broker gets money from you in the beginning from spread and commissions. So if you are looking for a signal provider, I suggest you check this website and demo the signals that are suitable for you. However, there are some numerical traps you should be aware of:

-More winning pips do not mean it is profitable. What Zulutrade did is to multiply the pips by the position size. So for example, the provider finished a winning trade with 2 pips, but he traded 10 lots, so his winning pips was 20pips. But this is not a fair calculation. Because suppose some provider won 15 pips on 1 lot, then his winning pips was only 15 pips. The latter is definitely more profitable. So you really need to see the transaction history and check out the position size the signal provider is using. I see many followers for signals that trade big, but actully not so profitable. So be careful with this.

-”Many followers” do not really mean exactly the same number of people are running them live. Most of them are just testing them. Find the real number of people running them live on the “live followers” tab beside the graph.

-Maximum Drawdown of course is important. But big drawdown does not mean it is bad. For example swing trades usually have big drawdowns, but they can sometimes be more profitable than scalping. Scalping have smaller drawdown, but there is always a delay between you and the provider, the signal goes through a long process to you, even if is less than half a second, the price changes quickly. You will get a losing trade even if the signal provider gets a winning one. Again, demo it first!!

-Diversification: Some traders like to diversify and try to follow 3-5 signals at the same time. But the problem is his account is too small. So he limit the number of trade signals from each provider. However, this may seem a good strategy for scalping followers, because many scalpers like to open 10 positions on the same trade and close them at different times. But for swing trades, this is a bad idea. Swing traders keep losing trades because they know price will reverse. In the meantime they will open other trades that may be profitable. But if you limit the number of signals from the swing trader, you will not receive a winning signal afterwards, and instead end up with a losing trade. This is also why sometimes there is a huge difference between the performances of signal providers and the followers. Don’t be greedy, 3 is the max for a small account under 10,000 dollars.

-Manual Trading or Automated Trading? Some signal providers are real traders who do manual trading and send signals to you, some are people who possess a trading program like an EA. Both could be profitable or unprofitable. So I suggest you choose one for each type.

-Important: Get a broker that allows two-way hedging!! Now many US brokers under NFA regulations do not allow sell and buy the same pair at the same time anymore. So if you receive contradictory signals from two providers, one will cancel out the other.

-One last advice about Zulutrade: check out where the money flows, if a system has a lot of followers, there’s gotta be a reason for that.

2. Tradency Trading systems such as FXCM FSS and FXDD Auto-trade

You should check out their websites if you don’t know what they are. There are many brokers offer scuh service. You can check it out at here. Basically what they do is the same as zulutrade. But they don’t have as many signal providers. In the meantime, of course, it means that their signals have been filtered before they go live, so they should have better overall quality. This is one thing that it is better than Zulutrade.

A little Advertisement from me: My trading signals and the rebate program:)

I just started using both services and sending swing and news trading signals to both Zulutrade and Tradency. But they will not go live until mid Jan and Feb. So if you using one of these systems, you can check out my signals later in mid-January, and search for “swing pirate” on zulutrade.

Another piece of good news for those who don’t have Zulutrade accounts yet. If you are interested, you can sign up through my affiliate link. Zulutrade offers all affiliates 0.4 pips per trade for referral fee. I am willing to give you half of that money to you each month if you sign up through my website.

Finally it is my own blog http://sites.google.com/site/fxfountain, I updated daily strategy and real-time comments everday for free. I just started it, but it will gradually get better and better and feature more resources. Just come and check it out. You will also find into about the rebate program and my signal strategy update.

Back to the second automated trading system: Expert Advisors on MT4

Many people are using MT4, so for now EA (Expert Advisors) are the most popular programs sold on the internet. And for some people with big account, they sometimes get free API attached to their account. But since MT4 is more popular, let’s just focus on EA.

1. Where to buy an EA?

You can buy an EA from a lot of commercial websites. One of them that I know of is BJF Trading Group. They have a lot of EAs to choose from with different trading strategies. I only bought one EA from them, so I cannot make a generalization. But as far as my purchase is concerned, they have a pretty good service. They reply email fast and adjust the EA according your needs. And they occasionally offer discounts to buyers during holidays like now. And if you subscribe to their service, you will probably get additional discount. As to the EURGBP Scalping EA itself that I bought, it was OK last year. But time changes, and it is not profitable anymore.WHY? Last year, people thought EUR and GBP are similar, so the volality in this pair is not that high; but this year, the fundamental picture totally changed. So never think you do not need to do anything even if you bought a profitable EA. You could lose money next month.

I know there are some other websites that are selling EAs, but mostly they are individual programmer who claim they found a “gold rule blah blah” and post some statistics and testimonials. I never tried them,because some websites just looks like a downright scam. Just look for reviews from forexpeacearmy.com.

2. OK, I am seeing a lot of EAs.

Which one is for me? Never think that an expensive EA is a good one, but cheap EAs are usually bad ones. Most EAs are sold for hundreds of dollars. So I suggest you to buy an EA from a website that offers free adjustment after the purchse. Some websites are just selling them, they don’t offer technical support. This is important, because time changes, and the settings actually should be constantly adjusted, especially in such a volatile market.

The next is to consider what trading strategy you prefer. Some like swing trades, some like scalping. If you want to scalp 4-5 pips for each trade on an MT4 account, I suggest you forget it. Most brokers will do shady stuff to prevent you from making money. Either they increase the spreads, or delay your transaction until it becomes a losing trade. It happens a lot with MT4. What you see is not what you get.

The biggest question now is how much risk you can take and how much money you have. If you have a small account (below 2000 dollars), choosing a heavily trading system will blow up your account within a week. If you don’t like drawdown, you should choose systems that have small SL levels. And also think about diversification, whether that system trades on different pairs. Buy a portfolio of EAs if you have enough money and big account.

My advice for people who are looking to buy from BJF: better buy the EAs that are running live on the website owner’s own account. They offer account monitoring on both demo and live. But if the owner went live on a particular EA, it is more likely that this EA is more profitable.

Another important issue is whether this EA is too popular. If it is too popular and widespread, many others will send orders at the same time as you. If you happen to have slow internet speed and you are physically located farther from your broker’s server, you will get a worse entry. What happened with the EURGBP scalping EA is that, people rushed in to buy on low and sell on high, eventually you end up buying high and selling low. But if you are trading in the Euro and US sessions, such problems are minimized because the price action is mostly determined by the big banks and funds etc, not by the demand of the retail traders.

3. OK, I bought an EA, what now? Backtest on your demo of course. But bear in mind that the results are highly hypothetical. Sometimes your broker will intevene and keep you from making money. So backtest is not completely reliable. My suggestion is to run it on a demo account for at least a month. And then constantly monitor if it is profitble and if possible analyse why you got a losing trade. Did it happen often before? What fundamental picture changed? Was the price action weird? (Yah, some brokers manipulate prices to get your SL). Write to the seller immediately if you have questions. Try to find a forum where other people also bought the system, and discuss.

OK, I guess have concluded all you need to know if you are up for an automated trading system. Choosing a good system is no easier than trading yourself. In the stock market, it is more regulated, so you can buy some funds to trade for you. But the forex market is so underregulated that there are just simply too many scams. Be careful!

It is a well known fact that serious investors seeking long term growth of capital have as their main objectives the two most basic goals in investing:

• to find an investment vehicle that would effectively preserve capital and minimize risk in the face of a fluctuating and constantly flexing economy

• the investment vehicle must provide better than decent yields in all economic conditions to promote constant growth of capital value.

With the stock market as the premiere choice due to its historical record of outperforming all other investments over time, people are increasingly turning to the stock market as their main investment vehicle for future capital growth. It is here where much higher rates of return can be made with a relatively small increase in risk to capital.

With thousands of books, manuals, internet sites, seminars and courses offering investment strategies and trading systems in the stock market and its derivatives, there are few, if any, that deliver the ideal investment vehicle sought by the long term investor in search of safety and high returns. Not only is there a near total absence of an ideal investment system but there are many that promise eye popping, mind boggling returns and, they are exactly that; mere promises.

Most of the trading systems offered are structured on strategies or activities that work when conditions are ideally suited to the program being peddled. Most of their successes are highly dependent on picking the right stocks at the right time. In other words you must be a good stock picker or use a stock picking service (for a high monthly fee) to select the right ones for you. Market timing is also an important factor in their systems. Again, you must be a good market timer or depend on a service that provides market timing signals (also for a high monthly fee). These supposedly high yield investment programs don’t say anything about how bad things can be when conditions go against their predictions. These programs do exactly as promised: great when the going is good but disastrous when the going is bad. Without doubt many have been taken by these so-called services and while an investor/trader may be successful for a while, the end result over a long period of time is always the same – no better than if you had done the selections yourself.

While there is no one investment system or vehicle that can be an answer-all to the various goals of various investors, there are some investment alternatives that can come close to satisfying the two basic needs of safety and decent returns. Diversified mutual funds have been touted as the answer to these basic needs. But over the years these funds have shown that during downturns in the economy they perform just as badly as the whole investment market in general. And, over the long term, many of these diversified funds have failed to even match market performance in general, much less outperform it.

Enter market derivatives with emphasis options.

Trading in stock options has become very popular with institutional investors as well as private individuals as a sound money management system supplementing their investment portfolios. The ability of stock options to give the investor a wide range of choices is what has made the options market grow considerably over the last two decades. To quote one options expert: “Stock options are the greatest wealth producing tool ever invented on this planet. . . . if you know how to use them”.

The key element of this statement is: . . . if you know how to use them.

For many people the mere mention of stock options, sends shivers up their spine. They look at options as synonymous with great risk. But isn’t driving a car very dangerous for one who doesn’t know how to drive? The ability of stock options to give the investor a wide range of choices in stock market investments is what has made the options market grow by leaps and bounds over the last twenty years. Statistics compiled by the Options Industry Council, a group that educates investors about options, show that volume in options trading has risen tremendously in recent years. Further, studies show that individual investors make up 60% of the market.

For the individual who has sufficient funds and is looking for more than a decent return on his capital and with controllable risk, stock options may be the answer.

There are dozens of option trading systems being employed by individual investors and institutions. Each system is designed to accomplish a specific investment goal. A financial institution may use long put options to hedge its winnings in stocks that have appreciated in value. Another investor may buy call options instead of stocks to enter a position in a security that has caught his fancy. Still another may sell calls against his stock holdings to generate income from his stock position, or what is popularly known as covered call writing.

Of the dozens of option trading systems there is one that can be carried out as a long term investment program offering a fair degree of safety and consistent high returns over time, thus satisfying the investor’s two basic needs of safety and return.

This is the selling of uncovered or naked options.

But wait! Is it not said that selling naked options carries the risk of unlimited losses? Isn’t this a contradiction?

Indeed selling naked options when done carelessly and without a disciplined strategic program is extremely risky!

But by using a carefully planned and disciplined system of trading, the so-called “unlimited risk” factor in selling options can easily be conquered. There is a three-pronged trading strategy being used by one successful options trader that is proving to be a consistent winner in all market conditions. It is a trading technique that couples naked option selling with a modified ratio credit spread and the use of the roll over feature. While naked option selling has acquired a bad rap of being highly risky, this three-pronged trading strategy allows the trader to defeat the risk. Not only is the system able to substantially reduce the risk, it also offers one the ability to become a savvy investor/trader without having to depend on picking the right stocks or timing the market.

It involves utilizing the system in any market condition using only one or a few stocks, ETFs or indexes (the latter two are more effective). One need not worry about finding the right stocks or timing the trades. The fact remains that stocks behave, more often than not, in crazy and irrational ways so that one can almost say that consistently choosing winning stocks is as good as a random walk down Wall Street. Rather than be proactive and try to predict and time the market, as many try to do, this three-pronged investment system is reactive. The prescribed trades are done in reaction to how the market has moved, not in anticipation of its future behavior.

This three-pronged trading system does not promise quick profits or mind boggling yields but steady annual returns in excess of 30%. Many are averaging returns of 50% to 60%. It would be prudent to say that in times of deep downturns the system may not deliver the promised returns but it will hold its own and will definitely outperform the market.

One options trader that has mastered this three-pronged trading technique has decided to share his knowledge of the system by writing an e-book on its methodology. Borrowing from that quote about options being a great wealth producing tool he has aptly titled his work: STOCK OPTIONS: THE GREATEST WEALTH BUILDING TOOL EVER INVENTED. In it he details the step by step methodology of this trading technique and gives an exhaustive series of sample trades covering several months of transactions. It shows the effectiveness of the system in an up market, down market and horizontal market using only one ETF stock. To this day the writer continues to use only one or two ETFs in all his options trades and he includes a web page that shows his current and actual trading results month by month on an ongoing frequency.