Five years ago, as a beginner investor, I started investing in the stock market with the aim of making fast cash.
Though I was aware of the basics of how the stock market works, I was very much unaware of the ways I could really last here.
I squandered away most of my money purchasing stocks from unknown companies without enough research and other times because the market went against me.
When I look back, I realize that most of my losses were due to a lack of discipline, letting emotions guide my decisions and an overestimation of my abilities to invest.
Investing in the Stock market
If you want to make your money grow, you too at some point would have considered investing in the financial markets.
What is the Stock market?
The Stock market is a great place to earn wealth if you understand how it works. The words Stock, Share, and Equity is generally synonymous with each other. If you purchase stock in a company, you officially own a share of that company.
Owning shares in a company gives you the benefit of having a share in the growth and profit of that company. When the company experiences growth, you benefit in terms of Capital gains, while profits earn you Dividend payouts.
There are different types of stocks you can trade in.
Penny Stocks are cheap and volatile but offer high potential for growth.
Mid-caps provide less risk and solid growth potential.
Blue chips are stable companies, with higher prices.
Stock indices are used to measure a particular section of the Stock market. Tracking how the indices are directed, is a great way of determining the overall market condition.
What to consider while investing in the stock market
To determine good stocks to purchase, there are many factors you need to consider before investing in a company. Checking the company’s gross profit margin ratio, net profit margin ratio, Return on Equity ratio, debt to cash flow ratio, the Net Gearing ratio, and the Dividend Yield Ratio would better equip you to choose the right company to invest in.
The right way to choose which company’s shares you need to purchase would be to closely follow the company’s growth and progress.
What is Commodity Trading?
I was properly initiated into the world of Commodity trading by my dear friend Luke in 2013. I haven’t looked back ever since.
Commodity markets present a great investor playground for an opportunity. In the markets, commodities are generally broken down into many categories.
The Metals (precious and non-precious): These commodities are generally known as the “Hard” commodities.
Agricultural commodities: These commodities are generally known as “Soft” commodities.
Energy commodities: Oil and gas come under Energy commodities.
These three categories of commodities have different markets when it comes to trading, and different uses when buyers and sellers are considered.
A commodity market is a high-risk place and the prices can be quite volatile.
How buying and selling commodities is not the same as buying and selling shares!
Most commodities are not a source of regular income and do not provide interest, unlike shares.
Commodities management- storage, delivery, weather, and politics- is an area of Commodity trading you do not have to worry about while investing in shares.
This makes the commodities market unpredictable, quite volatile and a market that needs thorough research and homework to be done on, before getting involved.
How commodity trading works
Around the world, there are some huge exchanges that specialize in trading commodities.
In the Retail market, you can either buy physical goods or funds. For most people, physically purchasing goods isn’t practically applicable, hence they go for funds.
Most retail investors are likely to go for the ETF (Exchange Traded Fund)
Investing in Gold ETFs
Gold has remained a favorite investment option for investors seeking safe, secure and good returns. Investment in gold has now become easier than ever with the introduction of Gold ETFs.
Why invest in gold?
Gold is an asset class worth of investing. It is a good long-term investment and gold investments are gaining pace again in today’s market.
For an ordinary investor, it makes sense to hold a small portion of their assets in gold.
Ideally, about 5 -10% of assets can be held in gold. The amount that is generally kept by investors in non-fixed deposits, one may look at parking a portion of that money in gold.
Usually, people have been purchasing gold in physical form, i.e. Jewelry or coins/bars.
Now, there is a better way you can invest in gold. One can invest in gold through gold ETFs.
When you purchase a unit of gold ETF, the person is actually purchasing physical gold. Usually, one unit of gold ETF represents 1 gram of gold.
Whatever the number of gold ETF units you possess, the exact amount of gold is held by you.
How are Gold ETFs different from physical gold?
Unlike physical gold, gold ETFs are held in Demat/Electronic format.
These gold ETFs can be traded on a stock exchange.
Benefits of investing in gold ETF
There are a number of benefits of investing in gold ETFs.
There are no hassles and drawbacks of physical gold – i.e. risk of impurity etc.
There are no premiums and extra hassles involved. If the investor were to purchase actual gold in the form of jewelry, there would be a heavy premium and some making charges adding up.
If the investor were to purchase coins/bars, again there is a premium involved. In gold ETFs, there is no such cost involved.
These are more tax-efficient and allow you to invest in small amounts.
It is extremely easy to purchase and sell gold ETFs, as compared to purchasing and selling physical gold.
If you want to purchase a gold ETF, you can simply call up your broker to place an order. Once it is purchased, the unit will be transferred to your Demat account.
Whenever the units are to be sold, you can inform your broker about the same, and you will receive the cash on the payout.
Tax benefits involved
There is no sales tax involved as in the case of physical gold.
If an investor holds a gold ETF for one year, it becomes a long-term capital gain, which is subjected to a lower rate of tax.
In the case of physical gold, it becomes a long-term asset only after three years. And hence, if the investor wants to sell after a year, before completion of three years, there is a higher tax for physical gold. This is not the case with gold ETFs.
All over the world, over 60 billion dollars get invested in gold ETFs.
Gold ETFs are currently the most convenient way to purchase and sell gold, without the hassles of physical gold transactions.
My introduction to gold ETFs
It was 2 years ago when Luke introduced me to the concept of Gold ETFs.
I was amazed at how secure and safe, these transactions were. I lost a good amount in the beginning, but with some guidance from Luke, I was back to making solid, hard cash again.
Apart from the precious guidance I got from my dear friend, Luke even emphasized the importance of following financial experts who followed the markets closely. This is very important to determine how the current trends are and to enable money making decisions.
When it comes to trading, timing is everything, and following a genuine expert in the market, is a sure-fire way of making the right decisions.
Luke introduced me to a program called “The Total Gold Trading Program” by Mike Swanson. Based on the positive feedback by Luke, I decided to order this program.
Mike Swanson has a website called the “Wall Street Window” which provides precious insights on the current trends of the financial market and a lot of tips and tricks of the trade.
In addition to following Mike Swanson’s website, “The Total Gold Trading Program” was an absolute eye-opener for me, and I went from ignorant to a pro within days of enrolling for the program.
I was amazed at how much I didn’t know and how simple trading actually is if you follow direction and discipline.
Pros and Cons of Wall Street Window
- Brilliant analysis of the financial markets
- Easy to follow
- Great tips and suggestions
- Top picks listed from time to time
- Relying completely on the research of others may prove to be harmful. Take time to think. Research and decide on what is best for you.
- Most of the times in the trading world, we find that greed takes over. Do not let greed guide you while making decisions.
- Failures are part of the game, just try to not commit the same mistakes again.
- You will have to do your own thorough research on the side, to be able to make wise and financially sound decisions.
- It may take a while to start making good profits, but the key is to stick around and learn as much as you can.
Summary of my review of Wall Street Window
In the Wall Street Window, Mike Swanson mentors readers with deeper aspects of the financial markets.
He not only reviews the current market trends but also shares information with respect to his research on how he sees the market trends changing.
His research is very accurate and can be relied on.
A lot of strong investor reviews are proof of how effective the tips shared on his website are.
But, you will have to delve deep and do your own research in addition to using these tips, to make a favorable move in the financial market.