DISCOUNT eTRADING REVEALED (Meg Nolasco-Brewer)

-Make goals and break them down. I.e. year/month/day/etc.

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Mutual Fund (i.e. government securities fund) are priced per share & prices are based on the net asset value (NAV) of the fund. 

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3 ways in determining the "FAIR VALUE" of a stock:

1) FUNDAMENTAL ANALYSIS

-focuses on underlying economics of a company, trys to estimate future sales, earnings, & expenses. Used to forecast the price of a stock. Also forecasts the economy, industry, & companies' commercial prospects, to determine intrinsic/fair value of a stock, comparing fair & market value determines whether the stock is priced fairly, under or over valued.

-since the goal is to buy low, fundamental analysis is to find under valued stocks.

-ratios can provide powerful insights to operational performance. 

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PROBABILITY RATIOS: Return on Assets (ROA), Profit Margin Percentage, Asset Turnover, Inventory Turnover.

FINANCIAL RATIOS: Debt to Equity, Interest Cover, Current Ratio, S&P Rating.

SHAREHOLDER RATIOS: Return on Equity (ROE), Earnings Per Share (EPS), Cash Flower per Share, Dividend Yeild, Price/Earning Ratio, Price/Book Ratio, Price/Cash Flow.

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2) TECHNICAL ANALYSIS

-studies factors affecting supply & demand of stock in the 3 major market movements (daily/normal activity; intermediate/secondary (which lasts two weeks to a month); and, trend: bull/bear markets.

-does not account for profitability/earnings, nor fair/intrinsic value.

-market value determined by interaction of supply & demand

-market likely to move in trends, with possible minor fluctuations

-supply & demand shift can be detected sooner with charts

-chart patterns often repeat themselves

-support & resistance levels identifiable 

-sites providing efficient technical analysis: clearstation, investtech.com, prophetnet.

-software providing technical analysis: equis metastock, inside ta, vector vest. 

3) MARKET TIMING

-uses historical data to discover market patterns and relationships that affect market conditions. Attempts to buy/sell at ideal conditions, based on predicted cycles.