DISCLAIMER: I am not a registered or licensed investment adviser and I am not affiliated with any finance company or bank. I have no interest in pushing any particular investment or product, other than its investment merit. Investing in stocks and all other forms of investment makes you an entrepreneur, which makes you a risk taker. All investments of money, and even time and energy spent working, are forms of gambling and thus carry risk. By reading further you agree to accept full responsibility of your own investments and stock purchases, including any and all forms of loss, that are in any way influenced by my writing. If you are not comfortable with this and do not agree, then stop reading now and do not read further. I deny all individuals who cannot accept the full responsibility of their own losses permission to read my writing. Past performance does not guarantee similar future results. Do your own due diligence, including if necessary, consulting with your licensed and registered financial or investment adviser.
How was your first week trading? Was it good? Horrible? Stayed about the same? Believe me, many people will reach this lesson and have a wide range of responses for their first time. If you did great, you're probably well on your way to becoming an excellent investor. There's a set of human instincts which are not shared by all that help with trades of all sorts. If that sounds like you then you might not need my help much more beyond this lesson. Research and curiosity are what originally led me to the knowledge that I am sharing with you and with the internet at your fingertips, you have the ability to quickly surpass your teacher whenever you like.
If your first trade experience led you in the other direction, still skeptical of what it has to offer you, fear not. The strategies and techniques that I will teach you are simple and you still have a good chance of learning how to make money grow. Now, on to the next lesson.
In business and trade there is a participant often referred to as "The Middle Man." It's this type of figure that gets the most profit for the least amount of work in the economy. A middle man is an unnecessary go-between or intermediary in a trade or business operation. In most cases, the middle man is a person who buys a product or service from a seller at a very cheap price and sells the product or service to a buyer at a significantly higher value. The work of a middle man usually involves simply finding the buyer and the seller and negotiating the trade for both. For this reason the money made by a middle man is sometimes referred to as a "finder's fee."
When making money, saving money, or improving the efficiency of a business, you either want to be a middle man, or to cut out the middle men in your trade and business operations. The reason for this is plain simple; the middle man is getting the most money for the least amount of work!
This means that when a business decides to cut their work force in half for the hope of catching themselves if the business fails or needs to be sold, they are being ridiculously stupid IMHO because what they should be doing is cutting out middle men. NOT hard working loyal employees!
But I digress. In this immediate situation of our interaction I am a middle man in a few ways. As someone who puts affiliate links on a web page and profits from clicks and purchases, I am the middle man who gets paid for leading people to buy a product. While this is potentially arguable since I do produce a bit of necessary work by making this page interesting enough to read, I'm still being paid for the near zero effort required on my part to connect the buyer to the seller. Even the work that I do on this page will continue to work for me indefinitely, so long as it's well written and I keep it updated. Being well on my way towards retiring from 3-7 days worth of work sounds good to me, how about you?
I'm also the middle man as it applies to your education in the stock market. You could have just as soon gone to the library or a book store to read up on stock trading for free and with no other individuals to profit from it, rather than go to my blog or any other online resource or even taking courses at your local school on the subject. Maybe I appeal to your learning style or the fact that you don't have to leave home is the best opportunity for your situation. Regardless, the point is that I am expendable as it applies to your profits in stock trading.
I should make a minor change to my earlier advice concerning middle men. One type of middle man that you don't usually want to cut out is one that costs you nothing and doesn't share in any of your profits or savings in the deal. That's free labor baby! Yes, as your free teacher in the Dark Arts Of Stock Trading I serve you completely and loyally for F-R-E-E...... my Master [bows low to the ground...then goes on a 20 minute coffee break and forgets to make you any hehehe].
CEOs and business owners are the biggest middle men of all. They stand as the intermediary between the worker and the profits made by the worker's labor. Unless you work for one of the few but highly effective employee owned companies out there and you are not a CEO or business owner, you are most definitely a victim of this scam. Running a business does involve a lot of hard work, but when a business is afloat, eventually anyone who runs a business (if they so choose) can just sit back and do next to nothing while money flows into their coffers.
There's also plenty that I have to say about religious middle men, but I'll save that for another blog. If you are interested, contact me directly and I'll be happy to help guide you right to the perfect way to give up your money out of "faith" and make the world a better place for it [wink].
So, when I say that CEOs and business owners are middle men, what should that make you think? Either get rid of them or become them. Trust me, for the time being, the latter is much easier to achieve.
In stock trading, protected and enforced by law, the stock broker is your primary middle man. Most investors I've come across have a broker who treats them as a personal friend and does all of their trading for them. This often incurs high risks and expensive maintenance fees which vastly contribute to the bum reputation that stock trading has these days. The broker of this type gets what they need to get by and maintain their middle to high class income by charging those maintenance fees. Whether they gain or lose your money, they mostly have nothing to lose by trading it. Plus, some of them will charge you for the commission costs of each trade that they make with your money just so that no work for them goes unpaid. So they sit on your nest egg, play with your money, and win no matter what happens to it.
While it's true that they have more money to gain by making more money for you (due to a percentage that they take for the gains that they make you) you are still putting your trust into their gambling habits, not their expertise. Look at it this way, if someone said that you could place a free bet on a horse in a race, thus making it clear that you have nothing to lose, would you bet on the horse that's a good bet but with little payout or would you bet on the horse with the worst odds of winning but the best payout? Now imagine if you were given 50 chances to do that every day and would never lose a penny if a horse you bet on doesn't win.
While I wont yet get into detail as to why, this is exactly the kind of gambling in the banking system that ultimately put us into the recession that we are now in. Now those are some middle men who 100% deserve to be cut (no pun or violence intended).
It's also true that such brokers don't maintain their clients if all they do is lose their client's money (unless they have a great advertising campaign like etrade or scottrade). That being said, this still makes excuses like the plummet of the DOW or NASDAQ taste like sweet candy to the bad ones out there. You are always going to be better off using your own trade choices and paying no maintenance fees or hidden fees for the simple right to trade stocks. Below is a referral link to the online brokerage that I use for just that purpose.
http://Zecco.popularmedia.net/click/share/e1e400a2c2cd1cec88a4d14609ba76d4
I will not lie to you, I am a free middle man to you if you sign up with them. If you sign up with Zecco through this link I will be getting $75 if you deposit $500 by the end of your first 60 days after signing up.
Honestly, unless it rightfully gains me great profits solely derived from my merits as an honest writer, and from this brokerage's merits as an honest business, I don't care what you do. You can sign up, drop in $300, make great gains from my advice and make not so much as a cent for me, and I'll still be happy for you and would love to hear back from you! Other than being a loyal member, I am in no way affiliated with this brokerage. I have been trading exclusively with Zecco since I first started trading because I did my research and found that Zecco is the best deal out there to trade stocks. Zecco is a middle man within a system that requires you to have a middle man by law. Thus it's only wisest to either be a stock broker (which will take time, school, and money) or get the cheapest middle man available. That's what Zecco is.
No, your next assignment is not to start up a Zecco account. You should do that when you are ready to make a real trade. Bookmark my link or just keep it in mind for the future if you are interested. First, you should take a good hard look at your updown.com portfolio. If you are in the green and understand exactly why, then you are ready to move forward and make a real trade. But for the rest of you, which should be most of you, you should go back to the drawing board and keep on looking at your progress with trading on updown.com.
If there are some terms or values that are confusing you, you can feel free to post questions to me below., However, another great resource that I've used for learning about the stock market is investopedia.com. They are an excellent resource for learning the exact definitions and more easily explained definitions of trade and business terminology. They also offer great tutorials, some of which might just happen to be better than mine for all I know. Since I get absolutely nothing for referring you to Investopedia I am free to say that you should not trust the ads on that site. Most of those ads are just human parasites who are aiming to bleed you dry. That being said, you might giggle if you see Zecco being advertised there or on updown.com. Yes, it looks like I'm contradicting myself, but I assure you that I am not. Zecco is the exception and not the rule on those sites.
If you are struggling on updown.com or just want to be more certain of your gains before investing real money, keep working at it for another week or so. Try researching a few terms that are confusing you. Try trading shares of stock on updown.com that are mentioned in my predictions and stock picks on my squidoo lens or on this blog. Sometimes you might be trading too many stocks that are risky or it might take more than a week for your stocks to be at height that makes for a lucrative enough sell point. Becoming obsessed enough to check the charts every few minutes is a good thing in this business.
When you're ready, keep an eye out for my next post Stock Trading 103 for some guidelines and beginning trade strategies. Keep up the good work. Happy Trading!
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