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Conservative Stock Investing

For the stock investor still hurting from the 2008 market crash conservative stock investing is attractive. Each of the world two largest economies, the European Union and the United States, is dealing with its own potentially disastrous debt crisis. There may not be enough time for the US congress to switch from posturing to passing the necessary legislation to avoid a debt default by the USA. As European officials drag their feet the so called PIIGS debt crisis spreads from Greece to Portugal, Spain, and Italy. How would the world economy respond to twin debt defaults on opposite sides of the Atlantic? How would such a situation affect stock investors and traders in the USA? Is conservative stock investing the route to take? A number of US companies, like Microsoft with $50 Billion in offshore reserves, have heaps of cash that amount to a significant margin of safety . In considering how to stock investing today we should first consider just what is conservative stock investing. What does conservative mean and is a conservative approach always the best choice? Where do the basics of stock investing , fundamental and technical analysis and the use of time honored tools such as Candlestick analysis fit in this story?

The dictionary defines conservative as cautious, practical, and averse to rapid change.The traditional conservative approach to investing in stock is long term investing , dividend stocks , and large cap stocks in a balanced stock portfolio . The problem is that long term, buy and hold investing in large cap dividend stocks is not always profitable and can lead to significant losses. A classic example is IBM in the early 80 when it saw the value of small personal computers too late and missed the boat. Like it or not we live in a world of rapid change and closing our eyes to that fact is a recipe for stock trading and investing disaster. Even conservative investors need to follow Candlestick stock charts and stay abreast of market sentiment.

Conservative stock investing can be a recipe for safe stock investing in today's fast paced world. However, we need to add the words thoughtful and based upon experience to the description of conservative stock investing. Thoughtful stock investors look for a margin of safety and intrinsic stock value . They avoid a stock with an inflated price to earnings ratio or price to sales ratio . In conservative stock investing the focus is in reducing investment risk while retaining profits. With the use of technical analysis tools such as Candlestick patterns the investor or trader can assess market sentiment and profit from buying at the bottom of a price curve. With the use of Candlestick signals the investor can learn to buy stock or sell stock at the most opportune and profitable moments. Where buy and hold investing can resemble an ostrich sticking his head in the sand, conservative stock investing with sound fundamental analysis and the use of Candlestick charts can give the thoughtful and conservative investor sound profits.

Market Direction:

There are multiple benefits that come from understanding candlestick analysis. From the short-term trader to the long-term investor, there are numerous subtleties that candlestick signals provide for each trader. Last night we gave a presentation on how candlestick signals are used for affective commodity trading programs. Utilizing the information built into candlestick signals turns the high risk perspective of commodity trading into a high profit controlled program. The major advantage of candlestick analysis is that it can apply profitably to all investment markets and all time frames. Within the next 10 days, the CandlestickForum website will be providing a trading program for the longer-term investor, the investor that does not have the time to sit and follow positions on day by day basis.

Commodity trading allows an investor to partake in profitable market moves that are not necessarily related to the stock market. Trying to make a living at trading the markets can at times be very discouraging when the stock markets are moving sideways. Trading the commodity markets not only allow for a steady stream of income throughout the year but the accurate analysis of specific commodities and currencies can provide a much more clear assessment of stock market reactions. Look for the commodity trading specials on the website.

Chat session tonight at 8 PM ET, Everyone is welcome!


Good Investing,


The Candlestick Forum Team

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