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What is stock?

For those that are new to investing, learning the lingo that is used on Wall
Street and in economics classrooms around the globe is essential. When you hear
the phrase "stock market" you get a vague picture of a group of men and women
running around like crazy people with slips of paper in their hands and yelling
out numbers and words that you can't quite make out. To understand what's going
on, let's start at the beginning and find out what stock is.

Stock can be described as the wealth (or capital) raised by a company or a
corporation from the issuance of shares.

If you own stock in a company, say Microsoft, that would make you a shareholder
in Microsoft. If you take all the shares available from Microsoft, or any other
company and put them together, that is called Microsoft's market
capitalization. This is figured by multiplying the current price of a stock
times the number of shares.

Stock falls into four major categories. There is common stock, preferred stock,
duel class stock and treasury stock. Common stock is, just like the name says,
the most common kind of stock available. Ownership of common shares usually
comes with some voting rights when it comes to decisions made by the
corporation. Preferred stock is different from common stock in the sense that
they usually get paid more dividends and usually come with extra rights and
decision making abilities for the company they are for. Dual Class stock is a
combination of the previous two kinds of stock and the rights attached to each
share vary. Finally, treasury stock are shares that were once issued to the
public, but have since been bought back by the company.

The history of stocks goes back many hundred years to the Dutch East India
Company, who began offering shares of their stock as far back as 1602. The East
India Company helped to pioneer the idea of joint ownership and helped the
economic growth in Europe at that time.

The most popular place to trade stocks in the United States is, of course, the
New York Stock Exchange, where millions of shares change hands on a daily basis.

The world of economics and stock trading can be very exciting and very
profitable for those that know the ins and outs. Hopefully, this article helped
shed some light on what stocks are and how they are used by companies.

What is the Stock Market?

Generally speaking the Stock Market refers to equities where actually stocks
and derivatives are traded. In the U.S.A. we think the Stock Market is New York
City. In fact there are major Stock Markets in Hong Kong, Hamburg, London,
Paris, Canada, Japan and others that influence one another and impact the world
Stock Market.

The New York Stock Exchange may have stocks listed that are listed on other
major Stock Markets. A company headquartered in Amsterdam may be listed on
multiple stock exchanges. Many foreign organized companies are listed on the
New York Stock Exchange. There is a tremendous value for foreign companies to
be listed on an exchange in the U.S. The exposure and knowledge of a foreign
company has a face on the New York Stock Market.

An example would be a China stock Baidu. These information and search
technology company has grown in leaps and bounds since it was introduced on the
New York Market. Sometimes all it takes is making a good impression to stock
analysts and a good review by key people to give the foreign company a boost.

The reality of the Stock Market today is its world wide integration of
investors, companies and alliances that create an unprecedented dynamic. Thus
far this United Nations of the financial markets has produced an unspoken
treaty of like minds. The main objective is to create a win-win scenario for
all of the world players in the Stock Market.

Any investor wherever located may hold a substantial stake in any given equity
no matter where the equity is traded. The Stock Market is a very large private
club that anyone can join with the only admission ticket is the price of a
single share of stock.

Most people are aware of American companies utilizing off shore manufacturing
of their products. It may be not as well known that some traditional American
brand companies are owned by foreign companies. Other American brand companies
have a significant multi-national presence with significant stock ownership by
foreign banks and investors.

The term equity should be broadly interpreted. There are equities that involve
the manufacturing of products and goods, but a product can be intellectual or
an entity like insurance. Banks are equities and financial brokers are all
traded on the various exchanges. An investor may own gold stocks, mining
companies and equities that package these equities into a corporate entity. The
only limitation is that if the investor is interested in owning the commodity or
trading in the futures market the Chicago Mercantile or other commodities
exchanges is the investing tool.

In other words you may own a bank as an equity who may have bonds and other
commercial paper that may trade on the commodities exchanges, but you can' t
buy a commodity as a stock. If you want a commodity like wheat, currency, corn,
gold, silver or the like you need to look to the commodities exchange.

In the United States the New York Stock Market is comprised of the NASDAQ, NYSE
and the newly created combination of the NYSE Group with Euronext in April,
2007. The Euronext holding company is a phenomenal synergy between Paris and
the NYSE whose history goes back to 1792.

The Euronext is a combination of derivatives, currency and equities to name a
sample of products. There are other exchanges that include the AMEX. There are
listing requirements for each of the exchanges. The Stock Market is basically a
place where buyers and seller of a piece of a company come together and in the
process the company hopefully raises some cash or other value.

What Does a Stock Exchange Do?

The stock market is on the news every day. Even on days when there isn't
trading, like a weekend or a holiday, there are people on TV and in the
newspaper that are talking about what they think individual stock are going to
do and why you should or shouldn't invest your money right now. We know that a
stock market trades stocks. But why? And what good does it provide to the

The stock market is seen by many to be the engine that drives the economy.
Businesses and corporations and even governments use the stock market to create
capital or wealth. They create this wealth by offering stock, or shares, which
are like little pieces of ownership of the company or corporation, and then
they trade them. The value of the stock depends on how well the company is
doing. The company sells the stock to investors who buy the stock based on if
they think the company is going to be making a lot of money or not. This brings
in a huge amount of cash into the corporation. IPO's or initial price offerings
are when a company offers stock to the public for the first time ever. A big
corporation can make hundreds of millions of dollars or even billions of
dollars during their IPO. If the company continues to do well and make money,
the stock price goes up, everyone that has shares makes money and more stock is
sold to people who want to own a piece of that company.

The same method works if the company is doing badly. The stock loses value as
the company does badly, and people then begin to sell the stock and the value
of it goes down.

Every company, even the most successful ones, have their stocks go up and down
on a monthly basis based on things like earning reports. There is no 100% safe
stock, but there are stock that is referred to as "blue chip" stocks, or ones
that are the most reliable.

But it isn't just stock that is traded on a stock exchange like the NYSE.
Bonds, securities and commodities are also traded, creating wealth in many
different sectors as well as helping the flow of goods and services over the
globe. The role of the NYSE and other stock exchanges around the world cannot
be overstated in their importance to the world economy.

What is the Dow Jones Industrial Average?

The Dow Jones Industrial Average (DJIA), is the top 30 Blue Chip stock whose
performance is averaged each day of trading on the stock market. The components
of the Dow Jones Industrial Average reads like a who is who in the stock market.

Currently, the top 30 stocks are doing quite well on the stock market. Due to
the small number of stocks that make up the DJIA all it takes it a few of the
stocks to take a dive and the overall average can take a dip. It is good to
analyze the sectors that make up the components of the Dow Jones Industrial

Direct consumer contact stocks in Dow Jones Industrial Average:

It should be no surprise to most people that Wal-Mart Stores Inc is a component
of the Dow Jones Industrial Average. Over the past three years the price of
Wal-Mart had a price adjustment due to various management decisions. The $52 to
$58 per share days of 2005 has seen a drop to $43 in 2007. This stock is
expected to reach the $52 range again in the foreseeable future.

Another solid past performer Home Depot is trying to make a rebound from
concerns about the housing market. Recently, Home Depot has seen some return to
the range where it should be trading. It closed recently in the $38 range and
should see some improvements to the mid $40 range.

McDonald's Company is also on the road to recovery after a slump in 2005. Their
healthy diet adjustments have improved the overall out look on the stock. It is
currently trading at the high $40 range and should easily go higher.

Walt Disney Company is a stock with many hats. It is known for resorts and
films, but it has a huge international presence in all types of communications
and media outlets. The product line is extensive. It has numerous media
outlets, including but not limited to ESPN, The History Channel and television
stations. The stock is a value stock currently selling in the range of $33.

Technology stocks in the Dow Jones Industrial Average:

Microsoft Corporation,United Technologies, Hewlett-Packard, Verizon
Communications, International Business Machines, AT&T and Intel Corp. round out
the influence of technology influence on the Dow Jones Industrial Average. *

At this point an investor recognizes that if a sector is down for the day this
will effect the overall Dow Jones Industrial average.

What Does the Dow Do?

If you turn on your local financial news, you're bound to hear the phrase Dow
Jones Industrial Average at some point. Most people assume that this just means
the stock market, or that it refers to the New York Stock Exchange. But what is
the Dow, and what exactly does it measure?

The Dow is a market average. It is used by investors to figure out how certain
companies that are being traded are doing. The Dow isn't the only market
average out there, there is the S&P 500 and The Russel 2000, as well.

The Dow takes into account 30 industrial stocks of well-known companies. The 30
companies are likely ones you've heard of, like Goodyear, Exxon, IBM or General
Motors. The Dow calculates the rises and falls of these 30 stocks and presents
a picture of how the overall market and the overall economy are doing. While it
may sound complicated, it really isn't. The Dow is simply a list of 30 companies
that have their estimated values averaged together with a particular formula.

The other averages follow essentially the same methods. The S&P 500 uses the
values of 500 major companies, while the Russel 2000 keeps up with 2,000
companies that are smaller than the ones used in the S&P and Dow.

The key to following the Dow or any of the other market indexes is to look for
trends. Market analysts can decipher problems or benefits in the current
economy by looking for particular stocks that go up in certain situation, and
particular stocks that go down in others.

The Dow company, now known as Dow Jones & Company was founded in 1882 and they
classify themselves as a financial information and publishing firm.

The Dow is responsible for the publication of the Wall Street Journal, maybe
the most well known financial publication in the world. The Journal's first
issue was on July 8, 1889. Dow also publishes several other financial
publications, as well as Barron's Magazine.

The Dow also runs several websites dedicated to financial news and information,
such as and

The Dow also has a hand in the broadcasting world, where it helps to provide
financial content for the CNBC cable network, as well as two finance-oriented
radio shows.

The Dow Jones & Company machine is one of the most powerful forces in American
investing. Their indices are the industry standard, and the Wall Street Journal
has the second highest circulation of any newspaper in North America. The Dow
helped to start finance in the US and they look to be a big part of finance in
the future.

What is a bond?

With the proper savings plan or with a lucky financial windfall, many of us are
ready to start investing. However, if you didn't take any economics classes in
high school or in college, you may not be familiar with the basics. Having seen
the morning financial news for years, you're probably familiar with terms like
stocks, bonds, commodities and Wall Street, but you might not know exactly what
they mean. Let's take a closer look at exactly what a bond is.

A bond is described as a debt security. Now, don't let that term confuse you,
consider it much like an I.O.U. When you invest in the bond market, what you're
doing is giving your money to something, whether it is a corporation, a
government, a federal agency or a municipality that is known as a bond issuer.
Now, what do you get in return for this act of faith? You get interest. When
you buy the bond, you agree to receive a particular interest rate from whoever
you bought it from, and then once the bond "matures," you get however much you
bought the bond for back (usually the face value of the bond.)

The different types of bonds you can choose from are varied. Most people have
heard of war bonds that are issued by the country to raise money for war. These
were extremely popular during World War II and became a very patriotic thing to
do. There are also things like asset and mortgage backed securities bonds,
bonds issued by foreign governments and many other kinds.

Now, bonds sound like a pretty good investment, but it doesn't sound like
something that's going to make you rich overnight. Well, that may be true but
that doesn't mean that bond investing is a bad thing. Think of investing in
bonds as good long-term planning. They are perfect for families that need to
save for their kids' college education. If you don't have kids, don't worry,
bonds are a fantastic way to save for retirement. Bonds are also highly
recommended to have as part of your investment portfolio. No matter how much
risk you can afford, it's good to have a rock solid investment, too, so if
things don't' work out well with your other investments, you have something
reliable to fall back on.

Today's bond market is varied and there are options for everyone, whether
you're just out of college and are looking ahead or if you are a Wall Street
high roller and you need an anchor to your portfolio. Investing in bonds can be
a fun and educational way to begin investing, and you likely won't lose your
shirt in the process.

What is a commodity?

For someone outside of the Wall Street marketplace, understanding the world of
stocks, bonds, P E Ratios and some of the other jargon that's used every day in
the business section of the newspaper can be difficult. One such term that many
people may use but not exactly understand is commodity. Most people know that
commodities are traded like stocks and that they can be worth a lot of money,
but if you ask more specifically, what is a commodity, many people wouldn't be
able to tell you.

So, what exactly is a commodity?

When talking about a commodity, there are a few qualities they usually have.
Commodities are manufactured by more than one company and the quality of the
commodity is the same from company to company. You wouldn't be able to tell one
companies product from another if you tried.

Sound confusing? It's not, really. Things like oil, electricity and lumber are
considered commodities. A product like, say, clothing wouldn't be, because
people can tell the difference between company A's clothes and company B's
clothes. If you have a barrel of oil in front of you, it's pretty much going to
be the same as a barrel of oil from another company. The term that's used in
economics to describe this is product differentiation. If you can tell the two
products apart, it's not a commodity.

Historically, commodities are priced based on their "marginal cost," which
means the cost it takes to take the oil from the ground, barrel it and ship it.
In today's market, however, most commodities are priced higher based on things
like one companies ability to do the job either faster or slower.

Other products fall into the commodity category like wheat, orange juice and
pork bellies (the belly-part of a pig that bacon is made from). More recent
commodities include Internet bandwidth and some computer chips.

A famous movie from the early 1980's Trading Places was about a group of men
who tried to make money on the commodities market. While the movie was
fictitious, it showed how quickly large amounts of money can be made on the
commodities market, and how quickly it can all be lost.

Understanding a little about what goes on on Wall Street can be a fun way to be
introduced to the world of economics. While this introduction just skimmed the
surface, the next time you hear someone mention commodities, you'll know
exactly what their talking about.

What was the bubble?

In the world of investing, certain phrases catch on like wild fire. Before you
know it, you're hearing catchphrases on the news, on analyst shows and even on
the street from strangers. Maybe no other phrase exemplifies this better than
the bubble. The bubble was a mini-crash of sorts in the stock
market that only affected one segment of stock: the internet company.

The origin of the bubble can be traced back to 1994. The rise of the
Internet from being a Department of Defense secret to a widely used tool in
everyday life caused the formation of thousands of new businesses seemingly
overnight. Many of these's were not run by people who knew that much
about business, but the ease of starting their own company over the Internet
was so simple, most investors didn't realize this.

As people poured onto the Internet, excitement grew as to the possibility of
reaching such a large number of people so easily and so cheaply. It was,
however, the misunderstood nature of the Internet that caused the eventual crash. Reaching all those people and getting them to buy your product
turned out to be a little more difficult than most thought.

Three particular companies that would come to represent the age were
WorldCom, who would end up not surviving the bubble, Netscape, which is still
in business today but is considered an also-ran by many, and Yahoo, who isn't
the industry leader it use to be, but is still doing quite well.

The "bubble" referred to in the name comes from investors speculating about a
companies future, and as the stock for that company begins to rise, the bubble
builds. It's called a bubble because the speculation and the rise in stock
prices isn't based on any real, ironclad evidence that the company is really
worth all the hype.

The Dot.coms began to fail en masse midway through 2000. The Nasdaq market felt
the full brunt of these failures since so much of their listed companies were
dot.coms. Many companies, such as WorldCom and ended up going out of
business, costing investors millions. Others, such as Yahoo and Amazon
survived, with Amazon being stronger than ever.

It's unknown if there will be another bust in the future. With Google
having bought YouTube for over a billion dollars, anything is possible. But one
hopes that investors will be more careful this time and heed the lessons of bubble's past.

The Bull & The Bear

The world of investing is filled with colourful jargon and phrases that may
seem strange if you don't know what they mean. A great example of this is a
"Bull market" and a "Bear market." These two terms refer to market trends. A
Bull market means that the market is headed up and it's time to make money. A
Bear market means that stocks are headed down and it's time to be careful. But
where do these terms come from? That is a question that is harder to answer
than you think. There doesn't seem to be any consensus of the origins of these
terms, but there are some solid leads.

Some link the origin of Bear and Bull to a book written in the 1700's called
Every Man His Own Broker by Thomas Mortimer. The book describes the tendencies
of some investors and links them to bears and bulls. The bull, as described in
the book, was someone who might purchase huge amounts of stock with little or
no money at all and hope to sell the stock for a profit before the time to pay
for it came due.

A bear, on the other hand, sold stock or property that he didn't even own yet,
and then would be forced to scramble to find a way to obtain the goods before
he was due to deliver it.

There are some interpretations of the phrases which are much more logical. When
a bull attacks, he will use his horns and swipe up to cause damage, while a bear
will attack you with his paws and swipe downward.

There is also a group that believes the use of the terms dates back to bear
trappers and the practice of bear skin salesmen selling skins they didn't have
yet at a particular price, hoping the skinners would come to sell their kill
for a lower price, so that the salesmen could take home the difference. And
since a one-time staging of bull and bear fights was popular, the term bull was
given to anyone who didn't practice this.

One final possible origin is related to the ways the animals charge, with bulls
moving at high speed forward and bears moving slowing and cautiously.

While the origins of the bear and bull market may never be known, the stories
surrounding them are just as colourful and fun as the terms themselves.

Is a Bull Market on its Way?

Recently, the Dow Jones industrial average broke an all time high, and recent
stock news shows that the index is ready to break through to 12,000, which
would also be a record high. Investors all over the world are asking themselves
if this means another bull market, meaning a market that is going to be going up
and up is about to start? Or is this a short term rise, and a bear market, or a
market that is going to be going down, is starting? Investors have argued over
the direction of the market for generations, just like sports fans arguing over
who has a better defense.

Pessimists of the current markets point to the fact that while the NYSE is way
up, the other markets like the Nasdaq and the S&P 500 are far below a possible
record high. They also point to the fact that recent economic indicators are
showing a downturn in the economy, although optimists argue that any economic
downturn will be short-lived. One of the best bellwethers for the overall
economy is real estate. Since the real estate market deals in such "real"
terms, meaning that they deal in land, homes and large buildings; things you
can see and touch, the real estate market is very stable and not prone to
seismic shifts in price and quality.

If you are going to judge the real estate industry on how stocks might do over
the next year, than you might want to think about selling off your holdings
now. Real estate experts agree that a "housing bubble" is about to burst,
sending the price of real estate across the country into the basement, and a
good chunk of the economy with it. A real estate bubble is caused when a flurry
of investing causes the market to become overvalued. With the 5-year long real
estate boom over, prices from California to Arizona to Florida are coming back
down to earth, and the economy at large is going to suffer. Cities like Boston
have already been feeling the affects of this burst bubble. The real estate
market there has been in decline for months now and the trend is spreading to
New York and even out west where the housing market has been red hot for years.

While there is no way to predict what the NYSE and the other stock markets will
do over the coming year, if the real estate market is an accurate indicator,
than there could be trouble ahead and a bear market might not be far off.

Day Trading

With the technology boom that has changed the way business is done across the
globe, one unintended result has been the rise of day trading. Day trading is a
risky and stressful form of trading that involved buying stock and selling it
within one days time. It's thought that if this is done enough time, with the
right foresight and financial advice, that a person can make quite a lot of
money each day. Day trading wasn't even an option before the 1990's. Here's why.

Back before the computer age allowed instant stock buying and selling, the
financial settlement period use to take much, much longer. It was possible to
buy a stock, and not have to pay for it for another 10 business days. It was
common practice in those days to try to sell the stock for more than it was
worth before you had to pay for it in an attempt to make a profit. Many traders
who had no actual money of their own would make their livings this way, and it's
obvious how dangerous this was.

A day trader has many different strategic options that he or she can follow to
try to make a profit. The first is trend following. This is a tool that is used
by all investors and its simply the idea that stocks that have been going up
will continue to go up and stocks that have been going down will continue to go
down. Obviously, this isn't always the case, which makes trend following a
dangerous method to base all of your day trading investments on. Range trading
is another tool used by day traders. This is the practice of buying and selling
stocks once they reach their respective highs and lows. The trader figures that
a stock that is headed up will continue to go up, but only until it reaches a
new high, and then it's due to go back down. The same is thought for stocks
headed the other way. Once they reach a brand new low, they tend to rebound and
head back up.

Playing news is another common tool of the day trader. The technique is exactly
what it sounds like, buying stock that has just released good news and selling
stock that has just released bad news.

While none of these techniques are guaranteed, day trading is increasing in
popularity every year, and while the potential for significant loss is very
real, many continue to walk the tightrope that is day trading.

The Securities & Exchange Commission (SEC)

The United States Securites and Exchange Commission was founded in 1934 in
response to the great stock market crash of 1929. Congress created the SEC in
the hopes that it would serve as an independent and non-partisan agency that
would help regulate the dealing of securities in the USA. Thanks to the crash
of 1929, Congress also enacted many new securities laws that the SEC was
created to enforce.

The main job of the SEC is to enforce a series of laws, most of them enacted
from 1933-1940 that help protect investors of securities and the economy as a
whole. Congress has given the SEC the right to bring civil cases against
companies that they feel have committed a series of crimes, such as insider
trading, fraud, or companies that have given false information. The SEC also
works hand-in-hand with local police, the FBI or the CIA in pursuing criminal
charges when the proper laws have been broken.

One of the ways that the SEC gathers information about various companies so
that it can see if any of them have broken the law is be requiring that
publicly held companies submit reports four times a year and then an annual
report, as well, showing their financial numbers. The companies also file
reports with the SEC that outline how the business did that year and how it
expects to do in the future.

These reports are absolutely vital to investors when trying to figure out which
company to invest in. The capital markets are notorious for upheaval and these
reports are essential for investors who are trying to figure out which
companies are safe to invest in and which ones aren't.

The SEC allows anyone to read these reports and they are available via an
online system to read at any time. The SEX also uses this same system so that
individual investors may file complaints against a company that they feel might
be breaking the law. This allows every day citizens the chance to call attention
to a possibly crooked company.

A recent pop culture reference to the SEC came from the now-defunct television
show Arrested Development, when the pilot episode featured the SEC boarding a
yacht to confiscate documents related to the Bluth family business.

The SEC is a vital government agency that helps companies walk the straight and
narrow and helps individual investors make educated decisions about the right
companies to invest in. If you're thinking about investing in the capitals
market, a visit to the SEC online system is an absolute must.

9-11 and the New York Stock Exchange

Maybe no event in American history was as dramatic as the attacks of September
11, 2001. When the attack on Pearl Harbor happened, we had live radio
broadcasts bringing updates, and the next days newspaper how photographs of the
carnage, but with 9/11, we had live, crystal clear television pictures beamed
right into our living rooms. While we still take pause to think of that
horrendous day, the world's financial markets took a hit like they never have
before as the ripple effect from Ground Zero was felt all around the world.

When the attacks happened, and because of how close the World Trade Centers
were located to Wall Street, trading wasn't even started. Everyone that had
shown up to work that day was told to stay inside until it was safe. Many
people inside the exchange reported feeling the ground shake as the two towers
collapsed, and the exchange became a refuge for those fleeing the giant cloud
of dust, smoke and debris that appeared once the towers fell.

The buildings that hold the New York Stock Exchange were not damaged during the
attacks, but a major telephone bunker than held the phone system for the entire
area located near the World Trade Center was severely damaged, hence making
communication on the floor of the exchange impossible.

The stock market remained closed until September 17. It would turn out to be
the longest that the market would remain closed since 1933 and the Great
Depression. During it's first day of trading after the attacks, the market lost
over 680 points, the single biggest one day drop in the exchanges history. While
the drop only accounted for a little over 7 percent, it is still considered a
major event. By the end of that first week back open, the Dow Jones had lost
over 1360 points or 14 percent of its value. It would go down as the worst week
in market history. The total money losses during that time were estimated to be
around 1.2 trillion.

The events of September 11 led to a dramatic increase in security around the
exchange, as many feel it could be a target in future attacks.

The events of 9/11 will live on in the minds of everyone who lived through it.
For those who had shown up for a day at work on Wall Street, the event is
difficult to forget. The NYSE came through it stronger and so did the nation.

How the market affects gas prices

A recent downturn in gas prices has come as a welcome relief to most drivers in
North America. The timing, however, of the price drop has many people thinking
conspiracy theory. A recent poll of Americans showed that a staggering 42
percent of respondents believe that George W. Bush and the ruling Republican
administration in Washington lowered gas prices in time for the November 2006
mid-term elections. While this may or may not be the case, the various stock
markets around the world do have a real time impact on the price of oil, and
therefore gasoline.

The biggest culprit in the lowering of gas prices might actually be Mother
Nature. In preparation for the upcoming hurricane season, many investors on
Wall Street and around the world invested heavily in gas and oil futures,
guessing that another direct hit by a Katrina-like storm directly on gas and
oil pipelines in the Gulf of Mexico would send prices through the roof like
they did last year. But a recent correction by hurricane forecasters who
downgraded the 2006 hurricane season caused the price of oil to plummet and all
those investors who bought futures to cry.

But it wasn't just the hurricanes that did it. The announcement coincided with
the end of the summer season for drivers, which also dragged down the price of
oil. The price of oil over this time fell off the table, going from an August
7th high of $77 a barrel to $58 a barrel in October. It doesn't take long for
this drop in prices to be felt at the pump.

This seismic shift in oil and gas prices over such a short amount of time left
many investors in deep financial trouble. At least one mutual fund that was
invested heavily in oil and gas futures went belly up due to this dramatic drop
in prices. At the same time, there were other funds that did quite well despite
the portfolio-ruining drop in oil prices. As they say in sports, sometimes it's
better to be lucky than good.

While it may be naive to think that global politics never plays a part in the
world's commodity markets, it is unlikely that the sole reason for the massive
and speedy drop in oil prices was due to upcoming elections. The number of
variables that play on the world's stocks, bonds and commodities is too vast in
number to be influenced completely on one country's elections.

The Skinny on Online Investing

The world of stock trading has changed dramatically over the last 20 years.
Trades that use to take more than a week to process now take only moments.
While once you needed to have a stock broker to make a trade for you, now, from
the comfort of your own computer, you can make as many trades as you like, and
at a much lower commission than your grandfather would have paid to make the
same trade 50 years earlier. The world of online trading can be very tempting
to many. Investing is a lot like gambling, with possible huge profits and even
bigger losses possible. But how do you know if online investing is for you?

The first question you need to answer is do you have money to burn? Of course,
none of us want to toss our money down the drain, but you have to be prepared
for the worst. Most online investors are armed with a copy of the New York
Times, online subscriptions to several investment websites as well as strong
word of mouth from family and friends, but even with all this information, some
investments don't go the way you want them to. Make sure you have room in your
budget so that you can afford to lose some and still be secure. Online
investing can be addictive, so you should know when to stop.

Be prepared to arm yourself with as much information as possible. While it's
true that even the most informed traders make mistakes, the more you know, the
less likely this will happen. This means immersing yourself in reliable, timely
and knowledgeable advice. If you're not willing to take the time to properly
educate yourself, you might want to leave investing to your broker.

A good investor has to learn to be patient. While it is tempting to take on the
human herding instinct and put your money on the latest trend or the most
fashionable stock, those investors that are confident and patient usually come
out on top.

If you're new, stick to blue chip stocks. There is a reason they are called
blue chips, they have shown slow and steady growth over long periods of time.
There is no such thing as a safe stock, but blue chips are the closest thing
you'll find. A good tip is to always leave a portion of your investments in
blue chips, so if the rest of your investments go south, you'll have something
to fall back on.

Online investing can be exciting and fun, but it can also be terrifying for a
newbie. Do the research, develop some patience and stick to familiar ground and
online investing can be a great way to develop your portfolio without having to
bow to mainstream brokers.

NYSE President John Thain

John Thain is the current Chief Executive Officer of the New York Stock
Exchange. Before coming to the NYSE, Thain was the Chief Operating Officer and
President for Goldman Sachs, one of the world's most prestigious investment
banks. During Thain's tenure with Sachs, he was able to develop a portfolio
worth over $300 million dollars in stock.

Thain was chosen for his business acumen, but also for the fact that unlike his
predecessor, Dick Grasso, Thain isn't as much of a showman and enjoys being
behind the scenes at the New York Stock Exchange. There are famous stories of
Thain while at Goldman Sachs that talk about how he was an important and
influential member of their company, people didn't talk about him because he
was so quiet. This demeanor is thought to be a major reason why he was chosen
to replace Grasso after the extremely controversial and public way he left the

Thain attended the prestigious Massachusetts Institute of Technology (MIT) and
still has very close ties to the school today as a member of the MIT
Corporation and with the Dean's Advisory Council. Thain graduated from Harvard
in 1979 with his MBA.

It was thought to be a bit of an upset that Thain would get the job to head the
New York Stock Exchange. Many other higher profile business men had been
bantered about in the media as possible successors to the tarnished throne of
Dick Grasso, but Thain won out.

One of the hopes of Thain's reign at the NYSE is that he will help to modernize
the trading floor. A major criticism of the Dick Grasso era was that he refused
to let computers and more efficient systems be installed into the exchange with
the rational that since trading had always been done this way, it should always
be done this way. One of the possible reasons Thain was chosen is that, while
he is by all means an insider to the financial world, he has no particular
allegiance to the men and women on the floor who trade stock, and while no one
wants to fire people who are doing their jobs, the need to modernize the
trading system to match other exchanges around the world is a must.

While no one can predict the future, it is hoped that the tenure of John Thain
is just as effective as his predecessor Dick Grasso, just a heck of a lot

Richard Grasso and the NYSE

Richard Grasso was born in New York City in 1946 and was chairman of the New
York Stock Exchange for 8 years from 1995 until 2003. His career on Wall Street
began in 1968 when he began working as a clerk. Grasso was also president of the
exchange during the September 11, 2001 terrorist attacks on the World Trade
Center and his leadership was considered to be a major factor in getting the
exchange up and working so quickly after the attacks.

Grasso grew up in the city and was raised by his mother. He joined the Army
after attending university for two years, and it was upon his exit from the
Army that he began working as a floor clerk on Wall Street. The rest, as they
say, is history. Grasso worked hard and moved up, through the ranks, and by
1995, he was president. Although his tenure with the NYSE would end in
controversy, he was thought to be a major force in keeping the stock exchange
one of the top financial markets in the world.

Four years into his reign atop the NYSE, a controversy began when Grasso
invited a group of members from the Revolutionary Armed Forces of Columbia
(FARC) to the floor of the stock exchange. It is still unknown why Grasso would
associate himself with an organization that the United States government
considers to be a terrorist group that uses illegal drug sales to fund their
war against the Columbia government. During the meeting, Grasso is reported to
have said that he was bringing a message of cooperation from United States
financial companies, since FARC has been known to preach anti-capitalism
ideals. A scene like this today in the post-9/11 world is unfathomable.

Grasso's downfall was precipitated by his receipt of what is known as a
deferred compensation pay package. The reason why this was a problem was
because the package was worth 140 million dollars, and the people who agreed to
give it to him, the compensation committee, had been hand picked by Grasso and
the members were made up of representatives of companies that traded on the New
York Stock Exchange. An obvious conflict of interest led to Grasso stepping down
as the chair of the exchange on September 17, 2003.

The story of Richard Grasso isn't over as a lawsuit is still pending to attempt
to recover some of the $140 million, as well as a counter lawsuit filed by Gasso.

Possible future of stock exchanges

With the electronic age firmly entrenched and the Internet and basic computer
usage a fact of life, many people are taking a look at how computers are
changing the workplace. Where most elementary schools may have had one or two
computers in an entire school, some schools now have a laptop for every
student. And while the average workplace use to have slow and clunky terminals,
they have now been replaced with lightning fast machines capable of running a
dozen complex programs at once.

One workplace that has been somewhat shielded by this evolution is the floor of
the New York Stock Exchange. Some consider this to be highly ironic, since the
floor of the exchange is where the shares in the very computer companies that
seem like they are taking over the world are traded.

The recent expulsion of Richard Grasso as head of the NYSE was seen as an
ominous move by many specialists who work at the exchange. Grasso, while far
from an ideal leader, was famous for trying to keep the individual traders
employed when they could most likely be replaced by a newly designed computer

With the appointment of new exchange boss John Thain, a possible revamping of
the entire trading system is expected, but how many jobs will it cost and what
will it look like?

A major sign of impending change happened in April of 2005 when a company
called Archipelago Holding merged with the New York Stock Exchange and the two
became a publicly traded company. Archipelago is an electronic trading network,
and it's thought by many who work on the floor of the NYSE that this merger is
the final nail in the coffin for the hundreds of people who carry on the
tradition of floor selling that has been going on for over 200 years.

The possible evolution of the NYSE may not even be up to those that run it. As
other markets across the world in places like Hong Kong, Frankfurt and London
upgrade their trading methods and begin to phase out trading by people in
favour of computers, an upgrade may become necessary to just keep up. Since the
computer can process trades significantly faster than a human, the NYSE may have
to do away with the traditional floor trader just so that the exchange remains
competitive and relevant.

While the constant sea of change is inevitable, the future of the floor trader
at the NYSE looks bleak. It is not known if there will still need to be traders
to input the trades into the computers or if that phase of the trade will
somehow be automated, as well. The only thing that is known for sure is that
change will continue to happen and unless we learn to anticipate it, those that
don't will be left behind.

History of the stock exchange

A stock exchange is simply a place where stock is traded. Obviously, in this
day and age, the New York Stock Exchange is much, much more than that. Not only
is stock traded, but bonds, securities, commodities and countless other things
are traded, as well. The NYSE has become so well known throughout the world
that it has evolved from a place to do business to a genuine tourist
attraction. The history of the market, combined with the wealth and power that
resides within its walls makes it a must-see for any tourist visiting New York
City. But how did we go from a dirt road trading post on the outskirts of a
small village to a marble and stone monolith like the New York Stock Exchange?

While the location of the very first stock exchange is somewhat controversial,
it is believed that the original exchange was located in the Egyptian city of
Cairo at or around the 11th century. It is thought that Jewish and Islamic
merchants dealt in stock and commodities trading. This goes against most common
beliefs that the Italians were the ones to actually invent the stock market.

The first appearance of stock brokers can be traced back to France in the 12th
century. A person known as the courratier de change was saddened with the job
of regulating and managing the debts and finances of communities that were
based on agriculture for the local banking system. They were also known to
trade the debts that they kept records of.

During the next century, French commodity traders started to become more
organized and groups that would meet on a regular basis to trade began
sprouting up all over Western Europe.

The first evidence of trading of government securities was seen by Venetians in
the 1200's. The government of Venice soon outlawed the practice of rumour
spreading with the intent of lowering prices of government-issued securities.

Within the next few hundred years, the Dutch were the first to start stock
companies that let their shareholders have a piece of profits, and losses. The
Amsterdam Stock Exchange was the first exchange to offer the idea of continuous
trade as early as the 17th century.

The road from dusty marketplace to organized stock exchange has been a rocky
one, but the evolution is unmistakeable. With the current trend of moving away
from floor traders and to computerized trading, no one knows what the stock
exchange of the future will look like, but one thing is for certain, the market
will continue to change over time, no matter what.

The History of Wall Street

When people in the media, or just people in the know, refer to the various
stock markets in lower Manhattan in New York City, they usually just refer to
Wall Street. The now famous financial district has become synonymous with large
amounts of money, power and influence. But how did one street manage to evolve
into such an important address?

Ironically, most major investment firms that helped to build Wall Street into
the financial force that it is today aren't even headquartered there anymore.
Thanks to technology advancements, these companies are usually headquartered in
other parts of Manhattan or in neighbouring New Jersey or Connecticut. One of
the most influential companies in Wall Street history, J.P. Morgan moved from
the address that they helped make famous in late 2001.

The name Wall Street was actually given to the street since it formed a
boundary to the New Amsterdam settlement in the early 1600's. To help ward off
the British, a 12-foot wall was built around the street to keep out invaders in
1653. In 1792, the Buttonwood agreement started the New York Stock Exchange and
its headquarters would be on Wall Street.

In 1889, a newspaper that would eventually become the Wall Street Journal began
publication. The paper took its name from the fact that a growing financial
district was sprouting around the stock exchange and many companies that would
go on to be powerful forces in the United States economy were headquartered

One of the most well known symbols of Wall Street, the JP Morgan headquarters,
was built in 1914. The building still stands today, but is now owned and run by
Deutsche Bank.

Wall Street has seen its fair share of history over the years, with the 1920
bombing that killed around 40 people and injured 400 to the great crash of 1929
that saw some people kill themselves. Today, if you check the front faŤade of
the JP Morgan building, you can still see pock marks of the 1920 terrorist

The construction of the World Trade Centers were the only real major
architectural change to the financial district in the last half of the 20th
century, and their subsequent destruction has left a void in the hearts and
minds of many that work and live near there.

The history of Wall Street is a collage of incredible highs and devastating
lows. As the center for American and some would say world finance, you can bet
that there will be plenty of memories made on the most famous street in the

History of the Ticker Tape

The grainy, black and white footage may be hard to make out, but during the
post-World War II parades that happened around the country, there was always
one constant: ticker tape. Ticker tape's home, however, wasn't on the parade
route, but inside the stock exchange, where the tape has had a colourful
history of helping to shape the current financial structure in the US. But
where did the tape, and the machines that used it come from and was the
original design made for the trading floor?

First off, let's take a look at the name. A tick was a term used to describe
the slight movement of stocks. These machines, (think a computer printer but in
1867) were used to track stock movements by recording every transaction and then
relaying the results.

Taking a look at what was recorded on the ticker tape, well, let's just say
that you would need to know quite a bit about investing before anything you saw
on the tape would make sense. For one transaction, the tape would record several
characters. The first set was the stock's ticker symbol. A ticker symbol is
simply an abbreviated name for a company, usually 3 or 4 letters that let
investors know which stock is being traded. The second set of symbols was the
number of shares traded. Usually the amounts are large, so if the number of
shares were in the thousands, the reading could be something like 3k for 3,000.
The next set of symbols are numbers that designate what the trade price of that
particular stock was. This is also known as the last bid price. The next symbol
is the easiest one to read, it will either be an up arrow to show that the price
of the stock is headed up compared to yesterday's closing price or it will be a
down arrow showing that the stock price in headed lower. The final set of
numbers shows the amount the price of the stock changed, for the better or the

The modern day tickers are electronic and the days of ticker tape being used
are over. The only place you're likely to see a ticker tape machine these days
is in a museum or on an episode of The Simpsons (Mr. Burns has one).

While ticker tape is no longer in use, it was synonymous with Wall Street and
investing in America for generations. And yes, even today, if there is a big
parade somewhere, you can bet rolls of ticker tape will be used to make the
event as festive as possible.

The 1920 Bombing of Wall Street

When most people think of terrorist attacks in New York City, images of
September 11th instantly spring to mind. But that wasn't the first major attack
in New York's history. The World Trade Centre was attacked earlier in 1993 with
a bomb in the building's basement. But there was yet another terrorist attack
in New York, this one right on Wall Street that attempted to shut down the New
York Stock Exchange for good.

On September, 16th, 1920, a wagon full of explosives was detonated at "The
Corner" of Wall and Broad streets. A man was seen fleeing the wagon moments
before it exploded, but no one thought to stop him. A few seconds later, a
large explosion ripped through the square, leaving behind it a scene of
unfathomable destruction.

Once the smoke had cleared, 39 people had been killed. This ranked as the most
deaths from a terrorist attack in New York history until the events of 9/11.
Hundreds of people were injured not only by the initial explosion but by bits
of iron shrapnel that had been placed inside the wagon so that the maximum
possible amount of damage would be done.

A bell rang out in the New York Stock Exchange just after noon on the 16th
signalling a stoppage of trading for that day. It was the first time trading
had ever been stopped because of violence. A decision had to be made by the
governors of the NYSE about whether to open the next day. And much like during
9/11, those that ran the NYSE decided to go ahead with business the very next

The 1920 bombing could have had a major historical impact had a few different
things happened. A young stockbroker named Joseph Kennedy was on Wall Street
that day, and had he been any closer to the blast which knocked him to the
ground, America's political history would look very, very different.

The tragic postscript to the story is that no one was ever caught, arrested,
charged or convicted of the bombing. Many people associated with the anarchy
movement that was present at the time were suspected and many people were
interviewed, but no one ever caught.

For many, the events of 9/11 were a stark reminder of the fact that terrorism
is simply part of living. Most figured that the attacks in 1993 and then in
2001 were New York's first brushes with terror, but a look at the history books
shows that New York has stood strong through terror in the past and it will do
the same in the future.

The Wall Street Crash of 1929

Maybe no event in American financial history is better known and more infamous
than Black Tuesday, the day the stock market crashed and ushered in a
depression that would grip the United States through the first half of the next
decade. But what caused such a horrible event and what can be learned from it?

The stock market crash that most people associate with Black Tuesday, was
actually a multi-day process. The previous Thursday, the market began its
downward slide, with trading setting an all time record with 13 million shares
trading hands that day. The Dow had reached an all-time high just a month
earlier in September of 1929 with a close of 381.17. A group of bankers met
during that Thursday to try to figure out how to stop the slide and they
decided to take the same tact that worked to stop the last market panic in
1907. They began to buy massive amounts of blue chip stock to try to reassure
investors that the market was holding steady and that they shouldn't sell
everything they had and make matters worse.

The bankers, led by Tom Lamont of Morgan Bank, Chase National Bank's Albert
Wiggin and Charles Mitchell of National City Bank thought that this method had
worked, but it only led to a quieter Friday. The downfall would continue early
next week.

On Monday, spurred on by negative newspaper accounts of Thursday's crash,
investors sold more and more stock off, sending the Dow into another tailspin.
At the end of Monday's trading, approximately 13 percent of the value of the
Dow had been lost. Black Tuesday led to more losses that some believed were
spurred on by President Herbert Hoover's insistence that he would not veto a
tariff bill that many on Wall Street thought would hurt the economy.

So, what caused the crash? Most believe an artificial economic bubble is to
blame for the crash. The bubble was formed during the 1920's and the great
amount of speculative investing that happened during that time. The downturn in
stock prices after the high in September saw a chain of events happen that led
to the Great Depression of the 1930's.

While no one can predict the future, it's safe to assume that while our current
economy is healthy, a possible stock market crash can happen again. But only if
we learn from history can we avoid another long-term depression that shakes the
American economy down to its very foundation.

The 1987 Stock Market Correction

The events of October 19, 1987, at the time, were looked upon as a full-fledged
stock market crash. In retrospect, no depression or even a recession was sparked
by this dramatic fall in prices, but the event is historic nonetheless. One of
the aspects that makes it so memorable is the fact that to this day, no one
really knows what caused it. There are many different theories as to the reason
of the correction, but its all speculation.

The '87 correction, known now as Black Monday was the first ever global stock
market crash. The final numbers are staggering, with the Hong Kong stock
exchange losing over 45 percent of its value, the Australian stock market
losing almost 42 percent of its value, the UK lost over 26 percent, while the
New York Stock Exchange lost 22.6 percent.

The October 1987 fall ended up being the second biggest single day percentage
drop in the history of the stock market. The biggest one day decline happened
in 1914 when the Dow Jones lost just over 24 percent. This drop was attributed
to the fact that the market had been closed for four months due to World War I
prior to that day. The biggest point loss in history was the first day of
trading after the attacks of September 11th, when the Dow lost over 680 points.

Starting in mid-August of that year, the Dow began to correct itself. A series
of 100+ point drops plagued the market over the next two months, but the drops
were always followed by recoveries. Even days before the October 19 drop, there
had been a major dip, and the next day, stocks were back up. It wasn't until the
Black Monday collapse that stocks went down and stayed there.

Possible causes for the crash are usually broken down into a few different
categories, including market psychology, illiquidity, overvaluation and program
trading. Other possible causes for the correction are attributed to a major
storm in the UK which happened on the previous Friday. The storm did not allow
traders in the UK to finish their days work and this caused many in the US and
around the world (especially in Hong Kong where the crash first started to
happen) to sell.

While time has shown the events of October 1987 weren't quite as bad as some
had feared, dramatic market corrections are a part of investing and while they
can be terrifying when they happen, they shouldn't take a savvy investor by

The October 27th 1997 Mini-Crash

The mini-crash of 1997 is remembered better today for what didn't happen than
what did. For the first time in New York Stock Exchange history, trading was
halted for the day for the first time ever due to losses in stock prices.

What made this event so controversial is that the "circuit-breaker" system that
was used for the first time that day was run on the idea that once the market
has lost a certain number of points, trading would be halted. This was seen to
be short-sighted since the actual percentage of value lost when trading was
halted was relatively minor compared to other market crashes and corrections in
the past. The circuit breaker system has since been corrected to only stop once
10 percent, 20 percent and finally 30 percent of the market value has been lost.

As is always the case with trading on the American stock markets, the ripple
effect that would turn into a tidal wave started with the Hong Kong market. The
Hang Seng Index fell about six percent the night before, but many experts in the
US didn't bear it much mind since the Nikkei average lost only two percent that
same day. As markets opened in Europe, they followed suit with their Asian
counterparts, with the FTSE losing about 2 percent and the DAX exchange in
Frankfurt falling, as well.

As markets opened in the United States, most predicted a bad day, but no one
predicted what ended up happening. The NASDAQ, S&P and the Dow Jones all opened
lower, and it was pretty much all down hill from there. Just after 2:30 in the
afternoon, the Dow had dropped 350 points, causing the first level of the
"circuit-breaker" to go off, halting trading. While a 350 point drop is
significant, many did not feel a stoppage in trading was warranted at that
time, since a drop of that size is relatively small, percentage-wise. Thirty
minutes later, trading began again, only to see the 550 point window smashed
around 3:30. This second circuit breaker level usually causes a one-hour break
in trading, but since there was only 30 or so minutes left, trading for the day
was ended.

This correction was seen as a slight bump in what was otherwise a good year for
the Dow. The 550 point drop was just over a 7% loss for the day. It turned out
to be the 12th biggest percentage loss in a single day in Dow history and third
biggest point loss.

Why is the Stock Market So Worried About Some Bad Mortgages

Beginning in the Spring of 2007 the stock market reporters discussed some
problems in sub-prime loans and predatory lending practices by some mortgage
companies. At first the stories were merely in passing, but as the months
rolled by the story became front page news. The President of the United States,
China's financial network and the Chairman of the Federal Reserve have weighed
in on what is supposed to be a small percentage of no credit borrowers reneging
on their mortgage. So why is everyone so worried about some lousy mortgages?

The simple answer is that the old fashion mortgage with your friendly Mr.
Cribbs at the bank downtown is on the endangered species list. The mortgage
market today spans the globe. Within days, weeks and months of a mortgage
closing it is sold all over the world in bundles of commercial paper.

This complex network of holders of the note are bought and sold by financial
brokers, and a others who make these commercial papers part of their portfolio.
The problem occurs when trying to determine who bought the risky, defaulting
loans. Some of the loans are in the process of foreclosure, some are at risk
for foreclosure and still others are foreclosed. The real problem here is
assessing risk to unknown factors. Banks, lending institutions and mortgage
companies do not like speculation on risk.

The most significant effect all of these risks have effected the Stock Market
is the tightening of the credit market. Some banks and mortgage companies have
simply stopped making loans. Others, have made refinancing and new loans with
increased restrictions. The credit market is squeezed and that effects big
stock market players like banks and financial institutions like Bear Sterns. It
also effects consumers who are seeking refinancing and new mortgages.

Within the period of several weeks in late August, 2007 the Federal Reserve
dumped billions of dollars into the prime lending market making it easier for
banks and lending institutions to make loans and to back their existing
position. In addition, the Federal Reserve dropped the interest rate for prime
loans to major financial institutions. The next meeting of the Federal Reserve
could see even further drops in prime rate interest rates.

With equal vigor to jump on the band wagon, the President of the United States
provided the possibility of legislative help for those unsuspecting mortgage
holders who were snickered into making bad loans with adjustable rate loans
that were predatory in nature. The problem is how can United States legislate
bad loans and notes that may no longer be in the United States. Remember, Mr.
Cribbs is nearly extinct.

At the present time it appears that there are some bad mortgages out there.
Some are held by people with limited income and little credit. Some are held by
speculators and house flippers that got caught in the head lights of a slowing
real estate market. For the latter mortgage holder it does not appear there is
too much sympathy for their financial crisis. The common thread is that no one
seems to know how many bad mortgages are on the loose. The stock market hates
uncertainty, so that is the reason for all the worry.

The stock market is like my dear old Aunt Nell. She never married and never had
a light bulb in her apartment house that was in excess of 40 watts. Her tenants
virtually lived in the dark. If the price of milk went up two cents she
switched to powdered milk. If her taxes went up a dollar she felt she was on
the verge of being destitute.

Summer visits with Aunt Nell were a real hoot. In a nutshell that is what is
going on with all the "sky is falling" on Wall Street. Uncertainty moves the
market and what is causing on all flutter in the financial stocks.

To assuage all the "Chicken Littles" an the possibility of some real problems
both the President of the United States and Chairman Bernanke sang a tune of,
"You can't always get what you, but if you wait sometimes, you get what you
need." No big rescues for speculators, but the promise for a few bones if the
economy goes sour.

Large Multi-National stocks in the Dow Jones Industrial Average:

This category takes into account basic materials, drugs, machinery, autos and
big cap companies that have a major influence on the Dow Jones Industrial 

The list of noteworthy stocks are: 3m Corp., Alcoa, Boeing Co., Caterpillar
Co., E. I. Du pont de Nemours and Company, Exxon-Mobil Corp. General Electric
Company, General Motors, Honeywell International Co., Johnson & Johnson, Merck
& Company, Pfizer Inc., The Coca-Cola Company, and Procter & Gamble Company and
lastly big tobacco, Altria Group Inc. .

It is hard to imagine a more stellar group of major players with such influence
on the world economy and influence. A mixed bag indeed, but there common thread
is there gargantuan influence on the Dow Jones Industrial Average. All of the
low to medium priced stocks may be purchased individually or in a mutual fund
or index fund.

Financial Stocks in the Dow Jones Industrial Average:

This last group has a significant influence in the financial world. It may have
some exposure to current angst in the stock market, but some are well positioned
for any rocky road. The most stellar include, American International Group Inc.
(AIG), American Express Company, JP Morgan & Chase & Company, and Citigroup Inc.

This groups influence on the overall Dow Jones Industrial Average is obvious.
Some of the ripple effect of concerns about commercial paper and the real
estate mortgage market may influence this groups effect. It will depend on
whether the concerns should expand to the commercial real estate market and the
extent of the defaults and foreclosures.

These are the top 30 components that make up the Dow Jones Industrial Average.
As you can see the overall rise and fall of small percentages in this market
indicator requires a closer look at the components and sectors.

What is the NASDAQ Exchange?

The NASDAQ Exchange is a limited liability company and a corporation that
provides a means for traders to execute stock orders for stock brokers,
institutional investors and on-line stock purchasers. The NASDAQ Exchange was
formed in 1971 by the National Association of Securities Dealer to fill a need
for reporting stocks that were not a good fit in the regular stock exchange.
The NASDAQ reports on over the counter stocks for thousands of stocks not
listed on the other exchanges. By the 1990s NASDAQ surpassed in terms of
listings the AMEX Exchange.

In order to trade on the NASDAQ the trader and members must be certified and
agree to the by laws of NASDAQ Inc. In 1999 NASDAQ merged with AMEX to form the
NASDAQ-Amex Group. By 2000 the National Association of Securities Dealers sold
their interest in NASDAQ to private investors. See: NASDAQ Corporate Filings.

NASDAQ operates similarly to all corporations, it has Articles of
Incorporation, Corporate Officers, By Laws and holds meetings. The NASDAQ LLC.
has a governing board and in turn has rules and regulations it operates under.
Given the quasi-governmental status of NASDAQ the Securities and Exchange
Commission has a role in making sure NASDAQ operates according to good
practices and regulations. If a company engages in inside trading, fraudulent
reporting of corporate earnings and assets or the many areas of bad practices
governed by the Securities Act of 1934, the Commission can provide sanctions
and remedies for these acts. Likewise, state attorney generals and the U.S.
Attorney may bring actions in court to cease and desist these bad acts and also
provide for criminal sanctions.

What notable stocks are traded on NASDAQ?

As an investor you may invest in NASDAQ, it is listed under the ticker QQQQ.
The stock value goes up and down depending on the overall health of the NASDAQ
Top 100 Trust Funds. Currently NASDAQ QQQ, traded under ticker QQQQ is priced
at around $48 a share. It has a market capitalization of $19 billion dollars
and over the past three years has a 11.56 percent return on investments. The
top holdings in QQQQ are: Apple, Cisco, Comcast, Gilead Sciences, Google,
Intel, Microsoft, Oracle, Qualcomm, and Research in Motion. A impressive group
to be associated with in one stock. There are however, some stocks among the
fund that are not as illustrious in their performance. The fund is weighted
heavily in the hardware sector. The others sectors with a significant impact
are software, business services, customer service and healthcare.

NASDAQ provides soup to nuts in investment opportunities:

NASDAQ offers literally thousands of opportunities to invest in individuals
stocks, indexes, real estate investment trusts, options and other means to make
an investment. The investor has an cornucopia of types of stocks choose among
from semiconductors, energy, finance, components, retail, in all 3113
components make up NASDAQ. Each company listed must meet capitalization and
reporting standards. The investor has the opportunity to review each quarters
reported earnings and debts. A company is required to report any significant
issues that may effect the investor and the company. There are news services
and financial advisor services who actively stay in top of company news. All in
all it is surprising why a company would even try to fool investors or
governmental watch dogs.

NASDAQ notables:

Apple Inc. is the darling of NASDAQ. It trades under the stock ticker AAPL. If
you have been living on a remote island somewhere in a cave, Apple is the
designer, manufacturer and marketer of iMAC computers, software, iphones and
through its subsidiaries a range of products that support Apple main line of
products. In September, 2005 Apple shares were in the vicinity of $48. As of
the close of business on August 31, Apple is worth in the range of $138 a
share. The unique aspect of Apple is just when you think it has topped out and
is dawdling it comes up with some surprise and it is off and running again. It
is a darling because it has resilience and innovation.

Never to be forgotten is Miscrosoft. It trades under the stock ticker MSFT.
What can you say about a company that brought information and technology to
middle America, Africa, South America and the world. It is a stock that sells
currently in the $28 range. It has controversy in all corners particularly with
law suits challenging this grand daddy of the Internet, but it is a tried and
true long performer. It is the company that people love and hate. If there is
innovation out there, Microsoft will find it.

A personal favorite of mine is Intel. In part because it is a work horse in the
technology sector and in part because I read and enjoyed Tom Wolfe's book on the
company structure in Hooking Up. It was not a biography, but it did parallel the
formation of this egalitarian work place. The stock sells in the range of $25
and sells under the ticker INTC.

What is an IPO?

An initial pubic offering is an IPO. In effect what an IPO does it takes a
private company public. It is also a means for an existing company listed on
one of the exchanges to spin off or create a new company from its parent
company. It all sounds pretty straight forward.

Reasons for going public:

The most obvious reason for a private company to enter the public market is
raising immediate liquid assets by way of offering shares in the company. Most
private companies would prefer to avoid all of the burden of complying with
reporting and other regulations, but sometimes a company needs to expand or
generate large sums of money to keep up with competition. The reasons are the
advantage of offering a chunk of the company without losing control of the

IPOs Past and Present:

Before the acts of a few bad apples like Enron, WorldCom and others IPOs
flourished on Wall Street. From the mid 1990s to the early 2000s each day
brought a new public offering to the market place. Some weeks two or three new
IPOs were introduced to the public market place. There were necessary
compliance issues to deal with and prices to set and then the IPO hit the
market and the exchanges decided what to do with the new kid on the block.
Millions and sometimes more could be generated on the first day of trading.

That was then and now there is Sarbanes-Oxley a piece of legislation that was
supposed to prospectively cure the market place of cooked books, fraud and make
the investor feel more secure. There are aspects of this curative piece of
legislation that has provided for more transparency in corporate America. The
auditor independence section makes perfect sense. It seems like common sense
you want your auditor to not have a conflict of interest. The area of corporate
responsibility for subordinate acts of fraud, errors and omissions makes perfect
sense. Disclosure regarding debt and other adverse actions involving the company
almost seems like a redundancy with other securities laws.

The effect of the Sarbanes-Oxley and other methods to cut out bad apples is
that it costs a great deal of money to take a company public these days. There
is the need to hire top notch consultants and extra staff to comply with the
ever increasing paper work and internal structural changes. It is not a bad
piece of legislation, but it is burdensome for a heretofore small private
company to be able to afford. The net effect is that the IPO is an infrequent
event on Wall Street.
There may be other reasons in addition to Sarbanes-Oxley.

Recently, the Blackstone Group introduced an IPO to the market place. It was
priced well, but overall the event was lackluster. It generated some 20 billion
dollars, but all of the expectations were overstated from the hoopla that
preceded the offering. Perhaps we have simply become jaded.

The IPO is a launch of a newbie. The era of "what's next," may be part of our
gilded past. It could be a good thing for the market place or it could signify
a final epitaph to the Horatio Alger story which was overblown in the first

What is a REIT?

The acronym for a real estate investment trust is a REIT. According to the
National Institute of Real Estate Investment Trusts 190 Re Its are currently
registered with the SEC and trade on one or more of the New York Stock
Exchanges. There are over 900 REITS that are privately held companies.

The advantage to the investor in the REIT is the source of income it provides.
Specifically, due to the structure of the REIT it does not accrue corporate
tax, instead it returns all of the taxable income to investors. The investor
receives a 1099 form for tax purposes and it is therefore taxed like additional

The REIT can be designed to fit almost any scenario available in the real
property world. It can play the upside and the downside and provide hybrid type
coverage. Primarily the REIT is composed of commercial property including
shopping malls, apartment complexes and income producing property. It also is
packaged with residential real estate of a particular type.

The influence of the REIT has seen increased interests to investors for
providing income and a compliment to their portfolio of stocks and bonds.
Because of the intricacies of the real estate market and commercial property in
particular the investor should consult with a qualified REIT broker or
investment advisor. Lists of REITs are available through Morningstar or may be
reviewed on-line at the National Institute of Real Estate Investment Trusts.

Troubled waters can be avoided:

The current Summer and Fall 2007 concerns about real estate mortgages and a
slow down in some United States real estate markets does not mean the REIT
investment is in jeopardy. There are certain REITS in the United States that
are hybrids that afford the investor with security in good times and troubling
areas of the market.

It should also be remembered that REITs are available for nearly all of the
world real estate markets. In many parts of the world, China, Asia, Europe and
Dubai the real estate market in both commercial and residential income property
is sizzling. There is stability in these parts of the world for some hefty
returns for investors.


The overall purpose of the REIT envisioned by the U.S. Congress was to provide
a means for investors and in turn the developers of real estate to mutually
benefit from growth. It places the average investor in a position of being a
big player with the benefit of a share of the profits. A small investment in a
REIT can enhance a portfolio of stocks and bonds. Each investment dollar goes
into enhancing or creating the availability of funds for building realty.

Due to the nature of the REIT, it must be organized and structured according to
strict guidelines. The SEC guidelines apply to those REITS public traded on the
New York Stock Exchange and governs those REITS listed with the exchange.
Privately held REITS must comply with IRS standards and other state and federal
laws pertaining to trusts.

The REIT is an investment that any investor should consider and review the
merits with a trusted financial planner with the expertise in the REIT market
world wide.

What Are Blue Chip Stocks?

Blue Chip Stocks are quality stocks that have a proven track record. A Blue
Chip stock is like a member of the family in the American pastoral landscape.
The Blue Chip stock makes toilet paper, laundry soap, aluminum, steel , washing
machines and just about every well known brand we used every day The Blue Chip
stock is Bank of America, U.S. Steel, Proctor & Gamble and others we think of
as being our companies.

In times of uncertainty and for long term investors the Blue Chip stocks are a
part of every portfolio either in direct stock purchases or through mutual
funds. The Blue Chip stock is a large cap company and has decades and even a
century of presence on the stock market. Some Blue Stock stocks are relatively
new players like Home Depot or the result of a merger & acquisition. If you
look around your house and around your town the brand products you use or have
come to rely on are Blue Chip stocks.

The fact is that we take for granted the Blue Chip stocks both in our
familiarity as an end user, but often times in the stock market. The Blue Chip
stocks make up the S&P500 index. These stocks as a whole can be purchased as an
index fund. Some Blue Chip stocks make up the Dow 100. These stocks on the whole
are a bell weather of how the overall market is doing.

Like any familiar item the Blue Chip stocks become like a comfortable old pair
of sneakers. We know where they are and they are easy to slip into, but they
may not be as exciting as say Google or Baidu. In recent months some of the
Blue Chip stocks have been a flight to safety for some investors. Not all Blue
Chip stocks are alike, but some have been grossly undervalued and therefore a
good buy.

Ways to invest in Blue Chip stocks:

The investor can pick and choose a Blue Chip stock and buy it through a stock
broker or on-line with a trading company like Scotttrade or E*Trade. This gives
you access to the companies performance on the short term and charts going back
at least 10 years. The investor can access the companies financial reports and
quarterly earnings on-line. The investor can ask the company to send you a
company prospectus.

There are index funds of Blue Chip stocks that can be bought through a
financial brokerage house. There are mutual funds that are designated as Blue
Chip Funds in most family of funds offered in all of the major mutual funds
companies. There is even a mutual fund company that offers a spider fund
comprised of Blue Chip stocks that is similar to the S& P 500.

The variety of ways to invest in Blue Chip stocks is endless. Spiders, Index
funds, and hybrids in between. There are option contracts and some tricky
investments that only a really savvy trader can advise you about.

The Blue Chip stocks merit a good review in all times not just in times of
market uncertainty.

Use Your Cupboard As A Stock Picker

There are experts in the field of making predictions on stock performance.
Another expert in the field of some stocks may be you the consumer. Think about
it, you pick products that for various reasons are your favorites. Your kitchen
cupboard or shopping basket may be a very good prediction on the long term
performance of the company stock.

Company brand products did not become staples in most homes because of clever
packaging and cute commercials. The brands we as consumers rely on are on 
shopping list because the particular product is tried and true to its word. The 
household purchaser can make or break a product. The true clout of the American 
consumer is not to be underestimated in the Stock Market.

On a larger scale, you as the consumer may have a grocery store that over the
years you may find carried all the products mentioned above. The convenience of
a grocery store that carries all of your favorite items save you time and money
in traveling around. The success of Wal-Mart, Target and other big box stores
is the convenience of one stop shopping. The prices for brand names in the big
box stores are good. Other personal favorites in shopping venues may include
Safeway, Albertson's and Kroger. All of these companies are listed on the stock

In the brand name product area you may need to look on the packaging to
determine the name of the company to find the stock. Some favorites like
Clorox, Johnson & Johnson, and others are listed under the familiar company
name. Due to mergers and acquisitions many name brand products have become
subsidiaries or subsumed in a larger company's product line. All you need to do
is check out the references on the label or customer service information that is
located somewhere on the product.

The idea of you as the consumer being the best stock picker extends to larger
items. You spent some time looking for an automobile, washing machine,
refrigerator and like items. You chose a particular brand for a reason. The
factors could be value, reliability or your past experiences. The reason could
be a combination of all factors mentioned above. Value your decision process
and consider investing in the company that produces the product.

A cautionary note is that even the best company may have a down year. The
reasons could be management changes, and other economic pressures. The product
is still good, but the internal structure of the company needs a quick fix. In
these circumstances make a decision whether you want to weather the storm or
wait until the company gets its act together. Sometimes the stormy days of a
company can be a buying opportunity.

In conclusion your cupboard or your shopping cart may be a good indicator of
the stocks you should consider choosing. The other good aspect of investing
using your cupboard is personal satisfaction. As a consumer you have the dual
role of being an investor in your product. It is a good feeling to put your
dollars into growth instead of simple consumption.

The Stock Market: The Greatest Show on Earth

The Stock Market is like a day at the horse races, the state fair, and the
gorilla exhibit rolled into one event. Nearly each hour of each day with the
exception of some holidays the Stock Market is open somewhere in the world.

The currency traders are the vampires of the Stock Market. Their work day
begins in the wee hours of the night and ends often times at the break of dawn.
The commodity traders check headlines all over the world in order to determine
how the volatile futures market is going to play out for the day. If there is a
natural disaster that impacts a commodity the commodity trader needs to take
note. The commodity trader needs to factor in significant and sometimes obscure
news events that may spur on or decrease the availability of a commodity. The
commodity trader is a news junkie.

The greatest show on earth takes place on the trading floor. Orders come in and
traders in the center stage often times called the pit place the orders in
between collecting their thoughts and barking back to to the other performers.
It is an amazing feat considering the onerous task at hand and the surrounding
circumstances. On some days some traders would rather confront the ferocious
lion than a day on the trading floor.

In the background unseen by the crowds is the order makers. The select members
of the stock exchanges that have the privilege of front row seats, but prefer
the private box seats. The stock broker and mega buck investor who can shift
the mood of the day by a single block of buys or sells. The strategic player
who can play the upside and the down side of any news event or rumor and keeps
the crowds coming back each day.

The stock analysts who determine based on graphs, moving averages and
mathematical formulas the strategy for their investors. The analyst takes into
account not only market news, but the probabilities of certain events impact on
a unit or the entire market. The analyst is in many ways like the fortune teller
at the circus with a crystal ball armed with a Hewlett-Packard hand calculator.

The show would not be complete without the critics. The clever and
knowledgeable group of commentators and writers who explain or elaborate on the
days events. It is similar to the play by play announcer at a Jai Alai game The
ball sometimes travels faster than the words can be uttered from any human form
of speech. This could explain why stock market commentators speak in fast
forward fashion.

The Stock Market is the greatest show on earth and this can be explained by the
very human trait of enjoying the art of the trade. It is the present day version
of a day in the square with all of the smells, color and fanfare of a carnival
where people communicate and come together to sell their wares. The Stock
Market provides that ingredient of human existence that enjoys watching or
participating in a good trade.*

What is the Reasoning Behind the Arbitration Agreement?

It is almost a universal practice to include an arbitration agreement when an
investor opens a brokerage account or commodities, mutual fund account. An
investor will find that in the process of signing up for a brokerage account
there is a standard arbitration agreement contained in the packet of
information. This article addresses some of the history of the stock brokerage
arbitration agreement and the reasoning behind the agreement. Not all
arbitration agreements are alike and therefore if you have any questions about
the legality of the agreement you should contact a competent attorney in the
field of securities arbitration agreements.

The reasoning behind the accepted practice of arbitrating disputes with your
stock broker and mutual fund manager is the notion that arbitration can be
handled privately, with a qualified expert arbitrator in a reasonable period of
time. While it is not required an investor may file a simple letter complaint.
The necessity of hiring an attorney to file the complaint. It may be advisable,
but it is not necessary to hire an attorney. The rules and guidelines for
arbitration are set forth on the New York Stock Exchange web site or may be
requested by mail.

The history of the arbitration agreement in the United States stock exchange
has a 200 year history. The Courts and Congress have uniformly favored the
arbitration agreement signed when the account is opened. That is not to say
that all arbitration agreements are flawless. Some arbitration agreements have
been voided for various reasons.

The arbitration provides a forum for disagreements that may occur with the
investor and the broker. Disputes may vary in severity, but the key is
disclosure of pertinent facts known by the broker that negatively effected the
investor. The other reasons are obvious mishandling of a clients funds, failure
to act in accordance with the clients orders and fraud like conduct. All of
these reasons and variations in between can occur and sometimes do occur in the
relationship of client and broker.

There is a Director of Arbitration with the New York Stock Exchange who has the
duty to provide the forum and implement rules that govern the arbitration of
dispute. The Director has the duty to provide lists of arbitrators who are
qualified to hear specific types of disputes. There are securities arbitrators
and public interest arbitrators. The Director has the obligation to report to
Congress any and all issues regarding the arbitration of disputes. It is
designed to be a forum that is friendly to non-broker complainants.

For disputes involving less than $25,000 there is an expedited form of
arbitration. For investor complainants over the age of 70 with health issues an
expedited handling of disputes may be requested. According to testimony provided
by the Director of Arbitration to Congress in 2005 the complaints from investors
have increased since 2002. See: Karen Kupersmith, Director of Arbitration New
York Stock Exchange to the Finance Committee of Congress, March 17, 2005.

Adjustments in staff and case management were suggested to keep the intent of
the New York Stock Exchange vital and up to date for the protection of
investors. The New York Stock Exchange Arbitration has in the past years of
2003 and 2004 awarded the public over 70 and 80 percent of all claims
presented. The rule of thumb that most arbitrators use is when applying whether
information by a broker should be disclosed is: "If in doubt, disclose,"
according to Ms. Kupersmith.

The question of whether to sign an agreement to arbitrate is not germane
because you will not get an account without the agreement. The question should
be is the agreement to arbitrate you are being asked to sign legal and
enforceable. That issue may require you to ask for an attorney consultant to
review the arbitration agreement. A majority of well known brokerage houses
have standard arbitration agreements.

Horror Stories:

There are some really nasty events that can occur between the holder and
advisor of your money and you. In recent years, some down right fraud has
occured. Some of the bad dealings required the FBI to uncover. Some examples
would be a broker who is not licensed and sells bogus securities. Other schemes
include churning accounts. The concept of churning means the broker buys and
sells stocks on your account to get commission fees not for the benefit of your
portfolio. Specious equities and other instruments are offered by a former
member of the exchange that turn out to be bogus. All states have an Insurance
and Securities Commissioner whose responsibility it is to regulate the
activities of brokers and the products that are sold in your state.

If you believe you have a complaint or have concerns about an investment it is
advisable to check with your Securities Commissioner or State Attorney General
before you invest. It is much easier to avoid a bad investment than to have to
undo one.

Should The Stock Investor Subscribe to a Business Publication?

In the world of stock investing, the more you know, the better you are. Most
investors subscribe to at least one business journal and others subscribe to
investor newsletters. The costs of subscriptions are reasonable compared to
other specialized reading services. Many of the news journal also contain daily
news stories and expert commentary. Most of the business news services and
advisory newsletters are accessible on the Internet or in paper format.

Journals and Magazines:

The Wall Street Journal has been a familiar source of reliable stock market
information for decades. It is owned by the Dow Jones family of business
related publication. Dow Jones appears to headed for an acquisition by News
Corporation with extensive a multi media entertainment holdings. The proposed
merger should go through in the fourth quarter of 2007.

The Wall Street Journal has excellent stock market information. The format is
easy to read and it is organized well for quick reference or for enjoyable
reading about the stock market. The writers are exceptional with experience in
the business world. There is a section to watch your own portfolio and to
research company history and financial information that is easy to locate. It
is a value at $79 for 54 weeks of reading either in paper or on-line. A
subscriber can get both the on-line and paper version for a total of $99 for 52
weeks and some free weeks.

Barron's is another publication that is owned by Dow Jones & Company. This
publication is sold as a separate subscription. It is a weekly magazine format
that is foremost in quality research and in depth reporting about the U.S.
Market and around the world. Barron's can be purchased on-line and in paper

Investor's Business Daily has similar content to the Wall Street Journal. It
has a remarkably good analysis of daily stocks and a good on-line educational
tutorial. The publication may be read on-line or on a paper format. The
publication is $295 per year for the paper version or $235 for the on-line


There are numerous financial newsletters available on-line and in paper format.
Of the ones I have reviewed there are only two that I would recommend for their
value in stock investing. The Morningstar Stock Reporter is a monthly
publication that has great research on stocks. The information is easy to
digest and the format is easy to read. The subscription is about $89 per year.

The Street dot com stock advisory is unique. It is produced by Jim Cramer who
has decades of experience in investing in the ups, downs and in between times
on the stock market. He has a charitable trust that he keeps tabs on and
invests. Due to a variety of reasons he is not an active trader of hedge funds
or other investments.

He is a financial whiz in the market who appears on TV and writes books. His
famous book Mad Money is now a half-hour TV show. He answers questions posed by
telephone callers to the show. He also provides stock analysis.

The Jim Cramer Street dot com stock analysis subscription allows the investor
to trade along side with him. He sends out advisories on stocks by e-mail. He
also allows the investor to see his portfolio. In addition for every
subscription sold he sends the subscriber a free copy of his book. This
advisory service is worth a free trial run and then decide if it is worth the
cost of the subscription. Jim Cramer has made himself and a whole lot of people
very rich.

What is a Hedge Fund

The simple answer to what is a Hedge Fund is that it is private equity funds
which provide a hedge against market conditions. The Hedge Fund is not simple
in practice. On a global basis there is over a trillion dollars of private
investment capital that can literally invest in any commodity, currency indeses
and stocks and bonds. Unlike traditional investing the Hedge Fund may go long or
short the market. It is private equity and therefore the gains on transactions
for fund owners is taxed differently that normal capital gains taxes.

Essentially the Hedge Fund is formed by individual investors who have a stake
in the fund. The buy-in is in the millions. Noted Hedge Fund owners are George
Soros and the Blackstone Group founded by Peter G. Peterson and Stephen A.

The Blackstone Group is a fairy tale. The Blackstone Group was founded by Peter
G. Peterson and Stephen A. Schwarsman. According to the Blackstone Group
corporate biography the iniital private funds in 1985 were $400,000. By forging
alliances and partnerships with some of the most well-heeled on Wall Street
their assets under management are over 88.5 billion dollars.

The Blackstone Group is a world leader in alternative investment strategies and
investment counseling. A recent IPO Blackstone Capital Partners raised an
additional 21.7 billion dollars.

Hedge Funds are only a segment of the Blackstone Group Investments. The
Blackstone Group has a stellar Hedge Fund management in the world market. Its
group of Hedge Funds are uniquely tailored for a variety of investment
strategies and goals. In fact the Blackstone Group can provide individualized
tailoring of a Hedge Fund to fit the needs of large investment endowments and
retirement funds. Anyone can purchase a unit of stock in the Blackstone Group
through a licensed stock broker. It trades on the New York Stock Exchange under
the stock ticker BX.

Any discussion about Hedge Funds would not be complete without mentioning the
financial wizard George Soros. His ability to sense movements in the market
place is known throughout the financial world. His Hedge Fund and investment
company is Quantum Fund. He senses weaknesses and strengths as only a master
financial investor/trader can. In 1992 his legendary move to short the British
pound nearly broke the Bank of London is part of the lore of George Soros. He
can play the upside or the downside of any market. Some may call it a sixth
sense, but it is an all encompassing ability to assess with precision the
reality of the market and stengths of the underlying values with the reactions
of the wild and crazy speculator will do. It is this investor saavy that has
placed him in the Forbes wealthiest category.

There are thousands of Hedge Funds available in the various market places.
Lately some have not done as well due to the roller coaster ride that has
occured. This is the time when the true test of a Hedge Fund manager is put to
the test. The average mutual fund holder or retirement beneficiary may be
surprised to learn that their funds are in part invested in low risk Hedge
Funds. The most successful endowment funds have utilized the Hedge Fund
investment to capitalize on market movement and volitility.

The professional that manage these funds are lightning quick and have the
eccumen to know how and when to make grand plays. Any one who does not possess
these combinations of skill and sixth sense does not last in the Hedge Fund for
very long. The old adage, "If you snooze, you lose," applies to Hedge Funds.

Know Your Mutual Funds

It is important for the individual investor to know about Mutual Funds. For
some people the decision to invest in Mutual Funds is based on the premise that
it is low risk investing. By in large this may be true, but it depends on the
Mutual Fund and in particular the fund manager.

A Mutual Fund is a collection of stocks and other investments that are packaged
by an investment company. Generally speaking it is a means by which the average
pay check earner may enter the stock market. Some Mutual Funds require only a
$1,000 initial investment and a small number of Mutual Funds may be purchased
with as low as an initial $250 initial investment.

The key to investing in Mutual Funds is to read and evaluate the individual
prospectives available to potential investors. You may review the performance
of the Mutual Fund on-line or request the prospective by mail. The prospective
gives you the Mutual Funds performance over the past quarters, years and
decades. It also provides you with the fees that are charged to investors of
Mutual Funds.

Certain Mutual Funds are no-load funds. Generally these funds are offered by
state and municipal entities. It means the fund does not charge a fee to invest
and is exempt to some taxes. There may be other charges for handling your Mutual
Funds and charges if you decide to withdraw funds or move your investment
elsewhere. This knowledge is essential before you commit a single dime to a
Mutual Fund.

Your investigation should include the name of the stocks and other investments
the Mutual Fund you are considering is currently investing. This point is
critical because knowledge of the broader market is essential in determining if
a particular fund is going to do well. If you have a penchant for global 
stocks, technology, financial or energy stocks you want to be assured these 
sectors are doing well in the overall stock market.

Some investors own single equities and Mutual Funds along with other
investments in their portfolio. Most brokerage houses have financial planners
who can review all of your investments including realty, equities, bonds and
Mutual Funds to give you a full picture of your financial health and goals for
your investing.

As with the stock exchanges Mutual Funds investing allows the investor to
determine their risk level. There are municipal bonds funds, blue chips funds,
growth funds, Asian Funds, Emerging Markets and combinations in between. The
investor determines the choice of investment by his or her objective. For some
it is for retirement, others income and tax consequences. The range of risk is
provided by most Mutual Fund investment companies.

There are some excellent advisory services that provide star ratings on various
Mutual Funds. The Morningstar advisors have up to date information on the health
of various funds. There are also articles in the Wall Street Journal and
Investors Daily about Mutual Fund Managers. There are stars in the Mutual Fund
field. The star manager is only as good as his or her last year earnings. It is
important to know who is doing well currently before you invest.

There are several families of Mutual Funds I would recommend reviewing. The
Vanguard Funds, Fidelity, Oppenheimer and American Mutual Funds. Within these
family of Mutual Funds there is a fund for about any level of interest and risk
level. The information is available on-line or by mail.

The current bothersome area in the real estate market in particular sub-prime
loans for at risk buyers is yet to be fleshed out on a global scale. The
possible spill over effect to banks, financial institutions, mortgage companies
and the commercial paper they have sold may be a factor in your consideration of
which Mutual Fund to select. The true impact at this point is speculative as to
the ripple effect that may ensue if the small percentage of risky mortgages end
up in foreclosures. Presently the effect is an unwelcome squeeze in the credit
market making it difficult to get loans for individuals and some lending

As with any uncertainty a good rule of thumb is to seek out Mutual Funds with a
minimal amount of exposure to sub-prime mortgage woes. The Blue Chip or
America's stand-by stocks may have some advantages as some are undervalued. The
technology and some exposure to China and Emerging Markets may be worth a look.
Most Mutual Funds companies have stocks and investments that may fit the
current trends and moods in the financial markets. Review the institutional
investors in each fund. A rule of thumb is that big institutional investors
generally do not invest in "dog" investments.

How To Pick A Stock Broker

The key to any relationship particularly when it comes to money is choosing
someone you can trust. A stock broker is essentially your agent in charge of
your money. The main role of a stock broker is to provide the investor with
timely good advice on picking the right investment for you and your money.

A stock broker must be qualified to sell equities. In order to be certified the
stock broker must be educated and pass state administered tests. Aside from the
basic minimum qualifications a stock broker has a track record in his or her
handling of stock portfolios.

A smart investor will ask the potential stock broker about his accounts for the
past five years. Questions that require the stock broker candidate to discuss
their investment strategy. What stock picks has he or she made that turned a
profit. What stock picks did not show gains, but losses. If the stock broker
works for a brokerage house and most do, ask about the clients of the firm.

The stock broker is like any professional you would hire to perform a service.
You are interviewing a candidate who will not only advise you on stocks and
other investments, but someone who will take your personal welfare above all
other considerations. Have a discussion with several candidates on the phone.
The next step is to come up with a short list and have a personal meeting with
the candidate stock broker.

There are regulations and government entities that regulate stock brokers in
every state. There is arbitration remedies for damages you may incur if the
stock broker has acted negligently in the handling of your account. These are
bottom line safeguards. You want to pick someone who will never place you in
that position.

In your selection process for a stock broker keep in mind the following points:

- A referral from a friend for a stock broker is useful, but not the final word.

- Hiring a friend that is a stock broker can be problematic if a disagreement

- From the first contact with the stock broker does he or she act attentive and
  return calls.

- Does the candidate stock broker ask you about your comfort level in investing.

- Does the candidate stock broker provide you with insight into his or her
  investment strategy.

- Does the candidate stock broker's investment strategy coincide with your
  ideas about investing.

- Ask the stock broker candidate to explain limit orders and other means of
  protecting your investment.

Is the candidate stock broker forthright in telling you of in-house stock
portfolios. Many brokerage houses have baskets of stocks they promote under the
firms name. How has the firm's stock package done over the past four quarters.

When the candidate stock broker is speaking to you does he or she gloss over
information or do you get the impression it is a sales pitch. Every stock
broker is a sales person, but there are limits in this field.

Finally, never make a decision on the spot. After your meeting face-to-face go
home or back to your office and consider your choices. Pay particular attention
to your gut reaction after you have left the meeting. Is this someone you trust
to carry out your wishes and provide you with sound investment choices.

How To Invest in Gold

The diversified portfolio has a small position in the gold market. For some
investing in gold means holding gold coins. Some speculators buy gold contact
futures on the commodity exchange. Future contracts are risky because you are
betting that the price of gold will go higher in the future. The contract
requires a relatively small up front payment, but there can be daily
fluctuations that require you have funds to back the dips in the price of daily

The reasons investors have been interested in gold is that the old reasoning
was that if the stock market was down the gold market was generally up. This
reasoning has become a possibility, but not an axiom of the current
marketplace. The weakness in the dollar generally brings a surge in the price
of gold. The current price for gold is in the range of $670. Prices have
fluctuated within a range of $664 and the current high of $672. Traders think
gold could easily go as high as $1,000 an ounce.

Investing in gold stocks and precious metal index funds can be purchased
through a stock broker. A stock broker specializing in this area is very
important because the investment needs savvy investment advice. Most of the
larger brokerage houses have individuals that are specialized in the area of
commodities and precious metal stocks.

There are certain international gold stocks that are noteworthy. A Canadian
based international player in the gold market is Agnico-Eagle Mines. It trades
on the New York Stock Exchange and the Toronto Stock Exchange under the stock
ticker AEM. The stock is also sold on the Frankfurt Stock Exchange. This
company has more than a thirty year history in the production of gold. Since
the 1970s AEM has produced over four million ounces of gold. The company is
international and has operations in Canada, United States, Mexico, Sweden and

Other noteworthy gold stocks include; Barrick Gold Corp, Goldcorp Inc., Kinross
Gold Corp., and Newmont Mining. All of these gold stocks are currently trading
on the upside, but it is advisable for all investors to make sure these stocks
fit your investment risk potential.

In recent years the price of gold has been as low as the $450 an ounce range.
Since the late 1970s gold has made huge profits for holders of gold. The key to
owning gold is to know the various resistance points and to assess the global
market for the use of gold. It is used primarily in jewelry manufacturing and
other types of manufacturing. Currently in India there is a small slow down in
the use of gold for jewelry making. The same applies to a degree in China.
Whether it is enough of a slow down to effect the price of gold is uncertain.

Investors who trade in gold should seek the advice of an analyst that can
factor in all the various aspects that effect the price of gold. If you own
gold as a hedge against a weak dollar you should look for any strengthening in
the dollar. The important thing to remember is to gage your investment in gold
to a level that you are comfortable. If you bought spot gold at $600 an ounce,
you might consider a rise to $720 a good profit. The ride to $1,000 an ounce
may be bumpy and there is no telling when it will reach that level if it does
as speculators have gambled.

There are numerous gold mining stocks on the market and if you are interested
in a small investment you can find these stocks in the $5 to $12 range The
smaller gold mining stocks do carry a risk because a great deal of overhead
goes into making a mining company profitable.

The range of risk and amount you decide to invest in gold is a personal choice.
It is always advisable to seek the expert advise of a stock expert or commodity
expert before leaping into this market. Another sage piece of advise I learned
is to trust my sense of cashing out before the price of gold drops
significantly due to outside pressures or manipulations.

Stocks for the Gambler

If you are a person who loves to gamble consider buying casino and gaming
industry stocks. As you know the "House" always wins. Some of the stocks are
healthy investments because there is real estate and other merchandise
involved. Instead of feeding your quarters into a machine think about investing
in the company.

MGM Mirage has a huge presence in the casino, hotel and entertainment industry
in Las Vegas. It also has hotels and casinos in Michigan, Mississippi, and
Macau S.A.R. Recently MGM Mirage signed a long term strategic relationship
agreement with Dubai World. The company is traded on the New York Stock
Exchange under the ticker MGM. The stock sells in the price range of $83.

Boyd Gaming Corp. may not be familiar to you, but the company has a large
presence in Las Vegas. It owns and operates 11 properties in and around Las
Vegas. It also acquired Coast Casinos in Louisiana and is a wholly owned
subsidiary of Boyd Gaming Corp. The stock is sold on the New York Stock
Exchange under the ticker BYD. The price is in the $40 range per share. Boyd
Gaming Corp. is expected to make steady gains over the next three years.

WPT Enterprises, Inc is a company you may know what it produces but not
necessarily that much about the company. WPT Enterprises, Inc produces the
World Poker Tour and owns the rights to television broadcasting and products
branded under the WPT Enterprises Inc name. It is a joint venture between some
notables in the gaming industry and Lakes Entertainment Inc. It is a wholly
owned subsidiary of Lakes Entertainment. WPT Enterprises, Inc. is traded on the
NASDAQ exchange under the stock ticker WPTE. The stock sells in the $3.50 per
share range, but who knows it may be a sure fire bet in the long term. There is
a great deal of public interest in the World Poker Tour.

Harrah's Entertainment Inc. is a well known name in the hotel, casino, and
resorts industry. It has been in existence for over 60 years. It may be one of
the largest influences in Las Vegas business ventures. Recently it moved
forward on its plan to build a world class sports arena on the Sunset Strip.
Additionally Harrah's is involved in the development of a master development
plan for Las Vegas. The stock is sold on the New York Stock Exchange under the
symbol HET. The stock sells in the range of $85 per share. One thing for sure,
Harrah's will be around for the long ride.

All of these stocks provide an avenue of investment for the gambler. The key is
to watch the stocks and determine when you want to buy stocks. Timing is
everything in this sector. In addition to casino and resort stocks there are
some excellent technology stocks. This is the area of the gambling sector that
supports the casinos in developing new technology for the gaming industry. The
field of gaming technology is always on the move due to new innovations.
Whether the casino is making big money or not, the need for new products is
essential to attracting new customers.

Investing for the Sports Fan

The avid sports fan has a place in the Stock Market. If you have a passion for
sports either as an amateur player or sports fan there are great stocks for you
to invest. The sports retail and manufacturing industry is worth billions in
revenue. Passions do not come cheap so maybe you can turn your enjoyment into
making a few dollars.

Dick's Sporting Goods is a multi sport equipment, apparel and general store.
The passion of the owner Dick borrowed $300 from his grandmother and opened a
bait and tackle store in 1958. Today Dick's Sporting Goods is located in 34
states with 315 stores. In addition, he owns Golf Galaxy a multi-channel golf
specialty retailer with 77 stores. The stock sells on the New York Stock
Exchange with the stock ticker DKS. The stock currently sells for about $70 per
share. It enjoys a market cap of over 3.5 billion dollars. The stock has some
big name holders like Citigroup, Oppenheimer and Goldman Sachs.

Foot Locker Inc. is another sports shoes and apparel shop that has a
significant market share of sports market. The stock sells on the NYSE for
$16.71 a share. It trades under the stock ticker FL. It has some room to go
back up to the $40 range where it belongs. Some weakening in the retail area
and other concerns have weighed on this stock. It is a good stock and worth

Cabela's is a Nebraska sports and apparel company that sells on-line. It has
store outlets that are an adventure for any shopper. Cabela's is a success
story and when the jitters in the market subside it will soar. It is priced
currently in the high $20 range and worth every dime. It trades under symbol

Nike Inc. is a familiar brand name for most sports fans and enthusiasts. The
stock is sold on the New York Stock Exchange. The stock symbol is NKE. The
company sells apparel, shoes and accessories. The company has a 28.2 billion
dollar market share. Nike employs over 32,000 employees. Nike is priced
currently at $58 per share. The stock is expected to climb as high as $70 per
share. Some of the major holders are Barclay's Global Fund, Fidelity Blue Chip
Fund, Vanguard 500 Index Fund and some other blue ribbon funds.

The combined efforts of Molson Brewing Company of Canada and Coors Brewing
Company in recent years created the Molson Coors Brewing Company. The market
cap and distribution of the company is tremendous. It employs 11,000 people. It
has plans to open a new subsidiary. It is going through a shift in upper
management, but it is a sold investment to keep on your radar. The stock symbol
is TAP and sells in mid to high $80. The company has a blue ribbon list of
holders of the stock. Barclays Global Fund, Vanguard Group, and Goldman Sachs
are a sample of their investors.

The sports fan has lots of opportunities to invest in their passion and enjoy
the game as a participant in the sheer fun of making a few dollar in the

Investing in Utilities

There was a time in our recent history that investing in utility stocks was
like opening up a pass book savings account. Today, the investor needs to be
more cognizant of the companies compliance with various regulations and their
current stance on applying new and efficient technology. The increase in demand
and a need for power plants and distribution has placed a burden on the
utilities sector.

Some utility companies employ a combination of energy producing resources. Some
rely on coal, hydro electrical plants and the occasional nuclear plant. Many
rely on their natural gas reserves and electricity contracts with their
producers to provide power to their customers. In effect the utility is a
reseller of power sources.

Investing in Public Utility Companies:

Some good work horse utility companies are on the stock market. In seeking out
the security of a public utility stock you may be interested in dividends. For
some investors the utility is a relatively secure method of investing for the
long term and part of a retirement plan.

One example of a good utility stock is American Electric Power Company. It
trades on the NYSE under the stock ticker AEP. This is a public utility holding
company that transmits, generates and distributes power to a variety of utility
companies. Some of these utility companies are cooperatives, municipal power
companies and smaller utility companies.

AEG is a 17.7 billion dollar market cap company. It has been a consistent
performer for over 30 years and its major institutional investors read like a
who's who on Wall Street. It is better than 93 percent of all stocks listed on
the S& P 500. The stock is a consistent performer and sells in the range of $40
to $51 for the last year. In November, 2006 the price was in the high $30 range,
but has moved to the $40 ranges in recent months. It consistently issues a small
dividend. It currently sells for $44.48 a share and should rise to its first
target of $49 with ease.

There are other holding companies that may be of interest to the investor with
a desire to invest in utilities. Duke Power that trades under the stock ticker
DUK is a multi billion dollar company. Another l00 year old company is
Constellation Energy Group in Baltimore, Maryland. The significant aspect of
investing in power companies is whether the company is in compliance with
various regulations pertaining to clean air and water. The cost to update
facilities is costly. Most of the major players in power have already commenced
updating their facilities.

Investing in Diversified Utility Companies:

There are some very good diversified utility companies that are consistent
performers. Wisconsin Power & Electric trades on the NYSE as WEP. This company
is a consistent performer and recently provide a large credit to its customers.
It has a 5.9 billion market capitalization. The company is owned by some of the
biggest funds in the country. It sells for $44 and has a mean target of $50.

Two other good good diversified utility companies are Integrys Energy Group
stock ticker TEG and Alliant Energy that trades under the ticker LNT. There is
a price difference in the companies, but both utilities are multi-billion
dollar companies. Both have a blue ribbon groups of institutional investors.

All of the utility companies listed require some analysis to determine if the
company fits your investment portfolio. The utility sector has some pressure
due to world wide considerations and the demand of end users. The key is if the
company is poised for future growth by enhancing its infrastructure and
distribution methods.

Investing in Green & Eco-Friendly Stocks

The socially conscious investor will find a wide range of Eco-friendly stocks
and mutual funds to choose from, both small and large. Due to the influence of
world-wide concern over global pollution and carbon dioxide, the investor will
find many large corporations are snapping up green companies to add to their
list of products.

A recent acquisition by Royal Philips Electronics (headquartered in the
Netherlands) of Color Kinetics, trading on the NASDAQ as CLRK is a great
example. Color Kinetics was a ten-year-old company that produced
environmentally friendly lighting through its enhancement of the LED
(light-emitting-diode) technology to create a new type of illumination.

Color Kinetics utilized digitalized technology to create a new source of
controllable illumination. The merger between the giant Philips and Color
Kinetics will enhance its Philips Lighting Solutions market in the LED
technology. Color Kinetic has existing installations world wide and a huge
customer list, with relationships in China and the UK. Philips, in turn will,
provide its 60-country-presence to the Eco-friendly technology of Color
Kinetics. Investors should not rule large conglomerates in their search for
Eco-friendly stock.

Small Cap Companies:

For investors that enjoy investing directly in small cap companies there are
numerous opportunities for investors in AMEX. These stocks are very reasonable
in price and may provide future gains as going green becomes an integral part
of business and not just a slogan. I have watched some Eco-friendly companies
grow over the past several years and the following is a highlight of some
interesting stocks.

Environmental Power Corp. trades under the ticker EPG on the AMEX exchange.
This stock currently sells in the $5 range. The company and its subsidiaries
engage in the ownership, development and operation of renewable energy
facilities in the United States. EPG owns 83 leasehold of land. It has plants
that utilize animal and food industry waste to produce bio-mass and other forms
of alternative fuel that utilize their renewable energy biogas. A good reason to
give this company a good look is that it filed a notice with the SEC that it has
a firm commitment from an underwriter to make and offering of over four million
shares of his stock. If the offering goes forward the company could realize a
gain in the price as well as an infusion of over 22 million dollars.

There is another stock that has great promise in the fuel cell area. This area
has room to grow. I particularly like Fuel Cell Energy. It trades under the
stock ticker FCEL. The company has a market cap of approximately 650 million.
The company is in the development, manufacturing and sale of fuel cells power
plants for use in electrical power plants. Its pipeline products are geared for
use in health care facilities, hotels, hospitals, universities, governmental
offices and water treatment centers. The company is located in Connecticut with
office in Korea, Japan, Canada and Europe. This $9 stock has no where to go but
up in the long term. Another reason to think twice about this company is the
major holders of stock in the company. Wells Fargo Bank, Barclays, Deutsche
Bank and other prominent funds are invested in FCEL.

A stock that is a good value, but lacks appreciation is Calgon Carbon Corp. in
Pennsylvania. The company trades under the ticker CCC. The company is in the
business of providing means to clean the air and water.

The company has been around for a good period of time and it appears that 2007
may be its year to take a solid place in Eco-friendly stocks. It currently
sells in the $13 range and deserves a good review.

There are numerous ways to get into the green, Eco-friendly stocks. There are
mutual funds and indexes available. In addition there are segments in wind,
health foods and solar energy that have opportunities for investment.

Investing in Chinese Companies

China's economy has been soaring for some time. It is possible the growth
potential is only at the starting point. During the years of its world
seclusion. China as a country amassed trillions of dollars in its coffers.
American companies that have relocated some of their operations to China has
added even more capital to the China economy. The Chinese are wise investors
and do not seem to make a bad deal in any of their financial transactions.
China calls the shots in the deal making process.

This year in particular China is going through a massive infra structure and
building phase within China to prepare for the 2008 Olympics. This factor has
increased China's tremendous building phase in manufacturing aluminum, building
trades and the railroad industry. In the area of communication China has stepped
up its manufacturing and distribution of products. China also has plans to build
a small economy car called the Chery Automobile.

For all the reasons mentioned above and the overall strength of the China
economy this could be a good time to buy China stocks. The average American can
purchase China stock on the New York Stock Exchange and NASDAQ Exchange. The
other avenue available is the mutual fund or spider that is geared to Asian or
China investments only. These funds do exist and are doing exceptionally well.

Specific China Stocks:

The need for raw materials and manufacturing of materials is a high priority
for China. One particular shining star is Aluminum Corp China. It trades on the
New York Stock Exchange under the stock ticker ACH. This is an $8.7 billion
dollar market cap company. It has seen tremendous gains in the past two years.
The growth spurt almost seems endless due to China's demand for aluminum and
other metals. The stock is currently selling in the high $60 range. The major
institutional holders are John Hancock Trust-Natural Resources, Allianz,
Goldman Sachs and other prized investor funds.

In the technology areas Chinese companies have some interesting choices. The
web company and software technology and mobile phone application company CDC
Corp. is a low cost stock to watch. The stock sells under the stock ticker
CHINA. It is currently a $6.40 stock that can easily make its mark at $11 and
higher. The Olympic 2008 event in Beijing is expected to boost their

A great information and search engine company is Baidu. It trades under the
stock ticker BIDU. For whatever reason the brains on Wall Street love this
stock. It sells in the $200 plus range, but it rivals the likes of Google. It
is a stock to watch.

Mutual Funds:

The investor looking to invest in China and Asian Markets should definitely
consider the mutual funds offered by various family of funds. Nearly all of the
large fund companies have a fund that is designed for for exposure to the growth
in China. Alger China Growth, Thornburg Global Opportunities, Evergreen
Opportunities Fund, American Funds, Oppenheimer and Allianz all have great
funds with good returns.

If you are interested in China stocks discuss it with your advisor or ask one
of the funds mentioned above to send you a prospectus.

Investing in Technology Stocks

The infra structure of technology has not quite reached puberty. The very best
is yet to come. In particular I am referencing Internet technology and mobile
access to the world wide market place of information and support system that
enables total remote access. Additionally, the use of technology in the field
of medicine, health care and other related services.

The list of products and services in the pipeline of small, medium and large
companies is astounding. Within the field of technology is the corner stone of
all the products is security software and services. The talk on Wall Street is
that technology stocks are ripe for investing in todays market. This piece of
information is noteworthy, but having watched the exuberance of gross gains in
the last decade go blow , not all technology stocks are the same.

The specific areas that appear in my opinion to be situated well for future
growth are in health care related stocks, multi-media and graphic software,
security software, networking and communication devices and specialized areas
of electronics. There are other categories, but these areas of technology are
poised for future gains in my opinion.

Health Care Related Stocks:

Imagine the future of delivering health care services. The physician practicing
in a remote town in Alaska who can consult with a specialist located at John
Hopkins Medical Center. In real time the rural doctor can send and receive
vital radiological and metabolic tests and results. Imagine medical scientists,
physicians and university medical centers consulting on their data enable mobile
phone devices. Some of these technologies exist today, but the future is going
to be fantastic.

In the small cap arena several health care delivery stocks are generating
interest. Mediware Information Systems is a $7 stock that will likely double in
the foreseeable future. It trades under the stock symbol MEDW on the NASDAQ
stock exchange. This relatively small company has a huge presence in the
hospital services area. MEDW has three components in its software applications
all that aid hospitals and physicians to track and modify drug orders, blood
management and perioperative functions. These tools are used extensively in the
United States and their application is being applied in other countries
including African nations.

Another interesting low cost health care information technology stock is HLTH
Corp. it trades on the NASDAQ stock exchange under the ticker HLTH. The way
most consumers recognize this health technology stock is by its subsidiary
WebMD. HLTH Corp. is the data management behind WebMD. The company is
diversified in that it has public services as well as private accounts for paid
customers like Blue Cross Blue Shield. It also supports a payee and bill service
for health care providers. The company is valued at 2.6 billion dollars and
employs over 2200 employees. Its current price is $14.60 and the growth
potential is solid.

Multi-Media & Graphic Stocks:

The name Konami may not be familiar to most people, but it is the underpinning
to virtually all of the video games utilized on all platforms. Konami trades on
the NASDAQ exchange under the ticker KNM. Its primary function is the
development, distribution, publishing and marketing of video games around the
world. It is based in Tokyo and has been virtually unscathed by fluctuations in
the Tokyo Exchange.

Recently it announced the development of a mobile platform for its most popular
games that will be available on September 8, 2007 through AT& T and other mobile
phone carriers. The video game industry is only going to get better. The stock
sells for approximately $24 a share. Another stock to watch is Electronic Arts
that trades under the ticker ERTS.

There are various ways to invest in the technology area. Some brokerage houses
do offer technology index funds that include a cross section of technology
companies. The other method is simply to pick stocks from the technology sector
that offer sustained growth, good value and potential for the future.

How To Form a Stock Club

The investor comes in all shapes and sizes. One method of investing is to form
a stock club. The members of the stock club pool a set amount of funds each
month or quarter and then as a group decide which stock or fund to place their
investment dollars. The members could be people you know from church, school or
a chat buddy on the Internet. The stock club is made up of people from all walks
of life and income levels. Generally, the stock club are comprised of people of
like means and interests. The number of members in a stock club may be as small
as four and as large as 10. The important ingredient in a stock club is that all
members have a voice in the decision making process.


After your group is formed a method of handling the funds and other
administrative duties should be initiated. One method is to have a rotating
treasurer or secretary of the group. This stock member will handle the funds
contributed by the club. A good method of starting out on the right foot is to
set forth the basic rules of the group in a letter. The rules should include
how much money each member will contribute each month or quarter. How the
decision on investments are made. How the members of the group will present
their investment choices to the group. How is the final decision is made either
by a simple majority vote or super majority. The members can rotate the
presentation of their stock picks. Each presentation should include the
financial information of the company and the last three years of prices and any
other material relevant to the stock.

Basic Decisions on Finance:

The stock club should open a business account with a local bank or on-line
bank. The choices of how you want the club account to be named on the account
is up to the members. The stock club account should be set up with at least two
signatories on the account. If you want all members to have the ability to
deposit and access the account that is up to you and your bank.

The next step is to locate an on-line stock account. Depending on the on-line
stock account you may need to open the account in the name of one or more
members. If you have a fictitious name selected for the name of your group you
may need to register the name with the state or county. Try and keep this
aspect simple. You are not a big investment club. Keep the entity simple. If
you need assistance ask your favorite banker or lawyer.

The Meetings:

The meetings for the stock club should be organized like any formal meeting.
You may all be friends and it does not need to be stiff, but the purpose of the
meeting is important. Discuss any old business. Keep notes of the event. Allow
each member to present their opinions in an orderly fashion. Set aside an
adequate amount of time for the presentation of a new stock opportunity. Allow
all members to ask questions of the presenter and state their opinion. The
final vote should be noted. Finally decide on the date of the next meeting.

The Dog Investment:

In the course of things someone may pick a real dog for an investment. The
stock club should not worry about a bad choice, but as soon as it is apparent
to all members that the stock is not going anywhere, sell. The group can learn
from its mistakes, but it is important to move on. Set objectives for the stock
club at each meeting. By continuing to set goals and objectives the stock club
remains vibrant.

Winding Things Up:

At any given given point the stock club may decide to dissolve the group. At
this point the process of winding things up may require some formality. Closing
accounts, dispersing funds to the members and the like. If a large sum of money
is involved the members may decide to ask for the assistance of a tax
accountant. The fee should be paid out of the funds accumulated and charged
against the account before disbursements are made.

The stock club is an enjoyable way to make long lasting friendships and to make
a few dollars in the process. The stock club is a means where the smallest
individually can become a viable group.

Investing in Stocks Direct From the Company

There are companies that allow an investor to purchase stocks directly from the
company. This is perfectly okay according to the Securities and Exchange
Commission. These are called Direct Stock Plans. It is called a DSPP. The
company may require that you already have stocks through employment with the
company. It is not required in all companies.

The Direct Stock Plan operates differently than buying stock through a broker.
There is no commission charged for these stock plans, but there can be a small
fee. The other difference is that the company buys and sells the stock at a
given time. The investor cannot sell or trade stocks at will. The investor may
turn the stocks over to a broker to sell, but the broker cannot charge a
commission. You may be charged a fee by the company. It depends on your

If you have a favorite company, like the Walt Disney Company, Coca Cola or
other brand names in the United State you may be able to implement a Direct
Stock Plan to purchase stocks on a regular basis. You can review the list of
stocks in your local library or check out the company you are interested in by
accessing the company web site.

Another method of investing direct in a company is by way of the Direct
Dividend Reinvestment Plan. It is commonly called a DRIP. The good aspect of
this type of plan is that instead of receiving the dividends you agree to
reinvest the dividends in more stock in the company. It is a regular Direct
Stock Plan with a reinvestment agreement. You may do the same reinvestment plan
with your other stocks and mutual funds even if you have a broker.

The advantage is that if the company allows a private investor to purchase
stocks directly this would allow you to set up a pay check withdrawal each pay
period for the purposes of the stock plan. There are various advisory services
that can assist you in locating companies that offer these direct stock
purchase plan. I would suggest that you find companies you are interested in a
make an inquiry with investor relations.

The advantage to contacting the individual company yourself is that it allows
you to use your preferences and then do a small amount of leg work. The company
representative will give you the necessary forms and provide you with individual
advice on how to set up pay roll deduction. In turn you can contact your banking
institution, employer human resources or bill payer and set up the account.

It will astound you the number of very good companies that will allow you to
buy stocks direct by setting up a plan. The range of possibilities include,
utility companies, fast food stocks, entertainment and retail stocks.

If you have a solid company that has shown solid performance this may be a good
option for investing. The only thing you have to lose is your time. The time it
takes in gathering the information has a big payoff. It will save you
commission fees and provide you with a long term relationship with your
favorite company.

Are You A Stock Market Investor?

The threshold question before you decide to invest in the stock market is
whether you are an investor. For some people the stock market may not be suited
to their personality. This article addresses some of the qualities an investor
should have in order to make a reasonable return in the stock market.

Sure, there are folk tales you may hear about the guy who bought XYZ Company
stock for $5 and sold it 60 days later for $50 a share. This scenario probably
has happened , but it is not the reality of being an investor. The following
points should be considered when you are considering becoming an investor.

Are you self-disciplined in your thinking?

The first step anyone must take into account is their own personality. Are you
objectively a person who is organized in your thinking? Do you know how much
money you have to invest? Do you know how to set objectives in your finances?
Have you set goals for savings and followed through on those objectives? An
investor has to have a clear set of objectives in their choice of investments.
Is the amount of money you intend to invest a one time wind fall? Are you able
to set aside a certain amount of money each month to investing that is
disposable income?

In effect what you will be doing is moving some of your pass book savings to an
investment. Patterns development in peoples lives. Are you able to transfer your
savings pattern to include a regular investment in the stock market? If you are
currently earning a small percentage on your pass book savings account what
rate of return would you be satisfied in receiving? The key to investing is to
know your expenses and income and decide how much money is disposable income.
It is this excess that will be your investment dollars.

Are you able to set goals and listen to good advise?

Once you have determined that investing may be a possible avenue for you to
consider the next step is setting goals. A goal is the objective of your
investment. It could be for retirement, a vacation home, a rainy day fund or a
new boat. Whatever your is determines the type of investing you will be looking
for in your research. If it is a long term goal like retirement you may seek a
tax exempt municipal bond fund or a mutual fund with certain characteristics.
If you want liquidity like a pass book savings account where you can draw money
as you need it there are some investments that may fit. The important aspect of
this step is to know your objectives and then draw up a budget or a plan.

All of the major fund companies have managers and consultants. Are you able to
set forth your objectives and ask for advice in picking out a fund that will
fit your needs? This does not mean you need to sign up for the first consultant
who takes your call. It means can you listen to advice and make a decision on
various alternatives offered to you. After you have gathered all the
information you believe is necessary for your decision can you apply your
personal goals with the information presented and make a final decision?

This may seem like an odd inquiry, can you make a final decision?
Unfortunately, some people will feel quite comfortable going to a car show room
and purchase a $30,000 automobile. The color, impression, and internal
motivators. But when it comes to investing, the buy is not as dazzling. It
takes consideration to commit $30,000 to an investment in paper form even
though you may be purchasing stock in the flashy car company.

Can You Let Go?

The final and perhaps most important aspect of deciding if you are a stock
investor is, YOU. After you have gone through all of the self analysis, goals,
research and advice of others and made your final decision the next step is
critical. Do you have the personality to allow your investment to take its
course? Can you sleep at night? Unless you are a day trader who plays the
upside and downside of the stock market and I would not recommend this to
anyone starting out. You have to be able to roll with the punches. Trust your
instincts and review your investment on a monthly or quarterly basis. If you
buy individual stocks, place a limit order on the account. A limit order allows
your broker or on-line account to sell if the price goes down.

The mutual fund investment works differently that buying individual stocks. If
you are satisfied that your choice of a fund met all of your criteria for
investing let it alone and review it only periodically. If your mutual fund for
any reason meets with unexpected long term problems you can change funds. I
would review the fund on a quarterly basis and discuss this with the fund
account manager or representative.

This is the investor personality that you need to have in order to have a
lifetime of success in the stock market. If you have it, it works. If you
don't, try another type of investment.

Investing in the Oil Sector

There is advantages to investing in areas of the stock market that you know or
have some personal experience with on a daily basis. Nearly everyone is
effected in one way or another by the commodity oil. If you are an individual
you take note of prices at the gas pump, heating bill and other uses of oil. If
you are a business owner the price of oil is a factor in the operation of your
business. For the purposes of this article the two areas that will be covered
is oil & gas and oil service stocks. The first area oil & gas covers some of
the big oil stocks whose names you may know. The second area is the oil service
stocks that support and aid the extraction and distribution of oil.

Big Oil & Gas:

For all the rhetoric and interesting speculation about "green energy," and the
alternative fuels like ethanol, biomass, and wind energy the present
circumstances places the lion share of energy that moves the world in the lap
of the oil industry. Names you not only hear about, but have been around in one
shape or another for a century. Chevron, Exxon-Mobil, Conoco-Philips, British
Petroleum, Royal Dutch Shell and Hess Corporation. These companies have an
individual market capitalization of hundreds of billion of dollars, with the
exception of Hess that has a mere 19 billion in market cap. It is hard to
imagine a more solid group of stocks with as much clout as this elite club.

All of the stocks mentioned above are involved in exploration, distribution and
marketing of oil products around the world. Their influence and their financial
worth allows them to invest in costly drilling, manufacturing and distribution
of oil in all of its forms. While the rhetoric continues about building and
providing alternative sources of energy. These companies presently support a
significant percentage of the every day uses of energy. Some of the big oil
companies even support blends of biomass fuels and ethanol as a compliment to
their own primary purposes.

The cost of purchasing stock in this stock is relatively cheap when you
consider the likes of Google selling for in excess of $500 per share. Still
other intellectual property stocks on the market and conglomerates sell for in
excess of $200 a share. The range of prices in Big Oil is between $61 to $89
per share. What you get is a stock that is capitalized with billions of
dollars, has a management team that is beyond exceptional and an underlying
product "oil" that is in short supply.

For the moral investor that blames Big Oil for the environmental mess, wars and
other maladies the world faces the only American not to blame are the Amish with
their horse and buggies. Still, the Amish may leave a smaller foot print, but we
all have in one way or another impacted and contributed to the need Big Oil has
satisfied and will continue to do so. At present there is small improvements
everyone can do, but Big Oil's contribution to a strong economy, and living in
a modern society is not going to be replaced any time soon.

The best bet for future stock growth and for pure investment is in oil & gas.
Of the Big Oil stocks that are worth looking at Royal Dutch Shell and
Conoco-Philips are the two that have some noteable room for short term growth.
Another reason to consider Conoco-Philips is that George Soros recently took a
position in this company. In investing it is good to follow the leaders. Review
the institutional investors in all of the stocks mentioned above and make a
decision on which company you think will be a good addition to your portfolio.
If in time you make a huge gain take a portion of the profits and contribute to
a fledgling "green energy" cooperative.

Oil Service Stocks:

The oil sector would not be complete without mentioning the drillers who get
that precious commodity out of the ground, ocean bed or frozen tundra. The oil
drilling stocks are rumored by some financial experts to be waning in appeal or
topped out. In order to put this in perspective the long history of the oil
drilling companies goes back a century. These tough minded riggers and
engineers made the oil industry what it is today. The inventive engineers and
scientists found astounding ways to detect and then extract oil from the most
harsh environmental challenges. The oil drilling stocks are part and parcel of
the oil industry.

Recently two of the biggest players in the drilling industry, Transocean Inc,
(RIG) and Global Santa Fe Corp. (GSF) announced merger plans. Individually, RIG
sells for around $70 per share and RIG in the neighborhood of $102. These
companies are backed by billions of dollars and their institutional investors
are stellar. Another drilling company of note is Diamond Drilling. This
drilling stock is owned by Fidelity Funds, Vanguard Funds, Loews Corp. and
Thornburg Investments to name just a few. The oil drilling stocks merit a good
look and watch for buying opportunities if there are dips in the near future.
In the alternative you can choose a mutual fund from one of the institutional
investors mentioned in this piece that focuses on the oil sector.

This has been a brief overview of the oil sector. Review your investment
objectives and seek the advice of licensed estate planner or stock broker.
Company prospectives are available on-line and by mail.

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