There are the four many fears in trading, and how you can work to handle them. The one I am going to be talking about here is the fear of missing when stock trading. This crosses ever stock traders mind through the day.

Fear of Missing Out

Every trend always has its doubters, but I often notice that many skeptics of a trend will slowly become converts due to the fear of missing out on profits or the pain of losses in betting against that trend. The fear of missing out can also be characterized as greed of a sorts, for an investor is not acting based on some desire to own the security – other than the fact that it is going up without him on board. This fear is often fueled during runaway booms like the technology bubble of the late-1990s, as investors heard their friends talking about newfound riches. The fear of missing out came into play for those who wanted to experience the same type of euphoria.

When you think about it, this is a very dangerous situation, as at this stage investors tend essentially to say, “Get me in at any price – I must participate in this hot trend!? The effect of the fear of missing out is a blindness to any potential downside risk, as it seems clear to the investor that there can only be gains ahead from such a “promising” and “obviously beneficial” trend. But there’s nothing obvious about it.

We remember the stories of the Internet and how it would revolutionize the way business was done. While the Internet has indeed had a significant impact on our lives, the hype and frenzy for these stocks ramped up supply of every possible technology stock that could be brought public and created a situation where the incredibly high expectations could not possibly be met in reality. It is expectation gaps like this that often create serious risks for those who have piled into a trend late, once it has been widely broadcast in the media to all investors.

If you are planning to buy stocks as a long term investment you might want to consider placing a bracketed order on it. A bracketed order goes one step further than a trailing stop order. Remembering that a trailing stop order, you are in control of your investments because you are able to limit the amount of your losses by setting stop price. With a bracketed order, you are able to not only set a limit on your losses, but you are able to set a limit on your profit, that when reached, your stock will be sold.
This type of order is best illustrated with an example. Your broker places a bracketed order for 100 shares from Linens-n-Things, a department store, priced at $50 per stock, placing a sell limit order at $100 and a sell stop order at $45. If the price per stock moves down to $45 or up to $100, the stock will be sold. Therefore, the investor will either earn a $5,000 dollar profit, or take a $500 loss in profits.
The main advantage of bracketed orders is that you, the investor, determine how much you will earn or lose when getting involved in stock trading. If you have a total investment amount of $150,000 and you determine that you do not want to lose more that 20%, then your total losses should not be set below $30,000.
However, if you invest $150,000 into the stock market and you would like to earn a 15% profit, then you should set your profit margin to equal $172,500. With bracketed orders you, the investor, are in total control of your investment.
The two main disadvantages with bracketed orders you must place a limit on how much profit that you will make and you could possibly lose a large sum of money. First of all, when an individual decides to invest in the stock market, he or she probably wants to make as much money as possible. By setting a bracketed order on stocks that the investor purchases, the investor is placing a limit on how much profit is able to be earned. Also, to be noticed, by placing a bracketed order on your stock you run the risk of losing money.
For example, you decide to buy 1500 shares from Company N, a new and upcoming business, at $625 each, for a total investment of $937,500. You decided to purchase such a large amount of shares after consulting with your stockbroker because your broker was confident that Company N would be able to expand into a big business in which would create massive profits for your stock trading investment. You placed a limit on your profit at $5 million, however, you did not place a limit on your losses because your stockbroker was so sure of Company N’s success.
However, after only 3 months, Company N was forced to claim bankruptcy, where Company N is seeking a court order to discharge all of their incurred debt. Obviously, you can kiss your $5 million profit good-bye along with your initial $937,500 investment. Unfortunately, as an investor, you were willing to take a risk based on the expertise of your stockbroker, however, with this risk; you lost a large lump sum of money.
As with any type of order, you must become educated in order to determine what orders are right for your risk tolerance. Due to the fact that the bracketed order is mostly successful, this is actually a low risk order even though some detrimental risks are involved. Seeking the professional advice of you stockbroker definitely has the possibility of earning you, the investor, an ensured, set profit.
But, for some reason, if the company in which you purchase stocks from is forced into bankruptcy, not only do you lose your initial investment, you also lose your hoped for profit in which you set. Again, it is highly recommended to shop around for a stockbroker in whom you feel will genuinely put your needs ahead of his or her desire to make a profit.

GlobalTec, the makers of Wizetrade trend recognition software, announces the release of WizeFinder 6.0, a tool designed for stock traders of all skill levels who want to find potential stock trades quickly and easily!

WizeFinder 6.0 makes it possible to locate potential trade candidates in three easy steps: Select your Scan, Set your Price Parameters and click “Find.” That’s it! WizeFinder 6.0 will scan thousands of stocks in mere seconds and return a list of candidates that meet the users’ criteria for their trade style. These symbols can be easily transferred to Wizetrade software with one click for further evaluation.

“WizeFinder 6.0 is the latest version of our premier stock finding tool, designed to allow traders to spend less time searching and more time trading,” said GlobalTec President John Dankovchik. Dallas-based GlobalTec is a nationally recognized provider of investment software that provides analytical and trending tools for personal investors. Its product suite includes Wizetrade, 4X Made Easy, Options Made Easy, Commodities Made Easy and CommandTRADE.

WizeFinder 6.0 comes with ten predefined scans, developed by GlobalTec’s foremost software experts and prominent trainers. “Customers can modify these scans to make them fit their own parameters, and can even build their own custom scans. … They can customize this tool to make it the most powerful tool in their trading plan,” Dankovchik said.

This amazing stock scanner tool allows you to:

Set Customized Alerts: WizeFinder 6.0 can be set to continuously monitor 15 stocks and will automatically send users an alert (audio, pop-ups or emails) when their trade parameters have been met.

Build Your Own Scans: An easy to use Scan Builder Wizard will guide users through a step-by-step process of building their own custom scans, which can be saved, modified and quickly retrieved.

Customize Scan Results: Users can customize scan results anyway they like; sort, group, select columns and even customize reports that can be printed for later review.

Access the New WizeFinder Cummunity with Downloadable Scans: Users will have exclusive access to our new WizeFinder Community Web site, where they can choose from an ever-expanding list of scans submitted by our foremost experts and other Wizetraders! With a click of the mouse these scans will instantly load into WizeFinder—saving time and perhaps even money! These scans, are reviewed and rated by fellow Wizetraders, so you can quickly see and download the most popular and successful scans!

After stock trading for a long time I have put together some rules that I follow to help my trading along. These are only my suggestions with what has worked in the past.

Be patient. Once a trade is put on, give it time to work; give it time to insulate itself from random noise; give it time for others to see the merit of what you saw earlier than they.

Be impatient. As always, small loses and quick losses are the best losses. It is not the loss of money that is important. Rather, it is the mental capital that is used up when you sit with a losing trade that is important.

Never, ever under any condition, add to a losing trade, or “average” into a position. If you are buying, then each new buy price must be higher than the previous buy price. If you are selling, then each new selling price must be lower. This rule is to be adhered to without question.

Do more of what is working for you, and less of what’s not. Each day, look at the various positions you are holding, and try to add to the trade that has the most profit while subtracting from that trade that is either unprofitable or is showing the smallest profit. This is the basis of the old adage, “let your profits run.”

Don’t trade until the technicals and the fundamentals both agree. This rule makes pure technicians cringe. I don’t care! I will not trade until I am sure that the simple technical rules I follow, and my fundamental analyses, are running in tandem. Then I can act with authority, and with certainty, and patiently sit tight.

When sharp losses in equity are experienced, take time off. Close all trades and stop trading for several days. The mind can play games with itself following sharp, quick losses. The urge “to get the money back” is extreme, and should not be given in to.

When trading well, trade somewhat larger. We all experience those incredible periods of time when all of our trades are profitable. When that happens, trade aggressively and trade larger. We must make our proverbial “hay” when the sun does shine.

When adding to a trade, add only 1/4 to 1/2 as much as currently held. That is, if you are holding 400 shares of a stock, at the next point at which to add, add no more than 100 or 200 shares. That moves the average price of your holdings less than half of the distance moved, thus allowing you to sit through 50% corrections without touching your average price.

Think like a guerrilla warrior. We wish to fight on the side of the market that is winning, not wasting our time and capital on futile efforts to gain fame by buying the lows or selling the highs of some market movement. Our duty is to earn profits by fighting alongside the winning forces. If neither side is winning, then we don’t need to fight at all.

Markets form their tops in violence; markets form their lows in quiet conditions.

The final 10% of the time of a bull run will usually encompass 50% or more of the price movement. Thus, the first 50% of the price movement will take 90% of the time and will require the most backing and filling and will be far more difficult to trade than the last 50%.

This article was written by Mouser57 of StockHidoeut.com Penny Stocks Penny stock investing site to help members when buying penny stocks.