Tools
Stock Trading Software
By Doug Newberry
Aug 7, 2004, 11:58
Stock trading software affords you the opportunity to really parse out the market. Rather than acquiring stock information on the fly from disparate sources, trading software gives you the chance to draft your own agenda. So why continue to make decisions using outmoded platforms?
In fact, the e-commerce revolution has ushered in a new paradigm of business practices. The new internationalism of the late 20th century and early 21st century have encouraged explosive growth around the globe. At the same time, global capitalism presents new challenges, both socially and politically.
Adapting Your Analysis to the New Internationalism
How can you adapt your stock analysis to read the trends of an increasingly exuberant market? Are you doomed to play catch-up with the industry leaders who have access to top-notch software? Or, can you combat the big guys by developing a new approach for the modern investor?
William McKinley, an avid investor and President of Investing Systems, Inc--developers of investing software--recommends, "Before investing dime one in the market, it's essential that the investor articulates a very specific investment portfolio--which, in turn, is guided by an type of growth, safety, etc. desired."
The notion of beginning with "the end in mind" stems from the landmark business novel, by Stephen Covey, The Seven Habits of Highly Effective People. "I recommend this self-help guide to any investor curious about how to maximize his business efficiency," states McKinley.
Utilizing Stock Trading Software for Research
"Articulating a specific portfolio" starts with researching a very specific--niche--area of the market. Stock trading software can assist the investor in sorting out significant variables and major players in the industry, or industries, researched.
Additionally, investors need to go beyond the software and the numbers in order to develop an intuition for the market.
One of the best ways to do this is to cultivate a hunger for information on factors affecting the market, overall. Typical examples include, interest rates, government spending, materials/labor supply and demand in subject industries under study, the relative value of the dollar in foreign markets, and trends underway in foreign markets (which open, and close before US markets).
The sheer volume of information coming in from various sources may first seem intimidating. However, directing your information search to assist with your particular market concerns can be done.
Uncovering New Strategies
Another great technique to parse out the market is to discuss strategies with expert brokers and traders in the field. Although savvy mavens may not easily give away their secrets, the inquisitive investor can glean general ideas. Once comfortable with a level of knowledge about a niche market and investing software, the investor can develop a diverse portfolio.
Bill McKinley chooses a niche, he says, "based not on conventional wisdom but upon my personal passion." But, he adds, an investor "must be cautious about entering momentum already underway." Feeding frenzies often are entered late, and the investor acquires shares only to see share price drop precipitously soon after. McKinley continues, "If the investor has acquired sufficient information about his, or her, niche market, the investor will be less affected by momentary movements."
It is up to each investor to develop an aggressive, but thoroughly researched business strategy. Trading software may greatly assist this process. Whether the strategy ends up successful, or not, will be known only over time. But, with due dilligence, and discipline, the investor will be honing his, or her, own original approach to investing.
