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President – Alan Riddoch. Trading vs. Investing. Investing = LONG TERM Trading = SHORT TERM. Famous Investor – Warren Buffet. Warren Buffett – World’s Greatest Investor. Famous Trader – George Soros. George Soros – “The Run on the Pound 1992”. Approaches to Investing.
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Trading vs. Investing • Investing = LONG TERM • Trading = SHORT TERM
Famous Investor – Warren Buffet • Warren Buffett – World’s Greatest Investor
Famous Trader – George Soros • George Soros – “The Run on the Pound 1992”
Approaches to Investing • Fundamental Analysis of Companies • Buying either cheap companies (low P/E) • Buying companies that will grow (low PEG)
What can you trade? • Currencies • Stocks • Futures • Bonds
Approaches to Trading • Macroeconomic events to influence decisions • Technical Analysis to find entry and exit points • Global events to influence decision making
KeyApproachestoTrading • Constantly monitor the news • Make a list of all the macroeconomic events for the month • Trading Ideas • Read up on the subject before you even begin to start.
Constantly monitor the news • Events can influence share/commodity/forex prices. • Example? Tsunami and the Nikkei 225
Macroeconomic Events 3 Economic Powerhouses to influence your trading: • USA • China • Eurozone
Macroeconomic Events • GDP • Unemployment • Interest Rates/QE • PMI • ISM (US) • Non-farm Payrolls (US) Economic Calendar http://www.dailyfx.com/calendar/
Trading Ideas • Create your own ideas. • How will a hurricane in Florida affect the price of oranges? • How will a war between Israel and Iran affect oil prices?
Trading Ideas • Effects of QE on Gold
Reading on Trading Advanced Beginner
Investment Decisions Three example industries • Retail • Drive for good Christmas performance • Halfords Group – Profits Up • M&S – profits fall 10%, missing key fashion trends • Oil & Gas Production • With Colder weather more demand for oil and gas • BP • Shell • Take care with sector quite risky ensure a good portfolio spread when investing. • Penny Stocks
Investment Decisions • Beverages • Incoming party season expect a more demand for wines, spirits and beer • SABMiller: Brands Include Bulmer’s, Coors Light • Diageo: Guinness, Smirnoff • Ensure to look at their brands and market share, take into account seasons i.e cider brewers generally do better in the summer time. • Impact the US presidential elections will have on the US and global capital markets. • Obamacare 3.8 per cent tax will kick in • What does this mean for medicine/private healthcare companies? • Tax's will need to be raised along with over a thousand spending cuts will likely be implemented additional taxes • This should hit consumer spending. How will this effect companies trading in the US market?
Information Gathering • Many sites available to obtain information on stocks/sectors. • www.londonstockexchange.com • Follow link for PRICES & MARKETS, then Stocks.
Sector Information Indicates daily rise and fall, pence and % change.
Digital Look • Useful website for information and charts. • www.digitallook.com
Bull Bearings Fantasy Account • www.bullbearings.co.uk • Set up your account • Join LSU Trading Competition • Password: trading