Investing in the stock market can be daunting, especially because the risk of making a mistake could cost you money. Where do you start? How do you decide what stocks you want to trade? Having a proven stock trading strategy can help alleviate this anxiety.
When you’re entering the stock market, it’s important to learn how to invest from an experienced stock trading strategy. If you’re just starting out, a professional adviser can help you make a smooth and successful entrance into the stock market.
If you already have a stock portfolio but are not following a trading strategy, an investment trading strategy can help you optimize your current efforts with stock market predictions, investment advice and stock recommendations.
Chuck Hughes provides professional stock trading strategies. He has been trading in the stock market for over 30 years. He has been consistently successful in his career and is open with records of his trades. Chuck’s stock market trading strategy can increase your potential for profit when investing in stocks and reduce your risk of loss.
If you’re ready to receive stock trading strategies and learn how to make money in the market, call Chuck Hughes now at (866) 661-5664 or click below to get more information about Chuck Hughes’ exclusive stock trading strategy.
The First Step of Stock Trading: Determine Your Market Level of Investment
The stock market is full of complex stock trading strategies. However, stock trading strategy is dependent upon which level of the stock market you plan to invest in. Thus, the first step when investing in stocks is deciding at what market level to participate in.
Investment opportunities come in a broad range of sizes, from small cap to large cap. Cap refers to market capitalization. A company’s market capitalization is calculated by multiplying the price of a stock by the number of shares within a company.
Example of Market Capitalization
Market Capitalization = Market Value of a Company
Market Value of a Company = Stock Price X Total Number of Outstanding Shares
Market Value of Company ($1,000,000) = Stock price ($10) X Outstanding shares (100,000)
This calculation is the market’s estimate on the value of a company. A company’s market capitalization determines what level of stock trading company they are. Levels include:
Small cap stocks are shares of smaller companies and large cap stocks are shares of bigger companies. Labels such as large and small are subjective, they are relative, and they change over time. Large does not always mean less risky, but the large caps are the stocks most closely followed by Wall Street analysts. The attention given to the large cap markets does tend to push individual investors towards investing in smaller cap markets, as this is where the potential for value-plays are.
Mega Cap Stocks
The mega cap market is comprised of companies that have a market value of equal to or greater than $200 billion. In 2007, there were 17 mega cap stock companies; by 2010 there were only 5.
Before the Great Recession, the mentality in the stock market industry was that the bigger the cap, the lower the risk. After the collapse of companies within the mega cap stock market, traders began to associate risk with any level of market capitalization. The years between 2007 and 2010 changed market capitalization and redefined what investors viewed as low-risk investments.
Only .1% of all stock market trades are traded within the mega cap stock market; most of these investments are from industry investors on Wall Street. Mega cap stocks generally include companies from the United States, Europe and Japan. Examples include Apple, Nestle and IBM.
Large Cap Stocks
The large cap stock market is made up of companies that are worth between $10 billion and $200 billion. These company’s stocks are referred to as blue chip stocks. This level of stock is frequently traded by stock market trading strategies and traders on Wall Street because this market level produces the most lucrative investment banking. However, in reality this level of investing represents a very small portion of stocks that are traded; only 3.5%.
Examples of big cap stock companies include Walmart, Microsoft and General Electric.
Mid Cap Stocks
Investors in the mid cap stock market invest in middle capitalization stocks. Companies with a market value ranging between $2 billion to $10 billion are included in the mid cap stock range. The mid cap zone accounts for 7.4% of all stocks traded in the stock market.
Examples of mid cap stock companies include Ann Taylor, Cabela’s, Dollar Tree, Franklin Electric and Ruby Tuesday.
Small Cap Stocks
The small cap market includes companies with a market value worth $300 million to $2 billion. Small cap companies often have high stock prices and relatively few stocks for purchase or trade when compared to large cap companies. The small cap market accounts for 17.6% of stocks.
Small cap stocks provide an advantage for individual investors as opposed to investing companies. If an investing company were to invest in a small cap stock, they could quite-possibly buy enough stock that they would have to abide by SEC requirements. SEC requirements need to be met when an investor buys a large enough portion of the company.
In order to meet SEC requirements, the amount of stock and stock value traded has to be made public. Individual traders purchasing stock from a small cap market are generally immune from having to abide by SEC regulations due to the fact that an individual trader would most-likely not be able to buy a big enough percentage of the company to meet that requirement.
Examples of small cap stock companies include Meridian Bancorp, Trex and Abercrombie & Fitch.
Micro Cap Stocks
Micro cap stocks account for companies with a market value worth $50 million to $300 million. This market accounts for the largest percentage of stocks in each cap category; 18.8%. What makes this market so popular for investors is the ability to make a large ROI (return on investment). These small companies have the ability for growth; and that growth can be lucrative for investors.
Chuck Hughes advises traders to invest in the micro cap stock market. This market is where Chuck Hughes has made an abundance of money using his personal micro cap strategies. Just take a look at his micro cap trade results. If you are interested in receiving exclusive trade recommendations that include a high potential for profit, learn about micro cap trading strategies through Chuck Hughes's micro cap guide book or join Chuck's micro cap profit alert.
Examples of micro cap stock companies include Riverview Bancorp Inc., Zix Corporation, Ladenburg Thalmann Financial Services Inc. and Avino Silver & Gold Mines Ltd.
Nano Cap Stocks
Public companies with a market value that is beneath $50 million are considered nano cap markets. Nano cap markets are also called ‘penny stocks’. They are often associated with an increased risk, and comprise 15.8% percent of stocks within the stock market.
Examples of nano cap stock companies include Allied Healthcare Products Inc., ARCA biopharma Inc. and BioLife Solutions Inc.
Stock Market Trading with Chuck Hughes
Chuck Hughes has been trading in the micro cap and small cap stock markets for over 30 years. He has won 10 Trading Championships; that’s more than anybody else in Champion Trading history. Chuck Hughes has a consistent and successful history in trading stocks in the micro cap and small cap market.
Chuck Hughes offers a micro cap trading strategy service. This service offers traders a way to enter into the stock market without having to invest a lot of money. Even with just $2,000, you can start investing in diversified stocks in both the micro cap and small cap trading markets.
Research has shown that investing in smaller companies provides a greater ROI (return on investment) than larger companies. You can increase your chance of profit and reduce your risk of loss by following Chuck Hughes’ stock option tips.
Use Chuck Hughes as Your Stock Trading Strategy
As a member of Chuck Hughes’ stock trading strategy, you’ll receive proven strategies and stock trading tips, including the trend trading strategy. Even in markets that are depreciating, you’ll be provided with tips for stocks that are appreciating in value. Chuck’s trading recommendations can increase your chance for profit and minimize your risk of loss with stock trading strategies in the micro cap and small cap markets.
Call Chuck Hughes now at (866) 661-5664 to take advantage of his stock market trading strategies and receive stock trading strategies to learn how to make money in the market.
Not ready to improve your portfolio? Join Chuck's email to get more information about Chuck Hughes’ exclusive stock market trading strategies.