| In the world of stock trading there is no one method | | | | Every company in a market can be categorized by |
| for finding good stocks to buy with great returns. | | | | what industry or sector they are in. Retail, Basic |
| There is simply to find what works for you and to | | | | Materials and Energy are a few examples of some |
| realize that your trading knowledge can always be | | | | widely understood industry sectors. Each of these |
| improved upon as you gain more wisdom about the | | | | sectors contain many component stocks assigned to |
| markets. Trading stocks is one area of your life | | | | it. More interesting however is that each sector is |
| where there is always something new to learn. | | | | tracked as to the aggregate performance as if it |
| In this article I will explain one way that works well | | | | were an individual stock itself. This is very useful |
| for me and I will describe step-by-step how to arrive | | | | because as a trader you can see how each sector is |
| at some really good stock picks for your portfolio. If | | | | performing. More importantly - for us as traders, we |
| you have ever followed the financial news you have | | | | can compare each sector to one-another as if we |
| no doubt heard some of the financial analysts talk | | | | are simply comparing two stocks. Taking this simple |
| about some of those high-flying stocks that cause | | | | concept and applying it across many sectors and |
| you to think, "If I only knew about these stocks | | | | applying some simple trend analysis, we can easily |
| before they got popular I would finally make some | | | | begin to see which sector is currently in favor. |
| real money." Well, finding those stocks before the | | | | It is not enough to simply compare any two sectors |
| analysts mention them is not only possible, but the | | | | on a day-to-day basis. While one sector may be |
| more you practice what I am going to show you, it | | | | outperforming all others today we can not be sure |
| will be very likely that you will notice and trade many | | | | of any underlying performance trend. It is important |
| stocks before they get the widespread attention | | | | to look at the performance trend over time to |
| given to them by the analysts. | | | | determine whether one sector is gaining in support |
| Ever think about what happens to all that money | | | | and overall if it is performing better than other |
| when the stock market goes down or up? If you | | | | sectors. The goal is to find the best performing |
| thought about the fact that when a stock goes | | | | sector or the sector that is about to experience |
| down - value simply evaporates, you are onto | | | | great performance according to our trend analysis. |
| something important but there is also something far | | | | Once we identify the sector with the best potential |
| simpler going on here. As stock prices fluctuate an | | | | over all others and we can be relatively certain that |
| observant person realizes that the money does not | | | | the money is flowing into our chosen sector, the |
| evaporate along with value, rather it moves, it | | | | next step is to find the component stock within that |
| changes hands. Think of money like the ebb and flow | | | | sector which is contributing to the most to the |
| of the tides. People all over the world commit lots of | | | | performance of that sector. This is simply an iterative |
| energy to chasing value and that does not just exist | | | | process where we compare all of the component |
| in the stock market. It is everywhere, it is in the | | | | stocks within that sector until we find the one with |
| currency exchanges, bond markets, you name it. | | | | the best potential. |
| Money is moving all around the globe and when it | | | | The result of applying this simple sector analysis then |
| moves in concert, when many people share the | | | | finding the most promising component stock is that |
| belief that something has value that is where we see | | | | we have identified the strongest stock within the |
| the money going. This is a key consideration traders | | | | strongest market sector, overall increasing our |
| around the globe must consider constantly as they | | | | chances of making a profit from identifying and |
| seek to invest their money where they can find the | | | | trading the best of the best. |
| most value appreciation happening. | | | | I have found this method to work consistently |
| On a much smaller scale yet no less profitable, this is | | | | enough that I find nearly all of my trades this way |
| happening in the stock market every minute of | | | | and reap fantastic profits from the market. The |
| every day and what you will see in a moment is that | | | | greatest side-benefit being that the analysts from |
| there are easy ways to see where the money is | | | | the financial news often identify and speak about the |
| moving, where some condition exists which is causing | | | | stocks that I am already trading and I can reap huge |
| an increasing number of traders and investors to | | | | rewards as I am consistently one step ahead of the |
| accumulate their money in an increasingly favored | | | | news. |
| area of the market. | | | | |