Where it all Began
When I first got involved in the markets as an investor it was many moons ago, when there were advertisements on British TV as the government was selling every state owned utility you care to mention. At the time mid-eighties in Thatcher’s Britain, we were goaded to buy, buy, buy. Whether that was housing or utilities, which essentially in terms of the utilities, as taxpayers we already owned. Needless to say, I was among many of the merry men and women who wanted a bit of the share/stock action. The ones that stick in my mind as I write this are British Gas and British Telecom. It’s hard to imagine that these were state owned utility businesses, but could only seriously grow from pumping millions into each one respectively – the tax payer was unwilling for the government to throw millions of pounds of their money into utilities which worked in the public eyes, much like the old saying ‘If it isn’t broke – don’t fix it’. So the only real way was to float each one in turn on the stock market. Thus, creating millions of pounds in revenue, which could then be reinvested over time in each. In turn, also creating for the first time, a greater national awareness of that old bastion of finance – the stock market.
I only had a few hundred pounds, which I sent along with my share application to invest in British Gas. I think I was awarded 100 shares, as the stock was oversubscribed 10 times over. Come to think of it, as far as I can remember – everyone got 100 shares. These shares were worth a lot to me, as in buying these shares I learned valuable lessons on trading, the validity of the markets, how and when they move and why.
What did I gain from this experience? It might seem obvious to say that the first thing that I noted was GREED – no surprise there obviously, as everyone invests in the stock market to create wealth or at least profit. However, what really made me sit up and take notice was that the actual chart of the share had little relevance to the real value. In other words, what I was seeing happen with the price movements had nothing to do with the fact that British Gas was creating more gas or had secured huge global contracts. No it was far simpler than that.
It was based on the psychology of greed and to whether person X thought the share was going to go up more in the future as opposed to person Y thinking it was going down over a similar length of time. This was creating more desire for the stock so the price went up, more people bought as they saw the stock rise – but this didn’t happen straight away, oh no! When the market opened thousands of small investors saw profit straight away. They got greedy and sold within the first few days. This initial mass selling of shares outweighed the buyers and so the stock went down. It was after this that I noticed the real greed and the ‘Clever Money’ come in. The institutions were buying the shares by the bucket load; they were cheap at that point – good value. The shares began to rise, more clever money being pumped into by the larger private investors. Followed by a final surge when the people who sold initially bought again, seeing the rise, not realising that they were near the top of the current Long upward trend, thinking the stock will keep going, only to be bitten when the institutions sell and take profit.
The rather long-winded point I’m trying to make here is, not once was the share price connected with any news, profit warnings, major contracts – or anything else for that matter. The price movements were to do with pure and simple greed and supply and demand.
Now knowing that the share price is governed in the short to medium term by this psychology of greed, we can therefore, by watching for particular patterns in share charts, spot price movements up or down – much like reading how people are thinking and using our techniques, plotting where they might go next. Sounds tricky but what I will be teaching you later in these modules is very easy to learn. Don’t worry about it just yet or at all for that matter.
So did I profit from my first trade? Well without wanting to blow my own trumpet! Yes I did, but not because I realised what was going on. It was only because there was some delay issuing some of the share certificates, as at that time there was nothing like a ‘Nominee Account’ whereby I could sell the shares without the need for a share certificate. By the time I got mine, the shares were creeping up again, I sold and made several hundred pounds and learnt a lesson, which would crystallise over time and become one of the best lessons I had learnt.
Now lessons are great, but are only ever of any real use if we actually apply what we learn. Sadly for me that was many years later. You see for a very long time, I knew there was a better way to make money, than plod away in some ropey 9 to 5 existence working for someone else and making him or her rich and not me. To cut a long and arduous story short – I tried everything and anything. I have done MLM, sold pills and potions of all types, acted as a letting agent, import/export agent you name it I’ve done it. In fact I have won two business awards given by Shell UK for my business ideas, one was a legal fake art import business – there are many clever, talented artists in Hong Kong who will copy works of art at a reasonable price or produce portraits from photographs – in fact I think there are still a few people doing this by pretending that they are the artist, save your money and do a search on the Internet and get a company in HK to do it at a fraction. The other was an advertising service for small businesses. Anyway enough of that let’s just say that if you’re anything like me, you have worked hard at creating a better way of life in a rather unconventional sense.
I am going to go into a bit of tangent for a while, to make an important point. Attitude! This is very important. What I mean by attitude, is not so much your general attitude, you don’t have to be some ‘Gordon Gecko’, or some ruthless individual who would sell their Grandmother to make some money (how much are Grandmothers worth today?) to be successful in Financial Spread Betting. The attitude that I am going to be talking about is your attitude to money and how it is made. Now I am assuming that you work, which is great, we all have to have a trade or a job of sorts. Sadly it is this that we get measured on, as a reflection of who we are and we are then treated accordingly – but don’t get me started on that one, that is another topic in itself. The attitude I want to concentrate on is, our attitude to how money is made and how you can make money. These opinions are important to your future success in this game and pretty much to your financial success in life.
If you are someone that believes that the only ‘True’ way to make money is to work hard in a job all your life, grafting towards a pension and to then spend the rest of those pension years playing golf and reminiscing with your spouse, then I wish you all the best because you will need it. Sadly the old attitude of a ‘Job for Life’ is no longer part of the new millennium. Many people are now having to continue working into their retirement as their pensions have either been eaten away by inflation or stock market fluctuation (excellent for Financial Spread Betting or both) .
Many retired people are having to re-mortgage property to keep their heads above water and recently in the British press, it is becoming so common now for retired folk to sell their homes to pay for private residential health care – leaving nothing but debt for the next generation to pay. Now, hopefully if you are one of those people that believe that working for someone else is the only way, then I just hope that I have angered you just now. Yes, I am saying all this to get a reaction, but more so because it’s true! Some of you may protest and tell me that you have made solid plans and anyway you’ve had promises from the government and your employer “…That things have now changed and will be very different when you retire, don’t worry, go back to work!” Oh so true! The funny thing is, that the very story your parents were told is now being told to you, and YES things will be very different when you retire. In fact it scares me to think how different.
Put it this way. I can’t see things getting any better with financial pressure on the government increasing yearly as more and more older people live longer. Trust me when I say that retirement isn’t going to be a cushy thing if you continue working for someone else and rely totally on your pension income for your future. So the attitude I am talking about here, is your belief in the fact that there are other, better, quicker, easier ways of making money than just working for someone else. Granted, not everyone can deal with Financial Spread Betting. What makes this game hard is not applying the techniques or learning the skills – it”s you. It’s your mentality and psychology that will either make you either a winner or a loser in this. There will be days when you will make an awful lot of money and by the same token there will be days when you will lose an awful lot of money. How you view this, is what will make you a success in Financial Spread Betting. If you see the losing as a negative, painful, depressing event whereby you have doubt in what you’re doing and the system that you’re using – then you will not be successful. IF on the other hand, you see these losing days and winning days as part of a greater picture and part of trading and treat them just the same, remaining focused, calm, controlled. Then you my friend will be a success in financial spread betting. That is what I mean about attitude.
There, got that off my chest, but it is an important point. Your attitude to this will be the greatest indicator of your successful application of what I will be teaching you later within the workbook and your longer-term success of profiting from financial spread betting over the years.
Back to lessons being learnt. It wasn’t for a long time that I realised what I had learnt way back in the 80’s. In fact it wouldn’t be until the late 90’s and the subsequent ‘Dot Com’ gold rush and then collapse of technical shares. Wow, what a mad time that was, but such a massive example of greed and supply and demand in an exaggerated way. To this day we all look back and think how any of it was possible. Some kid would have a ‘Dot Com’ idea, go to a Venture Capitalist who would then throw a couple of million at them, they create the company and then go IPO (e.g.: PLC) and sell shares in it to an ever greedy public who had been swept along with everyone else – this was where the future lay and everyone wanted a share. Investors would go crazy and buy the shares, which would sky rocket, creating paper millionaires for the VCs and MDs of that ‘Dot Com’. When fundamentally, their actual worth was whatever physical stock, property etc. they would have and the piddling market share they may, or in more cases not have. It took a while, but it was lastminute.com that signaled the end in the UK. When people realised that the shares were not worth the initial investment, more so these ‘Dot Com’ or dot Cons as they became known as, started crashing. When the financial reports of companies such as Boo.com where made public it transpired that this company and many others were spending money like water and wouldn’t be in a profitable position for about 20 years, when in truth to cling onto the tiny market share they had was costing them millions every month and would soon run out of money.
Now this is where fundamentalists got it right, they looked at the real value of the company and the stock etc., and came to the conclusion that things couldn’t hold out and sold at a profit. Technical analysts noticed too because of various key indicators and patterns (which you will learn) that things were getting choppy and time to bail out. Sadly it was the private investor that got burnt more than anyone.
That was the period for me where I started to become more interested in both Technical and Fundamental analysis. Just so you know. Fundamental Analysis is looking at the REAL fundamental worth of the company and its market; it simply can’t predict price movement in the short to medium term that is why we concentrate on Technical Analysis.
So as you now know share prices over the short to medium term reflect nothing but the psychology of the people buying that share. If shares were just based on their true value all the time, both the Index of every country (more on those later) and the shares themselves, would be nearly flat and only rise/fall when the company announces its profits at the end of their fiscal year. The same therefore can be said for commodities and every other area that Fund Managers pile their money into these days.
I know what you’re thinking? Yep, the Stock market and all the other markets are just one big Casino. You know what, you’re right. No one knows what the future will bring; nobody can tell with 100% certainty what will happen to any market sector or business. Some people like to use all manner of ways to second-guess price movements. Many rely on tip sheets; hearsay and what the guy they met in the pub once said about company XYZ. If that is your source of information then I hate to say it, but you will become poor very quickly. I know that I am one of the many people and companies out there that are vying for your buck, with the promise of wealth without hard work. Well, what I am promising you is my system and that it works and from reading these modules you will understand why and from reading this guide you will see that with your own eyes. What you decide to do with this information is entirely up to you, but I shall leave that for another time. What I am saying is this, from now on, ignore the press, friends, and colleagues, tip sheets, news groups, forums, tips boards etc. don’t take their word for it. Instead learn the techniques that I am teaching here and apply these techniques to the markets and make your decisions that way.
DO NOT; let Joe in the pub who once got lucky with a Tech Share in the late 90’s, tell you what you should put your money on. Let the charts and your knowledge tell you what to put your money on. Of course following our site or delving in the FAQ’s section will help massively should you need any further information.
We’ve covered two important issues, which have to be addressed before you even begin to think of learning what I am going to teach you. We have looked at your attitude to trading and making money, this alone can hold you back and cause a million problems for you, if you haven’t get the mentality for this. The second is listening to others’ opinions. In fact, for now, DO NOT tell anyone that you’re reading these modules. Wait till they ask you why you are going on nice holidays and have a new car, and then tell them. If you tell them now at this early stage, you will get a million stories of woe. Stories of their mate who once tried a similar thing and lost everything. True! 90% of people who go into Financial Spread Betting lose their deposit within 3 months. Now is that your knees I can hear knocking – I hope not, don’t worry. The reason being is that the people that lose their money have usually heard that there is easy money to be made (yes true it’s not hard work). They have then blindly chosen a trade and lost their money. They would have had no idea of the markets, no idea of a system and no idea of knowing how to protect their trading profits and limit their losses. You my friend will be in the 10% who will be winning. You have here a workbook that teaches you the key points in the markets, a real tried and tested system with a real history and you will know and have peace of mind knowing that your money is protected. Everything you will be doing is calculated; there is no error of judgment. You will know exactly why you are making a trade and when you will be coming out – with a good idea of how much you can make.
Are you still with me then or have you chickened out already, believing you won’t be able to hack it? If that is you, then take stock for a second. It saddens me to hear of people that have only read part of these modules and then criticize it. Not because I’m defensive about what I write or my website etc. No it’s that I know that there will be people who will go through life, working for someone else and scrimping on some ropey pension. This is what upsets me. I set up this website to educate the many who are out there, who work for a living and have little or no knowledge of how to make relatively easy money from Financial Spread Betting.
If that is you and you are getting itchy feet reading these modules, then this is what I want you to do. Stop reading, shut down your PC and think about what I have told you so far. Then forget about it for a couple of days. Then when you’re ready come back. Re-read up to the point where you last left and then have another think. IF you’re still having doubts about all this and have concerns, then drop me an email.
I know that I am going on about it here, but I genuinely want to help you and I can’t help you if you decide to quit at this early stage. At least give me the opportunity to address any concerns and worries you may have, I know I can. I have been in your shoes. You see I know what it’s like to feel edgy about something like this. After all what we are doing isn’t conventional, we are spoon fed concepts in life, which are both familiar and safe. That is why politicians are the way they are, why the secret services are secret and why papers create diluted news, and why most of us work for someone else for a living because it’s conventional and by the same token, when people like you and me do something like this that is not the normal preconceived way of doing things, it is frowned upon and taken in an automatic negative light. You now have no excuses, I want to help, I want you to succeed, and I want you to be driving that new car into your drive… AND I want your neighbour to ask you how you got so lucky.
My friend you have no excuses … do you need to email me! If so do it now and stop reading. As from now on, were going to get to the ‘nitty gritty’ of the markets, Financial Spread Betting and how to profit from them.
ARE YOU READY?
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