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    • Home
    • Trader Screen Intro
    • Major Inflation Coming
    • Why Only 10% Succeed
    • The Four Market Stages
    • Why Trade ETFs?
    • The Velocity of Money
    • Importance of Free Market
    • Collapse of the Euro
    • Value of Gold & Silver
    • Profit from your ABC’s
    • Types of Risk
    • Syndicated Articles
    • Testimonials
    • Top Trading Quotes
    • Order Trading Info Report
    • Contact Trader Screen
    • Disclaimer
  • Home
  • Trader Screen Intro
  • Major Inflation Coming
  • Why Only 10% Succeed
  • The Four Market Stages
  • Why Trade ETFs?
  • The Velocity of Money
  • Importance of Free Market
  • Collapse of the Euro
  • Value of Gold & Silver
  • Profit from your ABC’s
  • Types of Risk
  • Syndicated Articles
  • Testimonials
  • Top Trading Quotes
  • Order Trading Info Report
  • Contact Trader Screen
  • Disclaimer

Understanding The Velocity of Money

You Must Move Money In Order To Make Money

  

In Order to Make Money You Must Learn How to Move Money!


That is:


Don't Park It! 


Among run-of-the-mill, traditional investors, there is a little known investment strategy known as the Velocity Of Money (a.k.a. Portfolio Turnover).   


We say little known because only a handful of  consistently profitable professional traders are aware of the fact  that moving - NOT parking - money will produce significantly larger profits over the long run!


The traditional definition of the Velocity of Money is: 

The speed at which money flows through an economy.


However, this term can also be applied to the speed at which money flows through different markets, whether it be the stock, bond, commodity or currency markets.


This strategy has been employed by professional traders for many years while earning the professionals tremendous returns!


Moving your money makes more sense than “parking” it in cash, bonds, equities, or mutual funds – in other words – 401k’s, IRAs and the like.  


This “money parking” is the strategy that most financial advisors recommend (no longer viable in today's volatile markets).


Between 2001 and 2010, stocks in the S&P 500 earned investors a little more than 1 percent per year. Considering that bonds earned investors approximately 5 percent per year during this same period, you may wish to explore alternatives to the traditional “buy-and-hold” method of long term investing. 


That’s a lousy return, especially when combined with the “nail biting” and “sleepless” nights that accompany those lousy returns. 


In today’s volatile markets, it’s now a well known fact among professional investors and traders that “buy-and-hold” is no longer a viable trading strategy. 


Hence the old saying:

"A long term investment is a short term investment that failed.” 


This huge increase in market volatility is partially due to the advent of electronic trading (versus open outcry / the trading “pits”) combined with the incredible increase in the number of hedge funds out there – many of whom are moving their operations over to Asia where they don’t have to play by SEC or CFTC rules and regulations! 


Look back to charts of  the late 2007 to early 2009 equity market crash when the S&P 500 fell from almost 1,600 down to under 700 – many people had their retirement plans changed / ruined during that time period!  

Enter The Money Moving Trader / Investor

  

The money moving trader however, was shorting the market as well as purchasing long put options (and buying inverse Exchange Traded Funds - ETFs) during that period and making obscene returns – we should know – we did just that!  Returns of well over 350% plus per trade are not unusual when any market is that volatile and trending that strongly. 


  

The global currency, stock, bond, commodity and emerging markets offer a veritable plethora of opportunities each and every day.

  

Certainly, you’ve heard the old saying: “There’s always a Bull Market somewhere!” 

That is the truth, but there’s also always a Bear Market(s) somewhere as well – opportunities to make money in trending markets – by moving money to the most active area(s).  


Whether the market(s) in question are moving up or down – currencies, stocks, commodities, etc. - vast opportunities always exist! 


Successful traders thrive on volatility – because that’s where the big money is made - and today’s markets offer lots of volatility.  

Extensive Daily Research & Chart Scanning

  

Trader Screen is involved in extensive daily research to "screen" out the best and most profitable money making markets / opportunities.


When these opportunities are discovered, we move quickly and decisively as the "window" for action stays open for no one!


Volatility allows the astute trader to consistently extract large amounts of money from markets quickly – and then move their money into the next quickly moving / volatile market to extract additional (and consistent) profits - and so on, and so forth.


As Traders, we need market price MOVEMENT - that's how money is made - up or down - it simply does NOT MATTER.  Money can still be made in sideways markets, but a different trading technique is required - and the profits are usually not as large as those earned in trending / moving markets.


Basically, what you're doing is "picking up" profits from Market A, taking those profits, moving them into Market B, taking those profits, and proceeding onto the next volatile / moving market(s).  You will hold your positions anywhere from a couple of days to a couple of weeks (sometimes as long as several months).  


Of course, sometimes you will experience losing trades, but as any professional trader knows, that's just part of the trading "equation".


When a market does not move in the anticipated direction (or within the anticipated time frame), or worse yet, moves against you, you quickly (and unemotionally) "cut-and-run", that is, take your small loss (there's never any ego involved here at all), and move onto the next potential opportunity!


As mentioned above, if you followed the advice of most financial advisors and “parked” your hard earned dollars in a 401k, IRA, employer Defined Contribution Plan, etc., which invested in the broad markets (or the bond market), your return over the last decade would have been miniscule while still having to endure the roller coaster ups-and-downs. 

Look at the average portfolio return – it’s anywhere between 10% – 40% annually (40% is pushing the high end of the spectrum in a big way).  Then you’re paying an adviser anywhere between 3% - 6% of your portfolio value to invest your dollars – not really a very good deal – especially for you and your portfolio. 


If, on the other hand, you kept your money moving (or worked with an advisory service that kept your money moving), you could  reap ROI’s (Returns On Investment) of anywhere between 50% – 1,000% or more!!! 


Do you realize what that would mean to your long term portfolio over time – 

millions of extra dollars for your retirement! 


Look at the majority of “investors” in company pension plans and / or 401ks and IRAs – 

if they have an adequate amount of money to retire by age 80, they’re considered very fortunate nowadays. 


If you do what the majority does, you’ll end up like the majority:  

Struggling for a modest life style in your golden years – Is that all you want from a lifetime of labor? 


Of course not – keep your money moving (Velocity of Money) – go where the opportunities present themselves (Follow-the-Money) and your nest egg will grow exponentially! 


If you move money within an IRA or 401k plan, your profits / earnings are tax deferred – that is, you will not pay taxes until you withdraw from your retirement plan. 


If you withdraw after age 59 ½, you do not pay the 10% penalty on top of ordinary income taxes. 


Either way, upon withdrawal, you will be taxed at the highest tax rate: Ordinary Income. 


If you move money outside of an IRA or 401k plan, your profits / earnings are taxed at the current short term capital gains rate – which is always significantly lower than the ordinary income tax rate. 


Once again: 

About 80% of the traditional work force will have a higher retirement age and a lower standard of living during their retirement years. 


About 20% of the traditional work force will retire between ages 55 – 65 and have a higher standard of living during their retirement years.  


These are the people that understand: 

The Importance of The Velocity of Money! 


Which group do YOU want to be in??? 


Options and especially options on ETFs (Exchange Traded Funds) allow for extreme leverage and diversity. 


Leverage allows you to control HUGE amounts of stocks, bonds, currencies, commodities, etc. for a very small amount of money – and reap the profits as if you owned the entire contract value (refer to "Types of Risk" page for more details on this).


That’s how big money is made and large estates created over time – utilizing: 

-The Velocity of Money 

-Leverage* 

-Diversification 

-Consistency 

*Once again, please refer to  "Types of Risk" page for more information on how leverage works. 


At Trader Screen, we understand and constantly utilize the concept of 

The Velocity of Money.


Investment / trading risks are kept to a minimum by combining sound 

Risk Management along with state-of-the-art investment vehicles such as   

Exchange Traded Funds (ETFs) as well as Stock, Bond, Currency and Commodity options contracts. 


No Longer Sit on the Sidelines!


Opening a Free Account is easy and fast.


We now will only consider accounts with $50,000 or more.  


Proof of brokerage account balance is required before the Trader Screen 

Letter of Agreement is sent.


You can use your current broker (a Level I options account status is necessary) or open a new account with any major brokerage house.


You get the timely buy & sell recommendations, execute the trade and send us your fill sheets - it's that EASY!


See: "How Trader Screen Operates" Section at the bottom of the Home Page.


For More Details, Please Visit:


Linked-In: http://www.linkedin.com/in/ericzuckerman1


Manta: http://www.manta.com/c/mrnsqh7/trader-screen

 




No Longer Sit on the Sidelines!

Opening a Free Account is easy and fast.


We now will only consider accounts with $50,000 or more.  


Proof of brokerage account balance is required before the Trader Screen 

Letter of Agreement is sent.


You can use your current broker (a Level I options account status is necessary) or open a new account with any major brokerage house.


You get the timely buy & sell recommendations, execute the trade and send us your fill sheets - it's that EASY!

How to Open your Free Account Today!

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