The Bull Hunters Guide

Bullhunters Guide

Well Bullhunters… we have come a long way in the short time since the Bullhunters Guide blog started and I wanted to re-cap for you as there have been many new learnings in the understanding of how the US Stock Market works.

Firstly there was the fictional account of Wal-Mart’s founding which showed us how a business is incorporated and the getting of private financing for this to be made possible. Then we discussed how a corporation operates, what its objectives are and what gives shares of stock their value.

The components of the DJIA which is made up of 30 stocks and the understanding that when someone talks about the market being down 50 points they are generally talking about the Dow Jones in particular. The components of the DJIA were created by Charles Dow to simplify market watching.

21st Century Academy Graduates

Sean then came along and posted the wonderful story about Maria and Pierre retiring to the Stock Market. If you missed it, its well worth the read of how two of the 21st Century Academy graduates took on the renting shares strategy from the Jamie McIntyre homestudy program and ran with it. Within 10 months they sold their business and retired to the stock market so now they can work from home. Doing these strategies as you know does not take up a whole lot of time.

More DJIA

We then discussed the components of the DJIA and how some stocks are cyclical and some non-cyclical meaning that the cyclical stocks perform best when the economy is in the early stages of the business cycle and the non-cyclical stocks perform best when the economy is in the later stages of the business cycle. This is a case of needs vs wants.

The opposing investment strategies was about the capital gains and price to earnings ratio in which we learned of just two of the strategies that you can use when investing in the stock market. We also looked at more advanced strategies like trading options. There is so much to know before you even get started with trading.

Have a great week everyone and happy trading to all

Angela Recchia
Graduate Support
Universal Wealth Creation © 2004 - 2007

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Hello fellow Bullhunters

Well I am getting my head around all of this and we are nearing the end of The Bullhunters Guide to the US Stock Market which I know you have all downloaded by now. This resource will help you in your endeavour to comprehend what the stock market is about. Today we discuss some more about Options Trading and the reasons why some traders buy calls. So here is the excerpt…


Options Trading

On the other side of things are people who buy options. Someone buys calls because they believe a stock is going to go up. Imagine you were convinced that Microsoft stock was going to have a $5 per share gain by Christmas, but you only had $3,500 to invest. At $28.37 per share you could only buy 123 shares. If the stock went up to $33.37 as you expect, you would only make $635 in profit. Instead, you could leverage your money by buying calls.

You go online and discover that there are several expiration dates for Microsoft options - October, November, January, April. There are even options for January and April of the following year, but thats too far in the future for your Christmas strategy. You decide to look at the January and April calls.

You see that the strike prices are available starting at a low of $15 and going to a high of $37.50. Since Microsoft’s stock price is $28.37, any strike price under that would be considered in-the-money and any strike price higher than that would be out-of-the-money. The Options Clearing Corporation determines what strike prices are available for each stocks trading volume and current price.

You think that Microsoft is going to go up at least $5 to $33.37 so you look at the strike prices near that level. You see that January $32.50 calls are selling for $0.10 ($10 per contract) and April $32.50 calls are selling for $0.30. With your $3,500 you could either buy 350 January contracts or 116 April contracts. Obviously the April contracts cost more because there is greater chance that Microsoft (or any stock) will go up (or down) the longer the duration of the contract.

You decide to go with 350 January contracts. This gives you the power to control 35,000 shares of Microsoft - nearly $100,000 worth - for only $3,500. If the stock fails to reach $32.50, your contracts will expire worthless and you will have lost your whole investment. If it reaches $32.60 or more, you are guaranteed to break even. But the good news is that you don’t need to exercise your option (which would require upwards of $99,000) - you can simply sell it.


Trading for Cashflow

As you can see from this summary of buying calls, it can be a great way for you to produce a monthly cashflow with this trading strategy. It’s all about leveraging your money to make it work for you. So you could choose to make the small profit if the stocks go up or you can mulitply it to give you an even bigger return by buying calls.

This strategy is more advanced and to attempt it you need to be at least comfortable with writing covered calls and have your trading system and emotional intelligence in place to be able to deal with the outcomes of your trades. It is not for a beginner and you can build up to this slowly and gain confidence with every step you take in educating yourself.

Some of the graduates of the Jamie McIntyre homestudy have been very successful in learning how to rent shares (in Jamie speak) and have progressed to this strategy by learning how to cover themselves if things don’t go their way and the market happens to drop. Education for Life is the what Jamie teaches in learning how to become financially free and setting your own goals on how to achieve this.

To Your Success

Angela Recchia
Graduate Support
Universal Wealth Creation © 2004 - 2007

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Moving along to the next excerpt of The Bullhunters Guide to the US Stock Market we will be tackling the old Fundamental vs Technical analysis which is always rather interesting.  I have met and been in contact with many graduates of the Jamie McIntyre homestudy who are all right about there trading strategies as some only take on the Fundamental analysis and others take on the Technical analysis, and then some use a bit of both.  If it suits your trading system then that’s great.  Whatever works for you is the right thing to do.  Let’s see what Sean has to say in his eBook.

Value investors most commonly prefer fundamental analysis.  This is the rigorous approach of determining the value of a stock and whether or not it is under or overvalued.  Technical Analysis by contrast, examines the price history and the chart patterns of a stock.  Aggressive growth investors are more concerned with the technical analysis and will never buy a stock without first consulting a chart.

Support and resistance constitute the basics of technical analysis.   As a stock’s price fluctuates over time, it might routinely go down to one price (but no lower) and then rise to another price (but no higher).  This low price is considered its support and the high price is its resistance.

For example, if a stock traded in a range of $25 and $35 over the course of six months, $25 would be thought of as its support and $35 would be considered its resistance.  Support can be thought of as a price floor - the stock isn’t likely to fall through that floor.  Resistance is like a price ceiling.

If a stock does fall through its support (floor), this is a very bearish sign.  Who knows how far it will fall.  Technical investors think it will keep going down until it hits an earlier support level.  By the same token, if a stock breaks through its resistance (ceiling), growth investors think the sky is the limit.

At first glance technical analysis may seem a bit silly but there are several reasons to take it seriously.  For one, if several other investors believe in it (which they do) then their actions will create a self-fulfilling prophecy.  Secondly, support and resistance often represent psychological barriers.  Perhaps a lot of buy and holders keep adding to their position each time the stock hits $25.  But if it ever fell much lower, they all might bail causing the stock to plummet in value.

For these and other reasons it is a good idea for even the most fundamentally focused of value investors to consult a chart before buying a stock.  Luckily, several sources on the internet provide charts free of charge.

To have access to these websites and their free charts please download the eBook now if you haven’t already done so.  This also means that you will have all the information at hand when you need to refer to it.  You will find the links on page 27.

I would like to thank all our readers for the votes you have been giving this blog as it spreads the message that can help many stock market traders out there.  Keep it up and it will send us to the top of the charts.  If you haven’t voted, the icons can be found in the right hand column.  Thanks for your continued support.

To Your Success

Angela Recchia
Graduate Support
Universal Wealth Creation © 2004 - 2007

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Hello Fellow Bullhunters

I hope you all got to read Seans post yesterday regarding the success of a couple of graduates of the 21st Century Academy homestudy.  I personally know Maria and Pierre and I have to say that they are a great example of what you can achieve when you put yourself into action and go after your dreams.  Congratulations again on your retirement from your day job and now making a living from trading.

I don’t know about you but I am certainly getting more out of The Bull Hunters Guide to the US Stock Market by breaking it down into small chunks and analysing it.  It’s becoming clearer to me each time I write a post and bringing it all together.  Let’s continue…

The Dow financials are cyclicals as well, but they don’t always follow the same cycle as the industrials.  American Express is the most cyclical of this group.  It performs best when the economy is strong and thus consumer spending is strong.

Citigroup and JP Morgan Chase are the most closely related of the stocks in this group as they are both money center banks.  Banks do well when there is a positive disparity between short-term interest rates and long term interest rates, also known as a normal yield curve.  When long-term rates are lower than short-term rates there is an inverted yield curve which is a nightmare for the banks.  The factors influencing the movements of interest rates are beyond the scope of this book but suffice to say that the inverted yield curves are predictors of oncoming recession and therefore money center banks perform best when the economic future looks strong.

American International Group (AIG) is an insurance company.  It benefits from a strong economy because it invests its assets in the financial markets.  But it is the least predictable of the financials because major events like Hurricane Katrina can have a disproportionate impact on insurers.

Market conditions are dependant on many variables so it is wise to determine the value of a stock and then follow your trading system making use of technical analysis to find your entry and exit points.  Remember that a strong economy is when the financials perform the best.  We cannot predict when natural disasters are going to happen or any disaster for that matter that will have an affect on the stock market at any given time.  Writing put options is one way of protecting yourself if you happen to be new to trading and it’s always wise to start with paper trading until you are confident to put your real money into the market.

Yours in prosperity

Angela Recchia
Graduate Support
Universal Wealth Creation © 2004 - 2007

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I just got back from another fantastic, life-changing experience at Jamie McIntyre’s latest 4 day seminar in Queenstown, New Zealand.  After 7 days of visiting this beautiful place, we might get snowed in and the airport was going to close.  This news wasn’t all that upsetting to me.

I caught a helicopter ride with my wife and 4 friends, including Aussie Rob who retired a few years ago on the back of his successful stock market trading style.  I harnessed the opportunity and when the helicopter landed on a glazier, at 6000 feet (and probably -14 degrees Celsius);  I ceased the moment and filmed myself and Aussie Rob in the snow with an unheralded backdrop of the Southern Alps.  This footage will be available soon for you to view along with some great stuff from the seminar.

Jamie’s generous gesture to give away the $1,995 ticket to homestudy graduates spouses for Free was immensely popular and the result was clearly noticed.  I now know that with the next Gold Coast seminar 90% sold out and another one slotted in (December 2007) to keep up with the demand, we are going to be in for a fantastic experience.  This is what the Graduates and their spouses took advantage of (at no extra cost to themselves – 21st Century Academy footed the costs):

A free spouse ticket for their partner to attend the 4 day seminar within 12 months of purchasing the homestudy. Normally charged at $1,995. They got this for free.

The 24 month support structure was extended to 60 months (5 years) as long as the graduate attends the seminar within 12 months.

It’s easy for me to see.  I go to most of the seminars and know the guy very well.  The reason 21st Century Academy encourages you to attend the seminar even though you have already paid for the homestudy is this:

The most successful Graduates are the ones who attend the 4 day seminar.  It’s as simple as that!  Action takers are the people who succeed in life.  Bystanders get to ‘stand by’ and watch happy results for others.  Sorry!  No offense meant to anyone reading this but my experience is such:

“Our current results in life will keep repeating, UNLESS we change what we are doing”

Every time I attend the 21st Century Academy seminar, I experience massive personal growth.  This was my 8th time in 3 years!  Needless to say, I’m a happy camper.  I see the results and growth of many graduates and have made more friends than I have ever dreamt of in the past.  I state the next paragraph at the risk of sounding cocky.  Please understand, this is not my intention.  As a mentor of mine would say: “I say this, not to impress you, but to impress upon you“:

Since I fired my boss in December 2005, I have personally experienced over 900% increase in monthly income through stock market, property and internet strategies.

I’m the first to admit, I only make approx $5,000 - $6,000 on the stock market every month, but hey, who’s complaining?  Mind you, that’s on an average month and with very little effort.  I, along with thousands of other graduates, owe Jamie McIntyre and 21st Century Academy eternal gratitude.  Our lives have improved our families lives have benefited and our communities will prosper from this.  Untold charities are feeling the effect and even moreso every day as many graduates are honouring their pledge to donate 10% of their investment improvement to charity.

If you want the same result as our Queenstown Grads got, Jamie McIntyre is also offering these bonuses to you.  If you haven’t yet joined Jamie’s homestudy program, you can follow the options below:

Order online here: 21st Century Academy Homestudy Program >>

Phone the office on (08) 9791 6600 (Int +61 8 9791 6600)

Leave a message and we will call you back: 1800 066 090

Fax your orderform to: (08) 6267 8004 (Int +61 8 6267 8004)

To get the Free spouse ticket worth $1,995 and a 5 year support structure, you need to place your order within 21 days of viewing the Free Jamie McIntyre DVD I sent you in the mail.  Talk to Simon, Dean, Cherie or myself at Universal Wealth Creation on (08) 9791 6600

You also have 90 days to invoke your unconditional 100% money back guarantee. Check it out at No Risk.

Have you already attended a 4 day seminar and want another Free ticket to attend? Book Free Ticket Here >>

Have you done the homestudy and haven’t yet attended a 4 day seminar? Book Free Ticket Here >>

See you at the next Seminar. I’m the tall guy with a massive smile on my face.  Come up to me and say G’Day!  You can find my photo by clicking my name in the signature below

Until next time, I wish you Universal Success

Sean Rasmussen
The Bullhunters Stockmarket Guide
Universal Wealth Creation © 2004 - 2007

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