The Importance Of Timing In Forex And The Stock Market

Summary: When we make money from the Forex we are looking for economic data which will influence the price of currencies. But when we are looking for good companies to invest in on the stock market we have been told to "Buy the blue chips." "Blue chips" are the big,reliable companies, and obviously these are listed for the most part on the New York Stock Exchange. The Dow Jones Average is composed of blue chips, and since there are only 30 listed, at the same time that the average ...

When we make money from the Forex we are looking for economic data which will influence the price of currencies. But when we are looking for good companies to invest in on the stock market we have been told to "Buy the blue chips." "Blue chips" are the big,reliable companies, and obviously these are listed for the most part on the New York Stock Exchange. The Dow Jones Average is composed of blue chips, and since there are only 30 listed, at the same time that the average has been going up, it might seem a simple matter to toss a coin to see which ones should be bought out of this list of 30. But let us get down to specific cases: Standard Oil Company of New Jersey is one of the largest, best managed and generally soundest corporations in the United States. Its earnings per share in 1958 were $2.72, in 1959 $2.91 and in 1960 $3.18. From 1957 through 1960 its dividends have been $2.25 per share each year. From the middle of 1957 to the end of 1960 the price trend of this stock was down. It declined from almost 70 to a point below 40. Another giant on the list of 30 Dow Jones stocks is the highly successful General Electric. From a high in early 1960 of nearly 100, GE plummeted to a level of close to 60 in the spring of 1961 because of the actions of the United States government in connection with price fixing by the corporation. There is some merit to the classical approach to the valuation of a stock by analyzing the underlying strength and prospects of the company, but this is only * An example of a high yield tax free bond is the Chesapeake Bay Bridge and Tunnel Authority 5