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FAQ (Frequently
Asked Questions):
Market
Order: Market orders are instructions to buy or sell a security at the
best possible price available in the market at the time of order entry. Since no
specific price is desired, a Market Order fills more quickly, barring any disruptions in
the market. For example, Jane wants to buy 1,000 shares of XYZ. It's just
something she must have. So Jane uses a Market Order to buy. Jane needs to be
careful of XYZ's volatility because, no matter how well she times here order, the
execution price becomes the next available ask price on the market. This price may
be a significantly different price than the quote she saw upon order entry.
Limit
Order: A limit order is an instruction to buy or sell a security when the
market reaches a specified price or better. A Limit Order eliminates the risk of an
undesirable transaction price, however, a risk does exist that an order may not be
executed at all. this might occur if there are no buyers or sellers at the
specified limit price. Bob doesn't like the risks involved with Market Orders and
wants to sell his shares of ABC at $80. He uses a Limit Order to sell. The
order will be filled only if the market price, or bid, reaches Bob's Limit Price of $80 or
better.
Stop
Order: Investors use Stop Orders to take advantage of the best possible
price of the day, week, month or longer without sitting in front of their computer
monitoring the market. Once a Stop Order is activated, the order is entered into
the market. There are two type of Stop Orders: 1) Market 2)Limit. A Stop
Market Order becomes a Market Order after activation. A Stop Limit Order becomes a
Limit Order after activation. How are Stop Orders activated? For Buy Stop
Orders, the order is activated when the stock's price is equal to or greater than the Stop
Price. For Sell Stop Orders, the order is activated when the stock's price is equal
to or less than the Stop Price.
Stop
Market Order: Jane fears that the price will decline and decides she wants to
secure a profit and sell her position. However, Jane will not be able to monitor her
stock for the right selling price. Jane enters an order to sell ABC at a Stop Price
of $29. If Jane's stock trades at or below $29, the order becomes a Market Order to
sell regardless of how low or high the security trades after activation.
Stop
Limit Order: Bob recently bought shares of XYZ at $100. Bob
suspects a downturn of XYZ and wants to limit his losses, se he places a Stop Limit
Order. A Stop Limit Order has two components: 1) a Stop Price and 2) a Stop Limit
Price. Bob enters a Stop Limit Order to sell XYZ where he sets the Stop Price at $95
and the Limit Price at $90. Bob strategies that if XYZ trades at $95 or below, the
order will activate and become a Limit Order to sell XYZ at $90 or better. This way
Bob limits his loses to a maximum of $10 per share and a minimum of $5 per share.
American-Daytrader.com recommendations:
American-Daytrader.com sends to the subscriber an end of day stock newsletter. The
stock newsletter buy/sell recommendations are for the next trading business day.
We recommend that you place your buy order prior to the next trading business
day.
 | For example: today is Monday. The stock
newsletter is emailed to the subscriber between 6:00pm - 8:00pm (eastern standard time).
The subscriber will then review the stock newsletter and place his "buy
limit" order prior to Tuesday's opening of the stock market. |
| We recommend that you pay close attention to the
stock that has a consistent upward volatility movement. Look at the columns %profit
and %CumGain. You are looking for a high percentage number here for a given stock.
Find this and you will be successful. |
| We recommend that you install a software stock
monitoring product such as: "Winstock Pro".
Once you install this product on your computer you will be able to get updated
stock quotes with email or paging capabilities. |
| This will be required unless you are in front of
your computer looking at real-time stock quotes such as Datek's "Streamer"
product. If you are not at your computer screen then the "Winstock Pro"
product will solve this problem by sending you an electronic page to your pager to notify
you when the stock price has reached your buy price. |
| Once notified of your potential execution of your
"buy limit" order, you will then go to your computer screen and place your sell
order with the on-line broker at the American-Daytrader.com stock newsletter recommended
sell price. Please place a "sell limit" order and not a
"stop limit" order unless you know exactly how to place "stop limit"
orders. Remember the following: Nasdaq stocks may be entered
in multiples of 1/32. NYSE and AMEX stocks may be entered in multiples of 1/16. |
| Now monitor the stock for the
execution of your "sell limit" order. |
| You should be able to buy and sell
the stock on the same day and generate an approximate 2% return. |
| Now, do this same routine every
trading business day. |
| You must be disciplined to do this
every day and you will see great results. |
| Good Luck... |
How do you interpret the
daily stock newsletter:
Entering Order Information for Datek:
| 1.
Select Buy or Sell to designate a purchase or sale of securities. Use Sell to short a
stock and Buy to cover a short.
2. Enter the Quantity of shares
you want to buy or sell. You can enter orders for up to 5,000 shares. To trade more than
5,000 shares, you must enter additional orders up to a maximum of 5,000 shares each.
3. Fill in the stock symbol of
the specific security that you want to trade.
4. Enter the Price for your
order. Prices can be entered in decimal or fractional form (10.5 or 10 1/2). Fractions
require a space between the whole number and the fraction.
Nasdaq stocks may be entered in multiples of 1/32. NYSE and AMEX stocks may be entered in
multiples of 1/16.
Market Order: Leave blank
Limit Order: Enter limit price
Stop Market Order: Enter
activation price
Stop Limit Order: Enter
activation price
5. Select the Order Type:
NYSE, Nasdaq, AMEX:
Market, Limit, Stop Market, Stop Limit
6. Choose the Expiration of the
order
7. Enter the Stop Limit Price
for stop limit orders only.
8. Click the "Enter
Order" button |
I can't see the
American-Daytrader.com stock newsletter.
| American-Daytrader.com supplies two
file types containing the same information
- An .htm format stock newsletter.
This file can be viewed in your internet browser such as Microsoft Internet
Explorer 4.0 or a Netscape browser.
- An .xls format stock newsletter.
This stock report is the same formatted report that you can view in your browser.
The exception is the .xls format is in a Microsoft excel spreadsheet format.
If you don't have Microsoft excel you will not be able to view the report.
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| AOL's email system doesn't support
the use of advanced MIME compressed binary files. Thus, do you have the
"winzip" utility to unzip the file? If so, you will then be able to view
the .html / .xlx file(s) without a problem. |
| Try downloading the free "winzip" utility. Goto AOL.com and at the
keyword prompt enter "winzip". Then download the "winzip"
utility. You should then be able to read the newsletter. |
| American-Daytrader.com has many AOL
subscribers. The "winzip" utility is usually the solution. |
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