How To Become Wealthy

In order to earn 10%/month on your funds, you have to turn the traditional investment thinking on its head.  With traditional investment strategies you have to have to 1) pick out the stock or investment item, say, like gold, and then 2) know when it is going to go higher.  This means you essentially have to predict the future in picking out the correct stock or item, AND you have to know when it will make its move up!!!

But NOBODY knows when any particular stock or item will move higher.  There are some who claim they do, but all they want is your money.  No financial adviser can do it; there is no program that can do it.  The people who say they can, ONLY want your money for their ‘advice’, newsletter, or software program.  There are many financial seminars where they say they will tell you how to invest.  BUT they never give you a money-back guarantee.  Why because the advice they give, will NOT show you how to consistently earn money.

REMEMBER: Wall Street doesn’t give a damn about you – only your money!!!

So how do I earn 10%/month on my investment funds?  I know that neither I nor anyone else cannot predict the market movement.  And those that think they do, are only right around 30% of the time!!!  BUT even a stopped clock is correct 2 times a day!  So rather than trying to predict the when and where the stock market will move, I SELL to those who think they can predict the market direction!!!

More in next blog…..

If you are not clear about anything I am writing, just send me a question and I will be glad to answer it! Write to: questions@MonthlyIncomeGuy.com

Website:  http://www.monthlyincomeguy.com

Since the stock market can go up or down – how do we makes gains to make us wealthy?  Even if you were able to earn 10%/year it would take decades for you to become wealthy! And with the stock market making huge moves both up and down, it seems that you cannot do it.  And in today’s economy you can’t!!!  Many years ago, you could just buy quality companies and hold on to them and over time with dividends you could slowly over several decades become quite well to do!

As we move along with theses posts I will show you have to earn 10%/month, that’s right each month.  Sounds like a lot of baloney , right?  But fortunately it’s true and i will show you how!  But firsts there is more information I must share with you.

About 30+ years ago someone came up with the idea of options on stocks.  What options do for you is to let you make money if the market goes up or down!!!  When you expect the market to go up, you buy CALLs.  When you expect the market to go down, you buy PUTs.

Options are highly leveraged.  Each option is worth 100 shares of stock.  This is why people love options – it cost MUCH less to control 100 shares of stock than buying 100 shares of a companies stock.

All options have an expiration date, that it, they expire.  Options have various lengths, from weeks to years.  Naturally the longer the time period, the higher the cost of the option.  When you buy an option you are essentially betting that the stock price will exceed the option strike price before it ‘expires’.  If it does not, then you lost the money you paid for the option.

All options have what is called – ‘strike’ prices.  This is the price where you expect the stock to go beyond.  Example:  Let’s say IBM is at $100 and you expect it to go to $110.  So you buy an IBM 105 CALL option.  If the IBM stock does go to $110, then once the stock reaches $105 you will start making money on your option.  And the higher it goes, the more money you make!!!  At that time you can sell it at a big profit or if it remains above the strike price at expiration, get the stock.  PUTs work the same way except that you are betting that the market will go down!

When you buy a CALL or a PUT your greed emotion is at work and you will lose most of the time.  But, there are three GREAT option strategies that puts a damper on your greed emotion and one of them lets you earn an average 10%/month on your investment funds!

If you are not clear about anything I am writing, just send me a question and I will be glad to answer it! Write to: questions@MonthlyIncomeGuy.com

Website:  http://www.monthlyincomeguy.com

Do you want to be financially independent and want to know how to become rich.  This series of How To Become Wealthy posts will take you step by step on how you can create your own financial independence.

Now people reading these posts will have a wide experience on the stock market.  BUT in order to help everyone, I will have to start off with basic information that may be boring to you more advanced readers.  If you are more advanced you can click on any of the enclosed links and go directly to my website for more advanced info!

What is the stock market?

Most companies issue stock for various reasons, one of them being to raise money.  When people buy stock, they essentially own part of the company.  They buy stock in a company because they expect the company to make more money which will cause the stock price to increase and therefore their investment will also go up.

There are thousands of stocks that you can buy.  People buy the stocks that they believe will go up.  Today, around ONE BILLION stocks are traded each day.  This is important because the more people trading stocks, the easier it is to buy and sell them.  It is called a liquid investment because they are quickly bought and sold.  On the other hand, an illiquid investment would be real estate.  It is NOT easily and quickly sold.  Just think when you sell a house, it may take months to sell and then more months to close the deal.

So stocks potentially are the best place to build wealth.  BUT stocks go down as easily as they go up, so it is NOT a sure thing that you can get wealthy by buying and selling stocks!

More in the next post……

If you are not clear about anything I am writing, just send me your question and I will be glad to answer it! Write to: questions@MonthlyIncomeGuy.com

Website: http://www.monthlyincomeguy.com

So your question is probably – how do I sell to those people who think they know where the market is heading???

If we did not have options, we could not do it.  But because of options, you can do it.  The main problem for most investors is that they let their GREED emotion control their investment thinking.  They read people selling advice that you  can make 100%, 150%, etc. in just a few short weeks or months.  And sometimes this is possible, but it is the exception, not the rule.  The people selling their advice or program, don’t tell you that they are right only about 30% – 40% of the time and the big gain is rare!!!

In order to make a consistent 10%/month you need to do the following:

• Get rid of any get-rich-quick thinking.  This thinking will only cause you to make bad decisions and lose money,
• Do NOT attend any Investment seminars – they don’t know any more than you what the market will do or if they do, they won’t reveal any ‘secrets’ to you.  If their information was so great, why don’t they give you a guaranteed refund?,
• Do NOT purchase any trading systems – they simply don’t work as advertised.  They use software like TradeStation to generate a ‘trading system’ which in all probability they never used themselves. That is why the most time they give you to get your money back is 30 days, but no one can validate a system that quickly. The minimum amount of time you need is 90 days,
• Realize that as all humans – you are driven by the STRONG emotions of FEAR and GREED. If you don’t keep these emotions under wrap, they will cause you to make very bad decisions, and
• Have a predetermined entry and exit strategy – thus putting a damper on your greed and fear emotions.

More in the next post…..

If you are not clear about anything I am writing, just send me a question and I will be glad to answer it! Write to: questions@MonthlyIncomeGuy.com

Website:  http://www.monthlyincomeguy.com