Trading for Dummies

Companies sometimes pay a dividend, or part of the company profits, for each share of common stock that an investor holds. This dividend is distributed to shareholders usually once every quarter after the company’s board of directors reviews company profits and determines whether to pay and how much the dividend will be

When you see expenses drop from one year to the next, while gross margins increase, that’s usually a good sign and means a company likely has a good cost control program in place. The potential for growth in future profit margins is good.

Even though Home Depot’s sale volume is considerably higher, the ratio enables you to compare how efficiently each company uses its resources.

The gross margin or gross profit is the net result of subtracting the cost of goods sold from net sales. This figure shows you how much money a company is making directly from sales before considering other operating costs. The gross profit is the dollar figure calculated by subtracting costs

For example, the GDP strongly suggests the path of economic growth, but PPI and CPI are strong measures of inflation.

During a full recession, cyclical and technology stocks tend to lead the way. Investors look to saf

Utilities and finance sector stocks are the most likely to see rising prices during the first part of a recession,

peak, recession, trough, and expansion/recovery

Edgar (www.sec.gov/edgar.shtml

Evaluating trading systems and testing trading ideas

✓

Keeping trading logs to audit your trading performance