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Suppose that the market dropped 20% in one year (as it did in 2001 and again in 2002). You might have to spend the bulk of the next big move up in the market just getting back to even, instead of making money. But suppose we were able to walk away with a flat return...or just a small loss instead. Would you agree that we'd be in much better shape heading into the next move up in the market, if we could avoid "the big hit?"

Stock Option Trading Now, there used to be a time (throughout the 1980's and 1990's), that absorbing just a small loss in a year where the market drops 20% would be called "significant performance" compared to (or relative to) the rest of the market. This is because folks in the market were more interested in "relative returns" back then, not "absolute returns."

Assuming that funding targets intuitively know the value of the good work being done is unrealistic.

Currency Day Trading The reason so many were interested in "relative" returns back then was because throughout the '80's and '90's, we were barreling down the highway in a secular bull market. Every pull back along the way was simply a terrific buying opportunity. You were dubbed a hero if the market dropped 25% in one year and you were able to lose only 10%.

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Financial Software Trading Not so today!

Online Stock Trading Company We're not interested in "relative" returns and neither should you. What we are interested in is absolute returns.

Did you know CFDs were created in the beginning of the 90s by the derivative trading desk at Smith New Court, a trading company based in London. CFDs provided clients of the company hedge fund with the opportunity to short sell (on the London Stock Exchange) on margin and also avoid taxes payable due to ordinary stock trading. By trading CFDs, important clients no longer needed to arrange their stock transactions physically.

Forex Day Trading The methods we use (a blend of fundamental analysis and point and figure technical analysis) are not perfect every time. But they do an excellent job of telling us when supply overtakes demand. This is true whether or not we are looking at a particular mutual fund, an individual stock, a sector or the market as a whole. Whenever supply overtakes demand, lower prices are certain to follow. And we should take the steps needed to protect our retirement dollars at that time.

Financial In Market Look, losing money impacts your returns for many years, not just one year. That's because if we have a year where we lose 20%, we'll need to make 25% just to get back to where we began. It's really important that we do our very best to avoid big losses in our account...whether that account is our regular brokerage account, or our 401k account, or some other retirement plan.

Stock Trading System So what do you do to avoid big losses when the market is crashing?

Day Trading Stock Tip In 401k and other retirement accounts, we have a "safety valve" option which, if used properly, allows us to sidestep much of the damage. It is often called the "stable value" fund or the "stable income" fund.

Financial Forex Forex Software The stable fund is often a guaranteed insurance contract (or "GIC") that will give you a safe place to park your money, out of the stock market. There are millions of people (yes, millions) who have all of their money in their retirement plans invested in the stable fund.

Stock Market Trading In 2005, many of the plans that we advised had stable funds that generated yields in the neighborhood of 3% to 4% for the year. Listen: if you stayed in the "stable fund" for all of 2005, you beat the entire Dow Jones Industrial Average and the Standard & Poor's 500 index.

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But this is really not the goal of the stable fund.

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The "stable fund" is an investment that really should be looked at as a "parking place" or a temporary spot, to hold your funds while the market is going down, or on defense.

Day Trading Future In secular bull markets, we'd have little use for the "stable fund," since we'd want all of our funds invested all the time. But that is not the current environment we have in 2006.

Financial Forex Market Trading When the market begins to drop, we'll often recommend that a certain percent of your money go to the stable fund, instead of some other investment. This is because it's better to just stay out of the game than to take a risk, when everything's going to the dogs.

Online Trading Stock And Sometimes we may recommend you have most of your money in the stable fund. It really depends on your age, your tolerance to handle the fluctuations of the market and where things are heading at that current time. If a new client comes to us when the market is falling, it may take as long as four to six months to get most of the money back into the market. It all depends on where the market is at when we begin.

Day Trading Software The stable fund is an instrument we can use to generate decent returns in an otherwise bad market. Nobody's perfect when it comes to investing, but making use of the stable fund is a useful tool to have inside of a retirement plan. It gives you more flexibility.

Financial Market Science By the way, were you aware that close to 80% of all participants in 401k plans (and other retirement plans as well) make their investment choices on the day they join the plan...and then never change them again?

Stock Trading Software Since Social Security is a mess and pension plans are disappearing by the minute, managing the returns in your 401K has never been more important.

Emini Day Trading Thomas Mullooly, President of Mullooly Asset Management, works one on one with individuals so they can regain control of their investments. To learn how to stop making simple investing mistakes and to sign up for Tom's email alerts, visit www.mullooly.net, today! Or call Tom at 877.223.7300 to request to see for yourself, in writing, how to manage the risk in your 401k plan.

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Forex Day Trading System Thomas Mullooly, President of Mullooly Asset Management, works one on one with individuals so they can regain control of their investments. Tom's popular email alerts help folks to reduce the risks in their portfolios. To learn how to stop making simple investing mistakes and to sign up for Tom's email alerts, visit http://www.advicefor401k.com, today!

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