Access to information stands at the core of successful investments. What you understand and when you learn it about a potential investment holds immense significance. Your prosperity closely correlates with data quality and your skill in analyzing and interpreting it.
In any venture, several tools can be employed to significantly enhance the chances of success. Information sources and trade execution services exemplify investment-related tools.
Among the numerous investment tools available, some prove more valuable. In this context, we spotlight four of the most effective ones, elucidate why they can be pivotal in achieving profitable results from equities, and delineate their practical use.
A financial calendar
A financial calendar is pivotal in successful investing. A comprehensive and precise economic calendar delineates upcoming events likely to impact markets. Given the connection between equity prices and events such as inflation data releases and central bank actions like Federal Reserve interest rate adjustments, investors must closely track these occurrences. To maximize the utility of an economic calendar, investors should regularly update and cross-reference it with their expectations, adjusting their portfolios or strategies accordingly.
According to eToro market analyst Sam North, the economic calendar furnishes investors with a schedule of forthcoming economic events and data releases. This data empowers investors to foresee market fluctuations and adapt their investment strategies accordingly. Recognizing when not to invest holds equal significance with knowing when to invest. Hence, being cognizant of key data points is essential, enabling investors to capitalize on potential market swings, profit from anticipated trends, and avoid costly errors stemming from uninformed decisions in response to unforeseen economic developments.”For instance, if an investor knows when the latest Inflation report will be released, they may choose not to invest prior to its release, instead waiting to see how the market reacts before making a more informed decision,” Sam North explains.
Bar graphs
Charts depicting stock market trends are indispensable tools for evaluating share and market performance, aiding investors in visualizing price movements.
Charts can be customized to zoom in on daily activity or provide broader perspectives spanning days, weeks, months, or even years. Price charts are invaluable for technical analysis, enabling investors to incorporate it into their decision-making. While fundamental analysis centers on a company’s performance, technical analysis focuses solely on a stock’s price movement, with little regard for the company’s actual operations.
A plethora of technical analysis techniques exists, ranging from basic identification of support and resistance levels to intricate analysis methods. These can be compared with fundamental factors and integrated into the decision-making process before executing trades. The eToro investment platform offers an online learning academy featuring regular courses and videos designed to enhance understanding of technical analysis. While not all investors embrace technical analysis, it’s worth comprehending its fundamentals due to its widespread application. Charts are accessible on various platforms, including This is Money’s share data pages and investment platforms such as eToro. TradingView, a leading provider of asset price indicators, offers free resources and technical analysis overlays.
Sam North highlights, “Using a robust charting package like TradingView provides investors with significant advantages.” These platforms offer customizable visual data representations that facilitate technical analysis for identifying market trends and entry or exit points. Real-time updates aid informed decision-making, while clear visuals simplify complex data, enhancing investors’ ability to interpret information and make well-informed trading decisions.
Price watches
When contemplating actions, whether buying or selling, investors should have a clear target price in mind. This price is determined by combining fundamental and technical analyses. At this stage, price alerts come into play. Instead of dedicating entire days or weeks to monitoring screens, you can establish notifications that will alert you when action is warranted.
Sam North emphasizes the value of price alerts for investors, as they deliver timely and automated notifications regarding asset price movements. They facilitate quick responses to opportunities and risks, enabling investors to transact at desired price levels.
Price alerts also help prevent impulsive decisions, maintain strategic discipline, and safeguard investments by prompting actions when prices reach predetermined thresholds. In theory, setting price alerts can facilitate diversification management, reduce transaction costs, and encourage additional research.
One-click, real-time transactions
After conducting research, performing technical analysis, and setting up price alerts, a notification on your phone signals the need for action. This is where one-click trading proves its worth. The last thing you want is a significant delay between decision-making and execution. Stock prices can fluctuate substantially within seconds, making swift execution crucial. Sam North underscores the importance of one-click trading for investors, as it enables rapid trade execution. For more insights into trading tools and how to leverage them in your investment strategy, you can explore eToro.
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