Tech Stocks

[Ruien]

I'll be a bit counter to the crowd but personally I don't invest by just "buying some tech company". The market is going to price stocks according to the known information, so even if a company is going to increase in business over time, that doesn't mean that that level of growth isn't already factored into the stock price. In other words, you can bet on a company getting more business and making more money, be right, and still lose money on the stock (or vice-versa).

I think it's okay to be bullish on an economy as a whole (I've been long Chinese Yuan since 2007) but for stocks I think long-term risk is quite high unless you really have the data and time needed to see what other professionals don't. I think there's actually less risk in shorter-term trades, and I'm a technical investor. In other words, it's not about what you trade, it's about how you trade. You don't invest in a stock, you invest in the skills required to correctly read and interpret the market. In this respect it's just like any other career, and you'll spend at least 5 years acquiring those skills.

If you're really interested, I'd recommend the following books:
* Trading with DiNapoli Levels (Joe DiNapoli)
* Dynamic Trading (Robert Miner)
* The Master Swing Trader (Alan Farley)

I have a quick introduction on my website here if you're interested. This is not intended to be spam - there's a lot of good information and trading examples there.

Investing well takes a lot of time, expect to put in over 2000 hours before you get the hang of it. Otherwise you're just taking shots in the dark.

Edit: The above might seem like a cop-out answer to your question, but it's not. For example, the right answer would not be "buy Amazon" - it would be more like "buy Amazon if the price drops into a fibonacci support confluence level on weekly bars shortly after getting a stochastic sell signal while a particular MACD indicator is still strong, and then closes up on the week with a reversal bar or reversal confirmation signal. Then place an initial protective stop loss at the weekly low and take 50% profits at the 62% retracement of that weekly move to lock in profit in the trade and reduce risk. Manage the trade with a 3-week trailing stop over the next month but be ready to take profits if the stochastic goes back into a buy or the weekly MACD goes negative".