Generate Thousands in Cash on your Stocks Before Buying or Selling Them: Third Edition (Hardcover)

by Samir Elias (Author)
Key Phrases: confirming candlestick, fading momentum, falling rectangles, Case History, Chaikin Money Flow, Jun Jul Aug Sep Oct Nov (more...)

Editorial Reviews

Product Description
After a sell out first and second edition, Dr. Samir Elias added significant new material to the third edition - the main focus of which is making money in multiple ways. You can make money by purely trading stocks using numerous combinations of technical indicators described in several chapters and supported by practical market examples. You can also make money by raising cash on your long term holdings using effective and simple option strategies. In addition, you can make money by increasing your return on profitable trades while significantly reducing losses on unprofitable ones by using risk control strategies described in a special chapter. Learn also how to find stocks that have the potential to deliver explosive profits by incorporating ideas from the author's own stock scanning system that is presented in the book. Make the most of your trades by using specific techniques to determine the approximate best exit time and price using methods in the book applied in detail to the author's own trades. Whatever kind of trader you may be, this book will show you practical ways to increase your profits. If you are a swing trader, you can use candlestick charts combined with two specific technical signals to enter profitable trades. If you are an intermediate term trader, you can use profitable chart patterns described in one of the chapters in combination with technical signals to increase your return. Long term investors can use CD charts described in an especially dedicated chapter to determine the long term direction of a stock as well as entry and exit points.

From the Author
You purchased 1000 shares of Lucent at $40/share. The stock is now at $0.90. Your loss $39,100. How Can you Recover this loss?

Choice 1: Wait until the stock gets back to $40. May take Years!!

Choice 2: Throw in another $18,000 to buy 20,000 more shares. Your average is $2.76/share.

What if you do not have the $18,000 or the stock drops further to $0.50 after you buy? Better than 1 but Not a good choice

Best choice: Without spending any of your own cash sell someone the option to sell you 20,000 shares of Lucent at $2.50 within 2 years. You will receive $40,000 immediately . you will get to keep the cash if the stock reaches $2.50 at any time in 2 years. You will not lose any cash even if the stock drops to $0.50.

If the stock has bottomed, (A simple test in the book will show you how) you could use part of the cash ($18,000) to buy 20,000 shares of Lucent and have $22,000 cash left.

On 11/29/2002 LU closed at $1.76 and the option you sold for $2.00 are now at $1.40 . You could buy the option back for a profit of $0.60/share or $12,000 total profit and sell the 20,000 shares you just purchased for $0.80/share profit or $16,000 total profit. You have now recovered $28,000 of your $39,100

In fact this is just one of the techniques described in this book that will help you recover your losses while generating cash. --This text refers to an out of print or unavailable edition of this title.

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Product Details

• Hardcover: 408 pages
• Publisher: Leathers Publishing; 3rd edition (June 30, 2007)
• Language: English
• ISBN-10: 1585974242
• ISBN-13: 978-1585974245
• Product Dimensions: 8.9 x 6.1 x 1.2 inches
• Shipping Weight: 1.6 pounds (View shipping rates and policies)
• Average Customer Review: 4.7 out of 5 stars See all reviews (30 customer reviews)
• Amazon.com Sales Rank: #24,443 in Books (See Bestsellers in Books)

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Customer Reviews

Most Helpful Customer Reviews

95 of 100 people found the following review helpful:

5.0 out of 5 stars New Ideas For Greater Profits, September 5, 2003

By	Allen Morrison "traderpro" (Manhattan , New York) - See all my reviews (REAL NAME)

This review is from: Generate Thousands in Cash on Your Stocks without Selling Them (Perfect Paperback)

I have been making a living exclusively trading stocks and options for several years so I am what you would consider an experienced trader. While it is true that most traders lose money, the ones that are successful make a nice living at it. In my opinion the reason why most fail is that they follow the herd and refuse to change their style.
This is where this book comes in; many of the techniques are innovative and different in addition to the fact that they work. Let me give some examples:

Many investors employ stop losses which are a good idea and in fact in the book the author does suggest you do that. The problem is that if you set your stop loss using standard criteria that every one else uses (herd mentality); the market makers and specialists who control most of the trading can trigger a stop loss, which they know where the herd set it at, just to shake weak hands out and then move the stock to new highs. Say you purchased a stock at $50 and set a stop loss at $45 you would have lost $5 +/share if the stop was triggered. However if you followed a strategy in the book using covered calls by selling a $45 strike call you would have gotten $5/share + time premium and you could still have set a stop loss at$45 and exited the position. However in this case you would have made a profit or at least broke even. By using this strategy you could invest the cash you are raising on stocks that may be better picks.
Many inexperienced investors do not realize that for a covered call to be profitable the stock must go down in price at least temporarily. In fact the strength of this strategy lies in being able to cash in on the volatility of the stock. If this was a losing strategy there would not be books dedicated solely to covered calls advocating double-digit returns!

A unique and better idea offered by the author is using fading momentum criteria to trigger taking action to start raising cash or selling a stock. This sets your sell trigger apart from the herd and prevents you from being shaken out just to see the stock come back.
Say you bought a stock at $88 and set a stop loss limit at $80, if you get stopped, you lose at least $8. By paying attention to fading momentum criteria explained in the book which alerts you to a pending reversal even as the price is going higher, you can sell an $85 covered call for say $5/share as soon as you recognize fading momentum with the stock at say around $89. When the stock gets to $85 you can buy the call back, cash in most of the $5 as profit and sell a new call at $80, if the stock hits below $80 you get stopped out but you would have cashed an additional $5. The point is if the stock takes 2 months to drop from $88 to $80 using strategies in this book you would have cashed $10/share even before your stop got triggered and you sold the stock. This is cash you can invest to make more money. Using a stop alone you can only reinvest after you sell the stock, but using ideas in this book cash is available even before you sell.
Another example is the use of put selling as an avenue to raise cash on a stock before buying the stock. This again is an approach different from the majority that tends to buy the stock outright. This technique allows you to buy the stock at below market and pocket cash, which you can invest in other moneymaking instruments while buying the stock. Again a novel technique that most people do not employ. I am sure that anyone who lost money on enron, worldcom and other stocks would wish they knew how to use this strategy. Over 50% of this book involves techniques that do not even require owning a stock.

A fourth idea which was even new to me as an experienced trader and investor is how to use a contrarian approach employing sentiment and price action to cash in on low priced stocks without buying them or spending any of your own cash. Using a simple twist on this strategy, the author shows you how to recover losses of more than 50%, this alone is a worthwhile reason to read this book. The new techniques in chapter 11 made me a sizable profit on xmsr, amr,ntes,askj, and several others since I bought the book few months ago and I know ,as most people do, how to tell the difference between a profit and a loss!
I can list several more examples on how this book pushes the edges of new ideas but will stop here to keep the review short.
Of course, it is a personal choice whether one keeps doing the same thing and getting the usual results or they open their mind to new concepts and reap their benefits. I chose the latter .

41 of 43 people found the following review helpful:

5.0 out of 5 stars Pass this book by at your own risk, February 19, 2005

By	Jeff Sawyer (Arcadia, CA) - See all my reviews (REAL NAME)

This review is from: Generate Thousands in Cash on Your Stocks without Selling Them (Perfect Paperback)

I have had this book for over a year and found it very helpful and profitable In fact after a couple of months of losses I was able to turn things around using the ideas in this book. The author progresses from simple to more advanced ideas with lots of actual market examples. The first few chapters focus mainly on using options to raise cash on stocks. The author dedicates a couple of chapters to covered calls, a couple of others to combining covered calls and puts to increase your cash generation. Two chapters are also dedicated to timing techniques on when to sell the options. One chapter is dedicated to raising cash on stocks below $5 using naked puts. The author shows how you can make cash by increasing premiums using in the money options as well as using low premiums by selling out of the money options.
The last few chapters of the book focus mainly on trading stocks using new timing techniques. I always assumed I was just unlucky since every time I buy a stock it is down the next day. However the author puts it best when he says " If you follow the herd you get slaughtered with it". The market makers are aware of common techniques used by individual traders and trade against them , so by using the new techniques in the book , your move is not obvious. The chapters in this section of the book offer a wealth of ideas. I will go into brief detail. One chapter shows how using strength combined with sentiment can result in short term profits. These concepts are then combined with short squeezes and earning squeezes for explosive profits. Another chapter discusses unique combinations of technical indicators, to recognize accumulation by smart money and get in before the price move. A third chapter is written for long term holders and shows how using convergence /divergence charts drawn once a week can pin point long term reversals. This chapter was very useful to evaluate my long term holdings. A special chapter discusses common profitable situations that arise in the market and how to use the concepts in the book to profit from them . This chapter gets your creative thinking flowing to think of even other setups.
The author explains all the indicators used clearly and backs his techniques with many real life examples which made it easy for me as a beginner to be able to implement the concepts within a couple of months
While the author does not dedicate a specific chapter to risk, he does pay attention to risk in relation to the concepts and techniques he recommends . In many areas of the book ideas are given on how to reduce risk . Just to mention a few :,Quote" even though we are still better off than buying the stock outright, our objective is to control risk as much as possible ...." End Quote . Also Quote " I would recommend that you only bet 2 % of the value of your trading account on any one position such as this..." End Quote. Also the statement , Quote " To reduce risk, one possible option will be to take half a position before and the other after earnings. In this case..." End Quote . and many more.
The author does not discuss margin requirements in detail which I think will be a waste of space since each broker has their own rules , he does say Quote" When selling a put option, the broker requires a certain amount of margin cash in your account to be able to buy the shares if the option is exercised .. Please be advised that different brokers have varied requirements; hence I would recommend you contact your broker to find their specific terms" End Quote
With conflicting reviews on most financial books it is not an easy task do distinguish between useful and no so useful books. I asked myself, what have I done with books that were helpful for a short period of time or not helpful at all? Answer: I sold them as used books on the amazon market place. Bingo.. So I always check whether a financial or educational book has a lot of used copies for sale. If there is , I avoid the book and this criteria has worked well for me. With this book you can rarely find a used copy ,Draw your own conclusions!

30 of 32 people found the following review helpful:

4.0 out of 5 stars Gives a beginner some ideas, but, July 25, 2003

By A Customer

This review is from: Generate Thousands in Cash on Your Stocks without Selling Them (Perfect Paperback)

I have recommended this book to some people I know who have a hard time picturing a couple of different ways to generate income using options. [...]

But for people who are set on buying and holding, there are some good ideas here, especially on selling puts as a means of entering a stock. They are especially good in a market that is just grinding within a range as you can make money even if your stocks are going nowhere.

I have used the strategies here over the last two years (was doing them before I read this book) and had good success with them. Until this recent rally there were a lot of stocks that were grinding away at low prices, that had strong cash positions, that were great candidates for these strategies.

But you need a broker with very low commissions, [...] because premiums are getting lower and lower these days.

Someone new to options can easily make back their money with this one. So four stars for that, not five [...]. Go slow if you're a beginner, always anticipate the chance that you'll have to pony up money if a put is exercised against you. If you do that you'll be surprised how rewarding some simple strategies can be and how well they will fit into your existing approach.