Take me to the future magic car!

Math blows, but I'm quickly finding out that I need it's super powers in order to find a good time to buy and sell stocks. The more I research, the more I find out that creating and reading charts on stocks is a key factor in making an educated guess on a good stock to invest in, and more importantly the right time to invest.

The most important chart I'm learning is the Moving Average Convergence/Divergence, or MACD for short. The internet is littered with sites and people more than willing to help you understand how to read these charts. This chart/ratio basically lets you get an idea of a stock's tendencies and current trend(s). The MACD is particularly helpful if you are looking at penny stocks. 

This leads me to the next stock I bought, which is essentially a penny stock (bought at 1.14 a share). It's a company called Zap, based out of California, but sells mainly overseas to China. They design, produce and sell electric and other advanced technology vehicles...like alternative energy automobiles, motorcycles, bicycles, scooters, personal watercraft, hovercraft, neighborhood electric vehicles, and commercial vehicles. Basically, they make lots of goofy looking vehicles that American's aren't quite ready to embrace, so they sell overseas.

Aside from the news that ZAP completed it's acquisition of 51% of the capital stock of Zhejiang Jonway Auto Co. Ltd. of Sanmen, Zhejiang, China to manufacture and sell electric SUVs to fleets in China, the MACD chart tells me that it is/was the right time to invest in Zap (ticker symbol: ZAAP). I've basically come up with/learned 4 rules to follow when investing in a penny stock, with the MACD be the most important:

1. Strong Price Movement- Large % price gains w/ heavy volume, a good sign.

2. Return On Equity- Positive ROE means company is turning a profit, which is what you want.

3. Technical Analysis Indicators- Reading the MACD chart for stocks current trend(s).

4. Insider Buying- When company insiders are buying the stock, it's a good sign.

Aside from gambling with a penny stock I also recently invested in General Motors(GM) and Gamestop(GME) for more long term, sound investments. What can I say, I like investing in the letter G. I guess Google and George Forman Entertainment can't be far in my future. But for now, its on to more pennies!!

Billionaires & Turbines

In case you don't know, watching a stock go up and down in real time is a lot more exciting when you have money invested in the stock. That may sound like an obvious statement, but it really is surprising just how much more exciting it is. It's like the difference between licking an ice-cream cone you're holding in your hand and licking yourself if you were a giant ice-cream cone. It just tastes so much better the more you have invested in the process.

Now, the particular stock I've been drooling over is General Electric(GE). After buying GE at 19.98 a share it has been slowly going up (or quickly...what do I know about the pace of stock growth...I'm new at this), currently resting a little short of +1.00 a share since I bought in. Yey! My thinking behind investing in GE was based on two things: rich people and over-populated counties.

For starters, Warren Buffet invested billions in GE. Billions! Granted that was in late 2008, during GE's lowest point of the last decade, but it made a point. That point is "GE is the symbol of American business to the world". Which means, at least to me, that if GE can't succeed, then American business is fucked. And I still believe in American business as a whole.

The second key factor for me was GE's winning of a record $750,000,000 turbine order for Reliance Power Plant in India. The discovery of natural gas in the Krishna-Godavari basin by Reliance in 2002 has helped India boost gas output at the fastest pace in the world.  Considering all that, and the fact that GE's equipment generates about one-third of the world's electricity, I figured they were a good, solid first investment.

I'm now searching for a second investment and beyond, which in turn has me finding myself figuring out how to save more money, so I can invest more money. Don't get the wrong idea, I'm not looking to gamble every last penny that I can scrounge up on the stock market...just enough to invest on the most recent stock burning my eyes every time I look at it's ticker.