The fact that information appears on the Internet does not render additional credibility to the information. Be especially wary if the identity of the source is not identified.

Over the Internet, investors can purchase securities of a company directly from the company. Treat the online transaction as you would a regular investment, and make sure that the securities are registered or exempted under both federal and state law.

Alternatively, investors can trade securities through online brokers. Study and understand the terms, conditions and costs of these services, before you use them. Brokers must be licensed, and must be registered with the Securities Exchange Commission.

Finally, be very careful with information you gather from a chat room. It is in these chat rooms that persons posing as credible sources send out information to pump the price of a stock. Once the price of this stock has increased, they dump, or sell their stock at a great profit. These are called pump and dump schemes.

Steering Clear of Cyber fraud
The following steps, according to North American Securities Administrators Association (NASAA) and the Better Business Bureau (BBB) can help you keep on guard when you go online.

1. Do not expect to get rich quick When evaluating an investment you have learned about online; exercise the same caution and deliberation that you would bring to any unfamiliar investment opportunity. The old rule If it sounds too good to be true, it probably is applies just as much to offers made in cyberspace as to those made through any other medium.

2. Download and print a hard copy of any online solicitation you are considering This document may come in handy if problems develop later. Be sure to note the Internet address, date, and time of the offer.

3. Do not assume that an online computer service polices its investment bulletin boards The vast majority of services take a hands-off approach to screening claims made in message postings, and even those that do minimal policing cannot possible keep up with the millions of messages posted each month. Remember, too, that anyone can set up a web site or advertise online, usually without any check on the legitimacy of their claims.

4. Never buy little known, thinly trade stocks strictly based on online hype Low-volume stocks are the most susceptible to manipulation since their price can be moved through relatively small strategic trades. Even if a hyped stock starts to move up, proceed with caution this may just be part of the overall manipulation scheme.

5. Be cautious about acting on the advice of individuals who hide their identity The use of aliases on computer bulletin boards is intended to protect privacy, but con artists also can exploit it. People online may not be whom they claim. What may seem to be two or more different people talking up a stock may actually be a single individual with a personal interest in driving up its price through false information or baseless speculation. In addition, an impressive-looking website can be the product of a laptop computer on the other side of the world, far from the jurisdiction of U.S. law enforcement regulators.

6. Do not get taken in by claims of inside information such as pending news releases, contract announcements, and innovative new products In cyberspace, practically anyone can say anything. Despite the abundance of hot tips littered across bulletin boards and discussion groups, it is extremely unlikely that genuine insider information will be publicly broadcasted on an investment bulletin board.

7. Be skeptical about claims that an online stock hypester has personally checked out an investment One established tactic of investment schemers is to talk up companies, mining operations, and factories in remote corners of the country or the globe, where it can be impossible for the average investor to investigate or visit in person.

8. Take the time to investigate outside sources of information on any investment you learn about online Check with a trusted financial adviser and always obtain written financial information, such as a prospectus, annual report, offering circular, and financial statements. Ask the online promoter where the firm is incorporated, and call the states Secretary of State or Commissioner of Securities to verify that information. Also, make sure that an investment opportunity and the person promoting it are properly registered with your state securities agency. In Hawaii, the agency to contact is the Business Registration Division of the Department of Commerce & Consumer Affairs.

9. If you think you have been duped, do not be embarrassed about complaining Early action increases your chances of getting your money back and may prevent others from losing money. If you spot a potential online investment fraud, contact your state securities administrator, Better Business Bureau (808) 942-2355, or The Federal Trade Commission (415) 356-5270.

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About Day Trading Strategies
Every profitable trader will tell you that the key to trading success is an effective, reliable trading strategy. You, as a trader, need to identify a winning system, implement it, and have the discipline to stick to it. Though it would be possible for you to develop a unique trading strategy, it probably wouldnt be that practical. The best and most efficient approach would be to adopt an existing strategy, one which has been used by other traders in the industry and which has already proven to be successful.

Just remember, whether the strategy youre using is your own or someone elses, it is critical that you have a thorough understanding of it, especially its entry and exit signals. Do not fall prey to the pitfalls of following untested trading advice, especially the free advice available in numerous trading forums and chat rooms. Advice that you receive in these types of venues is likely to be opinion rather than fact, and in the market, opinions are not worth anything. What you NEED is a proven and effective trading strategy, one that will work in any market, under any market condition.

Because of this need for solid strategies, more and more traders are looking for trading success through technical approaches to the markets. One of these approaches is Welles Wilders RSI indicator. The general idea behind using the RSI is to buy when the RSI crosses above 30 and to sell when the RSI crosses below 70. As you can see, these rules are clearly defined and dont leave much room for interpretation. This is EXACTLY what you want from a trading strategy. In trading, youll need to make big decisions in mere seconds. Theres simply no time to rethink, or try to interpret the unknown signals and information that come your way. Following a set of simple, easy-to-understand rules and having a trading strategy that regulates all of your signals and indicators efficiently is the major key to trading success.

Though the rules of trading are very important, they are not the most essential element of trading success. The most essential element is YOU. The best trading strategy in the world will be useless if you lose your head in the market and panic. You need to remain calm at all times, executing your trading strategy efficiently, without hesitation.

How to Find a Good Day Trading Strategy
So, youre convinced that trading strategies are important. Now, how do you find one that works for you? Obviously, day trading strategies dont grow on trees. Youll need to do some research and either develop a strategy yourself, or find one that is easy to understand and has been proven to be successful. Take your time and do your research. Your strategy is an important step towards financial success, and its more than worth the investment of time and energy. There are plenty of books and helpful websites to guide you along your way.

Also, be on the lookout for scams. There are a lot of educational companies out there, each selling their own trading systems and strategies, and each claiming that their system works better than their competitors. Be wary of these companies. Dont fall into the trap of believing that you can buy a solid trading strategy for $97 and then make thousands in a short period of time. This is a lie.

More recently, some of the educational companies mentioned above started offering free local workshops in nice hotels. These free workshops, which are typically advertised in late night infomercials, are another danger sign. Most of them are merely a sales pitch for the companys actual product, and the learning that takes place at the workshop is minimal. Youd be better off spending that time researching the trading market on your own.

To avoid scam artists and faulty systems and strategies, you need to educate yourself. Your trading education should focus on exploring and familiarizing yourself with several different strategies; these ought to teach you to take advantage of price direction. You wont be able to get a solid education after reading only one book or watching a single 60-minute webinar on the Internet. True education takes more time and effort than that.

Fortunately, there are many ways to get a good trading education these days, and your best source of trading information and research is online.

Education and training play a vital role in the molding of a successful trader. If you want to be profitable in the trading market, you shouldnt be cheap when it comes to high-quality trading education. Find a company that has a proven track record. Check the Better Business Bureau (BBB) to learn about their reputation. Research the internet for company information, especially handy sites like www.ripoffreport.com and www.badbusinessbureau.com.

Get Researching So You Can Get Trading!
Day trading is a very risky venture if you have limited knowledge, weak discipline, and/or poor money management. However, if you approach day trading correctly, armed with extensive knowledge, a sound strategy, and the drive to succeed, it can become one of the most lucrative business ventures youve ever embarked upon!

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