How To Increase Your Returns

Written by 
Polina Median
October 11, 2021

Answer: Samsung

Hover your cursor over the buildings and look at the connections between the companies

ways to higher returns margin trade photo

Today’s topic is for adrenaline seekers. For high return seekers. We will talk about balancing risks in picking individual stocks, IPOs, and cryptocurrencies. 

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🌚 How to earn money fast?

1. Trading

On the Internet you see a lot of ads of successful traders with stock recommendations, options trading strategies, and online courses.. Trading strategies are based on buying stocks at the right moment and selling them later after some time. Usually, periods are very short: from hours to several days. Not all of them are effective, but the simplest and fundamental ones were described in one of the previous letters devoted to technical analysis.

You buy stocks when you see big dips and expect them to jump high back. This strategy works and you can find such stocks in our section Momentum Stocks but you should always measure the risk you’re taking.

For example, a stock costs $93 at the moment. Based on the chart the local minimum is at $90, we suppose that price might fall until 90 and have support there. Thus, the potential risk is $3. But it’s also possible that it doesn't fall and start growing. The local maximum is $100, so the potential upside is $7 ($100-$93).

risk and profit ratio photo

The risk/profit ratio is 3/7. It means that for each dollar you risk, you can earn 2.3 dollars of reward. Usually, the more risk you’re taking, the more profit you can make. The optimal rate is ⅓.

It is most important for speculative trades. So that next time if you see a falling stock and you consider buying it, measure the risk/profit ratio. 
For example, this case is not the best to invest in at the moment. Because you can earn as much money as you lose. 

investment strategy risk profit equal photo

This one is the best because you are already at the lowest point.

investment strategy low risk photo

2. Buy IPOs (Initial Public Offering)

It’s when a company goes public and starts selling its stocks. Most times, companies are cheaper in the beginning and become more expensive as time goes by. At the IPO Amazon’s shares cost $18 in 1997, now their price is over $3000. 

But if we talk about short-term gains, there is a pattern we see at IPOs. Stock prices jump the first day, then fall a bit and around 2-3 weeks start growing again. 

See the 4-month chart of Airbnb 

stock growth after IPO date photo

If you had held the stock for 10 days from the beginning, you would have had +17%. If you had held it for 3 months, you would have had 50%. 

Or use another pattern to speculate within a day. Look at the chart of the first day after the IPO of Snowflake.   

IPO growth in a day photo

It’s unlikely that you bought the company right at the beginning because there are already a lot of bids. But you could have bought it a little later (1) and sold it that day at point 2. Then you would have around 12% in just one day!

If you think I found a rare example to persuade you, that’s not true. It’s a very common pattern in many IPOs. Here’s one of the more recent examples — Coursera IPO. The price went +36% in 3 days. 

Coursera IPO photo

Find the recent IPOs in Gainy and see which companies have gone public. You can become an early investor in them.

IPO collections photo

IPOs are a real working tool but they don’t give you a 100% guarantee. Most of the time they grow, but there are always exceptions, otherwise the market would be too predictable. 

That’s why our analysts have checked all of them and made professional comments in Gainy on prospects of the company to help you make up your mind. 
One thing. If you invest in IPOs, don’t do it with all your money, ok? Don’t forget about rebalancing positions. 

3. Cryptocurrencies as another way to earn money fast

Regular volatility of cryptocoins can be as much as 5-10% a day. And in the long run it could be x5, x10, x20. Disclaimer: very high risk to lose money, so choose reliable trading platforms and invest little money. 

There are 2 ways to start: hard and easy. 

The hard way is to learn more about technical analysis so that you understand the drawing below (1). The easy way is to buy top-10 coins and hold them. The volatility and diversification will do the rest for you. You just need to check the portfolio from time to time and sell coins that grew (2).

bitcoin cryptocurrency trading photo

Don’t be put off by the prices of cryptocurrencies, you can buy fractions as little as you like. So you can buy 100 different coins at  1 dollar each. 

I would also mention that the easiest and safest way is to use Gainy recommendations but we are in the process of development and adding crypto. In Gainy we want to cover all financial assets and give you the best recommendations. 

Although this is the end of the basic course, I’m not saying goodbye to you. I really enjoyed sharing important principles of investing with you and I hope you understand the stock market better now! 

If this was useful and you find Gainy a good support in your stock searches, please join us on Facebook.

We will continue sharing more advanced information, important market news and analytics with you. 

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because I want to check what my friend has just sent me
The company developed and maintains technological products and services, namely Snapchat, Spectacles, and Bitmoji. Snapchat is the third most popular app among millennials and gets high profits from ads on the platform. Since TikTok is not available to invest in yet, Facebook is boring, we see Snap as a good choice to diversify your portfolio. We don’t know what keeps those kids so glued to screens in Snapchat but if companies profit from it, we can get a share thanks to investing in their stocks.
because xBox brings us together with friends
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So we packed peanut butter and jelly sandwiches for the kids, now it’s time to go to school. The K12 Inc. is an educational technology company. The company offers a private education program, software and education services built to teach online for preschool students up to grade 12 or K-12. The company’s earnings soared up after the pandemic because we came to realise that online learning is not far in the future and may continue the trend.
because we like to treat our pets and ourselves, too
The American manufacturer of supermarket food JM Smucker Co also operates a pet food business including brands such as Milk-Bone and Meow Mix. It’s also the producer of the peanut butter JIF, kid’s all-time favorite filling. The company offers a 2.96% dividend yield and in the third quarter reported a 7% increase in net sales.
because we love playing games
If there is one game to teach you financial literacy - it’s Monopoly, which belongs to Hasbro, as well as unparalleled portfolio of approximately 1,500 brands including MAGIC: THE GATHERING, NERF, MY LITTLE PONY, TRANSFORMERS, PLAY-DOH, BABY ALIVE, DUNGEONS & DRAGONS, POWER RANGERS, PEPPA PIG and PJ MASKS, as well as premier partner brands. The company generates strong cash flows and pays regular dividends. The company’s business moves along the online trend and develops digital content in the form of TV shows, films, computer games.
because everyone has a favorite childhood hero
Disney is a widely diversified company which owns everything from toys to apparel, and books to video games: Disney Parks, ESPN channel, Pixar, Hulu and so much more. And now it bets on streaming services with Disney+ and threatens Netflix’s market share. The company revenue suffered a major drop last year due to closure of Disneylands, but has opened them in October and foresees a strong comeback.
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Gainy is not an app to invest in stocks, but a screener and stock portfolio analysis app. We help our clients to identify the right stocks, depending on portfolio, personal goals, and fundamental analysis.

We work as a stock analyzer and stock comparison app: give the possibility to create collections tailored to personal needs, show charts and shares and allow users to track finance flows and dividends distribution.

You can use Gainy as a guide and stock picker: set your goals, get tips & forecasts, and pick up the right investments to gain your wealth.

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At the current moment, Gainy is not a stock investing app, and you can’t directly buy stocks using it, but in the future, we definitely will provide this feature. We work on Gainy updates to make it a stock market app and will inform you when these trading features are ready.

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