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May 21

The Serious Problems of Computer VirusesIf you believe what you hear in the media, there are an awful lot of viruses going around. No, not talking about the make-you-sick kind of virus, though they get plenty of airtime, too.We talking about the kind of virus that enters via your internet connection rather than your nasal passages.

What the mainstream media often don’t tell you–at least, in most radio and television newscasts and in the crucial headlines and opening paragraphs of newspaper articles– is that many of these “viruses” are not viruses at all.

What Computer Viruses Really Are

The main reason the mainstream media always are in alarm over viruses is that they tend to call any malicious computer program a virus. In reality, there are at least eleven distinct types of malicious software, or malware, commonly affecting computers today. The most common of these are worms, Trojans, and spyware.

So, what’s the difference between computer viruses and the other types of malware? The difference is that computer viruses are just about the only ones that regularly shut down computers and cause other obvious damage. The most common of the other kinds of malware–worms, Trojans, and spyware–are usually only detectable with a special scan.

The Real Danger of Computer Viruses

If the other types of malware are so unobtrusive that they can only be detected with a special scan, then what’s to worry about? For starters, these programs are called malicious for a reason: they are designed to cause some kind of damage, if not to your computer, then to someone else’s.

Worms are most famously used to damage, destroy, or disrupt other computer networks than the one on which the host computer is located. For instance, worms have been used by website owners to shut down rival websites by sending overwhelming numbers of requests to the computer that hosts that website. Worms have also been used to send out viruses to other computers, often without infecting the host machine–after all, what would it benefit the worm to shut down its host computer?

Trojans, in turn, are often used to insert worms and other malware on your computer, even if the Trojan itself does no damage.

But even if you don’t care what happens to anyone else, you should still be concerned about one kind of malware: spyware, a kind of malware that, true to its name, collects data from your computer and sends it back to a remote host.

Most spyware is only interested in monitoring your internet usage so it can tell other programs, called adware, what advertising to popup on your computer. However, there are criminal spyware programs that steal financial data, or perform a thorough identity theft. Don’t think you have personal or financial data on your computer? Some spyware programs contain a keylogger, which is a program that copies whatever you type, usually in order to snatch passwords. Even if you keep no financial information on your computer, if you ever buy anything over the web, the keylogger would allow its owner to buy stuff using the same information you typed in to buy stuff yourself.

Why Blame the Media?

Given the danger of all these different types of malware, isn’t it a good thing that the mass media are becoming hysterical about it? And can’t they be forgiven the sloppy reporting of calling Trojans, worms, spyware, and other malware “viruses”?

No, no, no.

This is a classic case of bad reporting doing more damage than no reporting at all. In this case, the damage bad reporting has done is to promote a common myth that goes something like this: “The only malicious software is a virus. Viruses damage your computer. Therefore, if my computer is working OK, my computer has no malicious software. I only need to scan my computer for problems when there is a sign of problems.”

Thanks to this myth, many people complacently let their antivirus software go months out of date, not wanting to be bothered with scheduling an automatic update. Just as bad, many people don’t have any extra software to combat the other types of malware that may not be covered by antivirus software.

In fact, it’s not uncommon for people who have found malware on their computers after a scan to say, “but  never had malware on my computer before!” But how would they have known if they had never scanned!

Until the biggest mainstream media–and especially television–start educating the public about the need to have their computers automatically scanned at least daily, the world will continue to have major, drawn-out problems with malware that could have been wiped out as soon as soon as the anti-malware software makers discovered it.

And until that day, the mainstream media will have many more opportunities to run hysterical stories about “viruses,” thereby forcing them to sell more newspapers and broadcast to even larger audiences of people who suck at the information trough yet somehow never become full.

May 18

The Best Strategic of Money ManagementThe following article includes pertinent information that may cause you to reconsider what you thought you understood. The most important thing is to study with an open mind and be willing to revise your understanding if necessary.

This interesting article addresses some of the key issues regarding Futures trading. A careful reading of this material could make a big difference in how you think about futures markets and trading them.

How a strategic money management plan works is discipline, not magic. In the market place it’s possible to be right, and to still lose money. In fact, it’s pretty common. Traders who win on a high percentage of their trades often end up with their capital eroded away, and left with nothing to show for their work. They lose their gains because they don’t know how to manage their money.

Being a good manager of your own money is one of the most difficult of skills to learn. But if you do not use good money management to bank profits, learn to take small losses when you are wrong and control your use of margin, you will lose it all. No matter how good of a trader you think you are, your first priority needs to be protecting your capital if you want to be successful.

As a trader, your capital is the most valuable asset you have. It is your only asset in the eyes of the market. Without it, you can’t work at all. For this reason, bringing in no profits on a trade is better than losing any part of your margined account. If your account is intact, you are alive and live to trade another day. If your capital has suffered a loss your efforts for making gains will wasted playing catch-up. The more you’ve lost, the longer it will take to get back to where you started from, because now you have a smaller pile of capital to work from. A smaller capital base means smaller percentage returns on profits. Making 10% on a $5,000 account earns you $500, but if you’ve lost half of that account and have only $2,500 left, making 10% on your money will earn you only $250. You’d have to do that twice to make the same $500.

Sound money management has two main goals: to avoid losing money, and to avoid missing profit opportunities. The first goal is straightforward. You want to preserve your money and whatever profits you’ve accumulated. But you don’t just want to keep your capital and let it go stagnant. You want to trade with it, to continue to grow it and make your returns larger and larger. Not keeping your money tied up in bad or problem trades for long periods of time will allow you to not miss new profit opportunities when they come along. Failing to avoid either of these will cost you

It’s really a good idea to probe a little deeper into the subject of Futures. What you learn may give you the confidence you need to venture into new areas. Working to avoid losing those profit making opportunities isn’t quite as obvious a goal. With the second goal in mind let’s compare the outcomes of two money-management decisions. Trader X buys a futures position, expecting it to go up, and finds that it doesn’t. However, he’s certain it will go up eventually, and he’s incurred a small loss, so he decides to wait it out. He ends up holding the position for two months before finally selling it. Trader Y buys the same futures at the same time as Trader X, but once he sees that it isn’t going up, he sells it at a small loss. He buys another futures position and makes a 10% profit on it. His next trade loses 2%, but after that he makes 7 %, and then loses 1%, and then gains 25% on a series of trades. Because the account is growing and he makes gains on an ever larger base of capital each time, at the end of two months, his account has grown quite handsomely, even though Trader Y was WRONG 50% of the time.

Which money management decision turned out to be the best? While Trader Y made a nice profit, Trader X not only lost time but also never made his money back. Even if he had made his money back on that position, it’s hard to see how this was a good use of his operating funds over the course of two months.

Clearly the goal of not tying up your capital in bad trades has an important impact on your profits. Using sound money management will keep your trading funds and your profits safe. Though it is a difficult skill to learn, once you know how to practice good money management techniques, you can almost guarantee that you will be a successful trader.

If you’ve picked up some pointers about Futures that you can put into action, then by all means, do so. You won’t really be able to gain any benefits from your new knowledge if you don’t use it

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