Some of the solidest opportunities in the stock market arise because of politics.

The government controls billions of dollars. That kind of power can make or break an industry. And the effect that an Obama presidency could have on pharmaceutical companies is one you should be aware of.

As you may know, Obama (and Democrats, in general) is in favor of importing generic medicines from overseas. This would not only increase the use of generics in this country, but also allow the government to negotiate lower prices with U.S. drug manufacturers for their name brands. Sounds good for us… but it’s not good for the big pharmaceutical companies.

First of all, if the use of generics increases, the big pharmaceutical companies will make fewer sales with their name brands. Second, the drug companies charge Americans up to two times more than they charge Europeans and Canadians for the same medicine. If the government negotiates lower prices for Americans, that means their profits could be cut in half. And if that happens, you can be sure their stock prices will fall as well.

So do yourself a favor and stay away from pharmaceutical companies until well after November 11.

[Ed. Note: One of the golden rules of investing is DON'T LOSE MONEY. You can keep your cash safe by following market analyst Charles Delvalle's advice to stay away from pharmaceutical companies. And you can keep your money safe AND make it grow by investing in low-risk, high-value stocks. Learn how you can pinpoint the safest stocks with the highest profit potential right here.]

Recession. It’s the boogeyman of the economic cycle. And while many people dread these low points, our economy would be worse off without them. How could something so negative make a positive impact on the economy? It’s simple.

When the economy is expanding, money flows into hot, high-growth sectors. Over the years, as the money piles into one or two booming sectors, other sectors are ignored. Eventually, there is over-investment in the booming sectors, while the others are left under-invested.

What a recession does is help reduce the over-investment and redistribute that money to under-invested sectors. This helps add new jobs, new industries, and new sources of income to the economy.

For example, after the real estate bubble collapsed, the money flew (and is still flying) right into commodities (which saw massive under-investment throughout the 90s). You can be sure that once the commodity sector expands significantly and finally begins contracting, money will fly into other parts of the economy that need the money more.

So you see, recessions are a necessary function of the markets. Without them, money isn’t distributed as effectively. And you can do your part to nudge the economy upward – and make serious money for yourself – by seeking out good deals in under-invested sectors.

[Ed. Note: No matter how bleak the economy looks right now, there is still room for you to make money. In fact, once you master a surprisingly simple system, you can be on your way to more wealth than you can imagine. Get the details here.]

When I started looking for ways to make consistent profits from the stock market, the first thing I learned about was technical analysis. With technical analysis, you use stock charts and various indicators to get a read for where a stock price might be heading.

The simplest explanation of how it works is that you look to previous price moves and try to pull out a pattern. So if a stock has a history of moving down to $10 a share and immediately moving $3 higher, then you buy at $10, hoping history will repeat itself.

However, if you’re going to use technical analysis, you have to understand that technical patterns in the stock market don’t always repeat themselves, because the many factors that affect price moves are never exactly the same. If you are convinced that history is always going to repeat itself, you are bound to hold onto your positions too long and lose a lot of money.

Of course, you will have some losses no matter what method you use to make your investing decisions. But with technical analysis, you’ll be able to quickly recognize your losers and cut them before they get worse.

[Ed. Note: Some of the most profound truths of investing are just as simple as the one investment analyst Charles Delvalle revealed above. And making money in the markets can be surprisingly easy, too. Learn just how simple it can be right here.] 

Many investors rely on stocks that offer dividend payments to supplement their retirement income. But how do you know that the company you’re looking at will continue to pay out steady dividends?

One of the best ways is to look at the company’s history of making dividend payments. Then you can see if it pays dividends sporadically or if it pays them regularly, every quarter.

Finding a company’s payout history is easy. Simply go to finance.yahoo.com and enter the company’s ticker symbol at the top. Once the company is pulled up, look to the menu on the left and click on "Historical Prices." You’ll see an option that says "Dividends Only." Choose that option and then hit "Get Prices."

What you’re looking for is a company that has paid at least 12 straight quarters of steady or increasing dividends. When you find that, you can be pretty sure you’ll get the dividends you are looking for.

[Ed. Note: It's not difficult to make smart choices when it comes to your investments. Charles Delvalle is a market analyst for Investor's Daily Edge, a free online resource that explains what the financial news means to you - and how you should act today to make the most money with the least risk.]

Ask any big-name investor what it takes to make consistent money in the stock market and they’ll all tell you the same thing: Discipline. Yet many investors leave discipline at the door when they decide to buy or sell stock.

That is the worst mistake you can make – because investing in the stock market is all about probabilities.

Let’s say you have a system that gives you winners 70 percent of the time. If you don’t follow the system on your next trade, the likelihood that you’ll get a winner could drop to 40 or 50 percent. Not only did you lose your discipline, you are also far more likely to lose money.

The best way to stay disciplined and control the urge to break away from your system is to remember one thing: There will always be another opportunity.

As long as you know that you’ll have more opportunities to make money, you’ll be less likely to go for the one that isn’t really in sync with your system. You’ll know that in the next few days, there’s a good chance you’ll see an opportunity that suits your system to a T.

[Ed. Note: As market analyst Charles Delvalle points out, discipline - not years of experience, not fancy tools - can help you make money in the stock market. And with a super-simple system to keep you on track, you'll be able to maximize your wins and minimize your losses.]

Figuring out when to sell a stock is never easy. And most experts wisely recommend keeping your emotions out of the decision. Of course, every rule has its exceptions. So let’s revise this one.

Edwin Lefevre, one of the greatest investors of all time (he made a fortune back in the 1920s) routinely used fear and hope – two emotions that often lead investors astray – to determine whether to get out of a trade or stick with it. But he used them in a very specific way. Here it is…

• If a stock was losing money: Instead of hoping it would turn around, he would fear losing more money and sell out of his position.
• If a stock was making money: Instead of fearing it was hitting a high, he would hope to make more money and hold on.

This approach gets you out of stocks that can keep dropping in value. It also keeps you in stocks that can continue rising. Of course, once that winning stock starts losing money and you "fear losing more money," you sell your position and capture a profit.

Edwin used his strategy strictly for short-term investing (any trade that lasts under a month). But you could still apply it to longer-term investing. All you have to do is set a stop-loss point at your personal "pain threshold." That is, if it hurts when a stock drops 10 percent from where you bought it, use 10 percent as your sell point. If it hurts when a stock drops 25 percent, use that as your sell point.

[Ed. Note: Charles Delvalle is a contributing editor to ETR's Investor's Daily Edge newsletter, and a regular contributor to INCOME. INCOME lets you in on the safest high-dividend-paying companies, with the goal of providing you with a total return (dividends plus capital gains) of at least 14 percent per year.]