Mechanical stock investing involves following a pre-determined set of criteria for determining when to buy or sell a stock. This type of investing has several advantages for the beginner as well as the average investor.

Probably the biggest advantage of mechanical stock investing is that emotions are removed from the equation. The number one reason most investors fail at stock investing is because of greed and fear. Here is a typical example you may even have found yourself in.

An investors sees everyone else cashing in big on certain stocks. The investors wants some of those big gains too so greed takes over. The investor rushes to buy the stock, but by now it has been overbought. Over the course of the next week or month, the stock comes crashing down. Fearing he will lose all his money, the investor exits the stock right as it reaches the bottom of it’s correction and makes a big run to the upside. All these problems with fear and greed are solved with mechanical stock investing systems.

Another big advantage is that you can go back in history and test the system through market downturns and uptrends. Once you know the mechanical trading system has been proven profitable, only then do you invest your money. No more blindly putting money on stocks and hoping for the best.

For example, over at my Insider Club, I have developed a system for generating weekly income. Over the years the system has picked several hundred stocks and they have all averaged around 3% a week. Knowing these proven and time tested numbers allows me to plan my financial future. Let’s say I want to earn an extra $1,200 per month to pay for that new Lamborghini I saw. All I need do is make one $10,000 investment each week with my mechanical income trading system. Based on that 3% average, each week my $10,000 investment should make me $300. Times that by four weeks and an extra $1,200 per month of income is generated.

I did use the word “should” in there because even a mechanical investing system fails to work some years. For example, I have a very simple mechanical investing system I use called the “Yearly Strategy” (because you buy the stocks and hold one year).

My Yearly system has returned an average 159% gain every year for the last 10 years. A measly $10,000 investment grows into over $6 million during that time (provided you didn’t have to pay taxes).

As amazing as that sounds, there were two years the system failed to return a profit. In fact in it’s first year the system lost 59% of it’s value. Those investors who gave up and left really lost out on their $6 million.

On way to solve this problem with mechanical investing systems is to have patience and stick with the system. The system has proven that given enough time, you will make a profit.

Another strategy is to diversify mechanical stock investing systems. Invest in two at the same time. I have developed eight trading systems that I watch and maintain over at my Insider Club. Not all of them are profitable every year. Some work better in bull markets and others in better in bear markets. I find that investing in 2-3 strategies usually works best.

Click here to learn more about my eight mechanical stock investing systems and other benefits of my Insider Club!