snake08 said:
So is the potential of the casino... same possibilities of high returns, maybe more in the casino.
Looks like a joke but it is essentially the truth...
Have $50K, what to invest in?
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So is the potential of the casino... same possibilities of high returns, maybe more in the casino.
Looks like a joke but it is essentially the truth...
This is probably not one of your options.But if anyone wants to be adventurous, and willing to invest more, there are couple here in Asia. Make sure you know where your investing, here's an example(might not the best ones)
http://www.suteraharbour.com/new/
http://www.suteraharbour.com/new/
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I want to be your understudy :smile:
And that is not said with sarcasm either. I was very active trading equities many years ago and made a lot of mistakes, which was a great learning experience. I stepped away for a long time and keep informed as to the general climate of traders over the years. It's just been difficult difficult for me to find someone that is has the temperment to take someone under their wing. I can understand their reasoning though... if one is making big money, why mentor someone when it takes time away from your trading? But the flip side is that being a mentor and mentee is a great experience as I've been on both ends.
And that is not said with sarcasm either. I was very active trading equities many years ago and made a lot of mistakes, which was a great learning experience. I stepped away for a long time and keep informed as to the general climate of traders over the years. It's just been difficult difficult for me to find someone that is has the temperment to take someone under their wing. I can understand their reasoning though... if one is making big money, why mentor someone when it takes time away from your trading? But the flip side is that being a mentor and mentee is a great experience as I've been on both ends.
Ryanmcd2 said:I will say that I did turn 20k into a little over 300k in one year and every year I start out with about 100k and end up with over 1 mill for the past 4 years. Yes I did lose every $ I had the 1st few years and blew out my account several times learning but now I know the risk and it's just a game, the money does not even matter. If you want to make the MAX $$$ dont be a lazy ass, study and learn I put in 16 hours days for 3 years learning this stuff as well as talking to 4 people who make over 1 million a year and have been for the past 20 years in the market using different styles. Also the key to the market is MONEY MANAGEMENT, most people lose all there money like me the 1st time and quit and never learn. Also you have to be able to change, like I said I used to play the @ES now I am playing the@EC because of trend. I used to counter trend now I play the trend and ride it. Less strees more $$$ also today was great in the @EC
buy a nice old restorable car...restore it and make some $$$
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The world of "investing" is roughly infinite, but you only need to know one successful way to trade to make money. What most people are looking for is just an idea of where to start. With your workweek your time is relatively limited, but I believe that you could easily make your goal of 10-15% a year in the stock market by devoting just a few hours a week to trading. You can research in the off hours online and even set up your trades during non-market hours. Just do your research and set your buy and sell orders to execute at a certain price and be sure to set stops on newly opened positions. So here is one idea: identify six stocks that trade in volume of at least 1,000,000 shares average daily volume and research them. You can easily research any stock worth trading on Yahoo finance. Choose large, household name type stocks. Identify the trend, then "paper trade" for a week or a month until you get a feel for how the price on each moves. I don't recommend following more than maybe ten or twelve at the most, because it becomes too much to pay attention to. Trying to watch even twenty stocks is way too much to start with. Don't paper trade for more than a month though. After a month you should know if you are interested or not. Also, if you decide to start trading with actual money, know that your behavior will be different from when you were paper trading, because now you will be using real money, and dealing with the factors of greed and fear, which up until now have been absent.
I am not suggesting a daytrading strategy, nor am I recommending a "buy and hold" strategy. More of a swing-trading strategy which would call for a few trades a month and maybe an hour a day of attention to open positions. A word about risk: most people think that if they were to buy, say, $10,000 of a particular stock, that they are risking the whole $10,000, like in a casino. That really isn't an apt comparison. If you were to buy $10,000 of a particular, large-cap, household name stock, what are the chances that the stock price will drop to zero? Pretty small. You can easily limit your risk to ten percent of maximum risk, with good upside potential, buy immediately setting a stop ten percent below your purchase price (or ten percent above your short sale price) Daytraders usually use 2-3% stops but you could easily set your stop to ten percent. So then you are only really risking one thousand dollars on ten thousand dollars "invested" in a large cap stock. Ten thousand dollars invested in a penny stock, however, nearly equals betting the whole ten thousand that the price will go up, because liquidity generally is poor and company financial information is virtually nil. Versus a penny stock, the casino is less risky: blackjack has much better odds than buying a penny stock.
When you feel you are ready, open a brokerage account with Etrade, then try your hand at trading on your own. I use and recommend Etrade because they are a large and reputable institution, with market capitalization greater than most large banks in the United States. Also, a larger brokerage has access to more stocks, which is important when you are shorting, since you are selling stock that the brokerage borrows from another account. Etrade's fee structure is slightly higher than some other deep discount brokerages, but the difference is negligible and worth it.
I don't think you need to be a professional to make money. I think the average person can be successful trading, because he or she will pay the most attention to his or her own money. Just be cautious and trade large household name stocks with large daily volume traded (Example: Ford). Don't be afraid to sell short. Short selling can be very lucrative, maybe more lucrative than going long, because fear is a stronger emotion than greed. Just be sure and set stops to protect the downside, whether you are short or long. You don't need to trade dozens of stocks either, no more than half a dozen big name companies would be sufficient. Don't fight the trend, follow the trend. The websites Investopedia and Clearstation would be two great places to start learning about trading. Investopedia for easy to understand explanations of topics and Clearstation to identify the trend of a particular stock. In my opinion the two most important criteria for a stock are trend and volume. Trend is the most important and volume is second. Trade in the same direction as the trend (buy stocks that are rising and short those that are falling) and watch for larger price fluctuations when volume rises. Don't pay for market research by signing up with any of the many "research" companies that are all over the internet, both reputable and nonreputable. There is a ton of information available on the internet for free. Yahoo finance is actually a great place for stock information, just don't pay any attention to the message boards on there. There are also a lot of other great sources of information on the internet.
Stay away from stocks that have little information available and trade in small daily volume. They are not sufficiently liquid to be traded efficiently. Stay away from stocks that trade for less than $5, one reason being that you can't short them, and I believe that this distorts their value. Stay away from penny stocks. They are touted by firms that are paid to "recommend" them. Lenders recoup the money they lend these companies by bundling the debt and selling it to the public as penny stocks. You can bet that the lenders take a premium as their reward for lending the money. Buying penny stocks is pretty much like buying lottery tickets. You might get lucky, but it would be just that, luck. It would not be "investing". Stay away from options until you get comfortable with trading the actual stocks themselves. Options trading is not a liquid as trading the actual stocks themselves.
Don't choose a team to be on (Bulls or Bears). Both are just cheerleaders for a particular market direction. Be a bull with a stock that is rising and a bear on a stock that is trending down. Don't pay much attention to what CEO's and other company flacks say. They are also just cheerleaders for their own company. Don't fall in love with a particular stock. Which means that if you think that, say, Toyota is the greatest company to ever walk the face of the earth, and it is clearly trending down, you should short it. In fact, I believe that it doesn't really matter that much what stock you choose, as long as you can see a clearly defined trend to follow, it trades in large volume, you keep an eye on announcements and any other information which may impact the stock, and watch for trend reversals, which are usually accompanied by a large increase in volume. Trend tells you which way "investors" think stock is heading in the short term, and volume moves the stock price strongly in one direction or another and provides liquidity. The company may be the greatest company ever, but if the investing public thinks differently, the price will drop. So trend doesn't really show what the stock is worth, it shows what the buyers and sellers opinion of the stock has been recently. Also, You don't have to trade every day. The money is not made in the trading, it is made in the waiting.
If you are familiar with REITs that might the best place for you to start looking. What is the trend? Without looking I think that most are trending down right now after a huge run-up in the last five years. If you were to short them or buy options you can't receive the dividend. But short-selling in a downtrend could be very lucrative. If you could short one in a downtrend for say, a month, then buy to cover you could realize a nice profit.
In my opinion, "investing" is a word made up by Wall Street to make the word "speculating" sound more sensible to the average person, particularly after the bad rep that "speculating" got early in the last century. Having said that, there is nothing wrong with speculating. Banks speculate. Mutual funds speculate. Anyone who buys anything in hopes that it will increase in value is speculating. Also, while some diversification is a good thing, and I particularly recommend it for the casual investor, I think too much of it just averages your losses and becomes a de facto "buy and hold" strategy, also known as being an "involuntary investor", where you sell your winners but ride your losers because you don't want to lose money. Sell the losers quick, even if it means a small loss and let the winners run a little. Don't get too greedy though. Know when it is time to take profits. As they say, let the other guy have the last ten percent.
One final thought: trading is very addictive when you are making money, and very demoralizing when you are not. I have had days when it seemed so easy that it felt like taking candy from a baby, and I have also had days when I felt like the baby! But so far this year, my account is up over about 54%, down from an all-time high of 94%.
Let the flames begin!
I am not suggesting a daytrading strategy, nor am I recommending a "buy and hold" strategy. More of a swing-trading strategy which would call for a few trades a month and maybe an hour a day of attention to open positions. A word about risk: most people think that if they were to buy, say, $10,000 of a particular stock, that they are risking the whole $10,000, like in a casino. That really isn't an apt comparison. If you were to buy $10,000 of a particular, large-cap, household name stock, what are the chances that the stock price will drop to zero? Pretty small. You can easily limit your risk to ten percent of maximum risk, with good upside potential, buy immediately setting a stop ten percent below your purchase price (or ten percent above your short sale price) Daytraders usually use 2-3% stops but you could easily set your stop to ten percent. So then you are only really risking one thousand dollars on ten thousand dollars "invested" in a large cap stock. Ten thousand dollars invested in a penny stock, however, nearly equals betting the whole ten thousand that the price will go up, because liquidity generally is poor and company financial information is virtually nil. Versus a penny stock, the casino is less risky: blackjack has much better odds than buying a penny stock.
When you feel you are ready, open a brokerage account with Etrade, then try your hand at trading on your own. I use and recommend Etrade because they are a large and reputable institution, with market capitalization greater than most large banks in the United States. Also, a larger brokerage has access to more stocks, which is important when you are shorting, since you are selling stock that the brokerage borrows from another account. Etrade's fee structure is slightly higher than some other deep discount brokerages, but the difference is negligible and worth it.
I don't think you need to be a professional to make money. I think the average person can be successful trading, because he or she will pay the most attention to his or her own money. Just be cautious and trade large household name stocks with large daily volume traded (Example: Ford). Don't be afraid to sell short. Short selling can be very lucrative, maybe more lucrative than going long, because fear is a stronger emotion than greed. Just be sure and set stops to protect the downside, whether you are short or long. You don't need to trade dozens of stocks either, no more than half a dozen big name companies would be sufficient. Don't fight the trend, follow the trend. The websites Investopedia and Clearstation would be two great places to start learning about trading. Investopedia for easy to understand explanations of topics and Clearstation to identify the trend of a particular stock. In my opinion the two most important criteria for a stock are trend and volume. Trend is the most important and volume is second. Trade in the same direction as the trend (buy stocks that are rising and short those that are falling) and watch for larger price fluctuations when volume rises. Don't pay for market research by signing up with any of the many "research" companies that are all over the internet, both reputable and nonreputable. There is a ton of information available on the internet for free. Yahoo finance is actually a great place for stock information, just don't pay any attention to the message boards on there. There are also a lot of other great sources of information on the internet.
Stay away from stocks that have little information available and trade in small daily volume. They are not sufficiently liquid to be traded efficiently. Stay away from stocks that trade for less than $5, one reason being that you can't short them, and I believe that this distorts their value. Stay away from penny stocks. They are touted by firms that are paid to "recommend" them. Lenders recoup the money they lend these companies by bundling the debt and selling it to the public as penny stocks. You can bet that the lenders take a premium as their reward for lending the money. Buying penny stocks is pretty much like buying lottery tickets. You might get lucky, but it would be just that, luck. It would not be "investing". Stay away from options until you get comfortable with trading the actual stocks themselves. Options trading is not a liquid as trading the actual stocks themselves.
Don't choose a team to be on (Bulls or Bears). Both are just cheerleaders for a particular market direction. Be a bull with a stock that is rising and a bear on a stock that is trending down. Don't pay much attention to what CEO's and other company flacks say. They are also just cheerleaders for their own company. Don't fall in love with a particular stock. Which means that if you think that, say, Toyota is the greatest company to ever walk the face of the earth, and it is clearly trending down, you should short it. In fact, I believe that it doesn't really matter that much what stock you choose, as long as you can see a clearly defined trend to follow, it trades in large volume, you keep an eye on announcements and any other information which may impact the stock, and watch for trend reversals, which are usually accompanied by a large increase in volume. Trend tells you which way "investors" think stock is heading in the short term, and volume moves the stock price strongly in one direction or another and provides liquidity. The company may be the greatest company ever, but if the investing public thinks differently, the price will drop. So trend doesn't really show what the stock is worth, it shows what the buyers and sellers opinion of the stock has been recently. Also, You don't have to trade every day. The money is not made in the trading, it is made in the waiting.
If you are familiar with REITs that might the best place for you to start looking. What is the trend? Without looking I think that most are trending down right now after a huge run-up in the last five years. If you were to short them or buy options you can't receive the dividend. But short-selling in a downtrend could be very lucrative. If you could short one in a downtrend for say, a month, then buy to cover you could realize a nice profit.
In my opinion, "investing" is a word made up by Wall Street to make the word "speculating" sound more sensible to the average person, particularly after the bad rep that "speculating" got early in the last century. Having said that, there is nothing wrong with speculating. Banks speculate. Mutual funds speculate. Anyone who buys anything in hopes that it will increase in value is speculating. Also, while some diversification is a good thing, and I particularly recommend it for the casual investor, I think too much of it just averages your losses and becomes a de facto "buy and hold" strategy, also known as being an "involuntary investor", where you sell your winners but ride your losers because you don't want to lose money. Sell the losers quick, even if it means a small loss and let the winners run a little. Don't get too greedy though. Know when it is time to take profits. As they say, let the other guy have the last ten percent.
One final thought: trading is very addictive when you are making money, and very demoralizing when you are not. I have had days when it seemed so easy that it felt like taking candy from a baby, and I have also had days when I felt like the baby! But so far this year, my account is up over about 54%, down from an all-time high of 94%.
Let the flames begin!
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I haven't tried Scottrade. Although their fees are less, they are smaller and less apt to have access to a stock I might want to short. Also, I don't know what the quality of their website is. Do they have a lot of information available on their website? Yahoo! finance actually has more current market news than Etrade. I jump over to Yahoo! finance when I feel like I am missing some new announcement that is moving a particular stock. Yahoo! should acquire Scottrade and become an online broker. Hmmm. That is actually a great idea. Yahoo!trade
I know that you are joking about the newsletter, but people expect newsletters to make stock recommendations. I am neither bullish or bearish on any particular stock. I am not emotionally invested in whether a particular stock or the overall market rises or falls. There are a few stocks that I watch, but only because they exhibit the qualities I like. Large cap, large volume household names with clearly identifiable trends. I would happily replace them with different ones if the new ones appeared to have better trending characteristics. My recommendation is pretty easy: buy or short a large cap stock that trades more than 1 million volume. If it is trending up buy the dips on light volume. If it is trending down buy the peaks on light volume. Watch for a high volume day to see if it will continue the trend or reverse. Hold it if the trend continues and sell if it seems to be reversing. Rinse and repeat.
One area I do differ in from the "professionals" is in stock price. I prefer a large cap, high volume stock that is trading at ten dollars over the same one that is trading at, say, fifty dollars. My "ideal" position is ten thousand one hundred shares of a ten dollar stock. Although there is no practical difference here from, say, 2000 shares of a fifty dollar stock, the ten dollar stock to me seems to exhibit the kind of price movement I prefer. I prefer to trade stocks that move 1-2 percent a day over those that move .2-.4 percent a day. And I don't want to trade something that moves 10-15% a day; too volatile. Also, I am sort of allergic to going long on a stock that is trending up at the same the time that earnings are negative. When earnings are negative they are burning investor cash to subsidize their operations. I would rather short a stock that is trending down with positive earnings. But insofar as a ten dollar stock being "better" than a fifty dollar stock, it really isn't. That is more a personal preference, and I don't recommend it to anybody else. Any large cap stock that exhibits a clearly defined trend with large volume is very tradable.
I know that you are joking about the newsletter, but people expect newsletters to make stock recommendations. I am neither bullish or bearish on any particular stock. I am not emotionally invested in whether a particular stock or the overall market rises or falls. There are a few stocks that I watch, but only because they exhibit the qualities I like. Large cap, large volume household names with clearly identifiable trends. I would happily replace them with different ones if the new ones appeared to have better trending characteristics. My recommendation is pretty easy: buy or short a large cap stock that trades more than 1 million volume. If it is trending up buy the dips on light volume. If it is trending down buy the peaks on light volume. Watch for a high volume day to see if it will continue the trend or reverse. Hold it if the trend continues and sell if it seems to be reversing. Rinse and repeat.
One area I do differ in from the "professionals" is in stock price. I prefer a large cap, high volume stock that is trading at ten dollars over the same one that is trading at, say, fifty dollars. My "ideal" position is ten thousand one hundred shares of a ten dollar stock. Although there is no practical difference here from, say, 2000 shares of a fifty dollar stock, the ten dollar stock to me seems to exhibit the kind of price movement I prefer. I prefer to trade stocks that move 1-2 percent a day over those that move .2-.4 percent a day. And I don't want to trade something that moves 10-15% a day; too volatile. Also, I am sort of allergic to going long on a stock that is trending up at the same the time that earnings are negative. When earnings are negative they are burning investor cash to subsidize their operations. I would rather short a stock that is trending down with positive earnings. But insofar as a ten dollar stock being "better" than a fifty dollar stock, it really isn't. That is more a personal preference, and I don't recommend it to anybody else. Any large cap stock that exhibits a clearly defined trend with large volume is very tradable.
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I use scottrade and really like their service. You are correct about shorting though.Back when MAGS popped up I tried to short 4k of MAGS and was only able to get just over 2k shares :frown: . I have also had problems getting short shares in large blocks on other stocks. Usually I can call in and get the trade through but not always. Scottrade is great about answering the phone within a couple of rings, which is very important to me. I also use YAHOO a lot. They have a lot of info and also much sooner (other than quotes) than most any other information providers.
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Etrade occasionally doesn't have a stock I want to short either. But usually they do. Once I tried to short a stock but was unable, then maybe half an hour later they sent me an online alert that they had located the shares, so I shorted it then. Etrade also has a VIP phone line for active traders, which is answered by an actual real live person who speaks english and is very familiar with trading. So if I need customer service they are easy to reach, although for price quotes via telephone I just use the automated line. I try to not waste their time so they have more live time to devote to the guy who needs to make a trade NOW! One day that guy might be me...
I take it you are a pilot. I am an Air Traffic Controller. What company do you work for, and what aircraft to you fly? I am guessing that you fly an RJ, say an E145 or a CARJ?
I take it you are a pilot. I am an Air Traffic Controller. What company do you work for, and what aircraft to you fly? I am guessing that you fly an RJ, say an E145 or a CARJ?
Ski_Banker
Suspended
A few thoughts on day trading -
I did it in college (in almost an identical way to described above, except Ameritrade). I spent many hours every day in a Barnes & Noble learning about technical analysis, time that wasn't spent studying for my real courses! I did fantastically well trading stocks for about a year (97-98). I traded the opposite, though, by finding stocks in a so-called trading band and buying support and shorting resistance. Then I got greedy. I figured, if I can make this trading stocks, why not use options and really juice my returns? So, being smart, I put together a DIVERSIFIED group of puts and calls on stocks across industries. Three months later, the overall market hadn't moved an inch, the time premium on my puts and calls had all but expired, and I was out 90%. Fuck!
Nevertheless, I was hooked. I took every econ and finance course I could, got my CFA, and charged onto Wall St for a bulge bracket firm (banking, not trading tho).
What have I learned? On the minute level, don't buy puts or calls for stocks that aren't trending. Unlike owning the stock outright, if you're wrong and the stock goes nowhere, you'll still get killed. At a higher level, trading options very very rarely makes sense, because the leverage that you pay for (the time premium on at-the-money) is sensitive to the single toughest thing to gauge in the market - WHEN. You may know a stock is over or undervalued (ie, short housing now), but even Soros can't tell you exactly WHEN the move will happen. So, I would only consider options as viable for a strategy where there is a definitive, calendar-marked time frame (like buy calls in advance of an earnings release or something). Otherwise you'll always get hosed on the time premium, even if you're ultimately right directionally. Back to the point, though - if you are going to trade/invest based on technical analysis (My opinion is that it's pretty damn tough, but that there is some validity to it), DON'T trade the stocks that are followed by everyone across the globe. They will always know exactly what you know (on price, volume, trend, indicators, etc.) plus a whole lot more. Trade podunk companies that no i-bank has research coverage of. Second point, Wall St research is the best and if you can open a small ML account to get access to it, perfect. Don't bother with the silly independant research firms - those guys all want to work for an i-bank but can't get a job at one. St research is PERFECT for getting the "summary" on a company. Current situation, competitive outlook, etc. It's usually stuff you could get by listening to earnings calls and reading all the public filings and learning the industry - but the longer analyst reports will digest it all for you, usually. The key is to ignore the "buy, sell, hold, price target" nonsense. That's where you gotta do your own homework.
I did it in college (in almost an identical way to described above, except Ameritrade). I spent many hours every day in a Barnes & Noble learning about technical analysis, time that wasn't spent studying for my real courses! I did fantastically well trading stocks for about a year (97-98). I traded the opposite, though, by finding stocks in a so-called trading band and buying support and shorting resistance. Then I got greedy. I figured, if I can make this trading stocks, why not use options and really juice my returns? So, being smart, I put together a DIVERSIFIED group of puts and calls on stocks across industries. Three months later, the overall market hadn't moved an inch, the time premium on my puts and calls had all but expired, and I was out 90%. Fuck!
Nevertheless, I was hooked. I took every econ and finance course I could, got my CFA, and charged onto Wall St for a bulge bracket firm (banking, not trading tho).
What have I learned? On the minute level, don't buy puts or calls for stocks that aren't trending. Unlike owning the stock outright, if you're wrong and the stock goes nowhere, you'll still get killed. At a higher level, trading options very very rarely makes sense, because the leverage that you pay for (the time premium on at-the-money) is sensitive to the single toughest thing to gauge in the market - WHEN. You may know a stock is over or undervalued (ie, short housing now), but even Soros can't tell you exactly WHEN the move will happen. So, I would only consider options as viable for a strategy where there is a definitive, calendar-marked time frame (like buy calls in advance of an earnings release or something). Otherwise you'll always get hosed on the time premium, even if you're ultimately right directionally. Back to the point, though - if you are going to trade/invest based on technical analysis (My opinion is that it's pretty damn tough, but that there is some validity to it), DON'T trade the stocks that are followed by everyone across the globe. They will always know exactly what you know (on price, volume, trend, indicators, etc.) plus a whole lot more. Trade podunk companies that no i-bank has research coverage of. Second point, Wall St research is the best and if you can open a small ML account to get access to it, perfect. Don't bother with the silly independant research firms - those guys all want to work for an i-bank but can't get a job at one. St research is PERFECT for getting the "summary" on a company. Current situation, competitive outlook, etc. It's usually stuff you could get by listening to earnings calls and reading all the public filings and learning the industry - but the longer analyst reports will digest it all for you, usually. The key is to ignore the "buy, sell, hold, price target" nonsense. That's where you gotta do your own homework.
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Almost everybody who bought stocks in 1997-1998 made money. It was a raging bull market. The trend was well-defined during that period. See how following the trend works? Then when the bubble burst and the trend reversed the brokers jawboned them into holding. (It is just a market correction, the stock will come back!) The brokers self-interest is in keeping people fully "invested" in the market. If people were smart they would have started shorting when the trend reversed, but the brokers know that the majority of people are conditioned to only buy long, and to take their money out if the market goes down. But if they take their money and go home it is bad for Wall Street, who is lending the money to business to finance operations. This is why they preach a buy-and-hold strategy, because it is in their own self-interest to do so. I firmly believe that an individual investor can easily outperform the pros by actively trading his own account with an eye to trend and by selling the losers fast and letting the winners run a little. Ever met a real estate agent who said it wasn't a good time to buy a house? I haven't.
I agree that trading within a band can work out well. When I daytrade, I try and daytrade a stock that is trading sideways and capitalize on small price movements. For these stocks, I prefer that they not be going up or down; just trading in a narrow range with large volume.
I agree that the options can kill you. The leverage is so tempting, and the downside relatively limited on calls, so why not leverage up when things are working out? But the time decay sucks and they are just not liquid enough to trade efficiently. I have only traded options once, because nothing focuses me like trading with actual money, but the options expired worthless. Fortunately, it only cost me $1500 to get a feel for how they worked. Options work out great for the large investment firms that sell them. Not recommended for the small trader.
Regarding technical analysis, I don't put too much faith in most of it. Take stochastic, for example. Stochastic may be telling you that the stock is "oversold". No kidding; it has been dropping like a stone. So it will continue to be "oversold" until the trend reverses. Better to short on the way down and watch out for trend reversal than buy based on an "oversold" stochastic signal with the thought that it is bound to turn around sooner or later. A contrarian trading strategy is just too difficult to work out well, it is like swimming against the tide. Go with the flow (trend). I have tried to read the technical indicator "moneyflow" but have had different sites give different reflections of moneyflow. You should be able to see that in the chart, anyway. If the moneyflow is positive the stock should be rising, or negative moneyflow should follow a falling stock price. I don't think it is accurate enough to signal a reversal, which should be when the moneyflow stops being positive and starts being negative. The data will lag the price action. Yesterday's price action is history, and a month ago it is ancient history. Anything beyond that is prehistoric.
Here is where we part ways; I would say DO trade the stocks that are followed by everyone across the globe. You want them to know exactly what you know (on price, volume, trend, indicators, etc.). When you are following the crowd (trend) you want the herd to all be of the same mindset as much as possible. I believe that stocks are one example where it pays to follow the crowd. Don't trade podunk companies. Let's say you were long 10,000 shares of XYZ and it had went up ten percent. Just try and liquidate the entire block at that price. Good luck. You might sell 100 shares at the current market price then get successively lower prices for each block down from there. The stock price may be up but the liquidity just isn't there. There aren't enough buyers for the small company at the current price. Now say you are holding 10,000 shares of a large cap household name company that went up ten percent. You put in your sell order and boom, it sells as a single lot at your price. Much better to trade because it is liquid.
I don't pay much attention to analysts recommendations; two different analysts recently released "hold" recommendations on Delta and Northwest airlines the same morning that both airlines filed for bankruptcy in the afternoon. One recommendation that I do pay attention to is the S&P stars reports, not so much the buy, hold, sell part but the 12-month price target. I view this number as a magnet. Say for example ABC corporation is trending up and trading at $15 at the same time that the stars reports assigns it a value of $10. I would still follow the trend but keep a sharp eye out for a reversal. Now say that ABC is trending up and trading at $10 at the same time that the stars report assigns it a value of $15. Of course that is the situation I prefer, because I view the S&P assigned price as a magnet for the stock price. In either case I would follow the trend first, though. Trend is the most powerful predictor of price and volume is the most powerful mover of price.
What if I could tell you the future price of a particular stock? Would you trade it? I would. If I knew the future price of a particular stock I would trade nothing else. Having said that, we all know that I can't predict the future. However, I do believe that is easier and therefore potentially more profitable to trade a stock that is trading flat. This is just another, flatter of version of trading a range. How would we define flat? Something that exhibits the flattest line on the chart for months and months. Neither rising nor falling very much. So in the hypothetical the most predictable way to trade might be to try and identify a stock that is trading at, say, ten dollars then anytime it broke above $10.10 short it and anytime it broke below $9.90 go long. If I could get 5 cents of price action in my favor daily on one stock I would never trade anything else.
I agree that trading within a band can work out well. When I daytrade, I try and daytrade a stock that is trading sideways and capitalize on small price movements. For these stocks, I prefer that they not be going up or down; just trading in a narrow range with large volume.
I agree that the options can kill you. The leverage is so tempting, and the downside relatively limited on calls, so why not leverage up when things are working out? But the time decay sucks and they are just not liquid enough to trade efficiently. I have only traded options once, because nothing focuses me like trading with actual money, but the options expired worthless. Fortunately, it only cost me $1500 to get a feel for how they worked. Options work out great for the large investment firms that sell them. Not recommended for the small trader.
Regarding technical analysis, I don't put too much faith in most of it. Take stochastic, for example. Stochastic may be telling you that the stock is "oversold". No kidding; it has been dropping like a stone. So it will continue to be "oversold" until the trend reverses. Better to short on the way down and watch out for trend reversal than buy based on an "oversold" stochastic signal with the thought that it is bound to turn around sooner or later. A contrarian trading strategy is just too difficult to work out well, it is like swimming against the tide. Go with the flow (trend). I have tried to read the technical indicator "moneyflow" but have had different sites give different reflections of moneyflow. You should be able to see that in the chart, anyway. If the moneyflow is positive the stock should be rising, or negative moneyflow should follow a falling stock price. I don't think it is accurate enough to signal a reversal, which should be when the moneyflow stops being positive and starts being negative. The data will lag the price action. Yesterday's price action is history, and a month ago it is ancient history. Anything beyond that is prehistoric.
Here is where we part ways; I would say DO trade the stocks that are followed by everyone across the globe. You want them to know exactly what you know (on price, volume, trend, indicators, etc.). When you are following the crowd (trend) you want the herd to all be of the same mindset as much as possible. I believe that stocks are one example where it pays to follow the crowd. Don't trade podunk companies. Let's say you were long 10,000 shares of XYZ and it had went up ten percent. Just try and liquidate the entire block at that price. Good luck. You might sell 100 shares at the current market price then get successively lower prices for each block down from there. The stock price may be up but the liquidity just isn't there. There aren't enough buyers for the small company at the current price. Now say you are holding 10,000 shares of a large cap household name company that went up ten percent. You put in your sell order and boom, it sells as a single lot at your price. Much better to trade because it is liquid.
I don't pay much attention to analysts recommendations; two different analysts recently released "hold" recommendations on Delta and Northwest airlines the same morning that both airlines filed for bankruptcy in the afternoon. One recommendation that I do pay attention to is the S&P stars reports, not so much the buy, hold, sell part but the 12-month price target. I view this number as a magnet. Say for example ABC corporation is trending up and trading at $15 at the same time that the stars reports assigns it a value of $10. I would still follow the trend but keep a sharp eye out for a reversal. Now say that ABC is trending up and trading at $10 at the same time that the stars report assigns it a value of $15. Of course that is the situation I prefer, because I view the S&P assigned price as a magnet for the stock price. In either case I would follow the trend first, though. Trend is the most powerful predictor of price and volume is the most powerful mover of price.
What if I could tell you the future price of a particular stock? Would you trade it? I would. If I knew the future price of a particular stock I would trade nothing else. Having said that, we all know that I can't predict the future. However, I do believe that is easier and therefore potentially more profitable to trade a stock that is trading flat. This is just another, flatter of version of trading a range. How would we define flat? Something that exhibits the flattest line on the chart for months and months. Neither rising nor falling very much. So in the hypothetical the most predictable way to trade might be to try and identify a stock that is trading at, say, ten dollars then anytime it broke above $10.10 short it and anytime it broke below $9.90 go long. If I could get 5 cents of price action in my favor daily on one stock I would never trade anything else.
Ill throw in my two cents on the available options.
Realestate. If your plan is to get into fixer upper type situations you might be in for a serious reality check. I am friends with a guy that made a fortune buying and selling fixer uppers. And the fact is that while you can make a LOT of money doing it, $50k is the absolute bare minimum you need to get started in it. With that kind of money your relying heavily on your first few deals going very smoothly. While it sounds as if you have no prior experience with the whole fixerup process you might want to consider putting a bit more money away before going down that road. Secondly I also now he ended up having to quit his job to stay on top of things or else risk going bankrupt. I dont see spending your weekends only being realistic.
Investing. I have done the day trading bit. I bought and sold stocks and traded the indices. I think Jett had an excellent write up on the whole deal. However investing is at the end of the day simply gambling. No system is 100% in fact if you get a system that is 70% reliable you are doing really well.
It takes a certain type of personality to trade. It can be VERY stressful at times but it can also be VERY rewarding as well. It totally depends on your personality. After all day traders dont jump out of thier windows and commit suicide cause there just so happy. If you decide to get into this do your self a HUGE favor. Do the research and spend the money to goto a couple of reputable seminars. Try and get friendly with some of the guys in the trading forums. Also test out your strategy on paper for a couple of months to make sure its sound. Dont get caught up in the stories of people making easy money in the dotcom bubble of the 90's. Those were days when even a monkey could have made money. Consequently most of those people lost everything they made. And the last thing to rember is that its not always your fault that you lost money.
I was trading with Ameritrade, the bell had just rung and I was watching a biotech that I had made a nice chunk of change on the prior day. I had a strong feeling it would start to drop within minutes of the market opening. SO I am sitting there and the stock is just kinda moving a couple cents back and forth. Mind you I have 30k shares so a couple cents is a decent amount of money. Then about 7 minutes after the market had opened sure enough the stock started to drop. So I sold no big deal still made a nice profit or so I thought. It turns out Ameritrade had a technical glitch that morning at the opening bell. There realtime tracker was almost 5 minutes behind the market. So when I saw the stock dropping it had actually been dropping for almost 5 minutes. It only took me 5 seconds to sell out my stock but because of the delay in the tracker I ended up losing somewhere around $9,000. Of course you sign so pretty ironclad agreements with Ameritrade that releases them from any liablility. If you decide you want to get into investing look into the gaming industry and companies that support that industry. The vide game industry is projected to become a 7 billion dollar a year industry by 2010. And has seen a steady rise over the last several years. Look into the companies that provide the hardware to run the games. I bought into nvidia back when it plummeted down to around $7 a share. So far I have seen a nice steady rise in it. I could have done the same thing with ATI as well or several other people. But then I trade what I know and that is technology.
Now if you are looking for pure passive type of investing I can talk to my realestate friend for you. He used to be one of the "goto" guys for several of walstreets top brokerage firms. He has written a book on several different strategies and was ranked number 2 in the "masters100" fund. He took a break to try his hand at realestate, made a bundle moved down to florida and now is back to trading all day on the beach. He currently manages portfolios for several local sports celebrities. I myself plan to let him manage my portfolio once I get some other things straightened out. Hes pretty picky about who he works with but if your interested I can talk to him and see what he has to say about it.
Ohh and one last thought. The whold "housing market bubble is going to burst" thing is overhyped. There are only a few select areas in the US that are actually highly susceptable to bursting. Unless you plan to buy and sell in one of those areas I wouldnt worry about it. FYI the housing market in florida is skyrocketing and going strong.
Realestate. If your plan is to get into fixer upper type situations you might be in for a serious reality check. I am friends with a guy that made a fortune buying and selling fixer uppers. And the fact is that while you can make a LOT of money doing it, $50k is the absolute bare minimum you need to get started in it. With that kind of money your relying heavily on your first few deals going very smoothly. While it sounds as if you have no prior experience with the whole fixerup process you might want to consider putting a bit more money away before going down that road. Secondly I also now he ended up having to quit his job to stay on top of things or else risk going bankrupt. I dont see spending your weekends only being realistic.
Investing. I have done the day trading bit. I bought and sold stocks and traded the indices. I think Jett had an excellent write up on the whole deal. However investing is at the end of the day simply gambling. No system is 100% in fact if you get a system that is 70% reliable you are doing really well.
It takes a certain type of personality to trade. It can be VERY stressful at times but it can also be VERY rewarding as well. It totally depends on your personality. After all day traders dont jump out of thier windows and commit suicide cause there just so happy. If you decide to get into this do your self a HUGE favor. Do the research and spend the money to goto a couple of reputable seminars. Try and get friendly with some of the guys in the trading forums. Also test out your strategy on paper for a couple of months to make sure its sound. Dont get caught up in the stories of people making easy money in the dotcom bubble of the 90's. Those were days when even a monkey could have made money. Consequently most of those people lost everything they made. And the last thing to rember is that its not always your fault that you lost money.
I was trading with Ameritrade, the bell had just rung and I was watching a biotech that I had made a nice chunk of change on the prior day. I had a strong feeling it would start to drop within minutes of the market opening. SO I am sitting there and the stock is just kinda moving a couple cents back and forth. Mind you I have 30k shares so a couple cents is a decent amount of money. Then about 7 minutes after the market had opened sure enough the stock started to drop. So I sold no big deal still made a nice profit or so I thought. It turns out Ameritrade had a technical glitch that morning at the opening bell. There realtime tracker was almost 5 minutes behind the market. So when I saw the stock dropping it had actually been dropping for almost 5 minutes. It only took me 5 seconds to sell out my stock but because of the delay in the tracker I ended up losing somewhere around $9,000. Of course you sign so pretty ironclad agreements with Ameritrade that releases them from any liablility. If you decide you want to get into investing look into the gaming industry and companies that support that industry. The vide game industry is projected to become a 7 billion dollar a year industry by 2010. And has seen a steady rise over the last several years. Look into the companies that provide the hardware to run the games. I bought into nvidia back when it plummeted down to around $7 a share. So far I have seen a nice steady rise in it. I could have done the same thing with ATI as well or several other people. But then I trade what I know and that is technology.
Now if you are looking for pure passive type of investing I can talk to my realestate friend for you. He used to be one of the "goto" guys for several of walstreets top brokerage firms. He has written a book on several different strategies and was ranked number 2 in the "masters100" fund. He took a break to try his hand at realestate, made a bundle moved down to florida and now is back to trading all day on the beach. He currently manages portfolios for several local sports celebrities. I myself plan to let him manage my portfolio once I get some other things straightened out. Hes pretty picky about who he works with but if your interested I can talk to him and see what he has to say about it.
Ohh and one last thought. The whold "housing market bubble is going to burst" thing is overhyped. There are only a few select areas in the US that are actually highly susceptable to bursting. Unless you plan to buy and sell in one of those areas I wouldnt worry about it. FYI the housing market in florida is skyrocketing and going strong.
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- 10 November 2002
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- 1,124
Okay, here is an actual REIT example. Take Equity Office Properties, (symbol: EOP), which is "the largest publicly held owner and manager of office properties in the United States". Trades on average volume of at least 1,000,000 shares per day, most recent quarterly earnings were negative, has an S&P rating of Avoid/Sell with a 12-month price target of $28 versus a current price of $31.05. When you look at the chart you see that the last volume spike drove the price up, but since then the company has posted a negative quarter after many quarters of positive earnings. MACD indicates a downtrend (which we can already see from the graph) and stochastic indicates oversold. It should indicate oversold; the stock is trending down. This stock looks ripe to short. So on Monday morning I would be sitting at the computer with the brokerage account open and streaming real-time quotes flickering in a java applet when the market opened. I would watch it for an hour, after which time I would looking to short it as near to the first hour's high as possible. Let's assume for the sake of illustration that I shorted at $31.05, which is the current market quote as I am typing this, and purchased a block of ten thousand dollars worth. (I actually would probably short 400 shares because I prefer even lots.) Immediately after shorting it I would put in a buy-to-cover stop order(also referred to as a stop loss order) order at slightly more than 3% above the price I paid, since I am short, for a stop price of approximately $32.05. I would choose $32.05 in this instance because I know from experience that more resistance is found at even dollar increments, so this puts me just above a resistance level for a stop. Then I would sit and wait, because waiting is where the money is made. If the stock traded up that afternoon to the stop price, I would let it execute and take the 3% loss, which would be $300. All the indicators point to a further decline, however, so let's assume that the stock closes Monday at 30.30, as it seems to be fluctuating about a buck a day, so $30.30 would be a reasonable figure. So on Monday evening I would log on and move my stop down to $31.05, then wait some more. If it trades back up to $31.05 on Tuesday, I would let it stop out and essentially break even, minus commissions which would cost me $16. So far my "true risk" has been about $325 (not $10,000) for a couple of hours work and two days of waiting. In the worst case scenario I would have lost approximately $325. Suppose it followed the trend, which is the path of least resistance, and on Tuesday it sold down to $29.80? Not unreasonable. I would move my stop down Tuesday evening to, say, 30.50. Now I am "in the money". If it goes back up above $30.50 on Wednesday I will still make a few bucks. But all indicators point to a Wednesday close of, say, $29.21. Each day I move my stop down a little when the stock trades down. Now I let it ride with the stop. This is smooth sailing, because after a couple of days you will always be "in the money" as it trends down. It will probably meet resistance at $28 but I would merely keep adjusting my stop and let it do it's job. There is a very good chance that the stock will drop through $28 and keep trending down, so since it would be a winner, I wouldn't be in any hurry to sell it. I would let it run. At some point, however, I would buy-to-cover and take the money, if the price action starts to waver. If volume surged I would still let the stop do it's job. A volume surge might very well drive the price down faster in this instance.
Options strategy - I must admit that $30 puts look very attractive in this instance, even with a short expiration. Let's have a look at buying EOP October 05 30 puts. The ask price is 25 cents per share, so you could buy four contracts (each contract equals 100 shares) for $100 plus commissions. This would give you the right, but not the obligation, to sell 400 shares of EOP any time within the next ten days only at $30 per share, then buy back at the then-current market price, which of course you want to be less than $30. After ten days the contracts become worthless if the price remains above $30. Your maximum loss would be limited to $100 plus commissions. Now let's say that the stock generally "behaves" but trades down to only $28, at which point you exercise them before expiration. Your profit would be $1.75 per share, or $700, minus commissions. Now let's say that you took your original "true risk" capital, derived from the above hypothetical trading example, and purchased October 05 30 puts instead. For $300 plus commisions you could buy twelve October 05 30 puts contracts. If the stock price stayed above $30 for two weeks, you would give up the $300 plus a few bucks in commissions. But if the stock traded down to only $28 within the next two weeks, you would have a 1.75/share profit, or $2100 minus a few dollars in commissions. Not a bad possible return on investment for risking only $325 or so max, and very much within the realm of reasonable. This is not even the best-case scenario. If the stock price dropped to $26 (admittedly less likely) you would make over four thousand dollars! But the stock price only has to decline about $1.35 or so from the current quote ($31.05)for you to be "in the money" and make a few bucks.
If you "only" made $1000 that would represent a 2% return on your $50,000, with a "true risk" of only $325. 2% for two weeks equals 52 percent a year annual return at a constant rate of return.
I think I may have talked myself into it, either with the actual stock or with options. I might short the stock or buy October 05 30 puts on Monday and see how it works out. Check Yahoo! finance for a price quote on EOP on Friday evening after 4 pm to see how it did this coming week...
Options strategy - I must admit that $30 puts look very attractive in this instance, even with a short expiration. Let's have a look at buying EOP October 05 30 puts. The ask price is 25 cents per share, so you could buy four contracts (each contract equals 100 shares) for $100 plus commissions. This would give you the right, but not the obligation, to sell 400 shares of EOP any time within the next ten days only at $30 per share, then buy back at the then-current market price, which of course you want to be less than $30. After ten days the contracts become worthless if the price remains above $30. Your maximum loss would be limited to $100 plus commissions. Now let's say that the stock generally "behaves" but trades down to only $28, at which point you exercise them before expiration. Your profit would be $1.75 per share, or $700, minus commissions. Now let's say that you took your original "true risk" capital, derived from the above hypothetical trading example, and purchased October 05 30 puts instead. For $300 plus commisions you could buy twelve October 05 30 puts contracts. If the stock price stayed above $30 for two weeks, you would give up the $300 plus a few bucks in commissions. But if the stock traded down to only $28 within the next two weeks, you would have a 1.75/share profit, or $2100 minus a few dollars in commissions. Not a bad possible return on investment for risking only $325 or so max, and very much within the realm of reasonable. This is not even the best-case scenario. If the stock price dropped to $26 (admittedly less likely) you would make over four thousand dollars! But the stock price only has to decline about $1.35 or so from the current quote ($31.05)for you to be "in the money" and make a few bucks.
If you "only" made $1000 that would represent a 2% return on your $50,000, with a "true risk" of only $325. 2% for two weeks equals 52 percent a year annual return at a constant rate of return.
I think I may have talked myself into it, either with the actual stock or with options. I might short the stock or buy October 05 30 puts on Monday and see how it works out. Check Yahoo! finance for a price quote on EOP on Friday evening after 4 pm to see how it did this coming week...
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The reason I got his help is because it was on a chat board and I posted some stuff that would help him keep in trends longer and made him some money as well as he was going to take what he tought me and give it to his son when he gets older. There are lot of good people out there but I have found this after trying to show 5+ people and only 1 took it and he was under capitalized. Most people want the easy money and dont want to do the work, I will say trading is the hardest and shows your true self more then anything I have done in my life. Also I traded the S&P500 futures but now the range sucks so I went to the euro and trade the trend there. The key to the WHOLE game is keeping emotion out of the market and MONEY management. Trade 3 contracts, sell at +10-+20-+30 so a winner makes 60 points, a looser you lose 30 so if you win 50/50 you do okay and in the Euro you get a 30 point move 85% of the time. It's just a big numbers game and I can show people what I do but they still lose because of the good old fear/greed deal. Let me know if you have any questions
PushHands said:I want to be your understudy :smile:
And that is not said with sarcasm either. I was very active trading equities many years ago and made a lot of mistakes, which was a great learning experience. I stepped away for a long time and keep informed as to the general climate of traders over the years. It's just been difficult difficult for me to find someone that is has the temperment to take someone under their wing. I can understand their reasoning though... if one is making big money, why mentor someone when it takes time away from your trading? But the flip side is that being a mentor and mentee is a great experience as I've been on both ends.
Also I use Interactivebrokers to trade with, my charts used to be CQG but $700 a month for stock info was a waste, I use Tradestation now and at $200 a month it's a good deal. Also people that say trading is risky or is gambling dont know what they are doing so that it is risky, having a 12 year old drive is a car is risky too. I win 80+% of my trades now so I guess I am really lucky and have been for the past 4 years. Also check this guy out, some good free stuff http://www.walterbressert.com/
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- 10 November 2002
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- 1,124
I don't mean to start a flame war with Coldhammer, but notice how he is bullish on the video gaming industry? He has already chosen a team (Bulls) and presumably would "invest' in this industry through ups and downs. And since he is emotionally invested in his team (Bulls) he will ignore logic and buy at highs plus buy on the way down on the theory of it's gonna go up more! or it's gotta stop going down sometime! This is the thinking of amateurs who don't know what they are doing and is exactly the wrong way to think. If Nvidia is trending up you should buy and if it is trending down you should sell short. It's that simple...take the path of least resistance.
Also he says that you can lose money and it's not your fault? If he lost $9000 on five cents of price movement on a stock he was screwing up, technical glitch or no technical glitch. Let's say there was no technical glitch...I know from experience that your order might not get filled at the limit you set or for a market order you get the price you get. On a market order the price could easily move a nickel before it executes, or on a limit order you might not get a fill before the price dropped a nickel. So if he was holding a line of 30,000 shares on a stock that moves almost two thousand dollars a penny he was in way over his head. He was screwing up. If you are making money you are doing well and if you are losing money it is your fault. Period.
Also, I know Warren Buffett's cousin and have his cell phone number, and if you want I could hook you up....just kidding! See why you should trade your own account?
Also he says that you can lose money and it's not your fault? If he lost $9000 on five cents of price movement on a stock he was screwing up, technical glitch or no technical glitch. Let's say there was no technical glitch...I know from experience that your order might not get filled at the limit you set or for a market order you get the price you get. On a market order the price could easily move a nickel before it executes, or on a limit order you might not get a fill before the price dropped a nickel. So if he was holding a line of 30,000 shares on a stock that moves almost two thousand dollars a penny he was in way over his head. He was screwing up. If you are making money you are doing well and if you are losing money it is your fault. Period.
Also, I know Warren Buffett's cousin and have his cell phone number, and if you want I could hook you up....just kidding! See why you should trade your own account?
It's funny because a lot of my friends ask me "Hey Ryan how is the dow" I have no clue where the dow is and really dont give a shit, All I care about is the trades I am in and I am never bullish or bearish I am in it to make my 20+ points a day no matter what it does. Saying you are bullish you are already screwing yourself, you need to set a goal and meet that goal everyday. My goal in the S&P 500 was 3-5 a day, if I was long or shot and took 5 I was done for the day even if that trade went 40 points, I dont make huge homeruns much but I do make money everyday.
Jett said:
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I generally agree with what Ryan said. Personally, if I can get only 5 cents of price action in my favor every day, I am perfectly happy. If the stock keeps going up after I sell or keeps going down after I cover, I don't care. All I care about is trying to get a nickel a day in my favor. A nickel a day in my favor is worth $500 a day to my account, multiply that by the number of trading days in a year and you will see how powerful that nickel is.
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Well first and foremost I believe Jett should learn to read. Please show me where I said I lost money on a 5 cent price movement. I believe I stated that the market had been dropping on the stock for over 5 minutes. So let me see. If my stops are based on the price of the stock and the price of the stock is tied to that little read out thingymajig on the tracker then I guess when the tracker finally got around to updating correctly and set off my stops hmm lemme think, but I do believe the market value was quite a bit lower than the false reading the tracker gave. But I am sure that Jett uses his superior JEDI mind power to foresee the future and thus does not use a real time tracker like the rest of use mere mortals. So when the stock started dropping but the tracker wasn’t updating correctly of course Jett would have felt a disturbance in the force and known it was going down and sold his stock.
Secondly Again Jett should learn to read. I have not said anything about buying a particular stock because its going up. Nor have I fallen in love with a particular stock. What I said was I bought nvidia back when it was $7 a share. I also said that the gaming industry is forecasted to go up and that you should look into people that make games and those that create the hardware to support it. Jett says
I also said
The problem is, is that Jett in his Superior arrogance feels that everyone else is an idiot if they dont do things the right way, which coincidently is his way.
There are many methods of trading, you can trade the indices, you can trade stocks, you can do passive investing and buy and hold, you can take a more micro control approach and sell short and long. Rather than say "I feel that you could make more money if you do it this way" (which coincidentally you can. And you can also lose your ass jsut as easily) no, Jett chooses "Not to start a flame war with Coldhammer" and to disregard the possibility that you can do it another way besides his way.
Another particular point of interest is that Jett states he only looks for a nickel price swing and makes $500 a day off of that. Well that would mean that Jett buys 10,000 shares of stock that is $5 a share. Now early on Jett stated
Ohh and since you can’t read lets not forget that bling stated in the begging he only has the weekend to devote to his venture. Which hmm if I remember correctly the markets are closed on the weekends. Damn that’s going to be hard to place and sell orders.
The other thing Jett fails to mention is as a beginner would you actually even able to spot a trend. Hell if it was so easy to spot a trend and capitalize on it then nobody would ever lose money now would they.
So what Jett does is paint you a nice rosy picture of how easy it is to make money on the stock market and it takes so very little of your time. It’s so easy the average person can do it. Hmm I saw a guy on an infomercial the other night say the same thing. You want his number?
So while you can certainly listen to JEDI Master Jett, I for one think that anyone that attacks someone else just because they take a different approach to something is a Moron of the highest degree.
And last but not least I should probably apologize for trying to reccomend a mutual fund manager that as it happens I know and personally would trust to trade my money and that has shown a consistent ability to beat the market regardless of trend.
Secondly Again Jett should learn to read. I have not said anything about buying a particular stock because its going up. Nor have I fallen in love with a particular stock. What I said was I bought nvidia back when it was $7 a share. I also said that the gaming industry is forecasted to go up and that you should look into people that make games and those that create the hardware to support it. Jett says
Hmm it seems to me he is making a broad recommendation as well but I guess its only amateurish when it comes from someone other than him.
I also said
.
Hey guess what I also bought it at $36, $42, $12, $15. Well hell looking back at my records sometimes i bought and sold it 7 times a day. But of course since I didn’t S P E L L it out for you I am automatically an amateur and Jett knows me inside and out.
Well damn. Lets see I bought in at $7 a share and its now $32 a share hmm let me do the math. Well damn look at all that money I lost. I am certainly a moron.
The problem is, is that Jett in his Superior arrogance feels that everyone else is an idiot if they dont do things the right way, which coincidently is his way.
There are many methods of trading, you can trade the indices, you can trade stocks, you can do passive investing and buy and hold, you can take a more micro control approach and sell short and long. Rather than say "I feel that you could make more money if you do it this way" (which coincidentally you can. And you can also lose your ass jsut as easily) no, Jett chooses "Not to start a flame war with Coldhammer" and to disregard the possibility that you can do it another way besides his way.
Another particular point of interest is that Jett states he only looks for a nickel price swing and makes $500 a day off of that. Well that would mean that Jett buys 10,000 shares of stock that is $5 a share. Now early on Jett stated
Please enlighten me as to what "large household name stock" you trade that has a value of $5 a share.
Ohh and since you can’t read lets not forget that bling stated in the begging he only has the weekend to devote to his venture. Which hmm if I remember correctly the markets are closed on the weekends. Damn that’s going to be hard to place and sell orders.
The other thing Jett fails to mention is as a beginner would you actually even able to spot a trend. Hell if it was so easy to spot a trend and capitalize on it then nobody would ever lose money now would they.
So what Jett does is paint you a nice rosy picture of how easy it is to make money on the stock market and it takes so very little of your time. It’s so easy the average person can do it. Hmm I saw a guy on an infomercial the other night say the same thing. You want his number?
So while you can certainly listen to JEDI Master Jett, I for one think that anyone that attacks someone else just because they take a different approach to something is a Moron of the highest degree.
And last but not least I should probably apologize for trying to reccomend a mutual fund manager that as it happens I know and personally would trust to trade my money and that has shown a consistent ability to beat the market regardless of trend.
Last edited:
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- 10 November 2002
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Again, I really really don't want to be in a flame war with Coldhammer. I don't mean him any disrespect, I just wanted to point out the fallacy in the kind of thinking he displays. So I will ignore all the Jedi stuff, etc. etc. and stick with just where his market logic sucks.
He says the gaming industry is forecast to go up. etc. etc. Who is doing the forecasting? The video gaming industry? Ever see a CEO forecast his business to suck? Anyone who is "forecasting" a rise in anything is engaging in wishful thinking. This is a bad way to invest, because you certainly can't trade on this sort of thing. You might buy and get lucky, but there is no rational basis for your trading. What is the timeline for the forecast? Go up next year? Go up in three to five years? Either way you have to buy now to capitalize on the forecast. Then what if it goes down? You're screwed but you are stuck with a buy-and-hold strategy, so you keep the faith and keep buying when it is dropping, or keep the faith and buy when it is rising, waiting for that great someday payday. This could grind on for years. You might get lucky, or in the more likely outcome you sell for a loss and leave the market in disgust.
I am not recommending anything in particular. When I say that I am not trying to be diplomatic to avoid having someone lose money or holding any "secrets" or anything like that. I don't recommend anything in particular because I don't really think it matters what stock you buy, as long as you follow the trend and buy large household name stocks because that 1 million plus volume provides the liquidity to move in and out of a stock with ease. Large volume also provides a base of support which insulates it better from nasty surprises like unexpected gaps. In fact, if you look back, I in fact say that I don't think it matters much what stock you trade, as long as it is well-known with large volume, because I believe that trend and volume are the two largest forces driving the price of a stock.
One of the best ways to lose money is to trade Coldhammer's way, because it is based on forecasts and faith. When the market is against ya, ya gotta keep the faith! The price is going up! Buy more, it's gonna shoot the moon! The price is going down! Buy more, it's gonna go back up and shoot the moon! The market, of course, doesn't cooperate and you lose your shirt and slink out of the market in disgust, declaring that it is "rigged" against the little guy. If you follow the trend, trade rationally and not emotionally, watch the company news, and watch for movement on volume you are apt to be much more successful.
If Coldhammer has made money on Nvidia, ATI, etc. I am happy for him. I am happy for him in the same way that I would be happy for the guy walking out of the casino, having won $100,000 on a pull of the slot machine. He got lucky.
Ten thousand shares of a ten dollar stock will move a hundred dollars for each penny of price movement. An example of this I already gave is Ford. Ford has an avoid/sell rating with the S&P, but we are trading the trend, remember? So we don't care much what the ratings are so long as we are following the trend. I have traded Ford successfully many times with the goal of getting just a nickel's worth of price action in my favor.
Bling could research at home and place his orders the night before, or log on from work, or wherever. With an online account you have the flexibility to "trade" even during off hours. Weekends would be great for doing market research. You can earn a substantial amount of money with less risk and without having to devote a lot of time, like say with real estate.
It IS easy to see the trend. A blind monkey can see the trend. It is right in front of you on the chart! Not the five year trend, the NOW trend. What the stock is doing NOW. I am not talking about what it is going to do next week. I mean, what has it been doing this week? If it has been trending up this week, go long. If it has been trending down this week, short it. What is hard is getting a bunch of morons to not choose a team (da Bulls or da Bears) to be on. What is hard is getting them to trade rationally instead of gamble. Out of all the non-professionals in the stock market, how many of them ever short a stock? Probably only two percent. So they are ignoring half the market!
He says the gaming industry is forecast to go up. etc. etc. Who is doing the forecasting? The video gaming industry? Ever see a CEO forecast his business to suck? Anyone who is "forecasting" a rise in anything is engaging in wishful thinking. This is a bad way to invest, because you certainly can't trade on this sort of thing. You might buy and get lucky, but there is no rational basis for your trading. What is the timeline for the forecast? Go up next year? Go up in three to five years? Either way you have to buy now to capitalize on the forecast. Then what if it goes down? You're screwed but you are stuck with a buy-and-hold strategy, so you keep the faith and keep buying when it is dropping, or keep the faith and buy when it is rising, waiting for that great someday payday. This could grind on for years. You might get lucky, or in the more likely outcome you sell for a loss and leave the market in disgust.
I am not recommending anything in particular. When I say that I am not trying to be diplomatic to avoid having someone lose money or holding any "secrets" or anything like that. I don't recommend anything in particular because I don't really think it matters what stock you buy, as long as you follow the trend and buy large household name stocks because that 1 million plus volume provides the liquidity to move in and out of a stock with ease. Large volume also provides a base of support which insulates it better from nasty surprises like unexpected gaps. In fact, if you look back, I in fact say that I don't think it matters much what stock you trade, as long as it is well-known with large volume, because I believe that trend and volume are the two largest forces driving the price of a stock.
One of the best ways to lose money is to trade Coldhammer's way, because it is based on forecasts and faith. When the market is against ya, ya gotta keep the faith! The price is going up! Buy more, it's gonna shoot the moon! The price is going down! Buy more, it's gonna go back up and shoot the moon! The market, of course, doesn't cooperate and you lose your shirt and slink out of the market in disgust, declaring that it is "rigged" against the little guy. If you follow the trend, trade rationally and not emotionally, watch the company news, and watch for movement on volume you are apt to be much more successful.
If Coldhammer has made money on Nvidia, ATI, etc. I am happy for him. I am happy for him in the same way that I would be happy for the guy walking out of the casino, having won $100,000 on a pull of the slot machine. He got lucky.
Ten thousand shares of a ten dollar stock will move a hundred dollars for each penny of price movement. An example of this I already gave is Ford. Ford has an avoid/sell rating with the S&P, but we are trading the trend, remember? So we don't care much what the ratings are so long as we are following the trend. I have traded Ford successfully many times with the goal of getting just a nickel's worth of price action in my favor.
Bling could research at home and place his orders the night before, or log on from work, or wherever. With an online account you have the flexibility to "trade" even during off hours. Weekends would be great for doing market research. You can earn a substantial amount of money with less risk and without having to devote a lot of time, like say with real estate.
It IS easy to see the trend. A blind monkey can see the trend. It is right in front of you on the chart! Not the five year trend, the NOW trend. What the stock is doing NOW. I am not talking about what it is going to do next week. I mean, what has it been doing this week? If it has been trending up this week, go long. If it has been trending down this week, short it. What is hard is getting a bunch of morons to not choose a team (da Bulls or da Bears) to be on. What is hard is getting them to trade rationally instead of gamble. Out of all the non-professionals in the stock market, how many of them ever short a stock? Probably only two percent. So they are ignoring half the market!
