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things every retail investor/trader should know
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stupidfool
Senior |
08-Dec-2008 14:02
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To me,looking at other key indicators are better to judge whether the economy is in shit or not. the charts etc...nowadays can play havoc.Have a gut feel of the economy and its key indicators.
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Livermore
Master |
08-Dec-2008 11:59
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Although with margin I have more room to play, I normally just buy a bit when a stock has stablised and not moving. There is no point putting too much as capital is being wasted when the stock does not move. Go with those "in play". I treat each of my buy like a aeroplane about to take off from a airport. First passengers will board the plane, then the plane gradually makes its wasy to the run-way. Then it starts its run on the runway and increases its speed and finally takes off. |
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Livermore
Master |
07-Dec-2008 13:46
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That's ok
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stupidfool
Senior |
07-Dec-2008 11:08
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Yes Livermore,it is hard for everyone to appreciate wat u are doing.So long as u know wat u are doing that is sufficent. For me,i will buy at 50 cents....so outlay is $500. Hold for say 7 years.Each year collect divvy say $50 a year,so over 7 years u collect $350 in divvy.Thus ur outlay becomes $150.(500minus350). Thus after 7 years,if the divvy is still $50 per year,then the yield is 33%(50 divide by 150). Or,if u choose to sell after 7 years....u got good chance of capital appreciation. This is a boring method,i agree bt think of the simplicity and less trading and less brokerage paid to brokers. |
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Livermore
Master |
07-Dec-2008 09:25
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Ok, let me put to you this way. Since we are in bear market, of course there is that risk i.e sell at 80c and buy at 90c. But in a bull market, you need to chase. It is hard to explain for others to fully appreciate. You will realise what I am saying when one sells at A price and refuse to buy back at B price which is higher than A and after a few years later you find you never bought back at all and by then the price is way up high. To me for certain stocks it is quite unlikely that they go back to their lowest price when STI was around 1475.
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stupidfool
Senior |
07-Dec-2008 08:56
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Thanks livermore. Ok.....say stockA,u buy at 50cents....so ur outlay is $500. Then sell at 80 cents......................................proceeds is $800. Thus far cash in bank is $800. Then buy at 90 cts................outlay is $900. Then cash balance is negative $100. Ur best bet now is uptrend so u can sell higher....bt what happen if mkt decides to correct?????
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Livermore
Master |
07-Dec-2008 01:51
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Well nothing wrong to keep things simple but I always feel."think out of the box". Don't be so rigid and be a bit flexible. Good strategies are not necessarily always must be found in books. Sometimes simple effective strategies can be thought of by just spending a few minutes thinking. Just like when I tell my friends selling stock A at a loss and put that capital in stock B is merely a transfer of capital from A to B. But unfortunately they say to me,"How can? I am selling at a loss." |
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Livermore
Master |
07-Dec-2008 01:44
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Ok I have to explain to suit you. Let;s say you bought stock A at 50c and it goes up 80c and then starts to correct to 70c. So you sell at 70c. After you sell you did not track it and it goes up to $1.20. Will you keep waiting for the stock to come down to 50c or 70c to buy or you don't mind buying at a higher price of 90c when it corrects from $1.20.
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stupidfool
Senior |
06-Dec-2008 19:07
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Why sell unless u have confidence that it is downtrending. then buy back at higher px.....confusing theory. Bt suppose this method suits u.... For me,i just KISS=keep it simple stupid. |
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Livermore
Master |
06-Dec-2008 14:34
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Give you a more concrete example. Let's say you bought Noble Group at its lowest price of 47c but you sold off at 60c. Now Noble is about 92c. Noble Group might not go back to 47c or even 60c where you sold off even when it corrects. Have a look at the chart.
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Livermore
Master |
06-Dec-2008 12:57
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Let's say you sold a stock at 80c and it comes down to 60c but you forgot to buy back and it climbs back up to 90c, some people would say to themsleves,"Ok, let's wait for it to drop back to 60c then I buy." It is a common mistake. But that stock may not even drop back to 80c. There is simply nothing wrong with buying back a stock at a higher price than the price you sold off at
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Livermore
Master |
06-Dec-2008 12:53
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We are like in a trading market. There is nothing wrong trading and locking in some profit but do remember to buy back your stock after you sold off as one thing that could happen to some people is you sell off your stock to lock in some profit. Then after the stock falls and it climbs back up fast, you would have lost it if you don't focus on it. When we eventually enter a bull market, the long term gain will far weigh all your successful short term trades if you forgot to buy back |
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temp123
Senior |
06-Dec-2008 09:55
Yells: "." |
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elf, You've said in your blog that "A key sign of bottoming is when markets go up despite bad news: it's a sign that markets have priced in." Do you think yesterday's US job report and the reaction of DOW confirms this?
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moneytalk.sg
Member |
05-Dec-2008 10:46
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"The more things change, the more they remain the same" Alphonse Karr
Blogging at moneytalk.sg on the stock market, ETF and anything to do with money.
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Livermore
Master |
05-Dec-2008 10:35
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Don't always trade based on luck i.e stock fall you buy and hope next day it go up. You can be lucky a few times but not all the time | ||||
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Livermore
Master |
05-Dec-2008 10:30
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Be careful of those stocks that make a intra day high and close at below its opening price. It might be time to get out | ||||
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Livermore
Master |
05-Dec-2008 10:27
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Thus don't be in such a hurry to buy those falling stocks. Wait for "basing". I don't see any "basing" yet for some of the blue chips that have fallen.
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Hulumas
Supreme |
04-Dec-2008 22:34
Yells: "INVEST but not TRADE please!" |
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Agree.
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Livermore
Master |
04-Dec-2008 20:58
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When a stock is falling down, best to wait for it to do some sort of "basing" first before you decide to buy and also monitor any buy activity | ||||
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Livermore
Master |
04-Dec-2008 20:24
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I always ask myself this question If ain't going down, then the likely way is up. If it ain't going up, the the likely way is down. So sometimes it may not be neccesary to get the "best price" if you think where the direction is likely to be. My style is I usually don't queue when I buy if I am confident where the direction is likely to be | ||||
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