All content in the ZeccoShare community is generated by its members and does not contain advice or recommendations on behalf of Zecco Holdings or Zecco Trading. More>>
Content Name: CommunityDisclaimerShortLeftNav
Preview Revision #:
Active Revision #:
Edit Content
Zecco.com » General Investing » Screening & Picking » The Turnaround in Financial Stocks
Last post 08-07-2008, 7:01 PM by Naren~. 20 replies.
Page 1 of 2 (21 items)   1 2 Next >
Previous   Next
Content Name: ForumThreadInternal
Preview Revision #:
Active Revision #:
Edit Content
  •  07-31-2008, 10:17 AM 34559

    The Turnaround in Financial Stocks

    Reply Quote
    One fund manager says he's never seen so many opportunities in the U.S. financial sector as he does today. As most of you should know, financial stocks are generally good dividend plays.
    *
    Author: Elizabeth Ody
    Date: July 24, 2008
    Publisher: Kiplinger's Personal Finance Magazine
    *
    http://www.kiplinger.com/
    *
    Sergeant_Major
    *
    Note: I invite all ZeccoShare members to join the High-Yield Investing group!
  •  07-31-2008, 10:55 AM 34562 in reply to 34559

    Re: The Turnaround in Financial Stocks

    Reply Quote
    Funny, a few months ago, they were all saying that the sky is falling.  I have learned an expensive lesson.  I will never listen to the fund managers, financial analysts, or the media.
  •  07-31-2008, 2:42 PM 34571 in reply to 34562

    Re: The Turnaround in Financial Stocks

    Reply Quote

    Told you. I think when you see the glass half-full, you will be better off. That doesn't mean to be niave. It just means will the "strongest" companies survive and the answer was and is, yes!

    I bet there's some people who got wiped out when WFC went up over 30% that day. I don't wish that on anyone, but I believe crashes only occur when no one anticipates them (i.e. in the middle of a severe bull market of irrational exuberance). As you can see, that's the way I view I have of the stock market.

    In 1987, it had reached a high and by year-end, it actually had a higher value than the beginning of the year despite that one-day 22% drop.

    If you study stock market history, you learn the dangers of buy stops and sell stops, but especially sell stops. The 22% drop that occurred in '87 occured because of these sell stops. It was called portfolio "insurance" and that's why so many people got hit very hard when these stops executed! They can be very useless and they can take you out at the time the stock begins to rise. The WFC, WB, and LEND examples indicate how you can get wiped out on a short when you use a buy stop to cover your position.

    Buy high-quality stocks, instead of relying on stops. Obviously, you can get hit very hard but at least than you won't get out of a stock at the wrong time. For example, you would have missed the run up in GME due to a sell stop.


    Aqua
  •  07-31-2008, 4:44 PM 34578 in reply to 34559

    Re: The Turnaround in Financial Stocks

    Reply Quote
    I just bought a little C. And I don't mean the vitamin. My 2 cents is that the worst of the mortgage part of the problems is pretty much behind us. And that's a big chunk. --Have a great day.
  •  07-31-2008, 5:13 PM 34580 in reply to 34578

    Re: The Turnaround in Financial Stocks

    Reply Quote
    Rayca:
    I just bought a little C. And I don't mean the vitamin. My 2 cents is that the worst of the mortgage part of the problems is pretty much behind us. And that's a big chunk. --Have a great day.


    I'm trying to sell C.  My break even price on C is around $22 per shares.   I'm currently debating if I should cut my loses and sell now.   I think C probably will see 16 before 20.   Btw, I also currently have a PUT position on WFC becuase I don't think WFC will be trading above 33 any time soon.
  •  07-31-2008, 5:53 PM 34582 in reply to 34580

    Re: The Turnaround in Financial Stocks

    Reply Quote
    short Banks ...if it rises..short more..thats my policy..to be honest it works
  •  07-31-2008, 6:26 PM 34584 in reply to 34582

    Re: The Turnaround in Financial Stocks

    Reply Quote
    I think financials are great if you're into trading. Sell them when they're up, buy more when they're back down. Especially with the financial ETF's XLF and UYG.
  •  07-31-2008, 6:35 PM 34585 in reply to 34584

    Re: The Turnaround in Financial Stocks

    Reply Quote

    The sky is falling on the banks.   With house prices continuing to fall at a record pace and unemployment growing, what the hell do banks have to be happy about?   Foreclosures are rising and will continue to grow as prices fall, home inventories increase and unemployment rises.  Financial stocks will not recover to their prior levels for years from now and that is if they are still in business.   The housing bubble has already popped and there is still a bubble in commercial real estate and consumer credit which still has yet to burst but the pressure is building for both of these to burst very soon.  

    I project financial stocks will decline in value by about 75-90% of their current price as of 7/31/08. 

  •  07-31-2008, 7:33 PM 34587 in reply to 34585

    Re: The Turnaround in Financial Stocks

    Reply Quote
    jackg1606:
    I project financial stocks will decline in value by about 75-90% of their current price as of 7/31/08. 


    Are you serious?   Let's take a look at a couple banks:

    If WFC will decline about 75% of its current value,  $30 - 0.75 * $30 = $7.5.  This is impossible.  There is absolutely no way WFC will be trading less than $20 a share any time soon.

    If JPM will decline about 75%, $40 - 0.75 * $40 =$10.  Again, There is absolutely no way JPM will be trading at $10 a share during the next three years.

  •  07-31-2008, 8:17 PM 34591 in reply to 34587

    Re: The Turnaround in Financial Stocks

    Reply Quote
    You may be right about WFC but JPM is a loser.
  •  08-03-2008, 11:17 AM 34693 in reply to 34591

    Re: The Turnaround in Financial Stocks

    Reply Quote
    There is a value trap in financials.  Yes, they have fallen dramatically from their levels of about a year ago.  The problem is those price levels were based on earnings made during bubble years in real estate and mortgage lending.  If you are buying now expecting these price levels to return anytime soon you are making an incredibly foolish investment.  With an abundant inventory of houses for sale and a tightening of lending standards, it will be years before there is a recovery in these industries and the price of these stocks will reflect their ability to generate earnings.   Mix this with the legal liability many of these financial companies such as C, BAC, WB, WM, GS, MER and LEH will have as a mountain of fraud suits are filed against them and their continued dilution of shareholders in order to raise capital results in very little reason to own these stocks.  Earnings growth does not exist here.  Would you have bought Enron in the middle of their downfall?


    Have you noticed the "experts" on TV who called for a turn around by year end now saying the turn around will occur in early 2009.  How do you continue to trust these liars?
  •  08-03-2008, 6:12 PM 34705 in reply to 34693

    Re: The Turnaround in Financial Stocks

    Reply Quote

    jackg1606:
    There is a value trap in financials.  Yes, they have fallen dramatically from their levels of about a year ago.  The problem is those price levels were based on earnings made during bubble years in real estate and mortgage lending.  If you are buying now expecting these price levels to return anytime soon you are making an incredibly foolish investment.  With an abundant inventory of houses for sale and a tightening of lending standards, it will be years before there is a recovery in these industries and the price of these stocks will reflect their ability to generate earnings.   Mix this with the legal liability many of these financial companies such as C, BAC, WB, WM, GS, MER and LEH will have as a mountain of fraud suits are filed against them and their continued dilution of shareholders in order to raise capital results in very little reason to own these stocks.  Earnings growth does not exist here.  Would you have bought Enron in the middle of their downfall?


    Have you noticed the "experts" on TV who called for a turn around by year end now saying the turn around will occur in early 2009.  How do you continue to trust these liars?

     

    I have to agree with you Jack - I don't see anything happening good in financials anytime soon. If yer in, git out, if yer out, git short!!!    SELL SELL SELL

     

     

  •  08-03-2008, 6:30 PM 34707 in reply to 34693

    Re: The Turnaround in Financial Stocks

    Reply Quote
    jackg1606:
    Have you noticed the "experts" on TV who called for a turn around by year end now saying the turn around will occur in early 2009.  How do you continue to trust these liars?


    Throwing in another, related thread:
    http://www.zecco.com/

    How does the "Bear talk indicates there's a Bull around the corner" theory relate to Financials?

  •  08-03-2008, 7:09 PM 34710 in reply to 34707

    Re: The Turnaround in Financial Stocks

    Reply Quote

    michiel:
    jackg1606:
    Have you noticed the "experts" on TV who called for a turn around by year end now saying the turn around will occur in early 2009.  How do you continue to trust these liars?


    Throwing in another, related thread:
    http://www.zecco.com/

    How does the "Bear talk indicates there's a Bull around the corner" theory relate to Financials?

     

    Bear talk is one of those indicators that are very subjective. Just like any overbought / oversold indicator. The bear talk high can be around a long time before there's actually a turn. The only way to really tell is after the fact. Right now, it's a good time to have a short term perspective. If you go long, keep your stops tight, if you go short, keep your stops tight. If you dive headlong into either direction you could get hit hard.

     

    One thing, I sure as hell wouldn't go long on financials right now. All of their problems still haven't been discounted in the price.

  •  08-03-2008, 10:39 PM 34712 in reply to 34710

    Re: The Turnaround in Financial Stocks

    Reply Quote

    Anyone know of an ETF that shorts the financials. That could be a way to hedge your long position?

     

    Lou

Page 1 of 2 (21 items)   1 2 Next >
Content Name: StandardBottom
Preview Revision #:
Active Revision #:
Edit Content
 


ZeccoShare is currently in Beta mode. In case you wish to provide feedback, please post it in the ZeccoShare Forum.

ZeccoShare provides a confined and secured environment. The information you share (e.g. profile, holdings, trades, performance) is only displayed to other Zecco members. Guest (i.e. not signed in) are not able to see any individual member information. Guests will only be able to see anonymous, aggregated community data.

Zecco members marked with a ‘Zecco Associate’ medal are employees of Zecco.com. They are not registered representatives of any broker/dealer, and are not registered with any national securities exchange. All information displayed and all posts made by these users are their personal information and opinion, and not the opinion or information of Zecco.com. Zecco.com is not a broker/dealer, has no access to material non-public information about publicly traded companies, and does not make any recommendations regarding the purchase or sale of any security.


All content in the ZeccoShare community is provided for educational and informational purposes only, does not constitute a recommendation to enter in any securities transactions or to engage in any of the investment strategies presented in such content, and does not represent the opinions of Zecco Holdings or its employees. Your use of the ZeccoShare Community is conditioned to your acceptance of all Disclosures and Terms of Service.
Close [X]
Content Name: CommunityDisclaimerLong
Preview Revision #:
Active Revision #:
Edit Content

More details about online investing and trading stocks with Zecco Trading:


Zecco Trading has reconstructed the mold of options trading and stock trading online, making it easier than ever for you to get smart and act smart with your money. Need to sell stock or buy stock online, interested in penny stocks? At Zecco Trading, get 10 free stock trades every month when you maintain a $25,000 balance or execute 25 trades each month. Otherwise it's just $4.50 per trade. Free Online Stock Trading Details. Where else will you find a discount broker who looks out for your best interest by providing you free online stock trading and a community of investors to share ideas with?

The ZeccoShare Community is a great complement to Zecco Trading. With ZeccoShare you can learn online about stock trading and get advice on stock trades and options trades from people who invest like you and who have similar risk tolerance. Who says online investing is complex? It doesn't have to be. With ZeccoShare you'll be able to ask questions, contribute investing ideas, share your investment portfolio (but not any dollar amounts), share your stock trades or options trades and your investing performance to help everyone learn to be a better investor.

Read our education section for information on How to Trade Options.

Terms of Service - Privacy Policy


Zecco.com is a financial portal of Zecco Holdings, Inc., which also provides access to Zecco Trading, Inc.'s and Zecco Forex, Inc.'s trading service. Zecco Holdings, inc. is not a securities broker/dealer. All securities and investments are offered to self-directed investors by Zecco Trading, Inc. Member FINRA /SIPC. Foreign exchange trading is offered to self-directed investors by Zecco Forex, Inc. Zecco Forex, Inc. and Zecco Trading, Inc. are affiliated but separate companies. More information is located on the disclosures page.

At Zecco Trading, get 10 free stock trades every month when you maintain a $25,000 balance or execute 25 trades each month. Otherwise it's just $4.50 per trade. Free Online Stock Trading Details. Options trades are $4.50 plus $.50 per contract. Only the first account of any account type is eligible for the Zecco Trading, Free Trading program. Any multiple accounts of the same type with the same registration are not eligible for the free trading program. Free Trading Program is only available through Zecco.com. $0 minimum to open cash and IRA accounts.

* Margin accounts require a $2,000 minimum balance for opening and trading on margin. Margin trading involves risks and is not suitable for all accounts.

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options.

Multiple leg options strategies involve additional risks and multiple commissions, and may result in complex tax treatments. Please read Spread Trading Disclosure.

Investors should consider the investment objectives, risks, and charges and expenses of a mutual fund or ETF carefully before investing. A mutual fund/ETF's prospectus contains this and other information, and should be read carefully before investing.

Forex trading involves significant risk of loss and is not suitable for all investors. Increasing leverage increases risk. Before deciding to trade forex, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained does not constitute investment advice. Read full disclosure.

System response and access times may vary due to market conditions, system performance, and other factors.

The content of Zecco Holdings, Inc.'s, Zecco Trading, Inc.'s, and Zecco Forex, Inc.'s websites, including research, tools and securities symbols, is for educational and informational purposes and should not be intended as a recommendation or solicitation to engage in any particular securities transaction or investment strategy. You alone are responsible for evaluating the benefits and risks associated with the use of our services or products and to decide which securities and strategies better suit your financial situation and goals, risk profile, etc. The projections regarding the probability of investment outcomes are hypothetical and not guaranteed for accuracy or completeness. They do not reflect actual investment outcomes and are not guarantees of future results. Projections and tools' calculations do not take into consideration commissions, margin interest and other costs that will impact investment outcomes. All investments involve risk. Losses may exceed the principal invested. Past performance of a security, market, or financial product does not guarantee future results. Neither Zecco Holdings, Inc., Zecco Trading, Inc., nor Zecco Forex, Inc. offers any tax, legal or financial advice. Content on these websites may be out of date or time-sensitive. Content is subject to change or removal without notice.

No consideration was paid for any testimonials displayed on this website. Your experience may vary, and the testimonials are no guarantee of future performance or success. Zecco Holdings, Inc., Zecco Trading, Inc., Zecco Forex, Inc. and their independent providers are not liable for any errors, incompleteness, or delays, or for any actions taken in reliance upon information contained herein. By accessing our websites, you agree not to redistribute the information found therein.

Market Data Copyright © QuoteMedia. Data delayed 15 to 20 minutes unless otherwise indicated. RT = Realtime, EOD = End Of Day, PD = Previous Day. Powered by QuoteMedia. Terms of Use.

© 2006-2009 Zecco Holdings, Inc., Zecco Trading, Inc., Member FINRA /SIPC, Zecco Forex, Inc. All rights reserved.