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Zecco.com » General Investing » New Investors » where should I start?
Last post 07-06-2009, 11:42 AM by ng8111. 38 replies.
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  •  07-04-2009, 4:23 AM 59909 in reply to 59908

    Re: where should I start?

    Reply Quote
    I noticed you own ACAS and are down >70% in it.  Where do you "see" this stock being 5, 10, 15 and 20 years from now?

  •  07-04-2009, 4:38 AM 59910 in reply to 59909

    Re: where should I start?

    Reply Quote

    Did you also notice that it is my smallest holding?

    Being as it is my smallest holding, it is not that important to my overall strategy.  We are also talking about a $3.00 stock.  It is not like it is a 70% loss on a $300 stock.  Keep that in mind, math whiz. 

  •  07-04-2009, 4:39 AM 59911 in reply to 59910

    Re: where should I start?

    Reply Quote
    VTECscreamer:

    Did you also notice that it is my smallest holding?

    Being as it is my smallest holding, it is not that important to my overall strategy.  We are also talking about a $3.00 stock.  It is not like it is a 70% loss on a $300 stock.  Keep that in mind, math whiz. 



    Why do you own it?  A 70% loss on a $3.00 stock is the same as a 70% loss on a $300 stock.  Either way, you've lost 70%.

  •  07-04-2009, 4:46 AM 59912 in reply to 59911

    ACAS

    Reply Quote

    I own it because they used to pay a very nice dividend.  I also like some of the companies they own and invest in. 

    Besides, again it is my smallest holding, and it not a very important component of my portfolio.  It was a "riskier" investment, time still may be kind to it or it may not.  If it doesn't payoff later on, it won't hurt me much because I didn't have much invested. 

     "A 70% loss on a $3.00 stock is the same as a 70% loss on a $300 stock.  Either way, you've lost 70%."  You are not getting it.  Yea, it is a 70% loss, but we are talking about the difference between hundreds or thousand of dollars. They are not the same in dollar terms.  I would rather take a 70% loss on a $3.00 stock than on a $300 stock any day.  I don't attach my pride to percentages, or short term gains.  I am not concerned about a 70% loss (at the moment) on a stock that is now $3.00.  It may turn into a gain at one point.  Or it may go bankrupt.  It is such a small part of my portfolio that it doesn't really matter.  We are not talking about alot of money. 

  •  07-04-2009, 4:49 AM 59913 in reply to 59912

    Re: ACAS

    Reply Quote
    VTECscreamer:

    I own it because they used to pay a very nice dividend.  I also like some of the companies they own and invest in. 

    Besides, again it is my smallest holding, and it not a very important component of my portfolio.  It was a "riskier" investment, time still may be kind to it or it may not.  If it doesn't payoff later on, it won't hurt me much because I didn't have much invested. 



    Fair enough, now same question for EWM.  Where do you "see" it being 5, 10, 15, 20 years from now?


    If you invest $1000 in a $3.00 stock or in a $300 stock, a 70% loss comes out to $700.00 no matter what.  They are the same.

  •  07-04-2009, 5:04 AM 59914 in reply to 59913

    EWM

    Reply Quote
    Trader Jack:
    VTECscreamer:

    I own it because they used to pay a very nice dividend.  I also like some of the companies they own and invest in. 

    Besides, again it is my smallest holding, and it not a very important component of my portfolio.  It was a "riskier" investment, time still may be kind to it or it may not.  If it doesn't payoff later on, it won't hurt me much because I didn't have much invested. 



    Fair enough, now same question for EWM.  Where do you "see" it being 5, 10, 15, 20 years from now?

    I don't "see" it being at a specific target or even a range.  I like Malaysia, and I like the growth that have experienced in the past.  I also like the fact they have alot of natural resources, and I like the fact that they trade alot with China.  It is somewhat of a stealth China play.  I also see it as a natural resource play in that countries that need the raw materials could be very interested in Malaysia. 

  •  07-04-2009, 5:08 AM 59915 in reply to 59914

    Re: EWM

    Reply Quote
    VTECscreamer:
    Trader Jack:
    VTECscreamer:

    I own it because they used to pay a very nice dividend.  I also like some of the companies they own and invest in. 

    Besides, again it is my smallest holding, and it not a very important component of my portfolio.  It was a "riskier" investment, time still may be kind to it or it may not.  If it doesn't payoff later on, it won't hurt me much because I didn't have much invested. 



    Fair enough, now same question for EWM.  Where do you "see" it being 5, 10, 15, 20 years from now?

    I don't "see" it being at a specific target or even a range.  I like Malaysia, and I like the growth that have experienced in the past.  I also like the fact they have alot of natural resources, and I like the fact that they trade alot with China.  It is somewhat of a stealth China play. 



    Same question, why do you own it?  Your strategy is to hold for several years (at least that is what you seem to mean).  Do you "see" the stock being worth more 5, 10, 15, 20 years from now?  When do you plan to sell it?  We don't own stocks because we like them.  They are not pets.  We own them to make money from them.

    To like something denotes an emotional attachment.  Are you emotionally attached to your stocks?

  •  07-04-2009, 10:22 AM 59916 in reply to 59910

    Re: where should I start?

    Reply Quote

    ACAS chart shows aa strong support level at 2.50. It's currently at 3.08. If you don't need the money from the stock to reinvest and you feel strongly the stock will rebound then hold onto it. It had a strong volume day a and a nice bounce up recently telling me people were buying it there at about the $3 range. Don't let other peoples opinions alter your perspective on a stock. It can really mess up your trading strategy when you start second guessing yourself. That's not to say they're right or wrong but you need to stick to your guns. I haven't looked at ACAS financial report. Just basing my opinion on their chart. Take it for what it's worth.

    CC

  •  07-04-2009, 12:56 PM 59925 in reply to 59915

    Re: EWM

    Reply Quote

    "Same question, why do you own it?  Your strategy is to hold for several years (at least that is what you seem to mean).  Do you "see" the stock being worth more 5, 10, 15, 20 years from now?  When do you plan to sell it?  We don't own stocks because we like them.  They are not pets.  We own them to make money from them."

     I own it for the reasons I stated in my first response to your question.  I think Malaysia has tremendous potential for growth, and I am interested in the companies that the ETF holds.  I think the ETF could be worth more in 5, 10, 15, or 20 years from now, but I don't 'see' this as the only outcome.  I don't know when I plan on selling it, I will know when the time is right.  I don't have a specific target or time frame in mind, in the meantime I will collect and reinvest the dividends. 

    You state that "we don't own stocks because we like them".  Don't generalize, simple jack.  Some people do own stocks because they want to own a part of a company or companies they like (or that appeal to them).  Just because you don't, doesn't mean that everyone else operates the same way.  There is that narcissism again. 

    Of coarse people own stocks to make money.  But some people get enjoyment out of getting an income stream from stocks they own, and have pride in owning a part of a company that appeals to them. 

    "To like something denotes an emotional attachment.  Are you emotionally attached to your stocks?"  Yes, I guess I am.  Being deviod of emotion is not part of my investment strategy.  You will never understand.  It is so simple, yet you cannot comprehend. 

  •  07-04-2009, 1:10 PM 59927 in reply to 59925

    Re: EWM

    Reply Quote
    Pretty honest answer.  I've never looked at the market as a hobby like that before.  I guess if you are not in it to make money and view it from more of a hobby perspective then nothing is wrong with having an emotional attachment to your stocks.

    I'll have to think about what stock I would like to have as a pet.  I can see some fun in that. 

  •  07-04-2009, 1:12 PM 59928 in reply to 59901

    Re: where should I start?

    Reply Quote
    Trader says: As far as "seeing" the market, I'm not the one claiming to "see" several years out into the future as you claim.

    My hypothetical over 5 years makes a lot more sense than your drop over 5 months. By the way, my thing is to help people see the benefits of long-term investing and when maybe you should lighten up your portfolio. To get to 28,000, this is how I was thinking that might happen:

    9,500 to 10,500 by 2010
    11,000 to 11,500 by end of 2010
    13,000 to 14.000 by end of 2011
    16,000 to 18,000 by end of 2012
    24,000 to 28,000 by end of 2013
    9,000 to 11,000 by end of 2015
    2,500 to 3,000 by end of 2017

    More likely path:

    9,000 to 9,500 by year end
    9,500 to 10,000 by end of 2010
    10,250 to 11,000 by end of 2011
    11,500 to 13,000 by end of 2012
    14,000 to 16,000 by end of 2013
    18,000 by end of 2017



    Now, I don't think this is the 5 year period that we go up 200%, but if we do, maybe you take some of your stocks off the table and count your blessings that you tripled your money. No one ever lost money taking a profit. There is an economic loss for earnings given up, thus having a LT focus is essential to successful investing. This is the reverse of when most people sell; they sell at the 6,547 bottom we had not at the 14,280 top that we had in July of 2007 (when I sold 1/3 of my stocks). People who avoided the top 10 days in the stock market turned their 7% return into a Treasury-like return (i.e. 1.25%). It is thus essential to realize that trading is risky business and can be destructive to an investing plan.

    My "prediction" had nothing to do with what I believed would happen, but is more of an age-old question, when it does happen, what should you do? The most likely scenario is that we will have slightly above-average returns for the next 10 years because the last 10 years was meek. The following 5 year chart occurs at least once every 100 years (I really think of it about every 25 years we get some variation of this, i.e. where you drop from 18,000 to 10,000 instead of venturing to 28,000 and dropping down 80-90%). There is always that "year" like 1999 whereby the markets go up a crazy amount (i.e. when the Nasdaq increased 80%). I don't like bubble markets since if you sell, you really feel like an idiot; that is until the tide reverses and than it all depends on the timing for which you got out. You also don't know what might soften the blow (i.e. in 2002, it was the real estate boom that helped turn the tide and split that recession into two separate recessions rather than one depression).

    Aqua

  •  07-04-2009, 1:26 PM 59929 in reply to 59928

    Re: where should I start?

    Reply Quote
    Aqua, you should never feel like an idiot for taking profit.  The old saying is "nobody ever goes broke from taking a profit".

    If you exit a position because the risk of holding it is more than the benefit then you are right to exit.  It doesn't matter if the stock doubles after you get out.  The last thing you want to do is to ignore what you see as being risky in order not to feel like an idiot for exiting.  Sure there may be times when a stock shoots up after you exit but don't forget all the times the stock will sink because there actually was a risk in holding it too long.  Once you are out of a position it's time to move on to the next....even if the next position is in the same stock after you have re-evaluated and determined it to be a good buy.

    Basically, over time you will lose much more money by ignoring risks than you will gain from occasionally getting lucky with the one that doubled after you ignored the sale signal.

  •  07-04-2009, 8:12 PM 59944 in reply to 59864

    Re: where should I start?

    Reply Quote
    alpaca:
    I have been trading on wallstreetsurvivor now for a few months trying to get comfortable with trading. I really enjoyed it and did pretty good. Good enough to feel like I'm ready to start with some real money. Problem is in the game I started with 100 grand. Now that I set up a real account I only have a few hundred dollars to start off with. I'm just looking for some advice on how to start out with such a small amount, stocks, options or mutual funds?  Anyone have some recommendations for a rookie trader.  thanks

    Trader Jack is a pretty good trader and you can follow his moves on covestor.com.
    I'm on there too if you want to see a long/short approach.
    chrib is a pretty good trader and shows everything he does on his blog.  Its been very educational for me and his approach is sound.
    Read!  The market is mysterious until you read about it.  Read about historical moments in the market.  Malkiel, Bogle, Greenblatt, Tharp, Elder, Swensen.  Read both technical and academic stuff, so you don't get too narrow-minded.
    And, most importantly, learn from good traders.  Watch FastMoney on CNBC, follow Jack and chrib, and participate in the blogs.
    Being a little more specific, you'll notice that FastMoney trader, chrib, and jack use ETFs a good bit, sometimes leveraged ETFs.  It took me a while to get comfortable with 2x ETFs and I somewhat doubt I'll ever be comfortable with 3X, but it's something to build towards.

  •  07-05-2009, 12:20 AM 59945 in reply to 59927

    Re: EWM

    Reply Quote

    Trader Jack:
    Pretty honest answer.  I've never looked at the market as a hobby like that before.  I guess if you are not in it to make money and view it from more of a hobby perspective then nothing is wrong with having an emotional attachment to your stocks.

    I'll have to think about what stock I would like to have as a pet.  I can see some fun in that. 

    Again, you are not understanding.  How hard is for you to grasp?  It is not a hobby.  I have taken the long term buy and hold approach.  I don't have a specific target or price range in which I intend to sell any of my equities at the moment.   I am in it to make money like you are.  Did you read anything I posted?  I said the stock market is one of the best investment vehicles around.   There is nothing wrong with having an "emotional attachment" to stocks you invest in when your intention is to make a profit.  Profit can be made regardless of the rationale behind purchasing the stock in the first place, math whiz. 

  •  07-05-2009, 1:45 AM 59947 in reply to 59945

    Re: EWM

    Reply Quote
    So, VTEC, would your strategy be let your winners run strategy or do you like Cramer's argument to use the house's money to keep a trade on (i.e. after it doubles in value)?

    There are some interesting articles in the July Smartmoney edition. They are for bulls & bears alike. This decrease in volatility has hurt me from benefiting on this "correction" with my German put that I own.

    http://www.smartmoney.com /smartmoney-magazine/


    VTECscreamer:

    Trader Jack:
    Pretty honest answer.  I've never looked at the market as a hobby like that before.  I guess if you are not in it to make money and view it from more of a hobby perspective then nothing is wrong with having an emotional attachment to your stocks.

    I'll have to think about what stock I would like to have as a pet.  I can see some fun in that. 

    Again, you are not understanding.  How hard is for you to grasp?  It is not a hobby.  I have taken the long term buy and hold approach.  I don't have a specific target or price range in which I intend to sell any of my equities at the moment.   I am in it to make money like you are.  Did you read anything I posted?  I said the stock market is one of the best investment vehicles around.   There is nothing wrong with having an "emotional attachment" to stocks you invest in when your intention is to make a profit.  Profit can be made regardless of the rationale behind purchasing the stock in the first place, math whiz. 

    Aqua
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