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If we are to financially survive the next economic money crises, we must do ‘event trading’ (earnings announcements, acquisitions by big companies who gobble up little companies, GDP, FOMC minutes, and other significant ‘events’.)
For example, Alcoa (AA) earnings were released this week, they were good but because sales were down, the stock price was down.
Had one owned Alcoa stock, they could not have absorbed the loss. When earnings or sales are bad, the move down is substantial. When earnings or sales are good the recovery is also substantial. Of course, the total market direction will influence price direction long term, including the overcome of disappointing sales such as the decline in Alcoa.
The point is one must be active in investment decisions rather than rely upon investment funds to achieve income growth.
This is a disater waiting to happen! Not to mention the endless hours of trying to pick stocks and beat the market. There are plenty of good funds that will produce the returns in the ten percent range needed by this friend.
If you want to do this safely play a mid or large cap with large volume. This is investing, not trading and is a big different world, although similar principles apply. PM me if you have some specific questions in regards to investment strategy.
"Had one owned Alcoa stock, they could not have absorbed the loss."
WHAT? They couldn't absorb a 2-3% loss?
OMG I KNOW!!!!!!! This friend of my friend who is trying to 'nudge' her into active trading said he lost 4K when Alcoa dropped.
When I looked at Alcoa over a five year window it's historic low was around 6 dollars a share, and it's never gone over 15.
I keep repeating that you buy good quality dividend paying stocks and you don't sell them. Ever. Unless something huge happens like they get bought out or something.
This same person sold all of his Chevron when they announced a cut in dividends.
BAM! The darn thing shot up like a rocket the next day.
Personally, I would think oil stocks are a buy given the current oil market, but, hey, I'm just a dumb blonde in a world of old dudes in suits.........
Quote:
Originally Posted by mathjak107
active trading -NOOOOOOOOO .
but nudging portfolio's to better navigate the changing big picture --- YEP!
35 years of falling interest rates let someone pick an intermediate term bond fund and sit in place.
bonds just added to the party.
well after 35 years we at he that junction where what we knew all our investing lives is finally coming to an end.
more than ever it will require some nudging like steering a big ship to stay on course with some fund swaps that better fit without taking away .
Exactly. I also keep saying buy funds, let the fund managers do the work. Again, WTH do I know?
A mil in the right funds could generate 100K/year easily with low to moderate risk, IMO.
Quote:
Originally Posted by MJ7
If you want to do this safely play a mid or large cap with large volume. This is investing, not trading and is a big different world, although similar principles apply. PM me if you have some specific questions in regards to investment strategy.
Thanks, MJ. You can bet yer behind I will raise the white flag to S.O.S. you folks, I just wish I could compensate you back. PM me with with car and parts problems.
OMG I KNOW!!!!!!! This friend of my friend who is trying to 'nudge' her into active trading said he lost 4K when Alcoa dropped.
When I looked at Alcoa over a five year window it's historic low was around 6 dollars a share, and it's never gone over 15.
I keep repeating that you buy good quality dividend paying stocks and you don't sell them. Ever. Unless something huge happens like they get bought out or something.
This same person sold all of his Chevron when they announced a cut in dividends.
BAM! The darn thing shot up like a rocket the next day.
Personally, I would think oil stocks are a buy given the current oil market, but, hey, I'm just a dumb blonde in a world of old dudes in suits.........
Exactly. I also keep saying buy funds, let the fund managers do the work. Again, WTH do I know?
A mil in the right funds could generate 100K/year easily with low to moderate risk, IMO.
Thanks, MJ. You can bet yer behind I will raise the white flag to S.O.S. you folks, I just wish I could compensate you back. PM me with with car and parts problems.
An easy 10% yearly return with low to moderate risk? Isn't that a bit optimistic?
Market timing is guaranteed to make you a loser. You might get lucky over a short period of time but odds are about about 4 to 1 that you will simply miss out on gains by attempting to time the market.
Market timing is guaranteed to make you a loser. You might get lucky over a short period of time but odds are about about 4 to 1 that you will simply miss out on gains by attempting to time the market.
This is basic economic teaching so I don't get why this guy doesn't get this. One reasoning of his is that by doing options, puts and calls you could garner ten percent each week.
But who's got the stamina to endure the stress and the time to make it your full time job? Maybe someone in their thirties, forties or fifties, but at over seventy? Jeez, get out there and live!
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