Wed 23 Sep, 2009 11:32 pm
Hi everybody, I need to learn about stock market and trading in shares.

Thanks for any ideas.
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Linkat
 
  1  
Thu 24 Sep, 2009 10:41 am
@navigator,
Go to the library and find a book about it. Or better yet take a course on it. Couldn't give you a 5 minute lesson on it.
0 Replies
 
Cycloptichorn
 
  1  
Thu 24 Sep, 2009 10:44 am
@navigator,
So, yeah. What do you want to know, more specifically? The topic is too broad to answer reasonably as it is right now.

Cycloptichorn
ebrown p
 
  1  
Thu 24 Sep, 2009 10:45 am
@navigator,
The basic principle is -- buy when the price is low, sell when the price is high.

This is exactly the opposite of what many novice investors do.
Linkat
 
  1  
Thu 24 Sep, 2009 10:51 am
@ebrown p,
Or be greedy when others are not, and don't be greedy when others are.
0 Replies
 
chai2
 
  1  
Thu 24 Sep, 2009 11:33 am
I took a weekend course at the beginning of the year, and to date I've averaged 20% return (tax free).

Seriously, a book I'd highly recommend is Rule #1 Investing by Phil Town.

Reading that, taking a course, learning how to graph charts, finding good stocks at a good value, how to place stop orders to minimize your losses and safeguard your gains have all been a great help, and enabled me to realize I can do what large mutual fund managers cannot. I can get in and out of a position in a moment, without causing the economy to crash.

I use a website (that I pay a fee for) that gives all that information, and I just have to analyze it and make a decision. I figure the cost of my yearly fee, and the per stock transaction fee into my gains, so the % I give are NET.

It's important not to get discouraged if you have a string of losses. Done correctly, you can easily tolerate a series of losses of 2, 3, or 5% if you have just a few stocks that have gained 20, 30, 50% already.
Right now I'm holding a stock that is up about 56% from when I bought it about 5 months ago. The worst that will happen if the stock dips to my stop order is that I will "only" make 35%.

You have to be prepared to make some mistakes. I've made some good choices, but the stock when down and I've lost....but, my worst losses have been because when I was just starting, I incorrectly set the stop so it expired the same day. I didn't realize it, and watched the stock plummet, thinking "wow, I'm glad I got out of that"....and I hadn't.

There's one stock that since the beginning of the year I've bought and let get sold 3 times. The first time it made 24%, then the price went back to where it originally was, I rebought it, it got up to 17% bfore it sold itself. Now I have it again, and it's earned 3% so far.....same money. I've got maybe 2 others that are repeaters.

I've certainly not gotten rich.....yet.
I just started so I conservatively opened an account transferring 10K of money in my IRA.
A few months ago, I transferred some of my husbands IRA into another account. I'm his broker Smile

Right now, I'm to the point where I'm going to transfer the rest of my IRA and do it on my own.

And all this is being done at a very careful, conservative pace.

It's really, really, really not that hard....stock brokers want you to think it is

Next year I have a personal goal set to make 35%
navigator
 
  1  
Fri 25 Sep, 2009 07:07 am
@Cycloptichorn,
Hi everybody, I want to know how to make theses charts and read them

ofcourse. Also, How to know the sign of buy and the sign of sell.

Green Witch
 
  1  
Fri 25 Sep, 2009 07:15 am
@navigator,
Quote:
How to know the sign of buy and the sign of sell.


If anyone could answer this we would all be multi-millionaires.

I know people who studied the markets for years and got smashed in the recent downturn. Don't bet money you can't afford to lose.
chai2
 
  1  
Fri 25 Sep, 2009 08:00 am
@navigator,
navigator wrote:

Hi everybody, I want to know how to make theses charts and read them

ofcourse. Also, How to know the sign of buy and the sign of sell.




Well, as has already been said, take a course, read and study.





greenwitch, did the people you know get smashed because they didn't have tools in place to get them out of the market once it it a certain low, minimizing their loss?
They should have been able to cut their losses and lose only 5-10%, wait, then start to rebuild from the bottom.

I mean, why would you cut your hand, but wait to go to the doctor until you're so gangreened you have to cut off the entire arm?
Take the cut, then sit out for a while until the wound heals, then go back to work.

No direct disrespect to the people you're speaking of, but the longer I live, the more I see that people that tell me they've studied something for years a lot of times don't know much more than people with a good dose of common sense.

It is very true though not to put money in the market without doing it so that you don't risk more than you're comfortable in loosing.

If I buy $2000 of stock @ $50 a share (40 shares), I've got it straight in my head before doing so that I'm willing to loose up to let's say $100-150 over the deal, about 2%, upfront, so seeing that the price has ranged from $47 to $51 over the last 2 week to a month, I set the initial stop at $46. Even if the stock dropped under $46 the next day (which I'm pretty sure it won't drop $4, or I wouldn't have bought it), the most I'm gonna loose is $160.

A couple/three weeks later, I see the low for that time has been my purchase price of $50, and the price is at $53, so I reset the stop at $49, so, if it drops under $49, I only lost $40.

Doing that one more time would at least guarantee I don't loose anything.

I repeat the process until I at least will make 15%, and will raise from there. My primary goal is not to settle for less than 15%.

Everyone talks about how the market went down, but, I studied the time after the inital crash (where, if I had been in during that time, would have been sitting on a pile of cash, having liquidated), and there were many opportunities to make money. Not in a risky way, but doing it conservatively and with awareness.

I was thinking of this thread this morning, and decided to actually figure out how much I'd be ahead if there was another crash today. I added up the total money in total I've put in, and added up my gains and losses and would be ahead 23% if everything I had liquidated.

If you invest $20K, you don't have to risk that much, like you're going to go broke. Decide how much of that you are willing to loose and act accordingly to protect yourself.

I know, I know....someone's going to say I just don't understand, it's more complicated than that, wait until next year, this was just a fluke, etc.

yeah well, eat my dust.
0 Replies
 
chai2
 
  1  
Fri 25 Sep, 2009 08:05 am
@Green Witch,
Green Witch wrote:

[If anyone could answer this we would all be multi-millionaires.



There would be a lot more multi-millionaires if people didn't assume they couldn't do something, because they've been told by the "experts"

The brokers don't want the word to get out that that they aren't doing as good a job as you could do yourself.

I believe people who are truly successful, in whatever realm they want to be successful in, got there because they decided not to listen to people who said they couldn't do it.

Navigator, get educated, be prudent. I've already mentioned a good book for you to read.
Get moving.
0 Replies
 
ebrown p
 
  1  
Fri 25 Sep, 2009 11:21 am
That's funny...

How many people in this thread aren't multi-millionaires?

Linkat
 
  1  
Fri 25 Sep, 2009 11:29 am
@ebrown p,
I'm not - but like what was mentioned here I took a sum of money that I felt comfortable I could risk and/or wait until the market came back to at least break even. Unlike others I invested in a couple of mutual funds. These work well in the sense you do not need as much money to diversify your investments.

You focus on an objective you want - and read up on the funds that fit your objective - prior returns/fund ratings - I use Morning Star. Then you do the be greedy when others are not. Which I did the beginning of this year - while the market was down and pretty low - I put my money in too funds and let it sit. I looked today and granted today the market is down and so are my investments, but year to date - I have made 28% return - if I were to sell today.
chai2
 
  1  
Fri 25 Sep, 2009 11:44 am
@Linkat,
I know, the markets been down the last few days.

I think it's just loosening its belt so it can go back up.
0 Replies
 
Cycloptichorn
 
  1  
Fri 25 Sep, 2009 11:48 am
Christ, the amount of time it takes to keep up with all that, it's like Work. Might as well just get a second job and make actual wages if you are going to go to all that bother.

Cycloptichorn
chai2
 
  1  
Fri 25 Sep, 2009 12:26 pm
@Cycloptichorn,
Not really. I spend a total of about an hour a week.

Well, that's for the necessary stuff, like seaching, analyzing and trading. Some weeks you search for a while and see nothing worthwhile, so you don't even bother to do any more.

I end up getting facinated by something, and spend more time just having fun.

Once you get all the companies that aren't worth looking at in the first place out of the way, the field is much smaller.

A bad company is not going to become a wonderful company overnight. You don't have to keep going back to look at it.

chai2
 
  1  
Fri 25 Sep, 2009 12:48 pm
@Cycloptichorn,
Cycloptichorn wrote:

Christ, the amount of time it takes to keep up with all that, it's like Work. Might as well just get a second job and make actual wages if you are going to go to all that bother.

Cycloptichorn


ok, maybe everyone's going to think I'm on a soapbox, but I don't care.

I hope this gives just one person something to think about.

The comment made before that if people knew how to do this everyone would be a millionaire?

It's not that people can't learn this, it's that so many either aren't aware, or if they are, don't even take the first little bit of initiative.

Let me tell you my experience....

Like I said above, I ended up learning about being able to understand enough about the stock market to intelligently make trades, by starting out going to this weekend long class.....I learned about that because I went to some motivational seminar, which I had absolutely no interest in "getting motivated" but wanted to see Colin Powell, Rudy Guiliani and Suze Orman (btw Colin Powell is a very funny man)
It was one of those deals where you could get a shitload of tickets, for practically nothing.
I must have asked 30 people I worked with if they wanted to go, that they could have as many tickets as they wanted for nothing.
I think about 8 people said they wanted to go, and some of them asked for extra tickets so they could bring friends.

Sure.

The day of the seminar, only TWO people, me, and one other showed up.
I didn't care, I just wanted to take the day off and see Colin Powell.

After Phil Town talked both of us decided to take the seminar, and my co-worker said she also wanted her husband to go.

She backed out (I think her husband talked her out of it) and I was the only one that ended up going.....and learning.

Later on, I found out the others didn't go to the motivational thing, so never learned of the opportunity, because they just didn't feel like it that morning, the girlfriend who was supposed to come too couldn't make it, so the boyfriend didn't go either.....just really ******* stupid **** like that.

So, all because someone didn't want to go somewhere unless their GF was with them, or because they just wanted to sleep late...they totally missed out.

In general, that's just how people are.

Then they turn around and say they don't know how to do something like trade stocks...never mentioning they never tried to learn.

Lemme tell you something people. I'm not the sharpest pencil in the box. If I can do this, so can you.

What's stopping you?
0 Replies
 
Green Witch
 
  2  
Fri 25 Sep, 2009 01:38 pm
@chai2,
I agree a person can educate themselves on how the markets work, but having worked in the markets, I can tell you the people on The Street have a great advantage. Chai, were you in the market in '87? I lost close to $45,000 in minutes when one of my better picks suddenly went belly up. I invested most of my money in real estate after that, but even in the most recent market downturn I took a pretty good hit- and I had stuff most people would have rated as prime. So much for retirement and the health savings account. It's not so easy to recover when you get slammed and I don't think we going to seen any New Golden Age of Wall St. in the near future. If you've just started to invest, you don't yet have the full picture of what the markets can do and do quickly. I'm not saying not to invest (it's one of the few options we have to make money without going to an office), but I am saying even the sharpest pencils in the draw can end up broke, so don't get overly confident.
chai2
 
  1  
Fri 25 Sep, 2009 02:11 pm
@Green Witch,
Green Witch wrote:

I agree a person can educate themselves on how the markets work, but having worked in the markets, I can tell you the people on The Street have a great advantage. Chai, were you in the market in '87? I lost close to $45,000 in minutes when one of my better picks suddenly went belly up. I invested most of my money in real estate after that, but even in the most recent market downturn I took a pretty good hit- and I had stuff most people would have rated as prime. So much for retirement and the health savings account. It's not so easy to recover when you get slammed and I don't think we going to seen any New Golden Age of Wall St. in the near future. If you've just started to invest, you don't yet have the full picture of what the markets can do and do quickly. I'm not saying not to invest (it's one of the few options we have to make money without going to an office), but I am saying even the sharpest pencils in the draw can end up broke, so don't get overly confident.



Just one question greenwitch.

Did you have a stop on your stocks at that time so they would have sold if they dropped below a level designated and adjusted periodically by you, to prevent you loosing more than a set amount?



0 Replies
 
Linkat
 
  1  
Fri 25 Sep, 2009 02:43 pm
@Cycloptichorn,
One thing that was suggested by a portfolio manager I know (a very successful one) is to focus on a company or companies that interest you or you think has alot of business - for example - way back when this manager saw his teenage daughter purchasing lots of stuff from the Gap and figured if all kids are doing this - and then went on to research it.

I work in the industry so it is difficult for me to purchase and trade in stocks because of the potential of insider trading appearances (and like you said - time consuming), so instead I focus on mutual funds. I look longer term - for instance when I see the market falling, I throw extra money in.

If you don't have the time to reasearch - find some funds that are according to your risk and financing objectives - then put in whatever you can afford monthly. This minimizes the ups and downs of the market.
0 Replies
 
chai2
 
  1  
Fri 25 Sep, 2009 07:50 pm
@Green Witch,
Green Witch wrote:

I agree a person can educate themselves on how the markets work, but having worked in the markets, I can tell you the people on The Street have a great advantage. Chai, were you in the market in '87? I lost close to $45,000 in minutes when one of my better picks suddenly went belly up. I invested most of my money in real estate after that, but even in the most recent market downturn I took a pretty good hit- and I had stuff most people would have rated as prime. So much for retirement and the health savings account. It's not so easy to recover when you get slammed and I don't think we going to seen any New Golden Age of Wall St. in the near future. If you've just started to invest, you don't yet have the full picture of what the markets can do and do quickly. I'm not saying not to invest (it's one of the few options we have to make money without going to an office), but I am saying even the sharpest pencils in the draw can end up broke, so don't get overly confident.


I'd like to open up for discussion some of the comments made above. So please don't take it like I'm trying to start an argument. It's just that I dispute to a greater or lesser extent some of the things said above, and by others. I'll gladly carefully consider any answers to some of the questions I'm going to ask, and have no problem with stating that sound, true points are being made.
However, I think it's only fair to bring up a few challenges to what is being stated as "that's just the way it is"

First, for myself, I have not said anywhere that I am not make prudent, conservative decisions. I buy only enough that I do not risk more than a small portion of my money at any given time. I thoroughly research a stock before buying, looking at it's history, studying it's financial statements, looking at it's value, etc. I also prefer buying companies in industries I know quite a bit about, and it's where I give most of my attention.

Ok, I hope that's enough to dispell that I'm throwing darts at the WSJ and picking stocks that way, and that I realize there's risk involved. Moving on....oh, and yes, btw, I was in the market back in 1987. At the time I was dating a market timer, and watched him flip out, but personally, I didn't lose much.

Why is is just assumed that the people on Wall Street have such a big advantage? I'm sure they have advantages in some ways, but the little guy has some great advantages over them.
OK, seriously, someone please list some of the advantages. I have an inkling of a few, but I'd like to hear from others, to see if it's the same as I'm thinking.

There was a time, like back in 1987, where people did not regularly have internet access. In order to know what the market was doing at any given minute, there were few alternatives. You had to be watching or listening to a financial channel/station, reading a financial newspaper or magazine, or phoning their broker, who obviously does not have all the time in the world to talk to little old you. Leave a message at the tone. People weren't emailing each other, and if you did want to trade a stock yourself, it was done, what? through telephones and faxes? I guess prior to the 90's wall street people did seem to have some kind of mysterious power, as they were the only ones who could regularly converse with the Great and Powerful Oz. The guy on the street had to make due with reading newspaper and magazines, whose information was already outdated by the time they went to print, or rely on some guy on TV/radio/at Merrill Lynch to tell them what was going on.

So, it's 1987, the sky is falling, and my broker has orders to sell my stock. Oh, and about a gagillion other people's stock. Get in line. This huge wave of sales overwhelms the Street, who, because of it's gigantic volume, is too big and cumbersome to get out of its own way. Crash.

Today, I decide to sell off everything I have, my little pittance in the big scheme of things doesn't effect anything. I move in and out at will (and no, I don't make numerous trades, just smart ones).

I'm one of hundreds or thousands of clients a broker has. He/she has no particular interest in keeping me individually happy as a customer. He's in a business, and what is the best interest for the whole may be bad for me alone.

Me, I'm my only customer. The only person I have to worry about making happy is me. I don't worry about that at all.

Sure, these brokers got a specific education to learn about what they are doing, but how do I know if the person taking care of me has years of good experiece, is someone working there, always on the edge of getting fired, or some upstart right out of school who hasn't learned the ropes yet?

Don't brokers have quotas or something to meet? I don't know the word for it, but I'm sure there's some kind of measure used to determine if they are making their employer money. I don't believe that always equates to acting in my best interest and making me money. Unless I'm a ba-zillionaire, no one knows who I am on Wall Street. I know who I am though, and never forget about me.
I can't afford to become overconfident, I'm all I have. I watch myself like a hawk.

Do people on Wall Street have access to information I don't? Sure, of course. But today, I have access to tools and information at the click of a mouse that couldn't be matched by brokers just a few (20 years) ago.

I'm just sayin' the if you mind your p's and q's, don't let your emotions rule you as far as daily ups and downs, do the right thing, etc. you can do quite well, and get emmense satisfaction and fun while doing it.
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