Since we're not talking about specific stocks and just talking theory and mindset, I thought I'd share something I've been thinking.
Rather than saving myself (and monies) for the big moves, I'm thinking it might be worthwhile to go for consistant small gains. $100 a month pays for 20 lunches at work or one month's worth of insurance. $200 covers utilities. $300 is like buying myself a $10 dinner each night. Higher amounts start to cover apartment/rental home utilities, car payments, and others.
Eventually, I'm sure we all have the same goal of attaining "critical mass" where investments cover our monthly expenses and "work" at the office is just a bonus.
I'm starting small. Wish me luck and try not to laugh if you see me joyful for making $3.33 a day.
Monday, April 21, 2008
Friday, April 18, 2008
R.C. Corner
During the first period of a man's life the greatest danger is not to take the risk.
-- Soren Kierkegaard
-- Soren Kierkegaard
Thursday, April 17, 2008
Simon: Trader Chat
there are 2 kinds of people out there...one that things that trading is easy, and the other that thinks that trading is hard...I wouldn't know which group the most successful traders fall into but i do know that there are many aspects of the game you have to accept if you are to become successful. The following is a short list of a few i find important:
1. ESID - Every Situation Is Different. Like life, there are no 2nd change opportunities or "i've seen this before" kind of scenario. No 2 situations are the same. This is why you should never feel 100% in any trade. Unlike many other games, you will never get dealt the same cards twice...NEVER! The moment you think differently is the moment the market proves you wrong.
2. There will be MANY missed opportunities. It is part of the game, especially during earnings seasons. Today had many huge 10% moves up or down...and i bet tomorrow will have just as many. Though hard to keep in the emotions of regrets and GREED, it really is best handled with a "live to fight another day" kind of mindset. The more time spent thinking about it is just more time taken away from searching for the next big move. And there will be another big move...there always is...
3. Don't mistake successful traders with intelligent people. The successful ones have 2 things going for them and 2 things only...They are controlling emotions and managing risk. No need to be smart to be profitable...and doesn't mean you are stupid to be unprofitable. Just means you haven't found your style in playing this game.
4. the market always gets even. cockiness is never rewarded and greedy pigs always get slaughtered. smile but don't gloat...the moment you start boasting about your talents, your portfolio will pay the price.
5. trading is boring. not every minute is exciting and for those who "think" otherwise are just afraid to admit the truth. this is a key in finding your own trading strategy. How much time can you sit at the computer watching graphs get created? 6 hours? 5 minutes? once a week? once a month? Figure that out and you'll know what graphs you should trade off of.
6. Negativity surrounds you. For every opinion you have, there is bound to be another millions of traders who are going against you. Once you enter a trade, you'll start to hear opposition from CNBC contributors, bloggers, and also trading friends....Don't believe anything they say...whether right or wrong, give credit to your opinions first...these trader most likely do not trade in the same time frame or with have the same risk tolerance as you...and most people who bother to mention their ideas are opinionizing just for the sake of argument...there is no spine to their conviction...just talk...
7. Success is not measured in dollars...it is not measured by the amount of money you make...success is measured by your consistently and ability to understand the market. Making money off a trade can be 100% luck. And seeing it right, though not a participant with a position can mean more than the guy who made money off the same trade. Credit is given to the traders who remain successful for weeks, months, years and decades...Time will separate the good from the bad from the lucky....
1. ESID - Every Situation Is Different. Like life, there are no 2nd change opportunities or "i've seen this before" kind of scenario. No 2 situations are the same. This is why you should never feel 100% in any trade. Unlike many other games, you will never get dealt the same cards twice...NEVER! The moment you think differently is the moment the market proves you wrong.
2. There will be MANY missed opportunities. It is part of the game, especially during earnings seasons. Today had many huge 10% moves up or down...and i bet tomorrow will have just as many. Though hard to keep in the emotions of regrets and GREED, it really is best handled with a "live to fight another day" kind of mindset. The more time spent thinking about it is just more time taken away from searching for the next big move. And there will be another big move...there always is...
3. Don't mistake successful traders with intelligent people. The successful ones have 2 things going for them and 2 things only...They are controlling emotions and managing risk. No need to be smart to be profitable...and doesn't mean you are stupid to be unprofitable. Just means you haven't found your style in playing this game.
4. the market always gets even. cockiness is never rewarded and greedy pigs always get slaughtered. smile but don't gloat...the moment you start boasting about your talents, your portfolio will pay the price.
5. trading is boring. not every minute is exciting and for those who "think" otherwise are just afraid to admit the truth. this is a key in finding your own trading strategy. How much time can you sit at the computer watching graphs get created? 6 hours? 5 minutes? once a week? once a month? Figure that out and you'll know what graphs you should trade off of.
6. Negativity surrounds you. For every opinion you have, there is bound to be another millions of traders who are going against you. Once you enter a trade, you'll start to hear opposition from CNBC contributors, bloggers, and also trading friends....Don't believe anything they say...whether right or wrong, give credit to your opinions first...these trader most likely do not trade in the same time frame or with have the same risk tolerance as you...and most people who bother to mention their ideas are opinionizing just for the sake of argument...there is no spine to their conviction...just talk...
7. Success is not measured in dollars...it is not measured by the amount of money you make...success is measured by your consistently and ability to understand the market. Making money off a trade can be 100% luck. And seeing it right, though not a participant with a position can mean more than the guy who made money off the same trade. Credit is given to the traders who remain successful for weeks, months, years and decades...Time will separate the good from the bad from the lucky....
Tuesday, April 15, 2008
They're cheap now, but they'll get cheaper later.
Something to keep in the back of your mind.
Country Wide (CFC) is on today's list of high volume leaders. I just happened to see it this afternoon. The stock is still plummeting. No surprise there. The current share price of $5 can easly lose another 50% (arbitrary %age). Defintely don't buy now hoping to sell in a month. I'm confident however that companies like these will turn around and become strong again in the long run. When it goes big, it will be huge. The catch is that you may be waiting yrs.
I'll be waiting until the stocks start to flatline and prepare for the rise before purchasing for the long term.
Two scary things:
1) The last time the stock was at $5, was back in 2000.
2) The stock was $32-40 for 4 yrs before this recent drop. There's not much volatility. Timing for this stock is everything.
Brian
Country Wide (CFC) is on today's list of high volume leaders. I just happened to see it this afternoon. The stock is still plummeting. No surprise there. The current share price of $5 can easly lose another 50% (arbitrary %age). Defintely don't buy now hoping to sell in a month. I'm confident however that companies like these will turn around and become strong again in the long run. When it goes big, it will be huge. The catch is that you may be waiting yrs.
I'll be waiting until the stocks start to flatline and prepare for the rise before purchasing for the long term.
Two scary things:
1) The last time the stock was at $5, was back in 2000.
2) The stock was $32-40 for 4 yrs before this recent drop. There's not much volatility. Timing for this stock is everything.
Brian
Earnings Outlook
While the market is in the middle of a tug of war between the bears and the bulls, earnings reported from Alcoa, GE, and Wachovia Bank have set the tone for this quarterly earnings reports. With the bulk of the companies reporting earnings starting tomorrow, here’s a possible preview of what to expect…
Financial Earnings – Most financial banks will report a decrease in net income or a loss as was the case with WB. It’s no surprise that banks currently have no means of generating income and it’s prudent for them to clean out their balance sheets. I expect the write downs to be finalized during this quarterly reports and efforts to increase liquid capital through stock sales, sovereign funds & dividend cuts will be made. While downside risk certainly remain for financial stocks going forward, this quarterly report period should be the final period to cause downward surprises.
Technology Earnings – While most technology companies reported good revenue numbers but got punished for bearish guidance in previous quarterly reports, this time around they’ll have to deal with a decline in revenue AND slowing growth in providing guidance. The economic slowdown would seem to deal the biggest blow to technology companies and I expect a massive amount of beatings to come for these stocks. Only bright spot would be for companies that have heavy international exposure as they can benefit from the weakness in dollar. However, going forward, with dollar nearing a bottom and domestic economy falling into a recession, I can’t paint a bright picture for the technology sector.
With financial crisis, rising inflation, decreasing consumer consumption, and overall slowing economy, it’s no surprise to see that the bears are up 3-0 so far after three earnings reports from companies mentioned above. By the end of earnings period, I expect the bears to come out victorious in a lopsided fashion. (Buying puts ahead of these earnings would be a play worth noting.) As for the general outlook for the market, with our recent failed attempt at registering a higher high than January highs, and negative earnings outlook, I’d favor a break of the previous lows and a fall down to 1150-1200 instead of a break of 1400 in S&P500. An increase in volatility will likely persist to the end of April at which time, the Fed will have a meeting to announce what could possibly be the final interest rate cut.
Rino Choi
Titans of Wallstreet
Market Columnist
Financial Earnings – Most financial banks will report a decrease in net income or a loss as was the case with WB. It’s no surprise that banks currently have no means of generating income and it’s prudent for them to clean out their balance sheets. I expect the write downs to be finalized during this quarterly reports and efforts to increase liquid capital through stock sales, sovereign funds & dividend cuts will be made. While downside risk certainly remain for financial stocks going forward, this quarterly report period should be the final period to cause downward surprises.
Technology Earnings – While most technology companies reported good revenue numbers but got punished for bearish guidance in previous quarterly reports, this time around they’ll have to deal with a decline in revenue AND slowing growth in providing guidance. The economic slowdown would seem to deal the biggest blow to technology companies and I expect a massive amount of beatings to come for these stocks. Only bright spot would be for companies that have heavy international exposure as they can benefit from the weakness in dollar. However, going forward, with dollar nearing a bottom and domestic economy falling into a recession, I can’t paint a bright picture for the technology sector.
With financial crisis, rising inflation, decreasing consumer consumption, and overall slowing economy, it’s no surprise to see that the bears are up 3-0 so far after three earnings reports from companies mentioned above. By the end of earnings period, I expect the bears to come out victorious in a lopsided fashion. (Buying puts ahead of these earnings would be a play worth noting.) As for the general outlook for the market, with our recent failed attempt at registering a higher high than January highs, and negative earnings outlook, I’d favor a break of the previous lows and a fall down to 1150-1200 instead of a break of 1400 in S&P500. An increase in volatility will likely persist to the end of April at which time, the Fed will have a meeting to announce what could possibly be the final interest rate cut.
Rino Choi
Titans of Wallstreet
Market Columnist
Monday, April 14, 2008
Sideways is good
The sideways market is great! It's a good time to watch the stocks in preparation for a big move up...or down. Keep an eye out. I know I will be! I don't want to miss another 23% jump in Apple like I did when I was away on vacation. Keep those eyes peeled!!!
Brian
Brian
Thursday, April 10, 2008
Re: Bullishly Bias? - I disagree.
Though there have been some ups and downs within the support and resistant lines, the S&P has been in an overall downtrend since October.
From late January up until now, it looks like a sideways movement.
In the past couple days it's been dropping.
I think even if the S&P will hit Simon's predicted mark, based on peformance so far in 2008, we're in for a drop shortly after.
It's too early to say which direction the market will go until it breaks some trend lines....particularly the ones being formed since March 17th as shown in Simon's graph. I predict it will drop below 1260 before May 10th. Let's make this interesting. If it breaks 1411, I'm buying you dinner Simon. If it falls to 1260, you can buy me one of those red bean paste fishes from Japantown.
Looking forward to it.
Brian
From late January up until now, it looks like a sideways movement.
In the past couple days it's been dropping.
I think even if the S&P will hit Simon's predicted mark, based on peformance so far in 2008, we're in for a drop shortly after.
It's too early to say which direction the market will go until it breaks some trend lines....particularly the ones being formed since March 17th as shown in Simon's graph. I predict it will drop below 1260 before May 10th. Let's make this interesting. If it breaks 1411, I'm buying you dinner Simon. If it falls to 1260, you can buy me one of those red bean paste fishes from Japantown.
Looking forward to it.
Brian
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