Stupid Stocks

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Sarvis
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Re: Stupid Stocks

Postby Sarvis » Thu Aug 28, 2008 4:02 am

Ragorn wrote:You aren't allowed to buy stock in the company you work for based on knowledge that isn't available to the general public (like knowing your company's earnings are up). That's called insider trading, and it's what Martha went to jail for.



It's not my company, there was a news article where they announced the earnings were coming out. (Oddly enough the stock jumped 20 cents when that came out, then dropped down lower than it was over the next day... :( )

If it were my company I'd already know if the report was good too, and wouldn't need to learn how to evaluate it!
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Vigis
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Re: Stupid Stocks

Postby Vigis » Thu Aug 28, 2008 6:10 am

Sarvis,

Does your company offer employee stock options? Mine gives me an extra 15% on top of what I buy and I immediately own it. If I buy $20 worth of stock, I can turn around the same day and sell it for $23. Do that every day and you will double your money. Most companies though will limit it to automatic withdrawals from your paycheck, so divide your $600 by 26 (if you get paid bi-weekly) and play that game. You won't double your money, but you will be very hard pressed to make better than a 15% return on any short term investment.

I will, however, echo everybody else's advice here. Invest for the long term and make your money work for you. The more you invest when you are young, the less time you have to wait before you can enjoy it.

If you are dead set on doubling your money you need to hit a blackjack table and hope the cards are with you. Do not start trying to day trade with only $600. In order to pull that off, you need to have a very big cushion. You have to be able to absorb losses from one day and make gains in the next; $600 isn't enough for that.

Do as you want, but I had to throw some advice out to you bud :)
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Sarvis
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Re: Stupid Stocks

Postby Sarvis » Thu Aug 28, 2008 12:42 pm

Vigis wrote:Sarvis,

Does your company offer employee stock options?


Nope. Actually we are an ESOP (Employee Stock Ownership Program) company, so basically the company owns all of it's own shares which are then divvied up among the employees according to some arcane formulae.

I will, however, echo everybody else's advice here. Invest for the long term and make your money work for you. The more you invest when you are young, the less time you have to wait before you can enjoy it.


I'm not young anymore...


If you are dead set on doubling your money you need to hit a blackjack table and hope the cards are with you.


I'm pretty terrible at blackjack! Not all of us used to be dealers you know. :P


Do not start trying to day trade with only $600.


Not going to be day trading, I have a full time job to hold down. That's why I'm picking up that "short term" trading book. It's aimed at holding stocks for a few days or weeks, which is probably more my style.

Granted, I'll probably still suck at it...
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Re: Stupid Stocks

Postby Corth » Thu Aug 28, 2008 4:35 pm

Sarvis wrote:On that note, the company I'm currently invested in has announced they're releasing an earnings report on Monday. What do I need to know about earnings reports to tell if theirs is good news or bad news?


Analysts will often make predictions about earnings. There will often more or less be a consensus. The current stock price is based in part on the prediction of earnings. If the earnings report exceeds expectations, chances are the price of the stock will rise. If the earnings report fails to meet expectations, chances are the price will drop.

On the other hand, maybe the sector your company is in is having a rough day, so even if earnings are met or exceeded, the price drops. Results are not always intutuitve, and day to day moves can often just be 'noise', and have no real bearing in the long term.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth

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Sarvis
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Re: Stupid Stocks

Postby Sarvis » Thu Aug 28, 2008 10:05 pm

Not too many analysts seem to care about this stock, but apparently they are expecting between -.1 and -.16 for earnings.

So we'll see on Tuesday I guess...

Thanks Corth!
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teflor the ranger
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Re: Stupid Stocks

Postby teflor the ranger » Fri Aug 29, 2008 11:45 pm

I shifted most of my investments into bond funds. Bat'n down the hatches, maties.

Yarr.
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Kifle
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Re: Stupid Stocks

Postby Kifle » Sun Aug 31, 2008 7:07 pm

Was reading some Twain last night and saw this little piece of genius and thought it might apply here: "October. This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August, and February."
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Sarvis
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Re: Stupid Stocks

Postby Sarvis » Thu Sep 04, 2008 8:51 pm

Ok, so looks like the analysts were pretty much on target... I guess we can expect the stock to stay about the same then? It went up $0.03, so far...
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Corth
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Re: Stupid Stocks

Postby Corth » Thu Sep 04, 2008 10:38 pm

I think maybe you are looking at this too rationally. Its typical of someone with a computer background. You are looking for a cause/effect relationship when in the short term there isn't one. Its very easy for the price to go up on bad news or down on good news based upon a billion other factors that are impossible to synthesize and understand, even if you had access to all the information that all the market players are basing their decisions on. In sum, it is possible (but difficult) to predict what a stock might do in the long term, and basically impossible to make any such prediction over the course of the next few days. And across any time horizon its impossible to base any prediction on meeting estimates for this past quarter. The smart money is already looking towards next quarter and the quarter after that.
Having said all that, the situation has been handled, so this thread is pretty much at an end. -Kossuth



Goddamned slippery mage.
teflor the ranger
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Re: Stupid Stocks

Postby teflor the ranger » Thu Sep 04, 2008 11:11 pm

Or, looking at it too rationally with too narrow a field of vision.

We get this problem a lot on this BBS. Consider factors outside of your current scope of vision, for instance:

Your company announces good news. Another company in the same industry announces great news.
Guess where all the major fund money is going?

Your company announces bad news. Another company in the same industry losses its prime credit rating.
Cha-ching!

This doesn't even get into the fire, wind, water, and accidents in the market. Like a bad broker getting caught with millions in unauthorized and possibly illegal positions. Or that company X gets a boost from completely unrelated outside events. For instance, sudden renewed investor interest in your alternative energy fund when a new technology is demonstrated that your fund isn't even involved in.

It's money. It goes where it goes. Just don't get hustled.
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