| Why do you guys invest in stocks. |
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luke101
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| Why do you guys invest in stocks. |
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I don't understand why you guys invest in stocks. You can only benefit when the stock goes up. If you go to forex it benefits in bear are bull markets it seems like double the profit. Plus you can leverage your position.
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Wed Sep 28, 2005 5:32 pm |
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correltrade
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| Re: Why do you guys invest in stocks. |
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quote:
Originally posted by luke101
I don't understand why you guys invest in stocks. You can only benefit when the stock goes up.
Sure but in some cases it is not too difficult to guess when a stock will go up.
Of course you'll never be 100% sure, but it is sufficient to have small advantage.
Using right tools you can easily get 60% of chance to invest on stocks that will go up.
With a good trading strategie you can therefore easily make money.
A bout the forex, i don't see your point.
bests,
Maxim
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Wed Sep 28, 2005 7:29 pm |
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Rolo
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| Re: Why do you guys invest in stocks. |
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quote:
Originally posted by luke101
I don't understand why you guys invest in stocks. You can only benefit when the stock goes up.
After that pathetically ignorant statement, why would you think anybody would take you seriously?
Shutchyer pie hole and look up:
1. Selling short
2. When the stock market ever lost money over a 20-year period.
3. What people think of spam.
"Expect me when you see me."
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Wed Sep 28, 2005 11:49 pm |
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luke101
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Thats bull%$#@ ROLO you know as well as I do that if a company goes under you will lose most of your money. Trading currency is alot more stable, it profits in bull or bear markets.
You can't go wrong if Dell, McDonalds, chrysler, microsoft and even amazon dedicate huge division to trading currency.
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Fri Sep 30, 2005 12:40 am |
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correltrade
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quote:
Originally posted by luke101
Trading currency is alot more stable, it profits in bull or bear markets.
How come ???
quote:
Originally posted by luke101
You can't go wrong if Dell, McDonalds, chrysler, microsoft and even amazon dedicate huge division to trading currency.
They may well trade currency for hedging only, since they are multinational.
Bests,
Maxim
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Fri Sep 30, 2005 3:15 am |
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Rolo
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quote:
Originally posted by luke101
Thats bull%$#@ ROLO
What have I said that was bunk?
Tell me a 20-year period where the stock market lost money.
Selling short = making a profit when a stock goes DOWN.
Currencies fluctuate just like stocks do. What happens when the dollar rises and you are holding foreign currencies? Your foreign money LOSES value. Currency risk is currency risk...it applies to trading them as well as trading foreign stocks, which I do.
Your original statement was ignorant and it was a lie. You can benefit greatly in bear markets (short-selling) and you can leverage stock positions. You can leverage futures much more.
Now go find that 20-year period.
"Expect me when you see me."
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Fri Sep 30, 2005 3:34 am |
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correltrade
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Hi Rolo,
How do you measure the progression of the value of a the market over a 20 years period ?
bests,
Maxim
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Fri Sep 30, 2005 4:03 am |
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Rolo
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Being a technical analyst, you know how. Whatcha tryin' to set up here? 
"Expect me when you see me."
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Sat Oct 01, 2005 12:55 am |
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correltrade
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We would probably agree that S&P500 gives a good idea of the market growth,
but may be not on a such long period as 20 years.
Firstable we should take into account free risk returns.
How to do that ? 20Y interest rate at the beginning of the period ? probably not
Also the index' return does not reflect the average return of investors, at most it tells you how much you would earn by investing on the portfolio it represents.
I found interesting the reading of S&P methodology (available on their website), there is a bunch of drastic criteria that a company has to fullfill to be able to be added to the index and if at some point a company fail for one of them: it can be removed from the index.
This could happen for instance if a company has negative earnings
Anyway, I apologize if my question let you think I just wanted to set up something...
It is just that I found it very interesting.
Bests,
Maxim
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Sun Oct 02, 2005 4:59 am |
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forexdaytrading
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luke101, I agree with a lot of the guys that are criticizing you here.
Forex (foreign exchange) is a global market. There are a lot of ways to participate in the forex or FXmarket, and none guarantee that you will make money (this is also true for stocks). Even though our business is forex related, the truth is the truth.
Currencies (which trade in the forex market) are an asset class; just like stocks or bonds.
Now, if you tell me that currencies are better to "trade" than stocks, I have to agree with you. Being the most liquid market in the world, forex provides a degree of liquidity not present in any other market (including stocks and treasury bonds). For trading purposes, the more liquid a market is the better. So in this respect, forex is better than stocks.
On the other hand, for investing using fundamental analysis, stocks are probably better. This includes the method used by billionaire investor Warren Buffett. Stocks (assuming that the information provided in financial statements is mostly true) lend themselves to easier and more accurate analysis from a fundamental point of view. For example, the popular method of analyzing a company's financial data using a comparison of popular ratios is a lot easier for stocks than for currencies. It is very difficult to analyze an entire country's economy to determine what its currency will likely do relative to the currency of another country. Consequently, for investors that prefer the long-term, fundamental approach to investing, stocks are probably better.
All of this does not mean that currencies are for speculation and stocks are for investing. This could not be further from the truth. A stock investor might be taking more risk in a stock mutual fund than in a forex managed account because the forex portfolio manager can be a lot better and more experienced than his stock counterpart. We see this fact on a constant basis with a lot of the stock investors that come to us to diversify away from traditional ivestments. By the same token, an investor who is involved in forex might be taking a lot more risk than a stock investor that really knows what he is doing.
In conclusion, for the most part it is not the asset class that determines the amount of risk that an investor is taking; it is the way that the investor is using the asset class.
Dan
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Sun Oct 02, 2005 9:24 pm |
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godzilla
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[quote="forexdaytrading"]luke101, I agree with a lot of the guys that are criticizing you here.</quote>
I think in any investment, you just have to get there before the rest of the crowd does. Timing! Timing! is the most important for me here. Be it currency or stocks, you can make money if you can anticipate the right timing. Of course doing your homework and technical analysing can be a help too. 
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Fri Oct 07, 2005 3:13 am |
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LottomagicZ4941
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| Re: Why do you guys invest in stocks. |
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quote:
Originally posted by luke101
I don't understand why you guys invest in stocks. You can only benefit when the stock goes up. If you go to forex it benefits in bear are bull markets it seems like double the profit. Plus you can leverage your position.
Leverage can work both for you and against you.
One day I may venture into forex but so far I have not.
I've made money on most of my stock purchaces. Or should I say sales?
I basically bought a car and took 3 months of leave when my kid was born off money I made in the stock market.
Biggest loss was with Corning but all the money I had in corning was off gains I had made with WD-40, Allied Capatal, Allied Stratagies, a Utility I can't remember at this time. Wonder how Dorchester is doing? Had to sell to finance my 3 months of not working.
Non promotional Facebook Jail regular forum inquiry
Promotional post in advert section for new Facebook group for those building a downline
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Fri Oct 07, 2005 2:19 pm |
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jlee1224
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It amazes me that people actually think these things.
Of course if an individual company goes under, you lose your money. If you have all your retirement accounts holding ENRON stock, then you'd be screwed. Trading foreign currency would then be less risky then holding one company's stock.
But that's not the smart way of investing in stocks. Holding a broad assortment of stocks will lower your risk. Holding stocks in different kinds of companies (large, mid, small cap) with different purposes (growth and value) will lower your risk. And over any 20 year period in history, you have never lost money (I read the worst period yielded 7.4%, but I have not confirmed that, using S&P 500).
But I suppose you probably read all this and ignore it. Trade your foreign currency. It's your money. I guess Warren Buffett is an idiot.
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Fri Oct 07, 2005 5:48 pm |
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forexdaytrading
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These posts just keep getting funnier 
Rather than going into another lengthy discussion about the same things, please read my posts below - which also refute jlee1224's comments.
http://www.money-talk.org/viewtopic.php?t=4916
(refuting anandmys posts as well as those from Silo)
http://www.money-talk.org/viewtopic.php?t=5052
(advice to mcvg, who joined our online webinar on Thursday, October 6. In this thread, see also my posts which refute auggyf comments - which are similar to those lf jlee1224)
quote:
Originally posted by jlee1224
But that's not the smart way of investing in stocks. Holding a broad assortment of stocks will lower your risk.
My friend, since the 1970's, researchers like Bruno Solnik have proven over and over again that holding too many stocks hurts your overall return and doesn't necessarily lower your risk. After about 15 stocks, the risk is reduced by an insignificant amount. If you keep adding stocks to a portfolio it also cuts your returns drastically. Check your research. This is already explained in more detail in the posts above (read them). The real reason why someone would add 100's of stocks to a portfolio is because he doesn't really know anything about fundamental analysis or stock selection. Adding so many stocks only lowers the quality of the portfolio because it is impossible to really keep track of them all.
Investing in stocks is just like investing in a private business. Why invest in all the business in your neighborhood when you can look for the best ones and concentrate on those? - Unless of course, you had no clue how to look for a good business at a good price relative to its true value.
Trading currencies is RISKY. You are right. Most people will lose money doing so. I never recommended that people trade currencies themselves. But there are money managers that specialize in alternative investments and manage money by using different techniques and a diversified currency portfolio to protect their clients and, at the same time, generate above average returns. You hardly hear about these professional managers because they are not as well-known as all the professional stock managers that handle billions of money and never outperform the markets. The companies that hire the typical mutual fund managers have plenty of marketing capital to spend. They advertise like crazy and fool investors into thinking that it's OK to invest in hundreds of stocks and to settle for average performance. It's one of the greatest feats of deception in human history.
quote:
Originally posted by jlee1224
I guess Warren Buffett is an idiot.
Are you retarded? Warren Buffett has the longest and best track record of any stock investor in history. If he is an idiot, then what does that say about brokers, financial planners, mutual fund managers, and brainwashed investors that settle for average and below average market returns?
Read the two previously mentioned posts. You might learn something from the ordeal.
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Fri Oct 07, 2005 7:10 pm |
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godzilla
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quote:
Originally posted by forexdaytrading
The companies that hire the typical mutual fund managers have plenty of marketing capital to spend. They advertise like crazy and fool investors into thinking that it's OK to invest in hundreds of stocks and to settle for average performance. It's one of the greatest feats of deception in human history.
Very well said. It's not only one of the greatest feats of deception in human history---It's more like daylight robbery! Professionally done!
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Sat Oct 08, 2005 1:36 am |
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