I personally know several multimillionares who made it daytrading.
That's real daytrading, though, in front of a bank of computers tied directly into the Island network, with real-time data. And trading with someone else's money, at least until they got good enough.
I wouldn't trade stocks over a daily or weekly time-frame on a web site, unless I had insider information. And then I couldn't do it anyway, huh?
I did pretty well with Dell back in '99-'00. I had a friend who worked down the hall from bookkeeping for a while, and he was able to suss the general mood around there. It was mostly jubilant in those days.
I also made out okay on Rational software. Bought at close to its 52 week low, and IBM tendered a bid out of the blue about 3 weeks later. That was a total stroke of luck, and I made about 40% in six weeks. (had to wait until jan. '03 to sell to avoid short-term gains)
I recently bought a good chunk of Apple right after the bogus Vivendi buyout rumor, and I'm holding it to see what happens monday. I'm pretty happy, so far.
I don't exactly day trade, but Ive made myself a "Thousandaire" by dabbling a bit.
My one big dissapointmet--UPS. I held on for 2 years and still took a 3-dollar per share bath.
I personally know several multimillionares who made it daytrading.
And I'm sure many people know several millionaires who "made it" gambling. That's all daytrading is, gambling on the stock market. Sure, there will be some who win it big, but in the long run almost everyone will lose because the odds are always in the house's favor (in this case, it's the per-trade fees that kill you).
As far as I know, there aren't any more daytrading shops open, nearly all of them shut down after the great tech bull market of 98-2000. If the shops couldn't even make money, what does that say about the average day trader at one of those shops?
So five years ago, if you had a chance to buy stock in Apple, Microsoft, or general Dow/S&P/Nasdaq funds... which would you have picked, at the time? How about in retrospect?
Kickaha, that's a totally pointless argument. 5 years is totally arbitrary, if you chose 3 years ago (when Apple was at a peak of $60 or so), Apple would be the worst performer. If you chose 10 years ago, Microsoft would have slaughtered them all.
But OK, lets take your choice of 5 years. Who just buys stocks then sits on them, never adding to their holdings? No intelligent investor that I know of. Dollar-cost-averaging is a much more common technique. Lets say you made an initial investment of $5,000 5 years ago, then added $100 a month after that. The best performer in this case would be MSFT, followed by the DOW.
My point? You can pick any point in history and say if you invested at that point, you'd make the most money. That's meaningless. Nor is it a sound investment strategy to simply plop a bunch of money into a single (relatively volatile) stock and sit on it.
And as the investors say, computer? What's a computer? I thought I was investing in a produce giant.
I wonder what would happen if someone tracked Apple's performance against other produce giants - Dole, et al. Their stock value doesn't seem to have any relation to their performance as a tech company
Dollar cost averaging is only slightly better than useless.
NEVER buy stocks using DCA.
Always buy several times per year, looking for spots that are near the lows.
Learn if your chosen stock tends to collapse in one particular quarter or season and buy then, even if it's just once a year. If that company is at a 1-year high, hold off until it drops. If it is at a multi-year high without groundbreaking news, sell short - it will come down.
If you are investing for the long term (5-years or more) research the last 10 years of the company in question and see if you can find a sales pattern that will let you possibly predict when stock prices will be lower.
If buying to trade in the short-term - less than one year, learn how the company stock reacts to news - some sell off, others rise. Learn how investors react to good-financial quarters and to bad ones.
Check out things like the institutional investors on thomson to see if the big money is who is reallymaking the stock rise or fall.
These are the guys who buy and sell millions of shares and who make money when the stock moves a penny or two. If you can learn their patterns you can get on and perhaps ride with them up and down, buying and selling as needed.
If buying short term, don't be greedy. Greedy costs you everything. Make a little every day or two and always reinvest. The power of compound interest will do the rest.
I bought at 23.75 dollars, just before the release of the second iMac... Unfortunately, that didnt help..
More sad with my dad.. He bought at 30 dollar 10 years ago or something... Then, 4 years ago, he desperately needed the money and sold out at 12 dollar..
Dollar cost averaging is only slightly better than useless. NEVER buy stocks using DCA.
Gee, with advice like that, who needs a CPA or financial planner? Market timing has NEVER been proven to work consistently. It's very easy to say in retrospect "Buy at lows." Well, when Apple stock first dropped from the sixties to about 33, that was definitely a "low." If you bought then, look where you'd be now.
You're ignoring the fact that stocks tend to go up over time (if they are good companies). If you're always looking to wait for the new "low," the stock may very well never reach that point, and continue to go higher (gradually, mind you), without your additional investment that you could have put into it.
And the comment on selling or selling short at highs? I'd say the majority of stocks have reached a multiyear high at many points, then continued to go higher. Of course, recent history is a bit screwed up with the recessionary hit and all, but I'm talking long term here. Know one knew when it was occurring just how far stocks would drop.
Blindly dollar-cost-averaging means that you may buy at highs. SInce the method is to purchse on a schedule that NEVER takes into account the cost of the equities, it is a very fallible method.
I intend to say that if you buy good companies, it is best to buy them when they are priced lower. Don't buy on May 30th just because it's "DCA Day," check the market out and make sure it's not up 300 points because the Fed lowered rates, etc.
Of course you'll never find the lowest low or the highest high, that's where not being greedy comes in. The point is to maximize the earnings through very thorough knowledge of the companies. You get bitten/aided by the effects of the general market, for sure, but DCA offers NO protection at all from this either - is in fact more susceptible to market whims because the method does not take the market's position into account at all.
I'll be buying AAPL if the 970s are released at WWDC. Wait until the price bottoms out after the keynote, buy in, and then ride the price up as sales of Powermacs skyrocket and Apple's market share balloons. I see this as the last opportunity to buy into AAPL stock at dirt-cheap prices before it begins to rebound from the initial fall that coincided with the dot-com bubble burst.
Given the patterns following past announcements, should we expect stock to drop even given the 970 announcement on Monday?
I'm wondering whether to buy AAPL (for the first time) BEFORE the keynote or wait until afterwards...
The institutional investors are the biggest movers of AAPL's price. They already have bought the stock they wanted regarding any WWDC announcement. They bought weeks ago, when it was $13 a share. For the last several weeks, they've been trading at the ends of the highs and lows.
Buying Monday before the Keynote is a dangerous ploy. THe stock is near a 52-week high - if it falls it will probably be a while before it rises beyond that price (probably on financial news for the Quarter that ends June 30, announced in mid-August ). If it rises, it will likley be a sharp rise and quick decline as latecomers buy in and sell out in a hurry. If the institutional investors sell like hell on Monday a.m., it doesn't matter how good the news is - the price will fall. If they buy,buy,buy, then they think AAPL is a bargain and are looking to make $$$ with it.
Remember, the ONLY way to make money on AAPL is to buy and sell it. AAPL offers no dividend. Your investment time line may be hours, days, weeks, years or decades, but the only way to profit from AAPL is to sell the shares for more than you paid for them.
If the California retirement system needs money, they may sell, regardless of the price. They are one of the largest shareholders in AAPL, along with a Saudi (?) Prince, and several institutions.
I intend to say that if you buy good companies, it is best to buy them when they are priced lower. Don't buy on May 30th just because it's "DCA Day," check the market out and make sure it's not up 300 points because the Fed lowered rates, etc.
I still have to respectfully disagree. The whole point of DCA is that you are buying in SMALL increments. Even if a few purchases are towards "highs," the total amount of each purcahse is so small that it has a very minute affect on your portfolio value. The real value is that it takes the "emotiality" out of the market, so you aren't tempted to sell and buy based on being scared of loss or greedy for gains. This is much easier to do "accidentally" than it seems, even for an experienced investor.
Again, using your example of the price jumping 300 points... whos to say that's not the start of a rally that will last for several months? If you ignore it and wait for it to drop down again.... oops, you've just missed a 25% increase in the stock price. There's no sure thing in the markets, if a stock really did just cycle up and down, up and down in a predictable manner, any trained monkey could make billions just buying and selling a single stock (like AAPL) over and over. Nothing is predictable on Wall Street.
The whole argument is kinda moot, though, because even DCA with a single stock really isn't a great strategy for the vast majority of investors... simple index funds are where its at, imho. And yet I still have 400 shares of AAPL in my portfolio... I just can't seem to give em all up...
(And yes, I know this is starting to get quite off topic, but whatever)
DCA is actually an emotional thing in my book - the emotion of blissful ignorance. Stocks normally trade in a range and that range moves up and down over time.
Anywho, I think AAPL may jump early-mid Monday, then the institutions will begin taking their profits -- will there be enough additional buyers to keep the stock up? I don't know.
IT behooves me to watch the events carefully.
I bought Apple at $23 or so in the late 90s and still have most of that (the split means they are actually still worth more than I paid for them now). I'm playing with a couple hundred shares that I bought a few weeks ago and last week. I can afford for it to fall to $17 or so before I have to decide whether to stay or get out. If they go to $23, I'll sell and take my profits and reinvest in AAPL when it does fall or maybe in PIXR or PFE or ADBE.
Best of luck to all investors, but remember that you make most of your own luck.
Comments
That's real daytrading, though, in front of a bank of computers tied directly into the Island network, with real-time data. And trading with someone else's money, at least until they got good enough.
I wouldn't trade stocks over a daily or weekly time-frame on a web site, unless I had insider information. And then I couldn't do it anyway, huh?
PowerMac sales should rebound from the lethargy of the past two years
Thats an understatement.
I also made out okay on Rational software. Bought at close to its 52 week low, and IBM tendered a bid out of the blue about 3 weeks later. That was a total stroke of luck, and I made about 40% in six weeks. (had to wait until jan. '03 to sell to avoid short-term gains)
I recently bought a good chunk of Apple right after the bogus Vivendi buyout rumor, and I'm holding it to see what happens monday. I'm pretty happy, so far.
I don't exactly day trade, but Ive made myself a "Thousandaire" by dabbling a bit.
My one big dissapointmet--UPS. I held on for 2 years and still took a 3-dollar per share bath.
CV
Originally posted by Mithras
I personally know several multimillionares who made it daytrading.
And I'm sure many people know several millionaires who "made it" gambling. That's all daytrading is, gambling on the stock market. Sure, there will be some who win it big, but in the long run almost everyone will lose because the odds are always in the house's favor (in this case, it's the per-trade fees that kill you).
As far as I know, there aren't any more daytrading shops open, nearly all of them shut down after the great tech bull market of 98-2000. If the shops couldn't even make money, what does that say about the average day trader at one of those shops?
So five years ago, if you had a chance to buy stock in Apple, Microsoft, or general Dow/S&P/Nasdaq funds... which would you have picked, at the time? How about in retrospect?
You sure?
http://finance.yahoo.com/q?d=c&c=MSF...x=on&y=on&w=on
But OK, lets take your choice of 5 years. Who just buys stocks then sits on them, never adding to their holdings? No intelligent investor that I know of. Dollar-cost-averaging is a much more common technique. Lets say you made an initial investment of $5,000 5 years ago, then added $100 a month after that. The best performer in this case would be MSFT, followed by the DOW.
My point? You can pick any point in history and say if you invested at that point, you'd make the most money. That's meaningless. Nor is it a sound investment strategy to simply plop a bunch of money into a single (relatively volatile) stock and sit on it.
Originally posted by Anders
AAaaaaaannnnnnd now! the stock is below the closing price yesterday.
What's up with that?! It's a fickle market indeed.
Originally posted by AppleExec
What's up with that?! It's a fickle market indeed.
Well as they say: Its only a 2Ghz computer...
I wonder what would happen if someone tracked Apple's performance against other produce giants - Dole, et al. Their stock value doesn't seem to have any relation to their performance as a tech company
NEVER buy stocks using DCA.
Always buy several times per year, looking for spots that are near the lows.
Learn if your chosen stock tends to collapse in one particular quarter or season and buy then, even if it's just once a year. If that company is at a 1-year high, hold off until it drops. If it is at a multi-year high without groundbreaking news, sell short - it will come down.
If you are investing for the long term (5-years or more) research the last 10 years of the company in question and see if you can find a sales pattern that will let you possibly predict when stock prices will be lower.
If buying to trade in the short-term - less than one year, learn how the company stock reacts to news - some sell off, others rise. Learn how investors react to good-financial quarters and to bad ones.
Check out things like the institutional investors on thomson to see if the big money is who is reallymaking the stock rise or fall.
These are the guys who buy and sell millions of shares and who make money when the stock moves a penny or two. If you can learn their patterns you can get on and perhaps ride with them up and down, buying and selling as needed.
If buying short term, don't be greedy. Greedy costs you everything. Make a little every day or two and always reinvest. The power of compound interest will do the rest.
More sad with my dad.. He bought at 30 dollar 10 years ago or something... Then, 4 years ago, he desperately needed the money and sold out at 12 dollar..
2 months later AAPL hit 150 dollars.. >
Originally posted by jccbin
Dollar cost averaging is only slightly better than useless. NEVER buy stocks using DCA.
Gee, with advice like that, who needs a CPA or financial planner? Market timing has NEVER been proven to work consistently. It's very easy to say in retrospect "Buy at lows." Well, when Apple stock first dropped from the sixties to about 33, that was definitely a "low." If you bought then, look where you'd be now.
You're ignoring the fact that stocks tend to go up over time (if they are good companies). If you're always looking to wait for the new "low," the stock may very well never reach that point, and continue to go higher (gradually, mind you), without your additional investment that you could have put into it.
And the comment on selling or selling short at highs? I'd say the majority of stocks have reached a multiyear high at many points, then continued to go higher. Of course, recent history is a bit screwed up with the recessionary hit and all, but I'm talking long term here. Know one knew when it was occurring just how far stocks would drop.
Blindly dollar-cost-averaging means that you may buy at highs. SInce the method is to purchse on a schedule that NEVER takes into account the cost of the equities, it is a very fallible method.
I intend to say that if you buy good companies, it is best to buy them when they are priced lower. Don't buy on May 30th just because it's "DCA Day," check the market out and make sure it's not up 300 points because the Fed lowered rates, etc.
Of course you'll never find the lowest low or the highest high, that's where not being greedy comes in. The point is to maximize the earnings through very thorough knowledge of the companies. You get bitten/aided by the effects of the general market, for sure, but DCA offers NO protection at all from this either - is in fact more susceptible to market whims because the method does not take the market's position into account at all.
Read the new book by B. Stein (check out Amazon).
Just my opinion.
Originally posted by Junkyard Dawg
I'll be buying AAPL if the 970s are released at WWDC. Wait until the price bottoms out after the keynote, buy in, and then ride the price up as sales of Powermacs skyrocket and Apple's market share balloons. I see this as the last opportunity to buy into AAPL stock at dirt-cheap prices before it begins to rebound from the initial fall that coincided with the dot-com bubble burst.
Given the patterns following past announcements, should we expect stock to drop even given the 970 announcement on Monday?
I'm wondering whether to buy AAPL (for the first time) BEFORE the keynote or wait until afterwards...
purchasing stocks should != gambling
The sooner america gets back to "investing" in the stock market the better.
Buying Monday before the Keynote is a dangerous ploy. THe stock is near a 52-week high - if it falls it will probably be a while before it rises beyond that price (probably on financial news for the Quarter that ends June 30, announced in mid-August ). If it rises, it will likley be a sharp rise and quick decline as latecomers buy in and sell out in a hurry. If the institutional investors sell like hell on Monday a.m., it doesn't matter how good the news is - the price will fall. If they buy,buy,buy, then they think AAPL is a bargain and are looking to make $$$ with it.
Remember, the ONLY way to make money on AAPL is to buy and sell it. AAPL offers no dividend. Your investment time line may be hours, days, weeks, years or decades, but the only way to profit from AAPL is to sell the shares for more than you paid for them.
If the California retirement system needs money, they may sell, regardless of the price. They are one of the largest shareholders in AAPL, along with a Saudi (?) Prince, and several institutions.
Originally posted by jccbin
I intend to say that if you buy good companies, it is best to buy them when they are priced lower. Don't buy on May 30th just because it's "DCA Day," check the market out and make sure it's not up 300 points because the Fed lowered rates, etc.
I still have to respectfully disagree. The whole point of DCA is that you are buying in SMALL increments. Even if a few purchases are towards "highs," the total amount of each purcahse is so small that it has a very minute affect on your portfolio value. The real value is that it takes the "emotiality" out of the market, so you aren't tempted to sell and buy based on being scared of loss or greedy for gains. This is much easier to do "accidentally" than it seems, even for an experienced investor.
Again, using your example of the price jumping 300 points... whos to say that's not the start of a rally that will last for several months? If you ignore it and wait for it to drop down again.... oops, you've just missed a 25% increase in the stock price. There's no sure thing in the markets, if a stock really did just cycle up and down, up and down in a predictable manner, any trained monkey could make billions just buying and selling a single stock (like AAPL) over and over. Nothing is predictable on Wall Street.
The whole argument is kinda moot, though, because even DCA with a single stock really isn't a great strategy for the vast majority of investors... simple index funds are where its at, imho. And yet I still have 400 shares of AAPL in my portfolio... I just can't seem to give em all up...
(And yes, I know this is starting to get quite off topic, but whatever)
DCA is actually an emotional thing in my book - the emotion of blissful ignorance. Stocks normally trade in a range and that range moves up and down over time.
Anywho, I think AAPL may jump early-mid Monday, then the institutions will begin taking their profits -- will there be enough additional buyers to keep the stock up? I don't know.
IT behooves me to watch the events carefully.
I bought Apple at $23 or so in the late 90s and still have most of that (the split means they are actually still worth more than I paid for them now). I'm playing with a couple hundred shares that I bought a few weeks ago and last week. I can afford for it to fall to $17 or so before I have to decide whether to stay or get out. If they go to $23, I'll sell and take my profits and reinvest in AAPL when it does fall or maybe in PIXR or PFE or ADBE.
Best of luck to all investors, but remember that you make most of your own luck.