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I'm shopping on the stock market tomorrow.
- Thread starter Leongsam
- Start date
Sam was too early.
https://www.bloomberg.com/news/arti...ager-who-beat-98-of-peers?srnd=premium-europe
But no big deal, $40,000 is peanuts to someone with net worth of > $10 million
Personally, I prefer to wait for the market to tell me by its actual behavior that it has bottomed out e.g. no reaction to bad news (i.e. it's already priced it).
It's a sucker's game to try to buy at the very bottom or sell at the very top.
My aim is to capture the meat of the big move without taking too much risk. If I can capture 2/3 of the big move without too much volatility, I will be happy.
It's important to protect your financial as well as mental capital.
https://www.bloomberg.com/news/arti...ager-who-beat-98-of-peers?srnd=premium-europe
But no big deal, $40,000 is peanuts to someone with net worth of > $10 million
Personally, I prefer to wait for the market to tell me by its actual behavior that it has bottomed out e.g. no reaction to bad news (i.e. it's already priced it).
It's a sucker's game to try to buy at the very bottom or sell at the very top.
My aim is to capture the meat of the big move without taking too much risk. If I can capture 2/3 of the big move without too much volatility, I will be happy.
It's important to protect your financial as well as mental capital.
you can capture 2/3 very swee liao!Sam was too early.
https://www.bloomberg.com/news/arti...ager-who-beat-98-of-peers?srnd=premium-europe
But no big deal, $40,000 is peanuts to someone with net worth of > $10 million
Personally, I prefer to wait for the market to tell me by its actual behavior that it has bottomed out e.g. no reaction to bad news (i.e. it's already priced it).
It's a sucker's game to try to buy at the very bottom or sell at the very top.
My aim is to capture the meat of the big move without taking too much risk. If I can capture 2/3 of the big move without too much volatility, I will be happy.
It's important to protect your financial as well as mental capital.
Sam was too early.
https://www.bloomberg.com/news/arti...ager-who-beat-98-of-peers?srnd=premium-europe
But no big deal, $40,000 is peanuts to someone with net worth of > $10 million
Personally, I prefer to wait for the market to tell me by its actual behavior that it has bottomed out e.g. no reaction to bad news (i.e. it's already priced it).
It's a sucker's game to try to buy at the very bottom or sell at the very top.
My aim is to capture the meat of the big move without taking too much risk. If I can capture 2/3 of the big move without too much volatility, I will be happy.
It's important to protect your financial as well as mental capital.
There's no such thing as "too early". It's not like buying a car. It's not a one off purchase.
You make a series of purchases while the market is going down and when you average the price it should be close to the trough.
When the recovery is in full swing you adopt the same strategy and start selling a bit at a time.
Will I have caught the bottom and the top? Of course not. However I will have made a lot more money than those who just bang away on their keyboards giving expert advice without putting a cent where their mouth is.
Sam. I bght HawPar. If next day drop nvr mind. I follow HC advice. Bght for long term. :(
1st time see u so angry..
not angry...i am just seeing that there is no way to pick a stock now. this covid 19 will be around for a long time.
Talk is easy lah. At least Sam took action.
But I do think this will affect fundamentals unfortunately. And globally. So business profits will be down. Who knows maybe recession.
Sam must be making million with this volatile market. Buy low and sell high.
If Ho Jinx enters the market, the dynamics will change. Buy high and sell low.
If Ho Jinx enters the market, the dynamics will change. Buy high and sell low.
KNN boss be reminded of this drama KNN 大有哥 from penniless to millionaire back to bankrupt then to billionaire then finally last straw to his grave KNN
should be in business world you...
Markets rise and fall based upon future expectations not current P&L. Once the market feels that the worst is over prices will start rising and the rise will result in more people buying because they think it will rise further. The shares they are buying will be the ones that I am then selling.
As long as you stick to low risk stocks ie organisations which are majority government owned (in NZ that's Air New Zealand and Auckland Airport) and that are virtual monopolies there is really a 99.999% probability of making money.
If I leave my $ in a term deposit for 1 year I'll currently get 2.8% return.
If I put that money into the stock market now in the counters I mentioned above in 1 year's time I'll be making at least 10%.
It's really a no brainer.
Comparing apples and oranges. When one buys a car, unless one is a used car dealer, it is not in expectation of being able to sell it later for a higher price.
When a speculator ahem “investor” buys a stock, there is no reason for doing so other than he expects to be able sell it later for a higher price.
If you are a speculator (long or short term doesn’t matter, it is always good to call a spade a spade, and also to bear in mind that in the long term we are all dead), then there definitely is a “right time” to buy, and it is not when it is too early or too late, but more about that later.
One can also make a series of purchases on the way up and do equally well if not better. Based on your postings, you bought Air NZ on 26/2 at 2.40 (closing price) and the price as of closing this Friday is 2.06 (and likely to go down more based on Friday’s price action and what happened in global markets after NZ closed). What makes you think that you cannot achieve the same by buying on the way up from 2.06 (after the market proved by its price action that 2.06 is more likely than not to be the bottom) to 2.40 and then selling off at 2.64 (your stated aim of 10% return)? And wouldn’t this alternative approach be better since it does not involve a 20% or probably larger draw down in equity aka “paper losses” which your approach has actually resulted in?
Now the stock is at 2.06 and will probably go lower since it closed Friday at the lowest price for the day and after the NZ market closed, the NY market dropped ... again. This means the price needs to rise 20% from here just to go back to your break even price of 2.40!
These are mathematical hard truths, regardless of whether you see yourself as a speculator or a ahem long term investor.
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The way things are going, it may not even get to 2.40 next year. Let see which airline go bust first. China airlines HNA hainan airlines taken over by the gahmen already. That was the weakest and most inept airline so far in china. But say, cathay pacific go bust, then trouble. Even air asia x looks wobbly. They depended on china market.
Its not just asian airlines. Airlines in europe and US are affected too.
Its not just asian airlines. Airlines in europe and US are affected too.
My purchase price has averaged out to $2.12 for $80,000 worth of shares.
It'll be back to $3.00 sooner or later and then I'll start selling $5000 worth at a time.
Timing is not really important. 6 months or 18 months does not make much difference to me. Whatever happens it's better than 2.8% per annum in a term deposit.
Dividend yield historically has been above 7% so even if I was stuck with the shares for a bit longer I'd still be getting a decent return.
Ah, so the intended position size has been doubled from the original $40,000 to $80,000 and by doing so you have managed to bring your average cost down by buying more as the price continues to drop. Up to a certain point, problems such as this can be “solved” by throwing more money at it, but not always.
Wish you all best of luck for your speculation ahem investment
It dropped further so I thought it was a great deal so I bought more Air New Zealand by diverting funds that I was going to use to purchase Flight Centre which is not government backed.
I hardly consider it to be speculation. I pay in full and have holding power plus I get dividends that are way better than bank deposit rates. I've used the same strategy before and always come out on top. My mistake has invariably been to sell too soon and be content with a smaller return instead of holding my nerve.
If you can point out which of my premises are wrong I'd be happy to admit the error of my ways.
I want to buy delta Airlines. Because Warren buffet bought it. But I don't have the balls to take up the consequences if it gets delisted.
It's just semantics. Whenever one is buying something in anticipation of being able to sell it later at a higher price - that is speculation in my books, regardless of whether leverage is being used or not or how long one is willing to hold that position. What has worked before may not work again - a variant of the typical disclaimer on fund prospectuses: past performance is no guarantee of future results.
Could it be possible that your mistake in selling too soon was caused by the nerve wrenching experience you had when the price was dropping and you were averaging down without knowing whether or when you will ever get out of the hole which you had apparently dug for yourself?
Air NZ can go lower from here. Nobody knows for sure, but what the price action is telling you now is that the chances of it continuing to go lower is greater than the chance of it changing course to go higher. Yes, the market may change its feeling of the economic prospects for Air NZ and push the price higher from here, but what the market is telling you now is that the market is feeling now that the economic prospects for Air NZ are getting worse and therefore the price is going lower. Who knows when or if that market feeling will change. The market may be objectively wrong, but it is the demand and supply for Air NZ's shares that determines its price and not the demand and supply for Air NZ's services. The market can continue to be wrong for a very long time and excessively so before some catalyst causes it to change its attitude. That's how bubbles and panics are caused. The lowest price for Air NZ in recent memory is below $1, during the first half of 2012. There is nothing to prevent it from going there again before (and if) it rebounds. It is a probabilities game and should be played as such.
Air NZ is not a monopoly. It may have a monopoly on domestic air flights (low margin and small market), but I'm pretty sure many other airlines operate international flights to NZ. It may well be NZ's version of HSBC when it comes to being the bluest of blue chips in their respective markets, but looked what happened to HSBC. A client (unpleasant old lady) once asked (in 2008) if HSBC at HKD120 was a good price. She had already bought a large amount and is just wanting somebody to confirm her actions, so I gave her an appropriate answer - our firm has not been engaged to provide her with investment advisory services and therefore we will not be providing her with free investment advisory services. HSBC went all the way down to HKD30 and even today is only HKD51. So, assuming she has the nerves and the wherewithal to buy equal amounts at $10 intervals all the way down from HKD120, HKD110, HKD90, etc to HKD30, her average cost would be HKD75 per share - way above the present price of HKD 51.
You might say that with dividends of HKD4 per year for 11 years, she still came out tops - HKD51 + HKD 44 in dividends = HK95 per share implies profit over her cost of HKD75 per share. But that profit of 26.7% is over 11 years and when annualized is only 2% per annum - virtually the same as what she would have achieved if she put the money in fixed deposits for those 11 years. Which means she endured that nerve wrenching drop from HKD120 to HKD30 and those 11 years of waiting - for nothing - not to mention the opportunity costs of not using that money to buy other things when the time is "nearly" but not exactly right.
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