Criteria for picking stocks

[Sean K]

SHHHHHHHHHH!

We don't tell them that until they buy the program.

On what's been said, I'm in! Please send sign up forms.

I love snake oil.

 

[wayneL]

On what's been said, I'm in! Please send sign up forms.

I love snake oil.

Actually, I'm signing up affiliates... Join Canuck-Yankee-Aussie-Pommie Wayne be rich beyond your wildest dreams:

 

[AlterEgo]

Hm quotes from Warren Buffet:

Quote: The dumbest reason in the world to buy a stock is because it's going up. Most people get interested in stocks when everyone else is. The time to get interested is when no one else is. You can't buy what is popular and do well. It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price. Price is what you pay. Value is what you get. For some reason, people take their cues from price action rather than from values. What doesn’t work is when you start doing things that you don't understand or because they worked last week for somebody else. Diversification is a protection against ignorance. It makes very little sense for those who know what they're doing.


thx

MS


thx

MS

Ok, let’s take a look at Buffet’s performance. Share price of Berkshire Hathaway BRK.A was $77,250 on 10/7/98 and had increased to $119,250 on 10/7/08. So in the last 10 years his share price has increased on average 5.4% per year. If that’s the sort of performance you’re trying to emulate, then go for it! What’s a fixed term bank deposit getting these days? 8%?

 

[Bloveld]

Ok, let’s take a look at Buffet’s performance. Share price of Berkshire Hathaway BRK.A was $77,250 on 10/7/98 and had increased to $119,250 on 10/7/08. So in the last 10 years his share price has increased on average 5.4% per year. If that’s the sort of performance you’re trying to emulate, then go for it! What’s a fixed term bank deposit getting these days? 8%?

Are you planning to be the richest guy on the planet anytime soon?

 

[white_goodman]

Ok, let’s take a look at Buffet’s performance. Share price of Berkshire Hathaway BRK.A was $77,250 on 10/7/98 and had increased to $119,250 on 10/7/08. So in the last 10 years his share price has increased on average 5.4% per year. If that’s the sort of performance you’re trying to emulate, then go for it! What’s a fixed term bank deposit getting these days? 8%?

i dont know who buffet is but all i keep picturing is the UFC and boxing announcers

 

[stargazer]

Hi

strudy
Buyers outnumber sellers. If the other way round, the share price will drop downwards for sure

Just on this i notice some standard platforms go ten deep in the market depth is this enough take the BUY SELL numbers as a gauge.

Market depth on more pro orientated go alot deeper.

Cheers
SG

 

[AlterEgo]

Are you planning to be the richest guy on the planet anytime soon?

What’s that got to do with anything? Buffet took a whole lifetime to accumulate that sort of capital and I’m supposed to equal that in the next few weeks I suppose??? Get real!

The point I’m trying to make is that this “value” approach to investing is never going to produce the sort of returns that active traders can get. The shorter your trading timeframe is, the higher the returns you can achieve. And for short term trading, fundamental criteria is virtually irrelevant. Why take the long, slow and steady way to your first million, when there are other ways that could potentially get you there much quicker, and has worked for many, many other traders?

 

[wayneL]

What’s that got to do with anything? Buffet took a whole lifetime to accumulate that sort of capital and I’m supposed to equal that in the next few weeks I suppose??? Get real!

The point I’m trying to make is that this “value” approach to investing is never going to produce the sort of returns that active traders can get. The shorter your trading timeframe is, the higher the returns you can achieve. And for short term trading, fundamental criteria is virtually irrelevant. Why take the long, slow and steady way to your first million, when there are other ways that could potentially get you there much quicker, and has worked for many, many other traders?

Buffett himself admitted that someone with less than a million in capital could easily outperform BH.

Thousands of small time (and some not so small time) private traders do it all the time and by a substantial margin.

Things change when you're managing huge lumps of capital.

 

[Julia]

Buffett himself admitted that someone with less than a million in capital could easily outperform BH.

Thousands of small time (and some not so small time) private traders do it all the time and by a substantial margin.

Things change when you're managing huge lumps of capital.

I think there also exists some level of confusion about 'the Buffet approach'.
Seems to sometimes be translated into holding onto falling stocks because once they were winners, the implication being they will eventually rise again from the ashes. Maybe they will. But maybe they won't. Unnecessary risk of capital.

 

[AlterEgo]

Things change when you're managing huge lumps of capital.

Yes, I don't disagree. But I still believe that anyone using a long-term 'buy and hold' type approach will never produce the same sort of returns that a skillful shorter-term trader could achieve.

 

[wayneL]

Yes, I don't disagree. But I still believe that anyone using a long-term 'buy and hold' type approach will never produce the same sort of returns that a skillful shorter-term trader could achieve.

Yes, we are in absolute agreeance(?) there.

 

[AlterEgo]

I think there also exists some level of confusion about 'the Buffet approach'.
Seems to sometimes be translated into holding onto falling stocks because once they were winners, the implication being they will eventually rise again from the ashes. Maybe they will. But maybe they won't. Unnecessary risk of capital.

But didn't Buffet do just that?! That approach would be suicide for you or I to do, but the difference with Buffet is that he could buy out the entire company, or at least a controlling interest in it, and then put changes in place to turn it's fortunes around. You or I wouldn't have the capital to be able to do that, and wouldn't have Buffet's brain for business, so I don't understand why so many people try to follow his methods when they don't have the capital or business skills to be able to do so.

 

[michael_selway]

Ok, let’s take a look at Buffet’s performance. Share price of Berkshire Hathaway BRK.A was $77,250 on 10/7/98 and had increased to $119,250 on 10/7/08. So in the last 10 years his share price has increased on average 5.4% per year. If that’s the sort of performance you’re trying to emulate, then go for it! What’s a fixed term bank deposit getting these days? 8%?

8% is only the current rate of interest, during that 10 years it may have been lower etc

You have to look at risks as well, at least he didnt lose any money in that 10 years. Basically he trades with minimal risk thats the the key to his success

trading on charts is high risk imo and thats where the problem

Would you prefer your kids to trade all day or buy stocks long term?

thx

MS

 

[AlterEgo]

trading on charts is high risk imo and thats where the problem

Well we'll have to agree to disagree on that point. Trading on charts CAN be risky if you don't know what you're doing, or don't manage the risks properly, but it doesn't have to be.

Would you prefer your kids to trade all day or buy stocks long term?

Well for starters, you don't need to day-trade to profit from charts. My average trade length is about 2 weeks, although I have held a couple for up to 2 months in the past year.

IMHO, short-term is LESS risky than long-term. It's much easier to anticipate where the stock price may be 1 month from now than it is to try to anticipate where it may be 5 or 10 years in to the future. The longer you hold a stock for, the more time you are exposed to any negative news that may be released, profit downgrades, etc. In that 5 or 10 year period the nature of the business may change, a competitor may release a better product that makes your companies product obsolete, interest rate rises or foreign currency exchange movements may reduce your companies profits, etc, etc. The longer you hold a stock for, the more things can go wrong, so rather than REDUCING risk, I believe you are actually INCREASING risk the longer you hold it for. That my opinion anyway, I'm sure many will disagree.

 

[Trembling Hand]

trading on charts is high risk imo and thats where the problem

Would you prefer your kids to trade all day or buy stocks long term?

Without a doubt DAY TRADE. If you can do that successfully all the rest can be rolled out at the appropriate time.

What is risky is trying to make money with one approach that is not suited to the market. Day trading there is always an opportunity.

Just on this i notice some standard platforms go ten deep in the market depth is this enough take the BUY SELL numbers as a gauge.

Market depth on more pro orientated go alot deeper.

Market depth is useless as a gauge of buying and selling. What is important is what is hitting the market not what is sitting in the order book.

 

[Bloveld]

I still want to know how a guy can go from nothing to 60 odd billion if he cant even achieve bank interest returns.

 

[white_goodman]

I still want to know how a guy can go from nothing to 60 odd billion if he cant even achieve bank interest returns.

a little known fact that he is the number one drug baron of south america

 

[cordelia]

I look for stocks that have been beaten down and watch them until they appear to have found support. They have to have plenty of volume ..not thinly traded. There's nothing to guarantee they won't keep going lower so I wait for a higher high and a lower low and place my order at the lowest low or just above. If I get filled well and good. . Patience can be very rewarding. I watch the stocks I trade for some time before I jump in...

Depending what happens during the session I get filled is what determines where I put my stop.

Two things I do is only place an intial order for half the position I want to fill. If it goes my way I add to it. Second thing I do is as soon as I get filled I place my stop and I have a target at which I am going to sell before I enter a position.

I f my stop gets triggered I haven't risked too much. If the stock goes sideways for too long I close out the position.

 

[wayneL]

I still want to know how a guy can go from nothing to 60 odd billion if he cant even achieve bank interest returns.

Buy using the same principle that most wealthy people use:

OPM

(Other Peoples Money)

Folks seems to believe Buffett started with the $10.95 in his piggy bank be earned as a paper boy and turned that into 60 billion.

Not so.

He started with OPM... lots of it.

 

[cordelia]

Buy using the same principle that most wealthy people use:

OPM

(Other Peoples Money)

Folks seems to believe Buffett started with the $10.95 in his piggy bank be earned as a paper boy and turned that into 60 billion.

Not so.

He started with OPM... lots of it.

yes think alan bond......