- Joined
- 24 October 2005
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captain black said::iagree:
I noticed that these 2 posts above are your first 2 posts here Bunyip. All I can say is keep it up, great deal of common ("uncommon") sense.
kerosam said:I've also omitted those companies that went broke.
captain black said::iagree:
I noticed that these 2 posts above are your first 2 posts here Bunyip. All I can say is keep it up, great deal of common ("uncommon") sense.
bunyip said:Mega.....You wrote:
"Researching stocks takes a lot of time and it prevents me from doing other things."
I agree - researching stocks is time consuming.
But there's a simple solution to your problem.....don't do any research. There's no need to - tens of thousands of traders and investors have already done the research for you, and their findings are reflected in the trend of the stock.
AMP fell from $13 to $3 between March 2002 and August 2003. Shortly after it's downtrend began it was patently obvious, even to someone of little experience in chart reading, that the stock was heading south east on the chart.......a downtrend.
Why was it downtrending? Because traders and investors were quitting the stock en masse.
Why would they do that? Because tens of thousands of them had researched the company and found out that it was in trouble, and it's future prospects were none too bright.
In which case, you could have made money from the AMP downtrend by selling the stock short, or buying put options.
Or if you owned the stock, you could have bailed out long before it's value was decimated.
The point is that you could have got quite an accurate summary of the fundamentals of AMP without spending one minute of your time doing fundamental research. Just look at the chart.....all the information you needed was graphically displayed for you.
Look at the current price action of AMP. Nice uptrend in place, particularly when viewed on the weekly chart.
Why is it uptrending? Because tens of thousands of investors, having done their research, have formed the opinion that the stock has good fundamentals. No need for you to research AMP to profit from it - the research has already been done for you. If an uptrending stock shows temporary weakness by pulling back for a few days as profit takers bail out,
and then the uptrend resumes as buyers come back in, it presents you with an ideal opportunity to hitch a ride on the trend and make some money.
The same sort of simple analysis and trading strategy can be applied to any liquid stock that starts uptrending or downtrending strongly.
WPL is a good example.....uptrend began in early 2003. Three years later, the stock is more than four times it's 2003 value.
Once you saw WPL heading steadily north east on the chart, making higher peaks and higher troughs, did you really need to spend hours or days of your time doing fundamental research on it?
Thousands of investors had already researched it for you and their findings were very positive, otherwise why would they be piling into the stock and pushing it higher week after week?
A common fallacy among stock market players is that if you want to profit from the market, you have to read the financial papers, company reports, brokers newsletters etc to keep yourself up to date with the latest developments in the economy and within individual companies.
Its simply not correct.....I've been trading the markets for 10 years or so and for the last eight of those years I haven't read a financial publication, a brokers newsletter or a company report.
The most reliable information is in the charts. Learn how to interpret them, learn how to identify trends, learn how to recognise retracements, watch for the trend to resume following the retracement.
You won't need to spend your time doing boring company research, and you won't need to hand your hard earned money over to Fat Profits either.
If you want some good books on how to identify trends and how to hitch a ride on them, I'd suggest.....
"Dave Landry On Swing Trading" by Dave Landry
"Secrets For Profiting In Bull And Bear Markets" by Stan Weinstein
The trading methods expoused by both these men are simple to learn, easy to implement, and require very little time input from the trader or investor.
Bunyip.
michael_selway said:hehe nice, u forgot current and forwad P/E, EPS, and forecast EPS.
Eg NCM had a great trend until the results came out recently.
Basically the P/E wasnt justifyable at current prices.
If u used "trend analysis" u may have lost some money. But it may do well in the future if Gold prices continue to climb.
thx
MS
i am close to wrapping up my first year with fat prophets on their general advice (ie. not mining). i initially went with them because a piece of their free advice in the sunday telegraph performed well and this was my first toe into the waters of investing.
12 months later i am unimpressed and i won't be renewing. the advice i have received on this board has been far better than some of the rubbish fat prophets have offered up. the continue to harp on about how they are awesome contrarians and all you have to do if you are mired in some of their bad advice is to just buy more and await the turnaround (ala NEM). then they put sell advice on stocks that have not had their fundamentals change and continue to increase in value.
i am also extremely unimpressed with the fact their mining section is seperate from their general stock section, were they combined for the same price then i might consider it more reasonable but as it is i think their general offering is lousy. maybe their mining offering is better but seriously, if you couldn't make money on the commodities boom you don't belong in the market in the first place.
i am also noticing a bias creeping into their advice so as far as i am concerned they are no longer trustworthy. i am getting a vibe some of their recommendations totally ignore both fundamental and technical analysis to the contrary and instead they are more interested in pushing their products and by extension other pies that they have their fingers in.
if you are a new investor, looking for long term holds (which means you will ignore all the rest of their advice after the initial piece) then maybe they are a reasonable introduction to the market based on their fundamental analysis. if however you have found this board, are willing to do a bit of reading on how to understand charts, then you can do a better job yourself.
should you wish to join then i think their mining section advice is probably better to take advantage of the commodities boom, but after a bit of t/a study and reading threads on this board you'll be able to figure it out yourself and probably do a better job. but if you do join, at least its a tax deduction.
How many buy recommendations were there per month by the way?
Were the recommendations practical? ie was it like buy at $xx.xx when the price was already $xx.xx + $yy.yy?
explod said:A good trender though eg AVO would stay put unless it was to fall in two days below the trading channel. Some say Trading Range or similar.
Nicks,
Do they give the buy dates of those quoted success stories, e.g. QBE?
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