Inside Information - how to get some?

[Darc Knight]

No, I'm not talking about the kind you go to Jail for (or Joe will for hosting this thread). I'm talking about the kind of information that is publicly available but not yet well publicized
eg. sitting in on a Court case which is public and getting a feel for the outcome. Or, wearing out a bit of shoe leather at major land development sites finding out who might be doing what. etc etc.

It seems the big boys have their advantages in gaining information due to size, us little guys must have some advantages due to our size or lack of it?

 

[SirRumpole]

That is what forums like this should be all about, sharing the knowledge.

It only works with a large contributor base, so get it there and pass on the tid bits.

 

[satanoperca]

That is what forums like this should be all about, sharing the knowledge.

It only works with a large contributor base, so get it there and pass on the tid bits.

Without disrespect, but why would someone contribute/provide information that they have earnt, to share on any forum if it gives them an edge in their investment opportunity.

Ie, I sat in a courtroom and hear the courts finding, that might mean I could short or go long on a particular company, why would I broadcast the information until I could action the information, so this would be ramping.

 

[Triple B]

It seems the big boys have their advantages in gaining information due to size, us little guys must have some advantages due to our size or lack of it?

Yes liquidity. we can get our piddly amounts into and out of our positions quickly.
The big guns need to build and then distribute their positions over time.
therfore the big guys need to be confident of a companies fundamentals over a period of months to years , as they will in effect be "stuck" in that investment. Putting massive buy or sell orders will push up or down the price against them.
Being able to close a position out quickly is a massive advantage I believe. One Im not using enough in my equities trading at the moment. If you can find and edge in shorter timeframe trading use it.
over and over and over again.
Almost forgot : Leverage is another advantage. retail trader can get up to 20x
leverage (using CFDs) however without a good understanding ,and some protective measures in place it can also be disastrous.
I believe the big guns can maybe get 2x leverage at best .
This creates a situation where the small trader can make larger return as a %.
but not larger in $ term s

 

[Darc Knight]

Without disrespect, but why would someone contribute/provide information that they have earnt, to share on any forum if it gives them an edge in their investment opportunity.

Ie, I sat in a courtroom and hear the courts finding, that might mean I could short or go long on a particular company, why would I broadcast the information until I could action the information, so this would be ramping.

Not talking about sharing your inside information Satan, but rather sharing your legal techniques of getting some.
I use the term inside information loosely here, of course.

P.S. and since creating this thread I've obtained my first follower. Hope its not the Feds!

 

[satanoperca]

Not talking about sharing your inside information Satan, but rather sharing your legal techniques of getting some.
I use the term inside information loosely here, of course.

P.S. and since creating this thread I've obtained my first follower. Hope its not the Feds!

Don't think what you are looking for you can find easily and is reliable on public forums but is fostered through personal relationships and networks.

If I could easily obtain said information, then why wouldn't I charge for it

 

[luutzu]

Not talking about sharing your inside information Satan, but rather sharing your legal techniques of getting some.
I use the term inside information loosely here, of course.

P.S. and since creating this thread I've obtained my first follower. Hope its not the Feds!

Have you read Phillip A Fisher's "Uncommon Stocks, Uncommon Profit"?

He described his method in great details there. I couldn't think of anything else to add to his approach.

For what it's worth, I think talking to executives and the competition are more useful when you're investing in smaller companies. In large corporations, I haven't tried but I'm sure you and your couple dollars wouldn't make it pass the PR people.. .and getting to the senior execs might not be that useful as if the corp is big enough. I mean they're so well trained in salesmanship and things are so out of the execs control that they could hardly offer you anything that's not already in the annual reports and presentations.

For smaller companies where you could meet the boss, and where the intellect and drive of the top managers really determine the survival or not of a company... Wouldn't hurt to talk and really understand the business and have certain points clarified. Might get something.

But definitely check out Fisher's book if you haven't already.

 

[luutzu]

Not talking about sharing your inside information Satan, but rather sharing your legal techniques of getting some.
I use the term inside information loosely here, of course.

P.S. and since creating this thread I've obtained my first follower. Hope its not the Feds!

Feds aren't that quick.

 

[Smurf1976]

If there's an option to do any sort of site visit, public tour etc then do it.

Never underestimate what someone might know about the business and be willing to share no matter what their actual job is.

I once found out the exact production costs of a significant company from someone employed as a manual labourer. Literally doing work with a shovel and a hammer. That didn't mean he didn't know exactly what it cost the company to produce each tonne of product and how sales and production were going. Even better, there was nothing preventing him telling me so long as I wasn't from the media or a politician in which case I'd have had to speak to management.

If you can find someone who's reasonably smart then odds are they know quite a bit no matter what their actual job title. No guarantees you'll find such a person simply by being on site but there's always some chance you will.

 

[SirRumpole]

Without disrespect, but why would someone contribute/provide information that they have earnt, to share on any forum if it gives them an edge in their investment opportunity.

The same could apply to chart techniques no ?

I've got a system and it works for me but if everyone knew about it then maybe it wouldn't work anymore ?

So why post anything here ?

 

[kenny]

The same could apply to chart techniques no ?

I've got a system and it works for me but if everyone knew about it then maybe it wouldn't work anymore ?

So why post anything here ?

• One self serving reason to share would be to do so once you've set your position already and essentially are promoting it like others might ramp a stock in other forums.
• Another way of looking at that however would be to seek validation and contrary views to test your premise amongst your peers.
• Technical analysis is ideal for this sort of discussion that isn't really any inside knowledge but rather assessing the impact of human behaviour through price and volume. Discussion might help refine your system.

 

[freebird54]

I used to sell fork lift trucks - great legal source of information it seems nowadays it they are telling you it is too late -

 

[Skate]

No, I'm not talking about the kind you go to Jail for (or Joe will for hosting this thread). I'm talking about the kind of information that is publicly available but not yet well publicized
eg. sitting in on a Court case which is public and getting a feel for the outcome. Or, wearing out a bit of shoe leather at major land development sites finding out who might be doing what. etc etc.

It seems the big boys have their advantages in gaining information due to size, us little guys must have some advantages due to our size or lack of it?

@Darc Knight

I hate long winded post - I get exhausted reading them let alone writing them..

I'll chunk the post to encourage you to keep reading (it's a trick I use when communicating with others)

The market is not a level playing field

The stock market is not a level playing field, but most individuals invest as if it is. They assume they have the same information as everyone else, so they focus on the facts that are readily available to them and ignore how a stock is actually moving.

Someone out there always knows more than you do

We don’t consider that maybe someone out there knows a lot more than they do and perhaps that might account for why a stock is moving the way it is. We have all seen a situation in which a stock suddenly starts making big moves up or down, and then a short time later significant news is released that explains why that move took place.

Someone out there always knows more than you do, and you shouldn’t assume otherwise.

Foolish

It is just plain foolish to think that it is an even playing field when it comes to receiving valuable information. There is absolutely no way small individual traders like us has superior knowledge about a company. But the good news is that small Investors don’t need an informational edge. They make up for it by moving fast and being reactive.

The stock market is not an even playing field, and rather than complain about that fact, we must use it to our advantage by paying close attention to those who do have inside information.

Disclaimer

I hate using the word "complain" anytime I communicate and the use of the word "complain" is not directed at you - I've included the word with generality as other may read the post.

Skate.

 

[Darc Knight]

@Darc Knight

I hate long winded post - I get exhausted reading them let alone writing them..

I'll chunk the post to encourage you to keep reading (it's a trick I use when communicating with others)

The market is not a level playing field

The stock market is not a level playing field, but most individuals invest as if it is. They assume they have the same information as everyone else, so they focus on the facts that are readily available to them and ignore how a stock is actually moving.

Someone out there always knows more than you do

We don’t consider that maybe someone out there knows a lot more than they do and perhaps that might account for why a stock is moving the way it is. We have all seen a situation in which a stock suddenly starts making big moves up or down, and then a short time later significant news is released that explains why that move took place.

Someone out there always knows more than you do, and you shouldn’t assume otherwise.

Foolish

It is just plain foolish to think that it is an even playing field when it comes to receiving valuable information. There is absolutely no way small individual traders like us has superior knowledge about a company. But the good news is that small Investors don’t need an informational edge. They make up for it by moving fast and being reactive.

The stock market is not an even playing field, and rather than complain about that fact, we must use it to our advantage by paying close attention to those who do have inside information.

Disclaimer

I hate using the word "complain" anytime I communicate and the use of the word "complain" is not directed at you - I've included the word with generality as other may read the post.

Skate.

This post took my thinking to another level. Thank you Skate.

 

[Darc Knight]

Not really inside information but I guess knowing what other so-called Gurus think is a starting point?

https://www.gurufocus.com/guru/top-holdings

 

[barney]

P.S. and since creating this thread I've obtained my first follower. Hope its not the Feds!

Lol ….. That's very funny DK.

Great thread title too ….. I read it and was over here like a shot

As for the Insider knowledge ….. I try to read between the lines in announcements but that generally doesn't work ….. I find Volume when there shouldn't be … and No Volume when there should be is often helpful

 

[Darc Knight]

Have you read Phillip A Fisher's "Uncommon Stocks, Uncommon Profit"?

He described his method in great details there. I couldn't think of anything else to add to his approach.

For what it's worth, I think talking to executives and the competition are more useful when you're investing in smaller companies. In large corporations, I haven't tried but I'm sure you and your couple dollars wouldn't make it pass the PR people.. .and getting to the senior execs might not be that useful as if the corp is big enough. I mean they're so well trained in salesmanship and things are so out of the execs control that they could hardly offer you anything that's not already in the annual reports and presentations.

For smaller companies where you could meet the boss, and where the intellect and drive of the top managers really determine the survival or not of a company... Wouldn't hurt to talk and really understand the business and have certain points clarified. Might get something.

But definitely check out Fisher's book if you haven't already.

You rate this Book as one of the best do you Luu? I've found a copy, just gotta take time to read it if it's that good.

 

[luutzu]

You rate this Book as one of the best do you Luu? I've found a copy, just gotta take time to read it if it's that good.

Yes. One of the best I've read.

Buffett also think so too. I think Buffett rates Fisher up there, or higher, than Graham. But in my opinion Graham is somewhat misunderstood to be a "value" [cheap stocks] whereas Fisher look more at the quality and "growth" rather than getting an accounting bargain.

Unfair in that Graham talk plenty, and know plenty, about "growth" and quality. Just that I think him having gone through the Great Depression, maybe even personality wise.... he like stocks that are cheap and quality and growth, while he know about it, he'd rather not get into it.

----------

I guess it depends on how we approach investing.

If we see stocks as a commodity to be traded, as a financial instruments where we buy low and sell at a higher price... Then I'm sure there are plenty of books and methods out there. I'm not saying anything's wrong with such approach, I mean we're all here to make money and whatever dependable way we can do it, sure.

But if we approach stocks as the ownership of a business, a share in the earnings and growth of that business where owning one single share should be approached as though we were to own the entire company...

Then I don't think there's any more reading than Fisher, Graham, speeches and essays by Buffett and Munger.

I also like what Peter Lynch wrote too. But like most other books, they provide context rather than anything new or much more insightful into the "art" of business investing through stock/share ownership.

An Australian example would be what Roger Montgomery discusses. I saw a few of his ASX lectures and interviews. The quality stuff he talks about he picked up directly from Graham. And while I'm at it, he's wrong in the way he prices a business as well. Yea I know, telling a high powered fund manager he's wrong from my little shed

----------

The way I learnt investing was basically read those books above... understand their principles... i.e. study the stock as you would an entire business.

Then learn the updated accounting side of what Graham talks about. For example. When Graham wrote his "interpretation of financial statements", and way until quite recently, the Statement of Cash Flows weren't in the report. I'm sure there are plenty of changes to certain accounting standards etc. too....

But fundamentally, you're studying a business and accounting is very helpful in understanding the company's financial position and performance.

So you then either learn and know how to read financial statements accurately... or set up a spreadsheet... or use my little app

But accounting is historical. Business is about the future of course. Though I wouldn't stray too far into the future with hopes and dreams as that would be what Graham called "speculation".

I find that buying higher quality businesses, selling at (un)reasonably low prices tend to work out better than jumping into more speculative stocks. But what's speculation and what's "real" do have a lot to do with how much you know the business and how little you care for your money being gone if/when it goes down with dreams of world domination.

 

[Darc Knight]

Yes. One of the best I've read.

Buffett also think so too. I think Buffett rates Fisher up there, or higher, than Graham. But in my opinion Graham is somewhat misunderstood to be a "value" [cheap stocks] whereas Fisher look more at the quality and "growth" rather than getting an accounting bargain.

Unfair in that Graham talk plenty, and know plenty, about "growth" and quality. Just that I think him having gone through the Great Depression, maybe even personality wise.... he like stocks that are cheap and quality and growth, while he know about it, he'd rather not get into it.

----------

I guess it depends on how we approach investing.

If we see stocks as a commodity to be traded, as a financial instruments where we buy low and sell at a higher price... Then I'm sure there are plenty of books and methods out there. I'm not saying anything's wrong with such approach, I mean we're all here to make money and whatever dependable way we can do it, sure.

But if we approach stocks as the ownership of a business, a share in the earnings and growth of that business where owning one single share should be approached as though we were to own the entire company...

Then I don't think there's any more reading than Fisher, Graham, speeches and essays by Buffett and Munger.

I also like what Peter Lynch wrote too. But like most other books, they provide context rather than anything new or much more insightful into the "art" of business investing through stock/share ownership.

An Australian example would be what Roger Montgomery discusses. I saw a few of his ASX lectures and interviews. The quality stuff he talks about he picked up directly from Graham. And while I'm at it, he's wrong in the way he prices a business as well. Yea I know, telling a high powered fund manager he's wrong from my little shed

----------

The way I learnt investing was basically read those books above... understand their principles... i.e. study the stock as you would an entire business.

Then learn the updated accounting side of what Graham talks about. For example. When Graham wrote his "interpretation of financial statements", and way until quite recently, the Statement of Cash Flows weren't in the report. I'm sure there are plenty of changes to certain accounting standards etc. too....

But fundamentally, you're studying a business and accounting is very helpful in understanding the company's financial position and performance.

So you then either learn and know how to read financial statements accurately... or set up a spreadsheet... or use my little app

But accounting is historical. Business is about the future of course. Though I wouldn't stray too far into the future with hopes and dreams as that would be what Graham called "speculation".

I find that buying higher quality businesses, selling at (un)reasonably low prices tend to work out better than jumping into more speculative stocks. But what's speculation and what's "real" do have a lot to do with how much you know the business and how little you care for your money being gone if/when it goes down with dreams of world domination.

Gee, some pearls of wisdom there. Thanks Luu

Remember folks www.danginvestor.com .

 

[luutzu]

Gee, some pearls of wisdom there. Thanks Luu

Remember folks www.danginvestor.com .

Promised I'll make up to you somehow Joe.

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An overview of the two main modules.