1. We have added a Gift Upgrades feature that allows you to gift an account upgrade to another member, just in time for the holiday season. You can see the gift option when going to the Account Upgrades screen, or on any user profile screen.
    Dismiss Notice

The New Peak of Dow Jones

Discussion in 'Off-Topic' started by tuckerkao, Oct 7, 2017.

  1. Birdjaguar

    Birdjaguar Hanafubuki Retired Moderator Supporter

    Joined:
    Dec 24, 2001
    Messages:
    36,272
    Location:
    Albuquerque, NM
    Bummer. When you have a long time horizon, be patient. The surest way to wealth accumulation with minimal risk is a diversified portfolio of low cost index funds. Options are like going to the casino.
     
  2. Zkribbler

    Zkribbler Deity

    Joined:
    Dec 17, 2009
    Messages:
    6,595
    Location:
    Philippines
    :agree:
    I've been out of the game for a long time. Are there still no-load funds? Is so, I would substitute "no load" for "low cost." If not, then I'm in lock step with you. :salute:
     
  3. tuckerkao

    tuckerkao Warlord

    Joined:
    Feb 17, 2010
    Messages:
    226
    The major problem is that so many people are investing their assets into Dow Jones. When it crashed in 2008, the real estates dropped rapidly afterward.
     
  4. civvver

    civvver Deity

    Joined:
    Apr 24, 2007
    Messages:
    5,480
    Well yes but I had to learn it through experience. When you make like 1, 2 even 3 times your money on your first couple buys it's really hard to not go back. And I did quite well buying puts on research in motion (blackberry) back in the day lol. In the end it was fine, it was my play money separate account from my retirement one where I would just buy what I felt like, and I came out a little ahead overall before I liquidated it to buy my house. I was mad about it for a while but you come to terms. In retrospect my biggest mistakes weren't even options, they were selling out of long term stocks way too early. I sold netflix for like a 30% profit in 2010? Somewhere around there, when I could've made 500%, and I sold under armor way too early too, though it's tanked recently.
     
  5. Birdjaguar

    Birdjaguar Hanafubuki Retired Moderator Supporter

    Joined:
    Dec 24, 2001
    Messages:
    36,272
    Location:
    Albuquerque, NM
    Yes, low cost = no load.

    Specific stock risk is always a problem. My kids have a significant amount of Apple stock. I keep telling them to sell it down in bits as it climbs to reduce the hit they will take if it tanks. My advice is to replace it with an index fund. Some times they listen, other times they don't. The dilemma is a tough one. It is a great stock that has gone from $92 to $155 since its 7:1 split. And they have started to pay dividends. 100 shares went to 700 shares and from $64,000 to $108,000. When do you take your profits? An ever rising stock price is a fool's dream.
     
  6. JollyRoger

    JollyRoger Slippin' Jimmy Supporter

    Joined:
    Oct 14, 2001
    Messages:
    42,963
    Location:
    Chicago Sunroofing
    I am a kind of speculator and I use a trailing stop loss. I got stopped out of Netflix in 2004 after a quick, hefty profit. Wish I would have held onto that one.
     
    caketastydelish likes this.
  7. Birdjaguar

    Birdjaguar Hanafubuki Retired Moderator Supporter

    Joined:
    Dec 24, 2001
    Messages:
    36,272
    Location:
    Albuquerque, NM
    The perils of single stock risks. For an investor to have not made lots of money in the stock market since 2009 would been a challenge. As a speculator JR, how did you handle the slow steady rise over the past 8 years?
     
  8. JollyRoger

    JollyRoger Slippin' Jimmy Supporter

    Joined:
    Oct 14, 2001
    Messages:
    42,963
    Location:
    Chicago Sunroofing
    The speculation part of my portfolio holds three stocks at a time with a specific screener to pick them and specific rules for getting out. In general, it outperforms the direction of the market, though in severe crashes, I get stopped out early and the wild swings during say a week long slide in the market might get me close to breaking even. I don't intentionally day trade though they could happen (my floating stop loss tarts 12 to 22 percent below my initial purchase price. Assuming I don't get stop losses, my holding period is at least 10 trading days and I rarely hold more than two months. This is the speculative part of my portfolio. I do have a non-speculative nest egg in mutual funds that are buy and hold.
     
  9. Birdjaguar

    Birdjaguar Hanafubuki Retired Moderator Supporter

    Joined:
    Dec 24, 2001
    Messages:
    36,272
    Location:
    Albuquerque, NM
    :thumbsup:

    How has your day trading been doing? We've had few downturns worthy of mention.
     
  10. civvver

    civvver Deity

    Joined:
    Apr 24, 2007
    Messages:
    5,480
    I don't remember the specific timings, but netflix soared, then crashed super hard, like down from ~$300 a share to ~$60 a share because their pe ratio was like 300 and investors didn't see them as being able to monetize or keep up their surging growth. And drop in added subs led to a sell off. But that was before original content. At that time netflix was paying a lot in licensing fees and still pushing dvds by mail. Now they're as much an original content provider as they are a digital delivery platform. It seems once investors saw that it started surging again, I don't remember when it split, but it's gone up a ton. So you could've made a lot of money shorting it on the way down and buying in on the way up. At the time I was reading a guy's column about his fake money portfolio. Pretty much all he did was buy puts on blackberry and netflix and buy calls on apple (sometimes he'd also double down and sell apple puts and netflix calls). He tracked it all like it was real money and just doing those things, riding those waves but using options to leverage he like quadrupled his money in a year. Sometimes it's just better to be lucky and ride a wave of momentum.
     
  11. tuckerkao

    tuckerkao Warlord

    Joined:
    Feb 17, 2010
    Messages:
    226
    Another big event celebrated, Dow Jones just surpassed 23,000 points with IBM stock leading the market. IBM must have faster CPU processors developed than Intel.
     
  12. Birdjaguar

    Birdjaguar Hanafubuki Retired Moderator Supporter

    Joined:
    Dec 24, 2001
    Messages:
    36,272
    Location:
    Albuquerque, NM
    Dow investors just love big round numbers.
     
    Hygro likes this.
  13. tuckerkao

    tuckerkao Warlord

    Joined:
    Feb 17, 2010
    Messages:
    226
    Dow Jones rose to 24,275 with the 331 points gain within a single day. The stock investors and riskers will surely get major profits before the Christmas.
     
  14. Birdjaguar

    Birdjaguar Hanafubuki Retired Moderator Supporter

    Joined:
    Dec 24, 2001
    Messages:
    36,272
    Location:
    Albuquerque, NM
    It has been a very good year for stocks. Profits will come only if you sell. The question is: should you sell and collect those profits or wait. Waiting may give you more profits, but risks a downturn. I suspect (baring a crisis we cannot foresee) that their will be a mild pull back once the tax situation is settled and we move into the spring/summer. The timing of the tax changes is still in flux. If there turns out to be a change in capital gains tax rates, that will change how folks respond.

    A 5-10% drop will be helpful for the long term outlook and no reason to panic.
     
  15. Hygro

    Hygro soundcloud.com/hygro/

    Joined:
    Dec 1, 2002
    Messages:
    22,750
    Location:
    Nicaragua
    In my lifetime, the market goes up or crashes. Sure, it might take a dip but there's no slow term downward "correction".
     
  16. Birdjaguar

    Birdjaguar Hanafubuki Retired Moderator Supporter

    Joined:
    Dec 24, 2001
    Messages:
    36,272
    Location:
    Albuquerque, NM
    Corrections are not necessarily slow. There have been 10 corrections (a negative change of 5-20%) since 2010.

    http://www.yardeni.com/pub/sp500corrbear.pdf

    Scroll down a page or two.
     
  17. Zkribbler

    Zkribbler Deity

    Joined:
    Dec 17, 2009
    Messages:
    6,595
    Location:
    Philippines
    I stopped doing that the day after my Western Union stock lost 1/3 of its value in one day. :cry:
     
  18. Birdjaguar

    Birdjaguar Hanafubuki Retired Moderator Supporter

    Joined:
    Dec 24, 2001
    Messages:
    36,272
    Location:
    Albuquerque, NM
    Bummer. I am not smart enough to be a stock picker nor do I want to spend all my time analyzing company information to make good choices. I am quite happy with index funds.
     
  19. JollyRoger

    JollyRoger Slippin' Jimmy Supporter

    Joined:
    Oct 14, 2001
    Messages:
    42,963
    Location:
    Chicago Sunroofing
  20. civvver

    civvver Deity

    Joined:
    Apr 24, 2007
    Messages:
    5,480
    I wish I had just put all my savings in apple or netflix a year or two ago. Everyone in the US has this idea that you need to have quick cash on hand for emergencies but everywhere takes credit and I can get a brand new interest free card with a higher limit than my savings in about 5 mins online. If there truly was an emergency I could just put stuff on a card while I get my cash out of investments.

    Sadly, well maybe not sad but reality is when you're married you can't just invest where ever you want on a whim. My wife would freak if I looted our savings to invest it lol. I just throw as much in my 401k as possible.
     

Share This Page