The Stock Market

The Sun comments box on all this is very entertaining right now.

Sell hell on Black Thursday
Why should people lose money because these spotty little stockbrokers have wet their nappies? These people are grossly overpaid parasites who have never done a day's work in their lives, so how on earth can they judge the performance of businesses where people really work?

baudrillard has the bullshitting skills that could have earned him serious bank in the city.

he woulda been great on the stand too. "your honor my next witness will demonstrate conclusively that the money my clients lost did not even exist."

recession????

woohoo i put loads of money in savings accounts and stuff

does that mean i'll be able to afford to buy a house soon?

is that how it works?

i'm fascinated by this whole stocks/shares thing, esp the spate of articles in sunday papers about the horrors of it all. but i dont really understand what it is, or how it works - can someone recommend an idiots guide to the whole thing?

and also a good book by say some 80s wall street guy who lived highs/lows, made millions, lost it all, etc

What's your most successful investment?

I've had my share of quick doubles and triples as a penny stock trader, but nothing that approaches a stock that I put my friend in, it was QBID, this was late '03, I got him in at .0001 and in 2 days it began moving up and was at .035 in a week. He invested a whopping $150 which would have been worth over $50,000 except he sold it the day after he bought it, for breakeven. I think in the entire index of pennies and pinksheet stocks there's only been like 2 that have exceeded that performance since.

haha, if the dude didn't sell at the right time, that's not "performance" at all!

I mean that's a little like saying "My most successful investment ever was that time I thought about buying IBM before it got huge"

can someone recommend an idiots guide to the whole thing?

http://ecx.images-amazon.com/images/I/61W6GM8VD7L._AA240_.jpg

oh noodle you are a one.

anyone got better suggestions?

James Cramer, Confessions of a Street Addict

a good book by say some 80s wall street guy who lived highs/lows, made millions, lost it all, etc

Victor Niederhoffer, Education of a Speculator actually fits that description more accurately (made/lost billions) but Cramer's book is a much snappier read.

yeah but jim cramer is a bastard

OTM freakshow

there are several good or at least interesting recommendations on barry ritholtz's site. I really am a slobbering bigpicture fanboy at this point. he should sell t-shirts.

Dailyspeculations.com for models + charts + spec musings galore.

To specs, "value trading" is a huge diss.

I'm a macro guy though. I put my money in mutual funds by sector and use spider/index funds as my "hedges." I don't have the time or the inclination to be a serious trader, especially with all the nasty stories I keep reading from my macro sources etc. what's the old stat, private traders only do 85% as well as the indices?

I "hedge" Spiders, Diamonds, and the Qs against foreign funds (Blackstone India closed-end ETF, Matthews India and U.S Global European emerging markets) and speculate on a bunch of single stocks that have been straight line tanking since January.

Yes, perhaps only 10% of private funds outperform. You're better off on the pass line at a crap table than using an FA, IMHO.

what's the old stat, private traders only do 85% as well as the indices?

I'd be surprised if it was even that high

bloodbath

Rolling US Economy Into The Shitbin Thread

from www.dailyspeculations.com

Path of Least Resistance, from Victor N1ederhoffer
March 11, 2008 | 4 Comments
The moves this Friday, Monday and Tuesday remind me of a good baseball swing, or for that matter what any good athlete does vis a vis economy of motion. Recapitulating exactly the Friday, Monday and Tuesday of the big French bank frontrunning move

Rodger B4stien replies:
The bigger question is whether this batter does what I too often did, which is once I found my stroke, I swung harder, many times losing my rhythm in the process.

Stefan Jov4novich adds:
Chili Davis says he has the same problem. Each time he walked up to the plate, he would mutter to himself "70%, 70%." That was how hard he should swing to allow his stroke to do its work. That didn't keep him from over-swinging or from displaying his enormous strength when frustrated, but he says it helped. Once upon a time at Candlestick I saw Davis, while walking back to the dugout after striking out, raise one knee up to waist level and break his bat into two pieces. He didn't break stride.

I love N1ederhoffer.

So I have a question about stock "valuation":

In a large, publicly held company with widely dispersed shareholders, we pretty much accept that shares don't represent any kind of "control" for most holders, and also that they don't represent any kind of substantial right to profit-sharing (since dividends are generally either small or 0). So isn't most stock investment, whether short-term or "buy and hold" effectively speculation, and if so, doesn't the "value" of a share of stock derive purely from the future expectation of a higher value? And if so, what the fuck does it all mean?

Or does the fact that a stock share carries a kind of hypothetical control right (if someone were to buy up enough of them) give it a kind of stored/potential value that has some tangible connection to the actual value of the company as a going concern?

by value you mean dollars and cents or why someone would want to own it?
i think i know (or learned it before) but not sure if i understand the question

I mean dollars and cents but as a reflection of why someone would want to own it. I mean the only reason anyone pays $51 for a share of WhizCo is because they think they can sell it for more later, and this is true whether you plan to hold for 10 minutes or 20 years. So what does the price actually reflect other than a bet on a higher price, and if so isn't it just bets all the way down?

(the only reason unless someone is trying to buy a genuine ownership stake in a company)

i mean, it's basically just a claim to the company's future profits, right? those may or may not be paid out as dividends, but if they're not they are at least in theory being reinvested back into the company because it has such excellent, high-return uses for them.

it is just a bet or a way to have wealth that isn't cash unless you really want to have a controlling share. that's it, isn't it? you give them money to do stuff with the business and in exchange you get the chance that your share will eventually be worth more than what you paid for it (as opposed to buying an ownership stake in equipment or inventory or products, which could be arranged in another type of organization that's not a corporation). but different types of stockholders might see different value in the same thing. like a hedge fund for example would see more "value" in acquiring additional shares so it can manage the company. if you just want to sit on it, another share would be less valuable to you. right?

how latency arbitrage picks $3 billion from your pockets

http://www.dailyfinance.com/story/investing/rigged-market-latency-arbitrage-3-billion/19503388/

The practitioners of latency arbitrage make money in two ways: They locate their computers as close as they possibly can to the electronic exchanges that execute their trades, and they pay exchanges to give them actual stock price information before that raw data gets consolidated and sent to most other market players.

a latency as low as 100ms allows traders who have paid more for their closer spot to the exchange server can then generate revenue through automated short-sells predicting the other automated trades

$3 billion

Taking no risk at all, except for the $1.8 billion they pay to the exchanges each year to locate their servers right next to the exchange computers, these latency arbitrageurs make between one and three cents on each trade by getting that tiny jump on you. And despite the volatility in the broader markets during that time, the latency arbitrageurs have been steadily profitable for the last four years.

Maybe it's just me but these stock visualizations are pretty cool (requires java and flash)

FinViz Financial Visualizations
StockMapper.com Heat Maps (click on a market)

I kind of wish there was a stock mapper for uncommon stocks. Maybe there is?

I'm about to start a minimal amount of day trading. I know that June is a terrible time to start. Once my electronic funds transfer goes through on monday I will start trading with real money for the very first time.

Anyone have real tips or suggestions?

I kind of wish I had a way of keeping up on stock press releases. I can easily find stock news with google but I just want all the good press for individual stocks right when they come out. Most websites will post news on just a few stocks that are getting tons of press.

long position on silver

i would wait a few weeks (or months) before trading stocks though, until the greece situation is sorted out

"Sell in May then go away" has supportive history but I have to try to use my 100 commission free trades I get for a month after my initial funds transfer. Anyways, the thing about day trading is that you get a better outlook than with long trading because intraday trading is more predictable - especially when there is good press.

So starting monday I will change my username to account for the measly $700 initial investment and then I will periodically change my user name so that people will see how well I am doing :)

intraday trading is more predictable

fuck no, just look at today's dow chart

i guess it's probably easier to predict the next 4 weeks than the next 4 hours

What kinds of stock do you want to trade? Have you studied/practiced daytrading? And by daytrading do you mean holding for minutes/maybe hours?

I actively trade penny stocks. You can do something with $700 with a little luck in pennies. I don't see how daytrading would really be feasible, esp once the commissions kick in.

yeah, but if you're on your toes you'll know that the dow is starting to tank. and if you're really good you can forsee that it will tank..... it's about being up on the news

My broker is only $3 commission once the fees kick in. I've done virtual trading. I am not going to be trading any specific kinds of stock

yeah 700$ for stocks isn't much, especially for intraday trading. options have a much higher volatility

* For stocks priced under $1.00, the online commission is $3 plus 1/2% of the principal value.
(I won't be trading penny stocks)

yeah, but if you're on your toes you'll know that the dow is starting to tank. and if you're really good you can forsee that it will tank..... it's about being up on the news

yeah but how do you explain that the dow has risen again after the release of the unemployment numbers?

yeah captain lorax its not quite as easy as you think.... looking at the news can be p unhelpful

just an example btw, but i would say that following the news isn't enough to predict the trend

xp what he said

don't listen to the trolls, Lorax. invest everything you have. pawn your possessions if necessary. you can do it. we're all counting on you.

lorax ive seen just as many times that bad news comes out + the dow shakes it off + goes up as vice versa

xpost lol

What's your most successful investment?

Well, this was a close call: In 2003 my friend Brian gave me $150 to invest for him, he told me to put it on a 'lotto' style pick. I bought 1,400,000 shares of QBID @ .0001 which was trading with liquidity at .035 the next week. Problem is, Brian decided he wanted to cash out the day after I bought the stock. So he got back his $150 - 2 commissions and forsook a profit of over $40,000 in a week, on a $140 investment. To this day the best run I've ever seen.

intraday trading is more predictable

fuck no, just look at today's dow chart

― groovemaaan,

Well, long trading has its advantages. I mean silver, gold, oil are always good.

If you want to make lots of money in 6 months to 1 year, then I highly suggest that you buy HDY right now.

Yesterday I predicted that Sprint stock would do well today. I was definitely right on that one; if I had my initial funds go through already I would have spent half of them on Sprint.

The stock market isn't 100% chance. If I was rich I would be able to make a decent yearly salary just by having my foot in the market. Our stock market isn't crashing anymore. Obama is one of the biggest corporatist presidents our country has ever seen. And it's no secret that lobbyists run our congress. Corporations get the biggest tax breaks of them all.

there was a point around 2001 when a bunch of the telecom stocks were in the dumper - trading at less than $1. I talked about buying shares of all of them, assuming that some would die off and the rest would rise. wish I'd done it, global crossing was trading at .50 cents at the time and now it's trading at $34.