Investing 102

[COYBILT]

Sounds like I really need to move into your shop, so i can use your tools and then you can advise me on stocks while I live there. sound good? I will agree with you though you have to be in it to win it with stocks, sort of like a marriage.

Originally Posted by GregWeld

100% agree with you here Todd!



RE: Chipotle Mexican Grill and similar stocks that are "priced for perfection" or have HUGE P/E Ratios they MUST grow in to... Just look at Amazon (AMZN) today. This is why - as much as I'd like to - I don't own them. You absolutely get murdered IF -- always the big IF - ANYTHING happens along the way that the street doesn't like. Instantly taken to the woodshed!!

Once in awhile I'll bite on a "big / fast growth" name.... I'll do this is tiny way (relatively) and I'll flip it if I get lucky... sometimes I win - sometimes I loose. I don't mention that stuff here because it's not pertinent to THIS thread. So I'm not against growth stocks and in fact think that you young guy SHOULD own them - because even if they hiccup - if the fundamentals are there - then long term the growth "should be" too. But in the meantime it can be ugly.... so you have to have the guts AND conviction to hold this stuff and or average down (what I'd be doing this AM if I owned Amazon). Just look at NetFlix (NFLIX) when the CEO did a major faux pas... if you were smart enough (do ya feel luck, punk?) to buy that one... I wasn't - but a friend that's on their board did... and he's absolutely killed it!

[COYBILT]

Sounds like I really need to move into your shop, so i can use your tools and then you can advise me on stocks while I live there. sound good? I will agree with you though you have to be in it to win it with stocks, sort of like a marriage.

Originally Posted by GregWeld

100% agree with you here Todd!



RE: Chipotle Mexican Grill and similar stocks that are "priced for perfection" or have HUGE P/E Ratios they MUST grow in to... Just look at Amazon (AMZN) today. This is why - as much as I'd like to - I don't own them. You absolutely get murdered IF -- always the big IF - ANYTHING happens along the way that the street doesn't like. Instantly taken to the woodshed!!

Once in awhile I'll bite on a "big / fast growth" name.... I'll do this is tiny way (relatively) and I'll flip it if I get lucky... sometimes I win - sometimes I loose. I don't mention that stuff here because it's not pertinent to THIS thread. So I'm not against growth stocks and in fact think that you young guy SHOULD own them - because even if they hiccup - if the fundamentals are there - then long term the growth "should be" too. But in the meantime it can be ugly.... so you have to have the guts AND conviction to hold this stuff and or average down (what I'd be doing this AM if I owned Amazon). Just look at NetFlix (NFLIX) when the CEO did a major faux pas... if you were smart enough (do ya feel luck, punk?) to buy that one... I wasn't - but a friend that's on their board did... and he's absolutely killed it!

[SSLance]

I read this article with a much different perspective than I would have had just a short while ago...

http://seekingalpha.com/article/2343...erything?ifp=0

Thanks to Investing 102...

[GregWeld]

Originally Posted by SSLance

I read this article with a much different perspective than I would have had just a short while ago...

http://seekingalpha.com/article/2343...erything?ifp=0

Thanks to Investing 102...

It's a good article and I like the honesty of it. WE ALL HAVE DOUBTS and we all sometime worry about whether or not what we're doing is right. Here's where I personally sit. Everyone needs to take a longer term perspective. This is why I preach DIVIDENDS and being paid to wait - as long as you're in the best of the best. Because if you're reinvesting those dividends -- then they'll be buying more shares when the market does take a dive. That's EXACTLY WHAT YOU WANT. More share paying dividends buying more shares.... that's the power of compounding.


If Warren Buffet sold his Coke (KO) shares every time he was worried about this or that --- then he wouldn't be getting that dividend that is now larger or equal to what his original investment was.

Everything goes up and down -- the key is what your reaction is to that. Nature has us buying when prices and things are high - and we sell when they're low... the key to the whole investing thing is to stop doing that --- and buy when things SUCK.

The problem is -- we never know when those things are going to occur. I've learned over time - to just let the great law of averages make me a winner - and the law of market averages tells me that over the LONG RUN I'll be fine. In the meantime I spend my dividends and I don't worry much about what the market is going to or not going to do 'cause I've never been able to figure it out.

I never thought once about the market as I watched a GTR run 237MPH or a Bugatti run 246 today.... 'cause I know I'll get my dividends whenever they're paid.

[GregWeld]

You Twitter (TWTR) holders will be happy campers this morning....


A good example for 102 -- Twitters (TWTR) metrics were better than "expected" so the stock will get a nice boost.... but Amazon (AMZN) got shot in the head because of a lack of profit...

My point is - that for me personally.... I can't own this kind of stuff because I don't like waking up to a 30 point drop in a name, even when it's fun as hell to wake up with a 10 point gain. And if I do own them - they're very very fractional stakes. I might buy 1000 shares of something like this - when a normal position in my accounts is 20,000 to 40,000 shares. Tiny positions. That way I can 'enjoy' a nice gain (if I owned TWTR I'd wake up to a nice 9 to 10K dollar gain this morning)... but I don't get whacked with a big haircut that affects my retirement when they drop like rocks.

It's taken me a long time - but I've learned to watch from the sidelines... and not be upset with myself when some other lucky bastard scores big. My dividends just keep plugging along and keep Gwen and I near the style we'd like to live for a long time. You YOUNGER GUYS should be taking some risk with some of these names... just don't get crazy betting the farm on them.

[sik68]

Just checking in to say hello...I still follow this thread religiously! I will try to post more and earn my keep.

Due to dividend growth alone, I am earning $75 MORE per quarter now than at the beginning of the year. Gotta love it!

[GregWeld]

Originally Posted by sik68

Just checking in to say hello...I still follow this thread religiously! I will try to post more and earn my keep.

Due to dividend growth alone, I am earning $75 MORE per quarter now than at the beginning of the year. Gotta love it!

Money for nothing and your chicks for free! Gotta love that Steven!

[GregWeld]

Remember what I've been saying about interest rates! The economy will take a real hit if we see a sudden spike up in rates. We are at a crossroads here where the economy is okay/decent which should support stocks --- but the FED can kill that party real quickly if they lose control of the rates.

[mdprovee]

Watching closely. Saw the news last night....and I started thinking of a few thing, ie. time to buy, why dropped so big, things like that. First time I can remember hearing news of the stock market, and me thinking about it.

On a side note, over the last year to year and a half, we have cut our credit debt in half, and pay things in cash now. What credit we have is no interest for another year. Hope to be completely payed of by April next year. I am dying to make changes to the car, but this thread has taught me not until the cards are payed off, and you can pay cash.

Thanks

[SSLance]

I've got an itchy finger on the buy trigger myself.