Investing 102

[GregWeld]

Originally Posted by glassman

So, speaking of which, WTH is CNBC showing a "bitcoin watch" window? Fascinating to them? just curious....

Trying to get Millenials to watch for ratings??? IDK

I just find it hilarious that every week I read another story about theft or hacking etc with this stuff..... it was supposed to be "so secure".... RIGHT! So secure they can steal hundreds of millions worth every other week.... a couple times this has even caused the "brokerages" to go out of business. Let me know how that works out.

[Vegas69]

I heard a radio ad this week urging homeowner's to take out a home equity line to buy the "bitcoin dip". I about lost control of my truck.

[JKnight]

Originally Posted by Vegas69

I heard a radio ad this week urging homeowner's to take out a home equity line to buy the "bitcoin dip". I about lost control of my truck.

I heard the same ad, started a couple weeks ago. All I can do is shake my head. You know there’s a handful of people who will think that’s a great idea and give them a call. They’re walking an ever-narrowing line on making investment recommendations too....no good.

[GregWeld]

I stole this fair and square ---- but it is well defined investment strategy....

So much of this thread has been about buying not selling.... buying when the poo hits the fan vs selling every time you hear some talking head saying the sky is falling. Holding great companies (think in that way versus "stock") and collecting part of your profits (since you are an owner in that company). I read this and thought I needed to copy and paste it here.

++++++++++++++++++++++++++


Memorize this affirmation: "I am an investor; I am not a speculator."

All together now: "I am an investor; I am not a speculator."

As investors, we:

Buy stock in solid businesses. We expect to be rewarded over time through share price appreciation, dividends, or share repurchases.
Don't time the market. And we certainly don't speculate when we buy stocks. Speculation is what day traders do.
Focus on the value of the businesses we invest in. We try not to fixate on the day-to-day movements in stock prices.
Buy to hold. We buy stocks with the intention of holding them for the long haul.
Tune out the noise: Put down the newspaper, turn off CNBC, and opt out of those alerts on your phone. None of it is doing you any good.

Fixating on the market's minute-to-minute news won't help you make your next brilliant financial move. That chatter is mostly noise. And it's costing you a serious amount of sound sleep — and maybe even some actual money.

Spread out your risk with a solid asset-allocation plan.

You should be building a portfolio (or working toward it!) that includes a bunch of investments that don't always move in the same direction — bonds and stocks, for example. You need to diversify.

Putting an assortment of eggs in various baskets isn't the only way to spread your risk. You can also avoid the risk of investing in a company at exactly the wrong time. Say you're interested in buying shares of Scruffy's Chicken Shack but you just don't know when to pull the trigger.

The answer? Take a bunch of shots!

Practically speaking, you do this through dollar-cost averaging (this means accumulating shares in a stock over time by investing a certain dollar amount regularly) through up and down periods.

So every month for three months, you purchase $500 of Scruffy stock, regardless of the stock price. The beauty of this system is that when the stock slumps, you're buying more, and when it's pricier, you're buying less.

"Buying in thirds" is another way to average into an investment: Simply divide the total dollar amount you want to devote to a particular investment by three, and pick three different points in time to add to your position.

Stay strong, think long!

[toy71camaro]

that is a great summary.

[WSSix]

I'm really not happy with the new Google Finance layout. What other sites are people using to see there stocks performance and get news about the stock at the same time? You know, how google finance used to be, lol.

Thanks

[GregWeld]

Originally Posted by WSSix

I'm really not happy with the new Google Finance layout. What other sites are people using to see there stocks performance and get news about the stock at the same time? You know, how google finance used to be, lol.

Thanks

Couldn't agree more Trey! Google managed to make a mess out of what was something decent. It's even worse on "mobile" platforms where you can only get percentage increase or decrease vs actual move in $$ and cents.

[GregWeld]

Someone asked me today if I saw the market drop as a buying opportunity.

Nobody really knows do they. Wish I had a crystal ball - but I don't - nor do the talking heads on TV.


Here's my PERSONAL view --

#1 - I was in the hospital today (Mayo Clinic) getting another procedure done so wasn't around to see what was going on.

#2 - I raised a pile of cash a week ago. I had sold all the high fliers I'd been buying (because they've been the only thing truly working for months now) - I'm talking about Salesforce (CRM) - Splunk (SPLK) - Alibaba (BABA) - Boeing (BA) - Nucor (NUE) - and I sold most of my Amazon (AMZN) and kept 200 shares that I have an average cost of under $1,000 a share.

#3 - Why? Because we have a whacko political scene (don't take this as an invite to discuss politics or as my view on politics - it's not) - we have the tariff talks (now action) - we have rising interest rates and I wanted to be ahead of a surprise FED move - and mostly because the market has acted as if it was looking for ANY reason to sell vs buy.

This is INVESTING 102 -- it's not a thread called "trader talk" - I don't discuss what I'm doing, or not doing, personally unless it's used as an example here. I get many trades wrong - I get a lot right.... and what I'm doing is not what someone else should be doing.

+++++++++ HERE'S THE REASON I'M POSTING TODAY +++++++++++



I want to remind you -- as INVESTORS -- as share prices come down --- the DIVIDEND YIELD goes up as a percentage. Stocks are just like BONDS - bond prices fall the yield rises. Bond / share prices rise - the percentage of yield falls.

So ---------- we are in a rising rate market - yet share prices have gone thru the roof -- making YIELDS hard to find. As the market sells off --- all of a sudden some stock you'd like to have invested in - but felt the yield was too low and the price too high --- HEY!!! That bad boy might be falling right in your lap!

Don't RUN from the market during selloffs --- rather --- keep some powder dry -- don't rush in and buy everything you ever wanted. WAIT to see what happens -- chip away at what you've been watching/waiting to buy because we don't know if the market goes right back up - or we get a downturn that lasts for months (we are heading in to summer in a couple months - Sell in May and Go away) and add up all the other pressures or headwinds the market can run into...

Remember your timeline ----- those who ran to sell at losses back in '08 and '09 and then watched as the market roared right back with HUGE gains (they sold too soon and at the bottom -- then waited to be absolutely sure the market wasn't going to bite them again - and thus bought at the top - or after the market had run 25 or 40%). If you have 10 or 20 years -- remember that. If you put money in the market that you planned to buy a house with next week --- yeah --- well that was just dumb to begin with.

As "market" rates rise -- stocks fall to make their rates attractive. Nobody is going to buy an "expensive" stock that pays 2% dividend -- when they could get 3% interest in something else --- so it's a natural phenomenon that money moves around to find the yield that's attractive. It's the way money works -- it's always worked the same -- it will never change. Recognize it - know it - understand it.

[SSLance]

I got a little buying done yesterday morning. Anyone else?

[GregWeld]

Originally Posted by SSLance

I got a little buying done yesterday morning. Anyone else?

I'm at the highest cash reserve that I've been at in about 4 years (2.4MM). I'm not buying anything until I see this market settle down. It's just too hard....