Why do you buy shares in a company?

[ceasar73]

Hi All,

Why do you buy shares in a company???

Is it:
accelerated eps?
tip?
new product?
great future prospects?
Insiders are buying?
Comany is undervalued?
etc...

Cheers,

Ceasar. :)

[prawn_86]

To (hopefully) make a profit

[ceasar73]

so you throw darts yeah?:confused:

[beamstas]

Why? Profit
How do i choose? Technical Analysis

[ceasar73]

yes but what makes a company attractive to you guys???

[beamstas]

yes but what makes a company attractive to you guys???

Price action?
All i know about a company usually is the 3 letter asx code. I don't care for fundamentals at all.

[MS+Tradesim]

Price action?
All i know about a company usually is the 3 letter asx code. I don't care for fundamentals at all.

LOL. Same. I don't have a clue half the time. Something will come up on the news or this forum about some company doing crap and I think, "Oh yeh, I traded that last week. So that's what they're about." :D

For me, it's all about the price action in relation to what the broader markets are doing.

[ceasar73]

thanx beamstas,thats what im after.

[ceasar73]

LOL. Same. I don't have a clue half the time. Something will come up on the news or this forum about some company doing crap and I think, "Oh yeh, I traded that last week. So that's what they're about." :D

For me, it's all about the price action in relation to what the broader markets are doing.

Sounds like a recipe for disaster..

[beamstas]

Sounds like a recipe for disaster..

The price action of a company never lies
On the other hand, speculative forum posts, shonky news posts and balance sheets can

[MS+Tradesim]

Sounds like a recipe for disaster..

Sure...for someone who doesn't know what they're doing. I've done my time, and I know how to make it work.

[AlterEgo]

Price action?
All i know about a company usually is the 3 letter asx code. I don't care for fundamentals at all.

Same here too. Price action is all I really look at. The only fundamental thing I'm interested in is what sector it's in - don't want to know any more than that.

[ceasar73]

The price action of a company never lies
On the other hand, speculative forum posts, shonky news posts and balance sheets can

Dunno...many investors thats have made a lot of money buying on strong company fundamentals.

[skc]

Someone smart once said stock market is a voting machine in the short term and a weighting machine in the long term. So depending on your time frame, trading against fundamentals is dangerous for anything longer than a few weeks imo.

Some quick fundamental research will make sure that you don't buy into companies like hat makers in the 30s, film makers in the late 90s or property trusts last year.

I can pull the trigger when both fundamental and technical/chart are in agreement. This may mean I have a much smaller universe of stocks which I trade, but that's what I feel comfortable doing.

[ceasar73]

makes sense skc,thanks.

[AlterEgo]

So depending on your time frame, trading against fundamentals is dangerous for anything longer than a few weeks imo

I'm only trading short term anyway. Most of my trades are closed in under 4 weeks. The longest I've held any stock for in the last couple of years is 8 weeks.

Fundamentals are old news anyway. They have already been priced in to the stock. If a stock is rising on high volume, I don't need to know WHY this is happening. Just the fact that it rising is all the info I need.

[So_Cynical]

I'm a dart thrower (punter) i like a falling chart or at least side ways, quality
operations with substantial market share in whatever there doing, also like
a viable reason why others are selling...the story has to make sense for me.

Also tend to just focus on the 80 or so company's i know well, doing pretty
good lately, sold CPU today after buying near bottom 4 weeks ago...easy money.

[tommymac]

Someone smart once said stock market is a voting machine in the short term and a weighting machine in the long term.

Warren Buffet made that quote.

I invest based on fundamentals, ensuring the company is undervalued.

However, in this market fundamentals don't mean much and a company that is undervalued may keep falling. This is why I have decided to learn about technical analysis so I can trade in any market.

[wonderrman]

Warren Buffet made that quote.

No I think that you will find it was Benjamin Graham, Buffett's mentor.

Price action. The trend is your friend.

[skc]

I'm only trading short term anyway. Most of my trades are closed in under 4 weeks. The longest I've held any stock for in the last couple of years is 8 weeks.

Fundamentals are old news anyway. They have already been priced in to the stock. If a stock is rising on high volume, I don't need to know WHY this is happening. Just the fact that it rising is all the info I need.

Stock rising on high volume - without knowing anything about a stock, you could have bought into BNB when the hedge funds were covering their shorts.

If it only saves you once a year, it's a good year :)

[tech/a]

This thats it.

[nizar]

Price action?
All i know about a company usually is the 3 letter asx code. I don't care for fundamentals at all.

You and me both.

[AlterEgo]

Stock rising on high volume - without knowing anything about a stock, you could have bought into BNB when the hedge funds were covering their shorts.

Not at all. Would never have touched that. I don't buy down-trending stocks. The stock needs to be in a strong upward trend. "The trend is your friend", as they say.

[stl_08]

Stocks that are the top of there industry, they must of done something right to get to the top,and sound balance sheets or have high quality assets they can sell if they need to

[ceasar73]

I agree stl_08.
Surely accelerated eps..sound cash flow statements etc are reason WHY INVESTORS/TRADERS (yes traders too) buy a company.

[beamstas]

I agree stl_08.
Surely accelerated eps..sound cash flow statements etc are reason WHY INVESTORS/TRADERS (yes traders too) buy a company.

Surely?
Surely?
Surely?

You do realise that when you buy a share in a company, someone else is selling at the same time :eek:

If everyone traded for the same reason you'd never be able to buy because they would all have the same idea as you :rolleyes:

Brad

[MS+Tradesim]

I run two trading systems currently. Neither involve trades held for more than 2 days. What exactly will fundamentals add over that time frame? Nothing. It's all sentiment. My bread and butter strategy, in this environment, involves buying momentum driven stocks at or near close and selling the next day at or near open.

Recipe for disaster? Pfft. :rolleyes:

Ave Win 1241.52
Ave Loss -413.34
W:L 3
Prob.Win 0.57
Prob.Loss 0.43
Expectancy 523.37

This offers from 0-10 signals a day but I never take more than 5. So yes, if you know what you're doing, even in a bear market, price action is all you need.

And then when extended rallies like this one are around, there are the really nice trades that add chunk to the bottom line.

Caesar, you seem to want fundamentals to be what counts for you. Go for it. But making uninformed comments about what others are doing for a living makes me think that you just want your current beliefs confirmed.

There are lots of ways to take money from the market, and even more ways to lose. There is no right way or wrong way. There are just consistently profitable, inconsistently profitable, and unprofitable methods.

[Julia]

Ceasar, have a read of this post by Bunyip a few years ago. Let us know if something falls into place for you.


"Researching stocks takes a lot of time and it prevents me from doing other things."

I agree - researching stocks is time consuming.
But there's a simple solution to your problem.....don't do any research. There's no need to - tens of thousands of traders and investors have already done the research for you, and their findings are reflected in the trend of the stock.

AMP fell from $13 to $3 between March 2002 and August 2003. Shortly after it's downtrend began it was patently obvious, even to someone of little experience in chart reading, that the stock was heading south east on the chart.......a downtrend.
Why was it downtrending? Because traders and investors were quitting the stock en masse.
Why would they do that? Because tens of thousands of them had researched the company and found out that it was in trouble, and it's future prospects were none too bright.
In which case, you could have made money from the AMP downtrend by selling the stock short, or buying put options.
Or if you owned the stock, you could have bailed out long before it's value was decimated.
The point is that you could have got quite an accurate summary of the fundamentals of AMP without spending one minute of your time doing fundamental research. Just look at the chart.....all the information you needed was graphically displayed for you.

Look at the current price action of AMP. Nice uptrend in place, particularly when viewed on the weekly chart.
Why is it uptrending? Because tens of thousands of investors, having done their research, have formed the opinion that the stock has good fundamentals. No need for you to research AMP to profit from it - the research has already been done for you. If an uptrending stock shows temporary weakness by pulling back for a few days as profit takers bail out,
and then the uptrend resumes as buyers come back in, it presents you with an ideal opportunity to hitch a ride on the trend and make some money.

The same sort of simple analysis and trading strategy can be applied to any liquid stock that starts uptrending or downtrending strongly.
WPL is a good example.....uptrend began in early 2003. Three years later, the stock is more than four times it's 2003 value.
Once you saw WPL heading steadily north east on the chart, making higher peaks and higher troughs, did you really need to spend hours or days of your time doing fundamental research on it?
Thousands of investors had already researched it for you and their findings were very positive, otherwise why would they be piling into the stock and pushing it higher week after week?

A common fallacy among stock market players is that if you want to profit from the market, you have to read the financial papers, company reports, brokers newsletters etc to keep yourself up to date with the latest developments in the economy and within individual companies.
Its simply not correct.....I've been trading the markets for 10 years or so and for the last eight of those years I haven't read a financial publication, a brokers newsletter or a company report.
The most reliable information is in the charts. Learn how to interpret them, learn how to identify trends, learn how to recognise retracements, watch for the trend to resume following the retracement.
You won't need to spend your time doing boring company research, and you won't need to hand your hard earned money over to Fat Profits either.

If you want some good books on how to identify trends and how to hitch a ride on them, I'd suggest.....

"Dave Landry On Swing Trading" by Dave Landry

"Secrets For Profiting In Bull And Bear Markets" by Stan Weinstein

The trading methods expoused by both these men are simple to learn, easy to implement, and require very little time input from the trader or investor.

[beamstas]

Im not sure who im quoting here, so if anyone knows please tell me, i read alot :rolleyes: I believe it was buffet

Price is what you pay
Value is what you get

Lets look at say RIO for example. Was trading this time last year at around $130. Now it is trading at around 1/3rd of that.

That is a 66% discount. Would you buy something for a 66% discount?

What if i told you RIO was only worth (valued) at $45 in the first place, and $130 was just the price. Is it a discount now?

Was it just overpriced to begin with?

How do you determine value?

Im not asking you to answer these questions to me but i'd like you to ponder them. I am not opening up pandoras box of tech analysis vs fundaments, but more-so trying to emphasize there is more to trading shares than balance sheets and cash flows :o

Thanks
Brad

[Sir Osisofliver]

Hmm this thread does sound like it'll turn into a Fundy V Techie battle royale. Might be fun

Me I use both strategies...and here is why.

Lets take a look at that chart (yes I have removed the name and all tech indicators and left you with a simple chart) Looking at it from a technical standpoint there are not great characteristics to this chart. It's too volatile the retracement is ugly, the trend looks sideways, we have the possibility of a third corrective pattern with no obvious breakout features either positive or negative.

Lets look at the date... Well the market is in the process of having a major retracement, overiding emotion in the market is WTF? and panic. Looking at this chart technically doesn't fill me with giddy glee.

HOWEVER - because of what I KNOW fundamentally about this company I purchased shares on the 21st of March.

Was I wise to do so from a technical standpoint? Probably not. Lets see how I did in my next post.

Sir O

[So_Cynical]

Would you buy something for a 66% discount?

How do you determine value?


Yep

I love the value in this market....for example i found a little company the other day with
a big, simple, single asset...asset replacement value around 250 million (the asset cost
200 million to build about 10 years ago) the company had a cap of about 45 million with
5 million debt and 14 mill in the bank....makin money, paying divis.

Bargain....sure was, jumped up around 18% the last 3 days.

That's how i determine value.

[Sir Osisofliver]

Well I seemed to have covered my brokerage with that transaction, somewhere along that nice rise someone has looked at it technically and gone said, Yep lets ride this sucker hard.

So looking at this chart, what can we see from a a fundamental and technical viewpoint?

Technically we seem to have a nice EW pattern there, if true we should probably look at exiting at this point (which I did).

Fundamental factors said that their was more in it over a lnger term basis, but was hard to value in the short term. With STRONG TECHNICAL features I sold, taking $2.05 in profit or close to 500% return.

Ok so what happened then, was that a good move???

Lets see shall we.

[Sir Osisofliver]

OK so now we have some cool technical features to work with, we've got a classic EW feature in the stock with a beautiful third wave retracement and bottoming feature. Fundamentals were also strong, the value that pushed the shares to above 2.90 were still present so looked great having both fundy and techie reasons to jump in. And so I did at $0.85 cents.

Was this a good thing to do, given the date and the market continuing to look awful?

lets find out how it's done in the last few months.

[sinner]

I buy shares so nobody else can have those ones that I have...my precious.

[Sir Osisofliver]

Once again I think I paid my brokerage, and I finally reveal the stock (I exited at $8.50, quite an improvement from my $0.85 cents purchase)

So all told out of this stock I took almost 1500% return in a little over 12 months, and I'd like to think it was because I looked at it with BOTH technical and fundamental views rather than just a single viewpoint.

Cheers

Sir O

[tech/a]

we've got a classic EW feature in the stock with a beautiful third wave retracement and bottoming feature.

Thats a classic.
Particularly the Bottoming feature.

[beerwm]

OK so now we have some cool technical features to work with, we've got a classic EW feature in the stock with a beautiful third wave retracement and bottoming feature.

haha, cool technical feature

I know the chart SirO, 4 consecutive takeover offers may have helped with the end 1500% gain :p:

[tech/a]

With STRONG TECHNICAL features I sold, taking $2.05 in profit or close to 500% return.


Fundamentals were also strong, the value that pushed the shares to above 2.90 were still present so looked great having both fundy and techie reasons to jump in. And so I did at $0.85 cents.

Yeh how'd you do that????
It never again traded at 85c
Close but never 85c
And don't tell me you got the EXACT bottom.
And the EXACT top!
Atleast I have the trading statement for the above example you wouldnt have yours there would you?

The perceived grandeur of Financial Planner status seems to have taken its toll.

[beerwm]

SirO's chart is abit off,

Stock is PES, bottomed at 40c. around Oct.

I dont think the 'fundamentals' tell you anything the price movement doesnt SirO, maybe just 'reassurance' to buy, and maybe a 'discouragement' to sell.
But many use it to success, so it must have an edge.

[tech/a]

Stock is PES, bottomed at 40c. around Oct.

Not on my chart

[Porper]

OK so now we have some cool technical features to work with, we've got a classic EW feature in the stock with a beautiful third wave retracement and bottoming feature.

Sir Os, would you mind posting your Elliot analysis on the stock, with initial trigger point, stop, profit target please, with reasons ? Thanks.

[Prospector]

Wait til Garpal sees your avatar - he aint gonna like it! :rolleyes:

[kennas]

For me, it's all about the price action in relation to what the broader markets are doing.


Sounds like a recipe for disaster..


Dunno...many investors thats have made a lot of money buying on strong company fundamentals.You've asked why people buy shares and then started bagging someone's approach.

So, you obviously don't want to listen to what people have to say, but just espouse your own biased view of investing/trading.

Why start the thread?

:confused:

[Sir Osisofliver]

Tech,

1) Did you see the time I was posting? I'd had a long day and was suffering from insomnia. I also wasn't sitting in the office with the paperwork in front of me, I was sitting in the guest bedroom trying to give my wife the opportunity to sleep when I couldn't.

2) You are in fact correct. That's what you get for trusting your memory at midnight after you've been awake since 6 am. Went I went back to check I purchased those shares for 95 cents, not 85 cents, on the 22nd of October. Poor me and my faulty memory. For some reason I'd thought I'd paid 85 cents. My mistake - I will ensure that in future when answering a casual question at midnight after a long day and giving my hurried and tired viewpoint to spend an extra 15 minutes in scanning all the contract notes and blacking out my personal details for your edification and satisfaction.... NOT /sarcasm

What I will do however is continue to do what I did in that example - use my faulty imperfect memory because I cannot be stuffed in going and getting the paperwork involved to give exact figures to a casual question on a bloody web forum when I'm not getting paid for it. If you don't like that and demand absolute perfection in every post Tech.... you'll continue to have problems with my posts and I will enjoy the thought of my slight errors causing your OCD to act up and twist your undies into a tight knot.


Yeh how'd you do that????
It never again traded at 85c
Close but never 85c
And don't tell me you got the EXACT bottom.

Nope I didn't get the exact bottom on my first entry, nor did I get the exact top on my first exit, $2.50 not the top of $2.90.

Nope I didn't get the exact bottom on my second entry I got 95 cents which wasn't the exact bottom, and when I exited I got 8.50 and I do believe the top is 8.59 so I didn't get the exact top.



And the EXACT top!
At least I have the trading statement for the above example you wouldnt have yours there would you?

The perceived grandeur of Financial Planner status seems to have taken its toll.

Any more criticism you'd like to make Tech or have you had enough fun?

Sir O

[Sir Osisofliver]

Sir Os, would you mind posting your Elliot analysis on the stock, with initial trigger point, stop, profit target please, with reasons ? Thanks.

No.

1) I'll do it in the Newbies thread so I don't have to do it twice.

2) My Market Analyst program has just been updated and I lost my historic data records and need to reload it - for some reason the program doesn't like that and I need IT to work on it.

Sir O

[tech/a]

I'm happy to pay you $500 for the production of those Statements.
Seeing you would like to be paid I'm happy to oblige,shouldnt take more than 30 mins so $1000/hr should suffice.

There is one stock in the ASX which has performed as PES.
Youve managed to trade it twice taking out big chunks---allegedly.
You have displayed that you have no idea about Elliott Wave analysis.
Simply I dont believe you.

Once Joe Blow has them in his possession I'll forward him on the cheque.
If your a generous kind you may have me address it (The cheque) to JOE Blow in support of his efforts in making this excellent site available.

So cough it up and help Joe out.

[nunthewiser]

well well well :D

now this IS rivetting :D

[beamstas]

I'm happy to pay you $500 for the production of those Statements.
Seeing you would like to be paid I'm happy to oblige,shouldnt take more than 30 mins so $1000/hr should suffice.

There is one stock in the ASX which has performed as PES.
Youve managed to trade it twice taking out big chunks---allegedly.
You have displayed that you have no idea about Elliott Wave analysis.
Simply I dont believe you.

Once Joe Blow has them in his possession I'll forward him on the cheque.
If your a generous kind you may have me address it (The cheque) to JOE Blow in support of his efforts in making this excellent site available.

So cough it up and help Joe out.

Hahahahhaa
This is going to be interesting

Brad:D

[nunthewiser]

Just a query tech/a .........

will you be making a formal public apology on this thread IF he can produce said evidence ?

[tech/a]

Absolutely.
More than happy to disclose that Sir O is bona fide.
In Fact if he did as he alleges he deserves all the praise he can get.
That would be the best trade I've EVER seen taken-----particularly twice.
I'll gladly pass over the 500 bills.

But right now its letters on a bulletin board.

[nunthewiser]

No worries and thanks ....... after all gotta keep things real .......

fair call re PROOF as its so darn easy to post how great we are here with the benefit of hindsight ...... personally prefer to see actual entrys/exits posted as they happen REGARDLESS of if they a winner or not as at least one can see the bare nuts and bolts instead of mere pipe dreams

as you were :D

[nunthewiser]

I'm happy to pay you $500 for the production of those Statements.
Seeing you would like to be paid I'm happy to oblige,shouldnt take more than 30 mins so $1000/hr should suffice.

There is one stock in the ASX which has performed as PES.
Youve managed to trade it twice taking out big chunks---allegedly.
You have displayed that you have no idea about Elliott Wave analysis.
Simply I dont believe you.

Once Joe Blow has them in his possession I'll forward him on the cheque.
If your a generous kind you may have me address it (The cheque) to JOE Blow in support of his efforts in making this excellent site available.

So cough it up and help Joe out.

sorry just thought i,d bump this request just in case it got missed by sirO while i was rambling away

hey.........could always make tech/a do a lil work and write 2 checks and split the cash with joe and yourself so your not out of pocket from any time wasted digging them up

merely a suggestion

[ceasar73]

You've asked why people buy shares and then started bagging someone's approach.

So, you obviously don't want to listen to what people have to say, but just espouse your own biased view of investing/trading.

Why start the thread?

:confused:


Kennas you right...appologies to the TA guys if I gave thi impression...but thts not wht Im about.I belive both TA/FA can work equally well. I get pissed of when the FA guys bag the TA guys. I surrounded by old blokes that have had great success (so they claim) in investing.Most of them tell me, that in the long run its about EPS. With this thread, I was trying to confirm (from FA guys ) if it does all boil down to eps in the long run....however,bad titled thread..:o

[ceasar73]

Ceasar, have a read of this post by Bunyip a few years ago. Let us know if something falls into place for you.

very interesting , thanx Julia.

I will Have a proper readof this and get back to you with some comments.

[ceasar73]

Surely?
Surely?
Surely?

You do realise that when you buy a share in a company, someone else is selling at the same time :eek:

If everyone traded for the same reason you'd never be able to buy because they would all have the same idea as you :rolleyes:

Brad

I agree Brad.
Im suggesting these are the only reasons people buys shares.;)

[ceasar73]

Caesar, you seem to want fundamentals to be what counts for you. Go for it. But making uninformed comments about what others are doing for a living makes me think that you just want your current beliefs confirmed.

There are lots of ways to take money from the market, and even more ways to lose. There is no right way or wrong way. There are just consistently profitable, inconsistently profitable, and unprofitable methods.

Your right I am trying to confirm some of my own beliefs.

Lotsof ways too makemoney...lots of ways to lose money?? Yep!
Ive almost mastered the way to losemoney!!:banghead:

[Sir Osisofliver]

I'm happy to pay you $500 for the production of those Statements.
Seeing you would like to be paid I'm happy to oblige,shouldnt take more than 30 mins so $1000/hr should suffice.

There is one stock in the ASX which has performed as PES.
Youve managed to trade it twice taking out big chunks---allegedly.
You have displayed that you have no idea about Elliott Wave analysis.
Simply I dont believe you.

Once Joe Blow has them in his possession I'll forward him on the cheque.
If your a generous kind you may have me address it (The cheque) to JOE Blow in support of his efforts in making this excellent site available.

So cough it up and help Joe out.

WHAT THE?

Wow Tech did I touch a nerve? If you do actually have OCD I don't mean to make fun of your affliction. If you don't have OCD, why are you being such a tool? I really don't like associating with what I like to call toxic people Tech, it's not worth the time and aggravation to deal with it if you don't have to. You don't believe me? Fine I can't control what you believe, so here, enjoy a screendump or two.

Now since I'm now absolutely sure that working for a control freak like you is a barrel of laughs what I'd like you to do with that $500 is to give it to charity (this can be Joe if you want). Alternatively if that idea doesn't float your boat I'd like you to take that $500 and spend it on your staff, give them all a nice little present of a gift voucher or something.

You really find it hard to believe that someone could take two big chunks out of PES? Damn I wasn't the only one. I told a bunch of people to look into getting into QGC, SHG, AOE, MPO and PES on the 21st of March 08. (most of them held long term and ignored the dips because of fundamental reasons)

I also know of a bunch of people who bought the listed options on PES ages ago (because of fundamental factors) and had even better returns than me (and they held on for more than 12 months so halved their CGT).

Once again Tech, I think you'll find that you will have a problem with ALL my posts. I won't be talking about stocks in the present tense, only in past tense. If I talk about a stock in the present tense I have to use a disclaimer and I don't want to do that. It could get messy. I'd have to disclose my AFSL number. You could look me up as an authorised rep under that number, that would get you my name and it's a short walk to boiled bunny from there if you get my meaning.

Anyway Tech from now on I think we should just acknowledge that you don't like me and the feeling is mutual, so feel free to ignore everything I say, as I will for you.

Cheers

Sir O

[tech/a]

Sensational.
Incredible.
My un reserved apologies.
I choose Joe as the recipient of the $500.

[ROE]

Im not sure who im quoting here, so if anyone knows please tell me, i read alot :rolleyes: I believe it was buffet

Price is what you pay
Value is what you get

Lets look at say RIO for example. Was trading this time last year at around $130. Now it is trading at around 1/3rd of that.

That is a 66% discount. Would you buy something for a 66% discount?

What if i told you RIO was only worth (valued) at $45 in the first place, and $130 was just the price. Is it a discount now?

Was it just overpriced to begin with?

How do you determine value?

Im not asking you to answer these questions to me but i'd like you to ponder them. I am not opening up pandoras box of tech analysis vs fundaments, but more-so trying to emphasize there is more to trading shares than balance sheets and cash flows :o

Thanks
Brad

Just because something used to trade at XX value now trading 60% or 80% below doesn't mean it represent value...but there are company that does represent value when it drop that far and so the trick is to sort out the good from the bad.

Determine a stock value is part science and part art so no one can correctly calculate them but if you can come close to it you can come out winning.

I calculate it by working out how much money I can extract from its life time, then discount it to present value.
then I add a margin of safety to it.

but before I get to that it has to satisfy several criteria.
stuff like certainly debt level, certain return on equity, cash flow, business is fairly easy to understand etc...

Have a read of the old classic
"Common Stock, Un-commmn Profit" by Philip Fisher.

[nunthewiser]

Sensational.
Incredible.
My un reserved apologies.
I choose Joe as the recipient of the $500.

Dear Joe , can you please confirm to the thread IF or when you recieve this $500 bucks from tech/a as there maybe some here that disbelieve that he will send it

thankyou in advance

[ROE]

Hi All,

Why do you buy shares in a company???

Is it:
accelerated eps?
tip?
new product?
great future prospects?
Insiders are buying?
Comany is undervalued?
etc...

Cheers,

Ceasar. :)

I buy because I admire and like to be part owner of that business..and part owner I want to share future profit and provide me with an income when I retire :D in 30 years from now... I also acknowledge a long the way I will make mistakes and it will cost me some money but over all the return will out run the lost .. I stick with it thick and thin and it takes 10,000 hours to be a master of a subject and each day I get closer to the 10,000 hours I am a better investor :D

Why 10,000 hours ask this man
http://www.amazon.com/Outliers-Story-Success-Malcolm-Gladwell/dp/0316017922

[MS+Tradesim]

It is easy to claim anything in a forum. Over time you get a sense for who is full of it, and who knows what they're talking about, even without seeing trading records.

During the bull run I made good money on fundamental/technical trades. In this market I don't believe fundamentals carry much weight, so I trade purely on price action at the moment, and I will add fundamentals back in when there is reason to think they are more reliable. I did not capitalise by shorting the large part of the last year's crash because I'm relatively young (33) and I've never seen anything like it. Despite that, I still make money doing what I do and the market over the last 13-14mths has added a lot of experience to my trading resume.

I post a lot on mechanical (which is not equivalent with automated) trading and trading systems development. The feedback from people I've been privileged to assist is the only thing that matters to me. However, I'm going to post a few trades that best exemplify my approaches, which go against a lot of the accepted wisdom, to show that you need your own approach and you need to discount other people's opinions if it is clear that their beliefs cannot improve your own approach.

One of the best pieces of advice I learned is that nobody trades the markets, they trade their beliefs about the markets. Hence, I accept that the way I trade (and invest) is based on my perceptions and even though I do this for a living, it doesn't mean other people with very different beliefs cannot achieve good results. What is ridiculous is to show disrespect for another person's methodology only because it differs from one's own beliefs. I would suggest that kind of person is unlikely to succeed because they will short-sightedly suffer from an overdose of confirmation bias ie. they'll seek out information that supports their beliefs and discount information that contradicts their beliefs and perversely and irrationally hold on to losing investments/strategies. This attitude is fairly obvious in a lot of contributors to this forum.

Anyway, some of my trades which underline that going against the herd, even a lot of seasoned traders, can generate good rewards.....

[MS+Tradesim]

CVN - Chart reference:

1) First pops up on my radar. Check the fundamentals. All good. Wait for post-ann. sell-off, none occurs, so....

2) Build position, then later.....

Top right of chart, shows topping indications with new highs on very low volume, then falls through support/resistance at 72-ish on 9/1/08. News from USA looking crappier every day. Bull run is over for all intents and purposes. XAO has rolled over and no reason to believe new highs are coming.

3) XAO breaks through S/R (blue dotted line) on the day and with no technical reasons left to stay in (even though company bottom line is still great), I exit on the 9/1/08. (additional 20,000 shares sold on the day belonged to someone else. weren't bought as part of my trade)

[MS+Tradesim]

What happens then? Record breaking down days on the XAO, with corresponding crash in CVN.....price action in relation to broader market movement.

Then I do very little trading until September. Plenty of opportunities but not sure how to safely capitalise so I spend the time in research and development.

[nunthewiser]

off topic ... but how did you put that trading history on the screen ? everytime i try save the screen to my docs it goes into an XPS file or something , i cant delete my account number or any other details . i am not computer literate and it usually wouldnt bother me but seems without proof here EVEN when making real time calls sometimes they are viewed as fulla poo without broker statements ....... is it worth the bother learning ( ie is it easy to explain here ?) or should i just tellem to jam sand up there clackas and worry about there own trading details instead

and really tho on a side note . IF one is able to delete stuff on the trade history(ie acc details etc) why cant someone change or edit the details to make oneself look like a 100% winner ? buggared if i know and now just rambling as been trying to get these statements on screen for nearly 3hours now just because someone doubted my trading in another thread ......

geez after typing all this .i just realised im a bigger dickhead than he is cos i just wasted a good part of my evening worrying about it !!!

[bunyip]

Sir O......well done in nailing a nice trade. But from now on I hope you won't feel that you're under any obligation to prove anything. There will always be an odd person who for their own reasons, will try to paint you as a liar.
Those sort of people are not worth responding to.
As a confident and successful trader you are under no obligation to prove yourself to anyone - least of all the 'toxic people' you refer to.

All the best to you.

[So_Cynical]

off topic ... but how did you put that trading history on the screen ? everytime i try save the screen to my docs it goes into an XPS file or something.

Screen shot (print screen) then paste in paint - save as whatever/JPEG
edit with PhotoFiltre...acc details etc. http://photofiltre.free.fr/download_en.htm

[MS+Tradesim]

While R&D is always ongoing, at some point you have to start trading an idea. There will always be something that could be done better. So I establish some workable strategies and kick them off and improve them with live results. Actually, one of them was designed during the bull market but I'd forgotten I had it. After dusting off and live testing, I start trading it and it now provides a solid income. Also doing other trading ideas at present but my bread and butter comes from buying momentum stocks on/near close and selling the next day on/near open. There are quite a few boxes to check for each stock but once they're ticked the trade takes place.

The results for this system I've already posted earlier in the thread. I do not recommend anyone try the same thing. This works for me because I have a fully developed strategy, back-tested, forward tested, live for some time and tracking as planned. I definitely wouldn't recommend it as territory for newcomers.

But the point is that no-one else is going to take responsibility for your losses, so don't abdicate responsibility to others for your profits!!!! Don't reject an idea just because someone else says it can't be done. Prove it for yourself.

Ps. I forgot to add about CVN that the reason it went against the herd was the fundamentalists were saying "Hold! Hold!" went from a technical perspective it looked like a good time to sell.

As an interesting point of trivia, this great little trade from the above system was completely wrong and misguided, according to the fundamentals and probably most technicals.......

[nunthewiser]

Screen shot (print screen) then paste in paint - save as whatever/JPEG
edit with PhotoFiltre...acc details etc. http://photofiltre.free.fr/download_en.htm

paint?

just pressed prtsc button on laptop .nothing!!


ARRRRRGH


bugga it . thanks for your help ...... wasted enough time on it already ......

thanks anyways

[Julia]

off topic ... but how did you put that trading history on the screen ? everytime i try save the screen to my docs it goes into an XPS file or something , i cant delete my account number or any other details . i am not computer literate and it usually wouldnt bother me but seems without proof here EVEN when making real time calls sometimes they are viewed as fulla poo without broker statements ....... is it worth the bother learning ( ie is it easy to explain here ?) or should i just tellem to jam sand up there clackas and worry about there own trading details instead

and really tho on a side note . IF one is able to delete stuff on the trade history(ie acc details etc) why cant someone change or edit the details to make oneself look like a 100% winner ? buggared if i know and now just rambling as been trying to get these statements on screen for nearly 3hours now just because someone doubted my trading in another thread ......

geez after typing all this .i just realised im a bigger dickhead than he is cos i just wasted a good part of my evening worrying about it !!!

Try downloading and using this, Nun.
http://winsnap.brothersoft.com/
I'm a complete technophobe but I find this is a piece of cake. Will be forever grateful to the ASF member who suggested it to me a couple of years ago.

[nunthewiser]

Try downloading and using this, Nun.
http://winsnap.brothersoft.com/
I'm a complete technophobe but I find this is a piece of cake. Will be forever grateful to the ASF member who suggested it to me a couple of years ago.

thanks but that keeps popping up on my popbar saying " internet explorer has blocked it from downloading files to my computer ""


thanks anyways

:D toldya i was illiterate

[So_Cynical]

paint?

just pressed prtsc button on laptop .nothing!!


ARRRRRGH


bugga it . thanks for your help ...... wasted enough time on it already ......

thanks anyways

hitting print screen is like a short cut for copy...so now u have to paste

Goto start button > programs > accessories > paint > edit > paste

[nunthewiser]

hitting print screen is like a short cut for copy...so now u have to paste

Goto start button > programs > accessories > paint > edit > paste

thanks for your help guys ....

tried all that , i must be doing something wrong , will try another time when i can get my head around it ... have written down all instructions and will have another look when im not going round in circles on it

[ceasar73]

[QUOTE=MS+Tradesim;412045]
One of the best pieces of advice I learned is that nobody trades the markets, they trade their beliefs about the markets. Hence, I accept that the way I trade (and invest) is based on my perceptions and even though I do this for a living, it doesn't mean other people with very different beliefs cannot achieve good results.QUOTE]

Yep, I agree tradesim.People trade/invest based on their perceptions.

The aim of this thread (and others I have posted) was to get an insight into the other traders perceptions.

[ceasar73]

[QUOTE=MS+Tradesim;412045]
One of the best pieces of advice I learned is that nobody trades the markets, they trade their beliefs about the markets. Hence, I accept that the way I trade (and invest) is based on my perceptions and even though I do this for a living, it doesn't mean other people with very different beliefs cannot achieve good results.QUOTE]

Yep, I agree tradesim.People trade/invest based on their perceptions.

The aim of this thread (and others I have posted) was to get an insight into the other traders perceptions.

This should read 'investors perception'.:o

[kennas]

The aim of this thread (and others I have posted) was to get an insight into the other traders perceptions.And then bag them for not sharing your ideas.

:eek7:

So, why do you buy shares?

To make a loss?

:confused:

[skc]

[QUOTE=MS+Tradesim;412045]
One of the best pieces of advice I learned is that nobody trades the markets, they trade their beliefs about the markets. Hence, I accept that the way I trade (and invest) is based on my perceptions and even though I do this for a living, it doesn't mean other people with very different beliefs cannot achieve good results.QUOTE]

Yep, I agree tradesim.People trade/invest based on their perceptions.

The aim of this thread (and others I have posted) was to get an insight into the other traders perceptions.

Is this what you are trying to express? http://en.wikipedia.org/wiki/Keynesian_beauty_contest



Sensational.
Incredible.
My un reserved apologies.
I choose Joe as the recipient of the $500.

I would like to further challenge Sir O and have him produce a statement / certificate etc showing that he has really received his Knighthood...

[Sir Osisofliver]

I would like to further challenge Sir O and have him produce a statement / certificate etc showing that he has really received his Knighthood...


:D HAR HAR

[derty]

off topic ... but how did you put that trading history on the screen ? everytime i try save the screen to my docs it goes into an XPS file or something
There is a handy and very easy to use little program called srip32. It is free ware and you can get it from here: http://www.esnips.com/doc/226effc2-20dd-4313-aca4-ba64528f9079/srip32

I find it easiest to use the Grab Rectangular Area method and drag over what I want to capture. Then just save it as a .jpg file.

If you have problems downloading it just PM me an email address and I'll send it to you, it's only 366kb.

[ceasar73]

And then bag them for not sharing your ideas.

:eek7:

So, why do you buy shares?

To make a loss?

:confused:

Im missing something here? Who did I bag for not sharing my ideas??.:banghead:

[ceasar73]

[QUOTE=ceasar73;412181]

Is this what you are trying to express? http://en.wikipedia.org/wiki/Keynesian_beauty_contest



"Keynes believed that similar behavior was at work within the stock market. This would have people pricing shares not based on what they thought their fundamental value was, but rather based on what they think everyone else thinks their value was, or what everybody else would predict the average assessment of value was"

spot on skc...exactly the info i was trying to find out withtthis thread.

Years ago, I did an aptitude test for a job I desperately wanted.Im an introvert,and knew,these guys were after an extrovert.I 'cheated' and answered the 100 questions how I perceived an extrovert would...got the job.
The company eventually dropped the test.

ceasar73.