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Variant said:
Outlook and expectation are essential parts of what value is, they can not be separated.
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Sure. Base those on facts...not fears.
 
Mycroft said:
Sure. Base those on facts...not fears.
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Risk tolerance is always going to have an element of our fears in it.

For the stock market you have to make projections and do it quickly.

My investing has to do with the fact that I'm not going to need the money anytime soon, so I can evaluate with patience. Not everyone is in that position so they might not be able to tolerate a volatile market.

There is simply no way to remove human psychology from financial markets, since, outlook, and thus value, can be quickly modified by fear.

Fear, of course, is quite rational, and correct when it turns out to be justified.
 
wash, rinse, repeat
 
here's an example and i'll let you guys tell me if you sell of not. be careful how you answer (if you're brave enough to). you bought it for $100/share and you bought 100 shares ($10,000).


you bought at the purple football and you still own it two days later. do you sell then?




Chart 1.jpg
 
CaughtInThe said:
here's an example and i'll let you guys tell me if you sell of not. be careful how you answer (if you're brave enough to). you bought it for $100/share and you bought 100 shares ($10,000).


you bought at the purple football and you still own it two days later. do you sell then?
View attachment 67276366
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I advise against buying companies when you don't know any information about them but just looking at a graph and price.

I sell immediately realizing I have exactly no information about what I am doing (aside from the company being bought right after the dividend).
 
Variant said:
I advise against buying companies when you don't know any information about them but just looking at a graph and price.

I sell immediately realizing I have exactly no information about what I am doing (aside from the company being bought right after the dividend).
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make up your own info about the company (since it can literally be anything about any company at any time, plus, the market can be doing anything as well) and then tell me if you sell or not.
 
CaughtInThe said:
make up your own info about the company (since it can literally be anything about any company at any time, plus, the market can be doing anything as well) and then tell me if you sell or not.
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Why would I sell something two days after I bought it without any substantive change? I hold investments on average, about four years.
 
Mycroft said:
Of course I know that. We've seen the results of that nonsense numerous times.

That's why it's so pathetic. They never learn.
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That is absolutely hilarious coming from you, being a person that never, never, never, and never learns.

If there ever was a person that is blind to fact and acts through emotion (love of Trump) no matter what is real, it is you.

Perhaps, what you should do in the future before you make comments on anything, is look at yourself first for exactly what you are criticizing.

Nonetheless, thanks for the comment. It has to be the loudest I have ever laughed in my life................they never learn, eh? hahahahahaha
 
CaughtInThe said:
make up your own info about the company (since it can literally be anything about any company at any time, plus, the market can be doing anything as well) and then tell me if you sell or not.
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Well, in that case, that company is McDonald's, and no, I'm not selling.
 
So, the market has hit a temporary bottom and won't go down unless things get worse, but traders will be sellers tomorrow?
 
A good trading strategy is one that produces positive results regardless of how the market as a whole appears to be performing.
 
SoCal said:
From what I've read, rule number 1 is ignored everyday.

"...Market prices are the result of the expectation of thousands of single individuals, each one different than the other, that are subject to numerous psychological biases. This component is heavily influenced by the sentiment of investors and traders, a sentiment that changes dramatically over short periods of time.

Psychology studies investigated the interconnection between our feelings and our judgments. This results in an emotional pattern that occured many times in history and is the plot of every bubble and subsequent market crash...."

Facts don't care about your feelings, but it seems the stock market does. :)
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Your right it is ignored. It is ignored in a huge way on a daily basis which is why we have such a volatile market.
As an individual trader though you cannot trade with emotion. if you do then you will end up losing a whole ton
of money. you will be chasing buys and sells. getting in wrong and exiting late.
 
KevinKohler said:
Well, in that case, that company is McDonald's, and no, I'm not selling.
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i didn't say to make up a company, go look at their stock chart and then come back here with the brave prediction of what to do.


the point, for those who haven't gotten it yet, is none of you know what the chart that i posted does in the following days/months. that is where the emotion creeps in as you're potentially up $3,000 or down $3,000.

and i noticed only one person even gave effort to try to give an answer without knowing the future.
 
Individual said:
A good trading strategy is one that produces positive results regardless of how the market as a whole appears to be performing.
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and i'll add that you're gonna lose money on trades (if day or swing trade). minimizing loses is a huge part of trading.
 
Craig234 said:
So, the market has hit a temporary bottom and won't go down unless things get worse, but traders will be sellers tomorrow?
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There is something called "trading the range" which is what traders do. The buy at the bottom of the trading range and sell at the top. 70% (or higher) of the trading on any one day is done by people that will buy or sell and then be out by the end of the day or end of 1-3 days.

In the DOW, that trading range is likely to be 19,000 to 22,000. That is a 3,000 point trading range. The DOW is due to open today about 400 points lower but it did get up as high as 22,000 and closed at the end of the day at 21,200. The low seen on Monday was 18,193. As such, it can "trade" within as much as a 3,800 points up or down without meaning further upside or further downside will be seen.

Traders will make money selling one day and buying the next without considering what the index will be doing next week or next month.
 
CaughtInThe said:
i didn't say to make up a company, go look at their stock chart and then come back here with the brave prediction of what to do.


the point, for those who haven't gotten it yet, is none of you know what the chart that i posted does in the following days/months. that is where the emotion creeps in as you're potentially up $3,000 or down $3,000.

and i noticed only one person even gave effort to try to give an answer without knowing the future.
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To some extent, yes.

But that FEELING...comes from empirical data.

My next confident choice...Raytheon.
 
KevinKohler said:
To some extent, yes.

But that FEELING...comes from empirical data.

My next confident choice...Raytheon.
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and that data can lead you to a $120,000 loss.

i never got what emotions had to do with trading until i actual started trading. and, sure, we're all are gonna claim that emotions have nothing to do with it and that's a lie of course. you just have to try to suppress being a human as much as possible.

think about all the emotional people who dumped 401k's recently for God's Sake. you know, LONG TERM vehicles.
 
CaughtInThe said:
and that data can lead you to a $120,000 loss.

i never got what emotions had to do with trading until i actual started trading. and, sure, we're all are gonna claim that emotions have nothing to do with it and that's a lie of course. you just have to try to suppress being a human as much as possible.

think about all the emotional people who dumped 401k's recently for God's Sake. you know, LONG TERM vehicles.
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I'm doubling down on mine, as well as increasing my company stock buy in.
 
KevinKohler said:
I'm doubling down on mine, as well as increasing my company stock buy in.
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I would not do that if I was you.

We are "officially" in a downtrend with the only question being "how long will it last". A downtrend is the opposite of an uptrend where dips are bought and a few weeks or months later the market is higher. A downtrend, rallies will be sold and a few weeks or months later the market is lower.

For "at least" the next year, the downtrend will continue and that means that anything you buy now will be able to be bought at a lower prices in a few weeks. An intelligent approach to a downtrend is to wait until a bottom is found. How do you know that a bottom is found? You wait for a bounce from a low to be made and wait for the retest of that low to occur and if no new lows are made on that retest, you start buying.

Buying because it looks cheap to you is always a fallacy. The stock market had no fundamental reason to have gone so far up. The DOW, for example, made a high at the beginning of last year around the 27,000 level but then continued higher to near 30,000 with the fundamentals being lower than when it was at 27,000.

The fundamentals right now are bad and "expected" to get worse. For example, the weekly unemployment report for the past few years has been around 250k and today it came out at 3.2 million and higher numbers are expected for next month and the month thereafter and so forth and so on.

As such, in a downtrend you don't buy until the fundamentals actually change and even then, the markets have a habit of going farther up (or farther below) than the fundamenals call for when in a trend and right now the downtrend is official and "just starting".

This is not a time to buy and hold because you are not using common sense and proven investment guidelines.
 
KevinKohler said:
I'm doubling down on mine, as well as increasing my company stock buy in.
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not a bad strategy.

well, unless we sink into an actual depression that lasts a long time.
 
Luckyone said:
I would not do that if I was you.

We are "officially" in a downtrend with the only question being "how long will it last". A downtrend is the opposite of an uptrend where dips are bought and a few weeks or months later the market is higher. A downtrend, rallies will be sold and a few weeks or months later the market is lower.

For "at least" the next year, the downtrend will continue and that means that anything you buy now will be able to be bought at a lower prices in a few weeks. An intelligent approach to a downtrend is to wait until a bottom is found. How do you know that a bottom is found? You wait for a bounce from a low to be made and wait for the retest of that low to occur and if no new lows are made on that retest, you start buying.

Buying because it looks cheap to you is always a fallacy. The stock market had no fundamental reason to have gone so far up. The DOW, for example, made a high at the beginning of last year around the 27,000 level but then continued higher to near 30,000 with the fundamentals being lower than when it was at 27,000.

The fundamentals right now are bad and "expected" to get worse. For example, the weekly unemployment report for the past few years has been around 250k and today it came out at 3.2 million and higher numbers are expected for next month and the month thereafter and so forth and so on.

As such, in a downtrend you don't buy until the fundamentals actually change and even then, the markets have a habit of going farther up (or farther below) than the fundamenals call for when in a trend and right now the downtrend is official and "just starting".

This is not a time to buy and hold because you are not using common sense and proven investment guidelines.
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I agree. Anyone buying now for the one year plus long term will be left holding the bag for a decade at least.
 
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