BuzzersonKillwell Posted February 21, 2013 Share Posted February 21, 2013 the woman who was a guest on the daily show tonight pretty much explicitly said "don't buy the stocks they mention on cnbc" I saw that too. Although in fairness she said they don't preform well over time, so there were multiple ways to make money on CNBC stocks, depending on how you play them, and betting short was a good strategy. Or something like that. I'm not big on investing, someone else handles my stuffs, but I'm going to try to gain some financial literacy this year. Quote Link to comment Share on other sites More sharing options...
roadmonkey Posted February 21, 2013 Share Posted February 21, 2013 Hmm I think I'll pick up that book myself. have a feeling I'm missing out on a bunch of growth Quote Link to comment Share on other sites More sharing options...
michaelmanfredi Posted February 21, 2013 Share Posted February 21, 2013 Well, to be clear, I don't just watch Cramer and say, "oh gotta quick go put some money into that." The whole philosophy (for me at least) is to watch him, and if he has any big segments on a company where he goes on for 5-10 minutes talking about it, do some research on them. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted February 21, 2013 Author Share Posted February 21, 2013 Cramer's show is popular because it is entertaining, not because he gives great advice. Then there is the effect that if the guy actually came out and said "If I had any free money in the bank I would by this and here's why ..." by the time he says that, the opportunity is pretty much gone. The price on that stock has just increased. Another great way to play things is to look at the percentage of the stock that is shorted (short is a bet that a stock will go down. You borrow someone else's stock and sell it, with an agreement to replace it in x months. If the stock goes up, you gotta pay the higher price. Just in case anyone is unaware). When a stock gets SO many people betting against it, it almost becomes a self-fulfilling prophecy, whether the stock is good or bad. I should have shorted the hell out of Netflix (or bought puts, similar to a short option) around that Qwixster debacle. So easy to see that coming and the stock was at about $300. Live and learn. Missed opportunity but I'll grab the next one. Quote Link to comment Share on other sites More sharing options...
BuzzersonKillwell Posted February 21, 2013 Share Posted February 21, 2013 So my question, specifically to you Lebowski but others can chime-in, is can it really as easy as the Netflix / Qwikster issues? I feel like I'm a reasonably bright dude with a pretty good handle on the tech industry. If often though of throwing a small amount (say 5k) in just to get a feel for how things work, educate myself and obviously because I think I could make some strong bets based on real insight. I could deal with losing that amount if shit went south, obviously I have a financial planner for my actual 401k and Roth. Problem being is I feel like a lot of my insight would pay short-term dividends, I'm less clear on the long term plays in some instances. Which leaves me with a pile of money that needs to be dealt with at certain points. I'd obviously read a couple books first, maybe like the one suggested, but you make it sound pretty casual. Which is validating my original assumption that I might be alright at it. You've effectively talked me onto the ledge. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted February 21, 2013 Author Share Posted February 21, 2013 Phew...gonna try and keep this short. Books can do much better. I believe in being a defensive investor. The simplest measure of risk is the price / earnings ratio (it's on the front page of every stock). A p / e of 10 or less is a safe stock. If you think about it, if a stock earns about 10% of its market price each year, that is approximately going to lead to a 10% return each year (obviously way more complicated but just speaking from the core). If Facebook had a p/e of 15 or 20, I would love it. It's in a growing industry. If Best Buy is turning a p/e of 5, I still don't want it (they aren't even doing that, though. In the negative). So it isn't everything. With Netflix, it was being valued at something like 50 or 100 times earnings. It wasn't Netflix's fault that people were paying too much for their stock. It's a great company. But at that ratio, they have to be aggressively growing every year to justify the price. Enter Qwikster, and the number of people who bitched and/or bailed on Netflix. One shock to that system and it dumped...hard... I think it peaked around 300 and hit $60 at one point. It rebounded huge last month and is back to $183. I don't look at the rebound as a missed opportunity, though, cause I didn't see that coming. The fall was predictable, though. If you follow a simple rule of never touching anything with a p/e over 20 and try to stay under 15, you pretty well insulate yourself from the worst drops. Bet on who is making money, not trying to be smarter than everyone and find the next google or netflix. As a defensive investor (I've been doing it for 2 years), I can think offhand at a few opportunities where I thought "this is just too good and I can't hold out any longer". I didn't act on all of them. Volatility this week was on. Chesapeke energy at $14. Shorting Netflix. Buffett looks for 1 or 2 good buys a year. That's the way I'm playing it going forward. Right now, I am waiting for a pullback before I buy anything for upside. If I wait 6 months, I wait 6 months. I feel like it is coming, though. Really hoping the automatic spending cuts in the government go through to spark it. That answer your question? Anyone who is good at Fantasy Sports is probably going to be good at investing. It takes the same skills. Quote Link to comment Share on other sites More sharing options...
BuzzersonKillwell Posted February 21, 2013 Share Posted February 21, 2013 Yeah bud. Thanks. Quote Link to comment Share on other sites More sharing options...
chamb117 Posted February 21, 2013 Share Posted February 21, 2013 Anyone who is good at Fantasy Sports is probably going to be good at investing. It takes the same skills. i was gonna say, you seem to be a jack of all trades... and by "all trades" i mean at least baseball and investing. this bit of information is promising for me though! love me my fantasy baseball. don't know if i'm at a good age (or a good amount level of income/assets) to start investing but will be looking into it in the next couple of years. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted February 21, 2013 Author Share Posted February 21, 2013 i was gonna say, you seem to be a jack of all trades... and by "all trades" i mean at least baseball and investing. this bit of information is promising for me though! love me my fantasy baseball. don't know if i'm at a good age (or a good amount level of income/assets) to start investing but will be looking into it in the next couple of years. I've been hammering a few threads lately. Not sustainable. I have to get back to work. I should close VC for the rest of the day. Really liking Apple. Their p/e is 10 with a 2% dividend. $440 today, stock was at $700 in September (so definitely has some room to grow). That is a great defensive buy. Sitting on $40 billion in cash. You don't have to have an "Apple is king" outlook for those numbers to look attractive, only an "Apple isn't going anywhere". Only reason I'm not buying is that I think it could still dip under $400 with a market sell off. If it runs and I'm not on board, oh well. Look for something else. Always a new opportunity tomorrow. Quote Link to comment Share on other sites More sharing options...
nivek87 Posted February 21, 2013 Share Posted February 21, 2013 walks into thread, slowly backs out Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted February 21, 2013 Author Share Posted February 21, 2013 There is some serious drama in my fantasy baseball league too! The old snake draft vs. auction league debate. Very unproductive week. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted February 21, 2013 Author Share Posted February 21, 2013 Grabbed another 7% out of UVXY today, too. Really hard question is when to cut and run. The debt ceiling deal around New Years went until the last second it could as both sides played hooky. When the news broke of a deal, volatility collapsed. I'm out this month. It's just a question of how far I push it. Quote Link to comment Share on other sites More sharing options...
noodle Posted February 21, 2013 Share Posted February 21, 2013 didn't someone start a thread about banking / financial questions and become a royal rumble? Quote Link to comment Share on other sites More sharing options...
Guest Posted February 21, 2013 Share Posted February 21, 2013 At this point I think I just want biglebowski to manage all my finances, forever. Quote Link to comment Share on other sites More sharing options...
homework Posted February 21, 2013 Share Posted February 21, 2013 Research vs Current News. The key to success with stocks. Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted February 21, 2013 Author Share Posted February 21, 2013 didn't someone start a thread about banking / financial questions and become a royal rumble? Royal rumble? No? Differences of opinion. Yes. It's all for the good of the community. That was more about personal finance. This is more about discussing market level trends and how your outlook on the future is. At this point I think I just want biglebowski to manage all my finances, forever. Thanks for the compliment. I started this hoping for more back and forth but happy to share what I know. I just don't want it to be taken as the "let me talk about money and tell you what you are doing wrong" thread. Quote Link to comment Share on other sites More sharing options...
BBech Posted March 3, 2013 Share Posted March 3, 2013 Couple questions 1. What is a good app that's a stock market sim for iphone/ipad? 2. Any books you recommend for people looking to get into investing? 3. I was talking to a friend who just invests in the whole markets (S&P etc). Anyone else do this strategy? Quote Link to comment Share on other sites More sharing options...
thebiglebowski Posted March 3, 2013 Author Share Posted March 3, 2013 I never did a sim. I think yahoo has something like this. I recommended a book earlier in the thread. Other than that, I just read yahoo finance once a day. Buying etfs or mutual funds is fine. I believe that you still want to read a bit. The most important thing you can figure out for yourself is when stocks are expensive, and when they are cheap. The '08 crash was harder to spot coming but the Internet bubble in (I believe) '04 was not, because people were paying huge amounts for Internet stocks that were making no money. There are indicators of when things are overbought. Just simply changing which etfs you buy into based on the overall market environment can improve how we'll you do better than just simply buying and holding until you are 60. Quote Link to comment Share on other sites More sharing options...
michaelmanfredi Posted June 6, 2014 Share Posted June 6, 2014 What are people's thoughts on Facebook as a company? I've read that people should stay away and i've also read it has potential to be triple digit stock. I bought a little bit when it fell to 57, i wish i would've pulled the trigger in the 20's. Quote Link to comment Share on other sites More sharing options...
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