OFFICIAL STOCK MARKET & ECONOMY THREAD VOL. SCHOOL'S OUT

[nocomment6]

It should reach that with ease, unless sales don't meet the unreasonable expectations of investors.
But the introduction of the new MBP line is due april (they most likely won't have retina display unfortunately, but will be significantly faster).

What do you guys think of the Spanish situation?

 

[freakydestroyer]

No longer bearish SBUX and HD for now, acting kind of strange IMO. They can still set up for nice shorts later, I'm going to keep an eye on them.
Still short GOOG. 

 

[bruce negro]

Originally Posted by freakydestroyer

Originally Posted by bruce negro

Originally Posted by freakydestroyer

So in other words, you're a Contrarian. Just do the opposite of everyone else?

He's telling you methodologies based in analysis and market prediction will kill you. And they will. If you want hedge fund trading strategies, again, I propose diversification. The more diversified the fund, the better the fund performs, and there is data out there to prove it. If anyone here says they're trying to trade like a hedge fund manager, or gain similar returns consistently, and they are not diversified then they aren't trading like a hedge fund manager at all, nor should they expect similar returns.

That is clearly not what he's saying. You must not have been following along. The stuff he says are borderline trolling but I was just curious enough to ask.

I haven't been following along. I'm only responding to the part I quoted 

Yeah, I've already said before that it takes a large amount of capital to truly diversify, but that's what makes it difficult for us, as investors with relatively low capital to invest, to say that we want to invest like hedge funds. 

And sure, you can have a great knowledge about one sector, but what happens when the entire sector goes red? You could have had great knowledge about Internet companies during the Dotcom bubble, but when that bubble burst you were probably STILL going to hit the red, hard. Relying on knowledge from just one sector is very risky IMO, since it is almost the opposite of many tenets of diversification. Investing in one market creates a high amount of correlation between your stocks, which means that if a big stock in the sector goes down, the entire sector may be hit hard as well. 

However, I do believe that hedge funds do not diversify as strictly as other funds may, but they are still very diversified. For instance, they may allot a certain percentage of capital to invest in those sectors that they have expertise in, but they are still diversified in case that sector goes down. Betting all of your money on your knowledge of one or even two sectors is like throwing all of your eggs into one basket. If that basket breaks, you're DONE. Hedge funds have enough capital to diversify while also actively investing a bit. And even they get burnt a lot compared to truly diversified funds. What do you think is likely to happen to us?

I'm not saying don't invest. But don't expect to gain consistent, hedge fund returns. I've made a few pretty pennies on stocks already, but if I were to compare my percentage gains to a diversified fund over a long run?.... Nah, not beating that.

 

[johnnyredstorm]

If these new MacBooks don't have retina display Idk if I'll be buying one even though I really need a new laptop.

 

[dajoka004]

Fuuuuuuuuuuuu. Panic selling setting in. Just down a G in less than 20 minutes. I'm holding tight. Will evaluate for new positions this afternoon.

 

[jonai number 4]

Used the dip in AAPL today to buy more shares. IMHO nothing has changed since the stock was sitting at $630. See it getting back to that price soon, if not higher.

 

[lazyj10]

Originally Posted by bruce negro

Originally Posted by freakydestroyer

Originally Posted by bruce negro

He's telling you methodologies based in analysis and market prediction will kill you. And they will. If you want hedge fund trading strategies, again, I propose diversification. The more diversified the fund, the better the fund performs, and there is data out there to prove it. If anyone here says they're trying to trade like a hedge fund manager, or gain similar returns consistently, and they are not diversified then they aren't trading like a hedge fund manager at all, nor should they expect similar returns.

That is clearly not what he's saying. You must not have been following along. The stuff he says are borderline trolling but I was just curious enough to ask.

I haven't been following along. I'm only responding to the part I quoted 

Yeah, I've already said before that it takes a large amount of capital to truly diversify, but that's what makes it difficult for us, as investors with relatively low capital to invest, to say that we want to invest like hedge funds. 

And sure, you can have a great knowledge about one sector, but what happens when the entire sector goes red? You could have had great knowledge about Internet companies during the Dotcom bubble, but when that bubble burst you were probably STILL going to hit the red, hard. Relying on knowledge from just one sector is very risky IMO, since it is almost the opposite of many tenets of diversification. Investing in one market creates a high amount of correlation between your stocks, which means that if a big stock in the sector goes down, the entire sector may be hit hard as well. 

However, I do believe that hedge funds do not diversify as strictly as other funds may, but they are still very diversified. For instance, they may allot a certain percentage of capital to invest in those sectors that they have expertise in, but they are still diversified in case that sector goes down. Betting all of your money on your knowledge of one or even two sectors is like throwing all of your eggs into one basket. If that basket breaks, you're DONE. Hedge funds have enough capital to diversify while also actively investing a bit. And even they get burnt a lot compared to truly diversified funds. What do you think is likely to happen to us?

I'm not saying don't invest. But don't expect to gain consistent, hedge fund returns. I've made a few pretty pennies on stocks already, but if I were to compare my percentage gains to a diversified fund over a long run?.... Nah, not beating that.

Yes and no. You can't group all hedge funds and say they do this and they do that. Not the way the financial services industry is anymore. I know there's a misnomer w/ the fact a vehicle is called a hedge fund, but the point still stands.

For example, in the last few years you've seen launches with very tech centered focus, energy and resources and even some commodity. They do their best to navigate when the sector is down, but chances are if they're that focused in a particular industry they're not limiting themselves to one geographic area so they can still find good investing opportunities. That's the hope at least.

How long they can withstand a down year depends on their LPs. If you're getting a ton of capital withdrawal requests then they're going to have limited opportunities, but they still don't just go investing in other areas just to diversify. If you're talking simple long/short focused then yes, you can look at their scehdule of investments and it'll span in multiple areas in different countries.  If you look at a tech, clean tech, energy, resoures, etc then you won't.

 

[dajoka004]

Originally Posted by Jonai Number 4

Used the dip in AAPL today to buy more shares. IMHO nothing has changed since the stock was sitting at $630. See it getting back to that price soon, if not higher.

Agreed. I think I'm going to wait until tomorrow to enter with my bull call spread though. I don't like we the chart is heading today.

 

[nocomment6]

I'd wait out on the AAPL a bit more, before buying. the 5 day MA should cross the 20 day MA which usually results in a drop. MACD and RSI have also been dropping.

As for the new MBP it's just guesses, but Sharp says that it will be able to produce such screens on a large scale by '13.
iPad mini rumors:http://www.macrumors.com/...priced-at-249-299-in-q3/

Whole tech sector has been down, LNKD too.

Financials up, great reports, let's hope they keep it up!

 

[secretzofwar]

I wonder if we're going back to 2011.

Buy the dips, short the rips.

 

[electroki5hi]

GL to all APPL holders, I might buy in soon if this dip continues...

 

[dajoka004]

Going for an hour run. Will make a decision on whether or not I want to jump in at market close or wait until tomorrow. I'm only hesitating because I worry slightly that bad earnings were leaked. 

 

[freakydestroyer]

ohh shhh

 

[johnnyredstorm]

 

[nocomment6]

Originally Posted by DaJoka004

Going for an hour run. Will make a decision on whether or not I want to jump in at market close or wait until tomorrow. I'm only hesitating because I worry slightly that bad earnings were leaked. 

you think?

 

[freakydestroyer]

AAPL PCLN GOOG will continue to roll over IMO. Look at the volume. 

 

[dajoka004]

http://www.cnbc.com/id/47065035/

OK smartypants, if AAPL is so great, why is it down today? There's clearly some broader tape issues at work, since it's been down five days in a row. Macro concerns are stronger.

For today, all the weakness in Apple came in the first twenty minutes; it's been stable since then.

Volume is heavy, and when I see other big tech names up (IBM, Intel, Micron, Microsoft, Oracle, EMC), this suggests that AAPL may be being used as a source of funds to buy other names that have not had anywhere near the technical runups AAPL has had.

 

[freakydestroyer]

AAPL 550 Puts look very juicy. 

 

[dajoka004]

Good close. 
Bought a May 620/625 bull call spread for $1.52. Very little cash involved. I'll see how I do with this before I make bigger moves. I still have plenty of capital to make more moves if we keep trending downward.

Was down 3.05% on the day. Obviously not happy about that, but this is why my portfolio is heavily weighted toward the long term.

 

[frankmatthews]

Originally Posted by bruce negro

I haven't been following along. I'm only responding to the part I quoted 

Yeah, I've already said before that it takes a large amount of capital to truly diversify, but that's what makes it difficult for us, as investors with relatively low capital to invest, to say that we want to invest like hedge funds. 

And sure, you can have a great knowledge about one sector, but what happens when the entire sector goes red? You could have had great knowledge about Internet companies during the Dotcom bubble, but when that bubble burst you were probably STILL going to hit the red, hard. Relying on knowledge from just one sector is very risky IMO, since it is almost the opposite of many tenets of diversification. Investing in one market creates a high amount of correlation between your stocks, which means that if a big stock in the sector goes down, the entire sector may be hit hard as well. 

However, I do believe that hedge funds do not diversify as strictly as other funds may, but they are still very diversified. For instance, they may allot a certain percentage of capital to invest in those sectors that they have expertise in, but they are still diversified in case that sector goes down. Betting all of your money on your knowledge of one or even two sectors is like throwing all of your eggs into one basket. If that basket breaks, you're DONE. Hedge funds have enough capital to diversify while also actively investing a bit. And even they get burnt a lot compared to truly diversified funds. What do you think is likely to happen to us?

I'm not saying don't invest. But don't expect to gain consistent, hedge fund returns. I've made a few pretty pennies on stocks already, but if I were to compare my percentage gains to a diversified fund over a long run?.... Nah, not beating that.

What kind of expert were you if you didn't see that tech bubble bursting beforehand?

While a buy and hold strategy requires a significant amount of diversification to achieve any success, swing trading or even intermediate term investing does not necessarily require such diversification.  It's not like any particular sector is going to crash in one day.  Small investors have the advantage in that they can liquidate their position immediately if there are negative developments in the sector.  Hedge funds require days if not weeks to liquidate their positions, which by that time may be too late.



Oh and a word to the wise.  Stop playing the earnings game.  In my years I have seen all possible combinations of good/bad earnings and subsequent good/bad price performance.
There is no apparent trend in earnings results and price performance. No one can predict what earnings will be better than professionals and there really is no rhyme or reason to how investors will react to any given numbers.  If your strategy revolves around earnings reports, you have no strategy, you're just gambling.

 

[johnnyredstorm]

What's the deal with writing covered calls to hedge? I've read a whole bunch up on it but I'm still a little hazy.

 

[freakydestroyer]

Still holding LNKD. If it breaks below $100 on heavy volume it might be time to get out.

AAPL, PCLN, and GOOG will fall even more Let's see if CMG is next.

 

[dajoka004]

Originally Posted by JohnnyRedStorm

What's the deal with writing covered calls to hedge? I've read a whole bunch up on it but I'm still a little hazy.

I don't get what you're asking exactly. Writing a covered call would hedge you against a drop in share price if you are long common shares. 

 

[freakydestroyer]

If you're writing a call, it is essentially the same as buying a put but without the cost. 

 

[secretzofwar]

^Plus writing a call can limit your upside. But it does generate a guaranteed return. I'd only do it if you have a large account and low transaction costs.