Suggestions for a speculative punt?

underground99

adindas said:

Thrugelmir said:

There's some 4,000 micro and smaller company shares listed on European markets. If you evaluated one a day it would 20 years to get through them all. Unlike Amazon which is covered continually by 54 full time individual analysts. Some are covered by just one investment house . Without stock market commentary you'd spend a lot of wasted time.  Anyone can spot a good business. Can you spot a good investment?  Very different things. 

Is it the way people screen the stocks to target? Well, no wonder, they have missed a lot of opportunities.

People with common sense in investing will never do that to screen the stocks. Have you heard about stock screeners, social Media before start investing your own valuable time ??

He was replying to someone that said that price targets for some stocks and much of the accompanying stock market commentary was meaningless; his counterpoint was to point out that if you tried to research the 4000 companies yourself it would take you forever, so analysts and market commentary can have useful roles in making a more efficient market by sharing the information around more effectively.  Thrugelmir is not recommending that you spend twenty years looking at all the companies yourself at a rate of one per day.

What social media is saying about the stocks can inform your understanding of how a stock is perceived and what 'the mood' among amateurs is, and perhaps give you a jumping off point for research. However, you probably won't uncover all the hidden gems or get the most in depth understanding if the approach is to screen for profits or price and then see what facebook and reddit reckon.

adindas said:

underground99 said:

What was the share price of Enron or Worldcom in 1999 or 2000? And then by 2003? Was the fact they had been on the stock market for 10 years not enough evidence that the price in 2000 was fair?  I guess you were not an investor learning the markets on a free trading app in 2000.

Comparing Enron with a company like Tesla which grow like an Octopus maintaining control of the business ecosystem show severe lack of understanding. From  previous posts people just know that TESLA is just about an EV company, with recent uptake of  Bitcoin. But if it is your view, I suggest you spend time to study their business model, where the revenue come from.

Your contention was that this was not a flash in the pan and Tesla had been listed on the stock market for ten years, and you asked was that not enough time to have a full understanding of the reasoning for its valuation and drivers of price.  Clearly it is not enough, if the price is moving from 70 to 900 in less than a year, dropping to 560 over the next five weeks and going back to 670 the day after. 

Enron and Worldcom had more than ten years on the market, latterly posting some too good to be true numbers as the dotcom boom started shaking out, and suddenly collapsed under fraud.  It doesn't 'show severe lack of understanding' to dare to compare high profile failures of established businesses from before your time, with a company that 'grows like an octopus' putting on a thousand percent price rise in a year.  The point being made is that you can't assume you know everything relevant that's going on just because you read popular analyst reports and social media and are comforted by the company having had its listing for ten years.

underground99

adindas said:

I know some people here feel bitter because they have missed the boat try to impose their own beliefs to other people. But demonising people who disagree with them calling them idiots is not the way to go.

In their opinion the people who have position in compnay like Tesla are a bunch of idiots. But this idiot has made made a few hundred percents in just a few months just from Tesla alone. I do not lose money in swing trading even during this recent market correction, using the method I mention in my previous posts.

Nobody is calling you personally an idiot for having a tesla holding.  But it is certainly a valid observation that there are a huge number of idiots who have bought tesla stock without knowing much about finance or much about the company itself; they are buying it because electric stuff seems cool and have seen the company share price has been seen to go up a lot so they feel it must be a great thing to buy.  That sort of thing can certainly help the price go up twelvefold in ten months, but does not make the price action a reliable indicator of underlying value.

Thrugelmir

adindas said:

underground99 said:

What was the share price of Enron or Worldcom in 1999 or 2000? And then by 2003? Was the fact they had been on the stock market for 10 years not enough evidence that the price in 2000 was fair?  I guess you were not an investor learning the markets on a free trading app in 2000.

The Executives in energy companies like Enron are full with people with short term interest. Just have a look on their executive pays, bonuses, etc. They got incentive to maximise the short-term performance to earn bonuses. If the company collapse in the future they are already out the system and enjoy their retirement. 

If Tesla hits the targets set. Musk's 2018 remuneration scheme is worth $55 billion of stock in total.  Spread over 12 tranches.

adindas

I remember someone here said. SMT never diappoint me. Did you still stand by that stament lol ...

underground99

adindas said:

I remember someone here said. SMT never diappoint me. Did you still stand by that stament lol ...

Seems to have done alright for most investors over time.

adindas

underground99 said:

adindas said:

I remember someone here said. SMT never diappoint me. Did you still stand by that stament lol ...

Seems to have done alright for most investors over time.

Let see under the microscope. This thread was created July 2020. People started to be made aware thus started buying it late last year. Those who were buying it in November 2020 are back to square one now. It is important to remember to take profit. I got SMT last year luckily, managed to sell as I needed the money for another trading.

Unless it is treasury bonds, saving guaranteed by the government, no investment product is risk free.

It will be back to all time high so it is probably time to start building position now. Never buy at all time high, however good the stock is. Avoid selling at a loss, but those who needed the cash will be in trouble.

underground99

adindas said:

underground99 said:

adindas said:

I remember someone here said. SMT never diappoint me. Did you still stand by that stament lol ...

Seems to have done alright for most investors over time.

Let see under the microscope. This thread was created July 2020. People started to be made aware thus started buying it late last year. Those who were buying it in November 2020 are back to square one now.  

This thread was really about speculative punt stocks, not investment funds/ collective investment schemes. But either way, most people didn't start to become aware of SMT from this thread, it has been delivering strong performance for years.

Avoid selling at a loss, but those who needed the cash will be in trouble.

If someone invested before the last week of November 2020 they are up. If they invested more recently than last November into a long term growth equity fund despite needing the cash in less than four months, they have probably got a very high risk capacity, or just never listened to any risk warnings to find out what investing is all about.

Never buy at all time high, however good the stock is.

Nonsense. There are all kinds of stocks which have been worth buying at their all time highs and a lot of funds spend most of their time within 10%  of their highs. SMT was at an all time high of 674p on 6 May last year. By your logic nobody should have bought it then. But it hasn't closed a day at a lower price since, and is now over 1100p.

If you bought NIO at the end of June last year for about $7.50, you'd have been buying at all all time high. It was a good move as it has never been lower since and is 5x that price at the moment.

kinger101

adindas said:

underground99 said:

adindas said:

I remember someone here said. SMT never diappoint me. Did you still stand by that stament lol ...

Seems to have done alright for most investors over time.

Never buy at all time high

That's terrible advice.  On average, the direction of the stop market is upwards.  Hence a lot of stocks or funds will be at all time highs a lot of the time.  Particular small cap stocks and growth funds.  

As for selling at a loss, why hold onto something in a downward spiral?  

adindas

underground99 said:

Never buy at all time high, however good the stock is.

Nonsense. There are all kinds of stocks which have been worth buying at their all time highs and a lot of funds spend most of their time within 10%  of their highs. SMT was at an all time high of 674p on 6 May last year. By your logic nobody should have bought it then. But it hasn't closed a day at a lower price since, and is now over 1100p.

If you bought NIO at the end of June last year for about $7.50, you'd have been buying at all all time high. It was a good move as it has never been lower since and is 5x that price at the moment.

kinger101 said:

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That's terrible advice.  On average, the direction of the stop market is upwards.  Hence a lot of stocks or funds will be at all time highs a lot of the time.  Particular small cap stocks and growth funds.  

As for selling at a loss, why hold onto something in a downward spiral?  

What Nonsense / What terrible. Does commnon sense apply here ??

Which one you prefer: to buy now or to buy back in November - February 2020 ?? . Did you buy it during that time ?  If you bought  during that time you would not say that.

I really sorry those who bought  during that time.

This is what happen you believe to people who apply the principles blindly. They will keep telling you the time to plant a tree is now. Buy at any time even if you see the price is spiking They are a lot of these people here on MSE. Those who blindly follow this principles  have lost a lot of opportunities.

Also, you will need to differentiate if you are buying an index fund and an individual share. Plant a tree is now might only be applicable to a well-diversified index fund and you do not have tme to observe the market but not to individual stock, let alone a specuative stock .

I have index fund which I never sold but I will only add my position when I see a market dip, market correction, market crash not to buy blindly even at all time high like many MSEr here have advised  in the past. "They will keep telling you the time to plant a tree is now" I remember keep reading this pharse many times.here on MSE

I agree it is very difficult to time the market. But in Investment world there is always be a market correction, market rotation, price dip due to non fudamental issue sometimes a few times a year where you could start your position or keep adding up your positions during that period. Those who do not know those cycle/pattern, who can not see that the knife is falling should either blind or should seek a financial advise.

You buy/add a good stock when there is dip. resell it back a small part of it at all time high to prepare for spare cash ready on the next dip, add your position when there is a dip due to non fundamental issues.

kinger101 said:

As for selling at a loss, why hold onto something in a downward spiral?  

FAANG. Microsoft stocks have gone spiral many times due to non-fundamental issues. Are you advising people to sell them at loss ?

You will only be selling it at loss if there is a fundamental change in business, such as fraud clear evidence they are about to go bankrupt. But you have anought time to act on this as the news are eveywehere. If it is just about market correction, market rotation you do not sell it. If you believe in selling it at loss, supposed you or other people own SMT  why do not you sell now ??

Even you are talking about index fund they will also be affected by market rotation, market correction.

underground99

adindas said:

underground99 said:

Never buy at all time high, however good the stock is.

Nonsense. There are all kinds of stocks which have been worth buying at their all time highs and a lot of funds spend most of their time within 10%  of their highs. SMT was at an all time high of 674p on 6 May last year. By your logic nobody should have bought it then. But it hasn't closed a day at a lower price since, and is now over 1100p.

If you bought NIO at the end of June last year for about $7.50, you'd have been buying at all all time high. It was a good move as it has never been lower since and is 5x that price at the moment.

What Nonsense. Which one you prefer to buy now or to buy in November 2020. Did you buy it in November 2020? If you bought it in November 2020 you would not say that.

I really sorry those who bought it in November 2020. I agree it is very difficult to time the market. But in Investment world there is always be a market correction, market rotation a few times a year where you could start your position or keep adding up your position. Those who do not know those cycle is either blind or did not read the financial news.

SMT closed at 1004p on the first business day of November and during November it rose about 10% to 1096p on the last day of November. The highest it closed was 1109p on the 27th.   As you showed on your own chart, investors buying in November at 1000p to 1100p are almost 'back to square one' now, as although it rose since November it's now fallen back, to 1111p at the moment. 

So investors buying at the start of November are still about 10% up and investors buying at the end of November are about break even.  You don't need to 'really sorry those who bought it in November'. They bought into a long term growth fund and after four months they haven't seen much growth, but they haven't lost a penny. They are not expecting to track an index, or to make gains every month. That's not how the fund manager's strategy works. 

During mid to late November, SMT investors were buying at an all time high, but over the following four months there have only been 3 trading days since November (in early March) where they could have caught it closing any cheaper than the very highest day of November. They have not lost their money. The investors buying at the all time high that I mentioned on 6 May at 674p, or six months ago at the all time high on 25 September at 975p, are presumably happy that they bought when they did, rather than waiting to buy later, as there hasn't yet been a cheaper later price, and they will have received a small dividend too.