***Off and On Topic***
You need to follow this thread for a while to get into the mind of a small cap stock momentum player. Follow them around to some of the other sites. It is a good education.
#Subject-28652
Some of them were following Tahera when the volume started to rise and alerted others. Many jumped on board. They look at charts and ignore a lot of the fundamentals. They are in and out in minutes, hours or days and are looking for a few cents rise for a few hundred dollars (ex: 10,000 shares x 0.03 = $300-$100 commission = $200. This multiplied over a year with several stocks per day is not hamster feed. It's a job and many make decent money doing it.
Of course many lose because they don't take the time to learn everything there is to know. This takes years to learn, and a knowledge of market insiders, players and promoters is key IMO. A stock preparing to breakout, will give signs of doing so on price/volume charts. Manipulation of the numbers in various ways gives the technical analyst clues to what the stock might do. A fundamental analysis of the stock, the industry and economy are key things to consider how good the price movement may be. The better your knowledge of all these things, the better chance you have of making money.
Many of us choose a stock based mainly on fundamentals, and wait for the rest of the market to recognize what we take for granted. This may cause us to buy, at a higher price than we should. And when the stock price turns down, we refuse to get out SUFfering huge losses until hopefully, sometime in the future, the price recovers and goes higher. Good momentum players would not take that loss. They may short it if conditions are right. They get out when their charts show them market interest is waning. When interest perks up again they are back to play the rally again.
SUF must use the money they are generating now to secure the projects that will give them the best longterm cashflow with the minimum of risk. They must evaluate each of the plays just as we evaluate our stock choices. They may or may not be right, such is life.
It is difficult to second guess their decisions when we have only a fraction of the knowledge and experience they have. The fact they are not going after the flavor of the month gives me some faith that SUF is a quality company, rather than a pump and dump like so many of the others. Unfortunately, quality companies work slowly and methodically towards a goal. Such work rarely attracts momentum players who look for short term gain.
Todays stock market is a result of momentum players and technological advancements, together with the huge rise in business news and information. Business news programs like CNBC and internet business information websites act as enormous promotion machines for the stock market. They sit on the sidelines and cheerlead the market. It has raised the profile of the markets, disseminated business and economic news, and attracted huge numbers of new stock market participants. Their money sloshes back and forth into the flavor of the day rocketing some stocks up, and others down. Bull and Bear markets that in the past took a year or more to play out, now occur in months and even days. Such a market is perfect for momentum players looking for fast bucks. It is not a market for the long term investor, until his/her stock is recognized. Once it is, you will get a short period in the limelight until the momentum folks lose interest, or you get bought out by someone else.
See where SUF fits in to all of this? We hamsters sit and wait for production increases or confirmed exciting new diamond discoveries.
This is too long! Pretty boring Friday is propagating extreme verboseness in hamsters today. This one is heading back to his wheel. |
