-OT- I'm not a proponent of flat out active trading. I do have key stocks that I plan to hold for years, but I do have play money to try to dabble with active trading.
With a day like today, I can see what you mean about the short term advantages of active trading. The actual danger as I see it is not the fees (or even the taxes you'll have to set aside --- though this becomes a problem for the 5 and 10 baggers).
It's actually, trying to time the market in itself. If I sell a stock I like, there is nothing to prevent it from going up by 10% or 20% tomorrow. It's the converse about dumping dogs :: if a stock goes down by 10% what I paid for it, I sell.
But if a long term stock goes up 10% after I sell some, should I buy (sndk,rimm)? That's hard, and you have to balance what facts you have with your gut-feel. In one case, I bought, in the other, I stayed away. You can never how it will turn out, but its never boring.
btw, the forbes.com article actually pointed out that the online amateurs were beating the pros by a huge margin. Returns of 240% a year are not unheard of. What it was trying to say is that the new amateru-gurus might fare as badly as the pros on a real meltdown situation. |
