Reg: Do you feel sorry for people who go to casinos and lose money? If you're like most people, probably not. Well, I feel the same way about people who will lose their shirt on this or any other Net stock. The analogy is right on the money because the two are one and the same--it's gambling.
They use to say that the biggest gamblers were the ones who bought and held common stocks, because they would hold a stock for the long-term and if things went bad they would lose everything. Today it's the other way around, the gamblers are the buyers of these Net stocks, where the price moves so fast that you can have a big loss before you even receive confirmation of your trade.
One guy told his story to the press recently, about buying a Net stock after hearing the CEO on CNBC. He had $15,000 in his account and the stock was trading at about $12. He put in an order through his on-line trading account to buy 1,000 shares "at the market". The stock soared after the CEO went on CNBC and he found out after the market closed that he had purchased the stock at $49. The stock closed the day at $17. He was down $32,000 and had to borrow the money to settle the trade.
Now, you can call that stupidity, and it certainly is that, and you can call it getting emotional or greedy, but one thing you can't call it, is investing.
Have a good day. |
