Hi all,
I read the post from Chris A. with a great deal of interest today. I believe
that there is an excellent lesson in his story that *MANY* people on these boards
need to hear. I'm not trying to pick on Chris, particularly since he was honest
and showed some guts to post his story. But, in a nutshell, his case was classic.
To wit:
Zenith posts an exciting press release and the stock starts moving. Chris
does a little digging (but not a lot) and likes the possibilities this technology
has, and *DAMN* this stock is moving fast!
So, he starts posting and encouraging people to jump in. As the stock accelerates,
the posts get more bullish, and more people are jumping in, many knowing only
one thing about the stock: it's going up!
Soon, ZE is proclaimed to be the next Iomega, and this technology is *HUGE* in its
potential to change the world, and Chris et al are in "for the long term", because
this one has such great "fundamentals" (fundamentals in this case == exciting story).
Then, when the crack in the skyrocket appears, fear sets in. If it's gone down
20% in the last 30 minutes, why can't it go down another 20 more? Pretty soon,
all the people who thought they were long-term investors have bailed entirely.
I've seen this happen a number of times in the last month alone.
So, learn something from this!
Not everything you read in these forums is true. Predictions about future stock
prices are SPECULATION by individuals who may or may not know what they are talking
about. Recognize the word "potential" for what it is: when someone claims that
a stock has the "potential to be a ten-bagger", realize that it also has the potential
to go into the shitbin. *YOU* have to look into the company yourself and decide
which prospect is more likely.
Sorry for the preaching, but there are so many people in these discussion forums
(and on AOL and Prodigy) that haven't learned this lesson. And, by the way, I've
learned this lesson by getting burned myself in the past.
There are no sure things, but you never would have known it from the hysteria
here in the last couple of days before the correction (which was inevitable).
Be careful,
Jim |
