Princess Di & jim p - couple of ?'s re: MARGIN !
Jim p - I love ya man; but this ?
<< "Maybe we will get a pop in the morning?" >>
... maybe ? - maybe not !
! but if not ? - what options would one have here being on heavy, or max margin if we have yet another day tomorrow like we just had today; if one was on heavy margin on a down day like today and then bought even more stock ?
Punt, Pass, or Puke on a gap down open ?
You've got better chances on "winning " and making money with a strategy like that jim; with you - yourself going into the NFL and throwing a Hail Mary from your own 20 - into the prevent defense of the St Louis Rams on a 4th & long with 2 tics on the clock....
Also, re: your earlier comments on this:
<< "One thing that we have not talked about is how funds operate. The oil and gas sector is very small today compared to other sectors. Most of the funds are managed by an asset fund manager, who selects the stocks he wants to invest in.
Most if not all of the funds have an Asset Allocation Committee that **only meets once a year**. This is the time of year that the committee's meet to determine the percentage of the funds assets that will be allocated to each sector. Over the last several years most of the funds have under weighted the patch because they have been burnt so badly in the past. This year I would venture to guess that we will see a lot of the Asset Allocation Committee's increase the allocation of funds that a fund manager is able to invest in the patch. " >>
Jim; please let me know the name of ANY company that in THIS market - has an asset allocation committee that ONLY meets "once a year" - because I DO have some serious #@)*@~#) ammo that I want to throw "short" at those clowns !
...no offense; but what are ya smokin ? Man, they'd sure as hell better have one hell of a crystal ball.
- I'm sure "Q" found that very interesting as well; as he NOW - knows how both hedge funds (thanks to Mikey) and asset allocation commitee's work (ROFLMAO).
Princess Di - re: your comment of -
<< "I believe brokers generally calculate margin buying ability based on the previous days close. Therefore, you could take a big hit today and still have the ability to buy based on yesterdays closing numbers.">>
...now that cynic in me - keyed in on your use of "I believe".... C'Mon Di ! - You can't be endorsiong, defending and promoting high, heavy, or max margin and be saying "I believe" - you'd better - KNOW !
Please don't be pulling our chain here.... because all the brokers I know of, certainly "DO NOT" use the previous days close to calculate your ability to buy based on yesterdays closing numbers. They use livetime balances. Gap down 5-7-9% on some stocks like we had happen in the OSX today and you've got one hell of a lot less buying power than not only what you previously had, but what you had better even be dreaming about using !
But !!!! - that's not even the point ! Even if they did ! Why in the hell would you WANT to marign some more ?!?!!?!?
Hello people !?!?!?! Is this online Viva ~ Las Vegas, or what !?!?!?!?!!?!?!?
Have ya all gone nuts !?!?
Is this monopoly money ya be playin with here ?
... unfortunately, that should probably be a rhetorical question - given the Pinocchioesque nature of most of the "max margin" claims here imho.
For example; if you have $100,000 of stock in your margin account backed up by $40,000 on deposit for .40% margin maintenance & the market goes down 7%...
You then lose $7,000, bringing the account value of your stock holdings down to $93,000 - now backed by $33,000 for a .36% maintenance level which = a House Margin Call in most cases and you are now only another similar day, or 6% away from a Fed Call/House Call & potential,if not probable Liquidation by your broker.
We go through 7% selloff's in 24/48 hour periods in the Oilpatch - like nothing ?
Why would ANYONE - want to skate on the edge of the brink of disaster, by design; as their gameplan ?
That further 6% gap down open, or closing selloff from that above example; would take you to potential liquidation ! - so who in their right mind is buying stock - doubling down on a day like today - mid day, while being heavilly margined ?
Check that; not "who" - but, "Why" ?
Talk about a strategy that totally takes away all your options and all your control ? Does the lyric - "highway to hell" ring a bell ? Hello ?
Guess Wrong, or have the wind change direction & you get liquidated like the broker did to John Q Public earlier ?
Please - just say NO ! Don't do it ! Lord knows I could not take another public tear jerker like that again...(VBG)~
My main "tirade" against all this braggadocio of who can ride the biggest & baddest "Mad-Max Margin" Bull is that first of all- given all the volatility we've had of late - for example; merely given just the recent retrace from OSX 115 to 100; it was nearly mathematically impossible to maintain "Max, or even heavy Margin" unless you drew the lotto ticket of the Oilpatch and happened to not have "index average" performance in you portfolio. In fact you would have to of had near "lighting strikes twice" luck, or accumen to have outperformed the index to a degree significant enough, to not have been severly affected, or liquidated by the volatility while riding on max, or heavy margin.
Even if not "max'd" out, or even if you were in less volatile stocks - we still have substantial volatility and for those who have "claimed" to be consistantly "holding" on "max margin" - at the very best, had to be within a gap down open, or a sell off close, away from a major margin call, if not liquidation on a near continual basis at times.
Is that really investing, or trading; or is it playing the casino ?
Is that something to be publically promoted, hyped, or endorsed ?
No different than playing video poker, buying scratch off's, or rolling the dice at the craps table...
C'Mon people - who's zoomin who...?
Given the rather public hystrionics & mea culpea's by some aformentioned "Players" who did get liquidated by their brokers - it amazes me that this reckless, literally - pure gambling & casino mindset is allowed to be perpetuated into the face of the simple mathematics that tell us that it either did not happen, or these guys were "rolling the dice & hoping - Baby got a new pair of shoes"...
PS - considering the type of hit to ones capital that it takes to get "liquidated" by ones broker - some rather vocal ankle biters in residence - are now working with pennies on the dollar of their former "stake" (VBG).
I'll be candid - I think 75 to 85% of this "braggadoccio" is pure & total Bull$h!^ - merely flatulent one-upmanship.
ie: Ohh, you caught one "this big" - well on my fishin trip I caught one "this big"... sound familar ?
If one sets aside all the personalities here and calmly analyzes the commentary here - its as if no one ever sells & takes profits; other than about 5-10% of the regulars here...
That meant that from August of 1998 to February of 2000 - no one made any money.
That meant that during that time frame if you were "holding" on max margin and "not" trying to time the market, or as I prefer to refer to timing - "trade the market" - one had to have been wiped out and totally liquidated at least 5 times.
... that obviously means - one hell of a lot of people here are packed chok' ful o nuts of you know what I mean.
Check a 2 year chart of the OSX folks & someone tell me how ANYONE held on heavy, let alone "max margin" through that volatility.... obviously; they didn't.
Anyone who promotes the heavy use of margin at 52 week highs, directly into what has proven to be a highly volatile period - ie: OPEC Meetings, let alone adding to that - a near simultaneous Fed Meeting - of which if we see "hot" PPI, or CPI's - and another .50 bp hike - we will surely see a market reaction that will bring "Jesus" to those who may "really" be ridin' ole Mad-Max Margin here...
When intelligent threads that hopefully are dominated by reasearch & stock picking ideas, or commentary releveant to potential buy, or sell points; become "One Way Cheerleading threads" (like the entire Tech Sector became from Dec to March of late) - prepare to be humbled...
Maybe we get "lucky" and just hit nothing more than a speed bump here, maybe we retrace to OSX 110ish and then base; dodge the bullet from both OPEC and the Fed; report across the board upside surprises for Q2 earnings and then take off for the next leg in the cycle.
... Or, maybe we don't dodge "EITHER" OPEC, or the FED - then come late June - where will all those "Mad-Max Margin " riders be then ?
Where do you think "Professional Money" is going to enter, or rotate at ?
1. here ? ... directly into the face of a Naz Meltdown - via a low volume, death by 1000 cuts selloff, a looming Fed & OPEC pressured by $30+ Crude and the renewed potential of $2 gasoline at the pumps ?
2. After the coming CPI & PPI's and on the coat tails of a bounce in the Naz - but, perhaps before the Fed & OPEC meetings ?
3. After all the reports and after both the FED and the OPEC meeting - if not also the Q2 earnings reports ?
... did they NOT wait untill AFTER the Q1 earnings report to rally the E&P's ? (how soon we forget) - even though they knew we had $25+ crude & $2.50+ Nat Gas and that the numbers would be great - as all analysts were predicting upside surprises...?
If they waited to flow into the E&P's untill AFTER the Q1 reporting for this last rally - WHY in God's name would they take on Q2, the Fed AND OPEC - this time ?????
.... it really aint that damn difficult folks.
Please don't end up writing tear jerker mea culpea's ala~ Ken Lingerfelt aka John Q Public ? Swearing to NEVER make that stupid, insane, entirelly emotional, illogical, irresponsible, gut wrenching, depressing, sickening, stupid mistakes like riding on Max Margin and not taking those heady profits after such a nice run into so much clear & present danger - ever again ?
Nahhh - I doubt it.
Not in Sin City...not in the new paradigm online Casino !
But; without "players" like YOU - people like me; couldn't make so much money - so easily, in both directions.
Because when things get hinkey in the market - you can allways just trade the traders when the market gets too tough.
C'Mon People - Let's put the Pom Poms down , quit telling "Big Fish Stories" and act like the savy, sharp, cutting edge thread this used to be - and not some Nasdqian Bubbleonians who think we can only keep going up, because its been a while since we've went down...
Make sure it walks like a dip , talks like a dip and smells like a dip before you buy it - and even more importantly; as we all "really" know - one can't buy a "REAL" dip - if you got to one - being on heavy max margin; now could ya ?
...Think Big & Move Fast; run strong, jump high & bite harder than you bark (never be a Chihuahua); shoot straight and never, ever, ever ! - fail to take MARGINED profits off the table on 30 point moves in the OSX into the face of a potential 7th CONSECUTIVE Fed Hike and a looming OPEC meeting - while the Naz is in a death by 1000 cuts spiral...and remember; CASH is not just warm & fuzzy, it sometimes is BOTH the best offensive AND defensive weapon one can have...
Ciao~
Your ever humble pal in Bubblemania
Da` $lider |
