Mary:
I know what you mean about this writing thing being very different in expressing oneself, especially when you don't have anyone else to proof it and edit it and you don't sleep on it before you file it.
Got the thick skin about the old thing and many more, just don't try and hype that the economy is fine, and we'll probably be fine. Your first few post's did not give me the impression that you're new to investing, far from it. And of course when you posted all those comparison charts with the goldies a couple of days ago, just looking at them was a lot of work. I was going to spend some of the weekend looking at them all, but for now, I've got some questions.
First, why does everything have to be a comparison with another? Many comparison's are made, but how many are relevant. You can't look at the ratios between two things until you have analyzed the individual components first. All this For sector rotation spotting I thought I sick
these tickers into the link above and see if it would indicate which ones were moving.
$BKX,$BTK,$CRB,$DRG,$FPP,$GSO,$IIX,$INDU,$MID,$NDX,$NWX,$OEX,$OSX,$RLX,$RUT,$RXP,$SOX,$SPX,
$TYX,$VIX,$VXN,$XAL,$XAU,$XBD,$XCI,$XOI,$XTC,$HUI and then to compare them to individual components which are also part of those indices, not to mention the weighting factors within the index, well you might see where you're going, but I'd say I can't see the forest for the trees. Either that or you're an actuary, a rocket scientist aka, nuclear physicist, (we have one at least on SI), (now that I think about it we have a couple of wannabes too<LOL>), an accountant for Anderson or Coopers or________ (they're all the same) and want to hide something or just a keener who consumes and absorbs everything they can about what they want to do and jumps in.
So tell us you're a keener and we can help. Tell us how you got crushed and we'll tell you about a guy here who bought 500,000 shares of NT at $24 saying they were going to 32 and held them down through 10. We don't believe him of course, but if you check the threads, he's still pumping it. So unless you lost over 5 million it can't be too bad<G>. At least tell us who you were reading, following when this happened.
Do you just reference TA books or have you read one. Murphy's pretty dry to just read. Have you read Dr. Alexander Elder? Do you have a list of investing or trading rules and know how to follow them? We all break our own rules, (and usually pay) but if you're not following them 95% of the time, something's wrong. i.e. do you set stops and trail them up and never move a stop down? I very seldom sell my positions unless I think there's a serious reason for me to leave them and the whole sector, rather just keep tightening my stops if my worry level goes up and let the stops do the work 95% of the time. I broke that rule in October when I rode the golds down from the 911 spike, but for fundamental, macro reasons. Could've traded it and made more money, but c'est la vie. I see here that in fact I have sort of automated a part of my trading style. IMO it's the hardest part. Selling for profit at the right time, and it's the selling we have to focus on. Buying is easy, finding a good entry point a little harder, and cutting your losses a little harder again, but selling is hard and needs to be focused on.
Peter has a great set of 10 or 12 rules bookmarked from someone here at SI that's terrific. Now let me step one step back again from TA towards the beginning. Before there's trading or profiting there's style. What are your thoughts on diversification? Do you have the time to daytrade? Can you stomach having people lie to you all day every day and tune it out? Have you read "The Battle for Investment Survival"? Written decades ago but revised by the author Gerald Loeb in '88, it's a classic, by a guy who was there in 29, and spent his life in the business. A great and easy read.
Now right to the beginning and the "live with sleep with" thing. Iso talked about money management, risk/reward. This is where you start. Tell us your ideas about this and you'll at least get a response from me and others will help I'm sure. I'm going to gloss over this for now, but remember it's the beginning. Elder does good work with this part and since he's a shrink, the psychological part as well.
So I end up actually at the second thing. No style, system, technical or fundamental analysis will help and you'll lose in the long run unless you have this down pat. Do you know how the odds are stacked against you? Among individual investors, most lose most of the time. SI is an exceptional community where we even have 41 (or more) heroes who keep their eyes out for scams etc, but I'm sure the list of those who lost and went away is long. Whether or not you are restricted by law to play that way, do you understand the dark side? Do you know the who, what, where, when and why of the short sellers?
Sorry for the long dissertation and all the questions, but when you said you were a newbie, I thought I'd better find out where you're at before delving into hours and hours of chart analysis. Starting with the basics and good ideas is way more important than TA, as is keeping up with the good ideas of those you come to trust on SI as nothing except data is static in this game.
I know you didn't want your questions answered with other questions, but we're all here building relationships along with our portfolios.
Regards
Bob |
