STOCK MARKET: Let's talk stocks and investing

Not all of energy has been so hot as you generalize. Coals been going up steady for its only a matter of time before it booms, especially when oil prices keep climbing to record levels. You never know when gas prices will drop but its pretty much assumable that if you hold coal for the long term, youll everntually make some $$ and gains because of the limited availability of petroleum and OPEC

 

No, a big company like CFC isnt going down easy. BAC has considered buying them and I am interested in them again. After the first initial crash I believe there would be no way the government allows the fall of a big financial company which would affect a GREAT amount of people in the united states. I uderstand that CFC isnt a "state-owned" company but I had many reasons to believe the govt would do all it can to make sure CFC wouldnt die and file for bankruptcy.

When CFC fell down even a bit more, to me that symbolized how bad and how unstable the financial market really is

 

crossover, are you saying that taking some money out of the S&P Index and putting it into some fixed funds might be a good idea in the short term? According to the Vangard website, their S&P index fund is down something like 6% over the last year. Some people would say that's a good time to buy more because of the low share price, but if if it's going to continue to go down...

Of course, I'm not suggesting that anyone knows for sure, just asking your (or anyone else's) opinion.

Also, to you or anyone else - what is the best "investing for novice's" type book out there? I'm looking for some new reading material.

 

This is like a good time to invest since market is down. I may go down further maybe up to 10%, but eventually it will go up a lot of low p/e's and global companies. Crox is pretty cheap and they are doing business overseas. GU might be good in the future. TSO was a good a couple days ago .

 

you do know that there is a significant feeling that the deal could get repriced downward. i have no reason to believe that this thinking is off base either. i can't imagine that CFC's financial position has improved over the months since the merger was announced. so i'm not sure why you would be interested in them again. further they are only trading about 12% below their buyout price so the reward doesn't seem to be there for a merger arbitrage trade especially given the risk of repricing.

anyhow...keep working and reading.

 

What's the general feeling on penny stocks? I don't have much money to play with (and yes, it is STRICTLY playing money), and I'm looking to start off by investing in penny stock and low dollar stocks (under $10 basically).

And please do add tips for us beginners that want to focus on buying and selling stock. Thanks ClutchFans Financial

 

it is very difficult to judge stocks by looking at the analysts recommendations since they put out SOOOOOOO MANY buy and strong buy recommendations. i thought it was good (and hilarious) when i saw the new CEO of Merrill Lynch, John Thain, mandated that analysts had to put out a sell rating on a minimum of 30% of their recommendations. I believe the industry average is somewhere around 5% right now which makes sell recommendations pretty strong when they do come around. so if you see one try to pay attention to it and read why the analyst is giving it a sell rating.

further, i can also explain how buy and sell recommendations work really quickly. basically, it is a 12 month price target. if it is higher than where the stock is trading currently when the recommendation is given then it is a buy rating and conversely a sell rating would be lower. neutral ratings are given when analysts believe the stock will perform inline with what the overall market does.

about NOV...they have been very volatile but huge since their merger with varco. they are basically printing money right now and so is pretty much any other company related to drilling. Transocean (RIG) has also been a monster since their merger with GSF. Maybe if you want to play drilling go for a combo of the 2. They are certainly both very strong companies and neither are terribly expensive on a p/e basis. RIG is cheaper on a p/e basis but they also carry more debt related to the GSF merger. drilling opportunities will not be slowing down anytime soon but always be cautious about buying a big piece of your position near highs. NOV has gone up almost 35 bucks (almost 70%) in only 2 1/2 months so there could be some good profit taking if we do see a nice pullback in oil which is somewhat likely now that the fed has mentioned that they are mindful of the dollar and willing to raise interest rates. and the dollar's weakness has played a role (15%-20%) in rising oil prices. it's doubtful that the fed could cause the dollar to rally too much to cause a major fundamental change in the dollar but it could be enough to get people to take some profits in commodities and related plays.

hope that makes some sense.

 

I never understood the allure of DCA. Studies have shown repeatedly that it does not garner better results or lowered risk. However, I'd like to hear what you think robbie.

 

I just made a guaranteed 900 bucks by buying and selling options in a matter of seconds. I also trade currencies. I don't have a job right now so this is how I get by on a daily basis.

You just have to know what you're doing

 

hmmm....well i think i am just using term that because i don't want people to just buy brazil now that it is basically on 52 week highs. i think brazil is safe to buy on deeper pullbacks. i don't think that for every stock i look to invest in.

i guess i may look at things from a different perspective since i do know when the right spots (err...good enough spots) to pick up another chunk of a stock occur. i also know when it's like a good time to get out/move on when things aren't going my way if i do decide to average into an investment/trade is going against me. i haven't actually seen any studies on dollar cost averaging so i might be horribly off base when using that term. i may be recommending dollar cost averaging too lightly since i am thinking about it from my perspective. i'm pretty sure i do the most trading out of anyone on cf.net and that gives me the ability to know when to average into something and when not to and when to get the hell out.

 

I see what your saying - it's what I like to call "smart dollar cost averaging". My father in law (a financial advisor) is a huge fan of this technique. Basically, you invest consistently on timed increments, and pull out when the market is high and (naturally) buy low. In theory, since you are investing in installments, you lower risk to sudden losses - especially if you know what you're doing and can read the market.

If you are like me, and you are not so sure about how to guage the market (or don't have the time to research it day in and day out) studies have shown that a purely random investment time-scale is just as good, if not better.

The most famous is from 1979 by a guy named Constantanides (spelling may be off). This quickie article from MSN money does a good job explaining the issues...

 

Penny stocks are quite often bad. I do like stocks under $10 as they may not be as well followed by the professional analysts, which can give you a chance to find a good bargain.

 

I'd wager it's 50-50. Good returns though, as a whole (just on a smaller scale) if it works out.

 

Ive explained why Im interested. BAC is buying them but the fact is, BAC hasnt really confirmed yet that they are buying it which is why the price of CFC hasnt gone up significantly. Until BAC truly sets an offer they will stick to, then CFC will remain a bit unpredictable, but it will remain an interest of mine because of the possibility of a buyout

 

That is effectively DCA. I'd wager any brokerage will give you this option. I do it with a few mutual funds every month (simply because I do not have massive lump sums to deposit).

A 401k is effectively a dollar cost averaged investment strategy as well.

 

Are there any good resources (sites or books) that focus on penny stock trading. I'm going to try to do some day trading to build up my funds first. It might take a little while, and I might be leaving some money on the table, but I want to make a little profit before I do my real investing. Good idea, Bad idea?

 

Anyone feel like natural gas is ripe for shorting?

 

This one costs money but is touted as the best.

http://www.pennystock.com/

This one I've used occasionally for advice.

http://www.bestpennypick.com/index.php