Complete Noob Investing Questions

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Manticore

Official BUF Angel of Death (also Birthdays)
Staff member
Nov 5, 2003
6,371
229
63
Optimum Trajectory-Circus of Values
Why the hell would you want to invest in something when all someone had to do was sneeze and you lose half its value? The stock market in general is a bad idea IMO.

I would have to agree with this generally.

However if you are getting into speculation with a view to longer term investing the stocks that I would not trade because they are too volatile are:

Entertainment industry (including video games companies)
Airlines
Retail traders (such as Walmart)

Less volatile would be:
Mining and resources (including oil and gas extraction)
Technology (such as Intel and M$)

However the stock market is all about speculation and is, therefore, gambling of a kind.

It is also dependent on how well a country's economy is doing and the price of it's currency etc in the global context.

Better putting the cash into a long term investment account or buying real property in a good neighborhood and living in it.
 

BITE_ME

Bye-Bye
Jun 9, 2004
3,564
0
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Not here any more
If the Economy is bad.
Then people aren't making babies.
So put your money into condom stocks.

If the Economy is doing great.
Then put your money in cocaine futures.
 

Twisted Metal

Anfractuous Aluminum
Jul 28, 2001
7,122
3
38
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Long Island, NY
Twisted, didn't you want to blow your 40k on a car a couple of months ago and everyone told you to read up on investing?

Still considering this. I love driving too much to cheap out on it. :D

Except I would finance some of it. Maybe like a 30k down on a 50k car. That way I can save some money for investing and build credit towards a future house purchase.
 

DeathBooger

Malcolm's Sugar Daddy
Sep 16, 2004
1,925
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The stock market is a waste of time. Buy some cheap houses and rent them out to deadbeats with shitty credit for a profit. Better yet, buy some cheap housing in Mexico and rent it to tourists for a huge profit.
 

Zur

surrealistic mad cow
Jul 8, 2002
11,708
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You can buy or sell whenever you want assuming the market has enough supply/demand at that price. You could even use options to control your risk. But you should probably practice with fake money first using a demo account, and when you do start trading you should risk as little as possible at first.

I can't give any advise on any specific stock or strategy so I can't say if it would work. Just don't blow thousands on something unless you know what you are doing. Cramer's mad 4 life would be a good read here.

+1

It's better to spend 6 months to a year on a demo account than learning the hard/expensive way. Markets move on a daily/weekly basis and you can only really know the kind of whipsaws by observing a full yearly cycle. When you actually get to trading live only use money that you don't need.
 
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Zur

surrealistic mad cow
Jul 8, 2002
11,708
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Looking at the history graphs though, the share prices are always up during the release of a major title. It really spiked during GTA IV. Why wouldn't that trend continue? At the very least, I don't think the prices would dip below what they are now, especially at the time of release. Right? Maybe? Perhaps?

If you want to capture a trend it's best to attempt to enter during a reversal on a higher timeframe. That can create drawdown though and requires some money management. Depending on the market, big players can actually go against the trend so be careful when price is ranging. Personally, I'd go for the slightly shorter term by watching price as it nears breakout levels. If you happen to catch a trend then it's a bonus. Go for low leverage if that's open to you. I hear MF Global got burnt using only 40:1.
 
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Twisted Metal

Anfractuous Aluminum
Jul 28, 2001
7,122
3
38
39
Long Island, NY
How about like 10k worth of Google and/or Amazon?

edit - Or Apple. But it's not really possible to "buy low sell high" when Apple keeps rising??
 
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Agent_5

Replica?
Jan 24, 2004
1,140
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UT
But many are saying you should avoid stocks altogether, or to just give it to a professional. That's wrong.
I can see the argument against avoiding stocks, but why should he not give it to a professional?
 

TWD

Cute and Cuddly
Aug 2, 2000
7,445
15
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Salt Lake City UT
members.lycos.co.uk
I can see the argument against avoiding stocks, but why should he not give it to a professional?

I just know that you can get a better return yourself. There's so many things about large institutions that work against them. It's much more rewarding to do it yourself. There's nothing wrong with just picking a mutual fund, but those that go the extra mile will certainly be rewarded.
 

Sir_Brizz

Administrator
Staff member
Feb 3, 2000
26,020
83
48
I might go with 10k of Apple. How can you go wrong? Half the population of the world is in an Apple store right now.
Right now is tentative. Without Steve Jobs, they could lose half of their value in the next few years.
 

Balton

The Beast of Worship
Mar 6, 2001
13,428
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Berlin
but those that go the extra mile will certainly be rewarded.

and that's where you need to heed your own advice. TW proves that walking the extra mile is too much hassle for most people.

It only takes about 5 to 10 grand to make a porn.
Add 2 grand if you need some one to write a script.

if you fund me I'll undercut that price by half and deliver ;)

still horrible posts you do :p
 
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TWD

Cute and Cuddly
Aug 2, 2000
7,445
15
38
38
Salt Lake City UT
members.lycos.co.uk
and that's where you need to heed your own advice. TW proves that walking the extra mile is too much hassle for most people.



if you fund me I'll undercut that price by half and deliver ;)

still horrible posts you do :p

I don't view it as a hassle, but it's definitely true that most simply don't care enough to put forth the effort. Such individuals should just stick with their 401k's.

I guess it's easy for me to say because I stare at charts practically all day. I just think that far too many people are scared out of pursuing it because they're told it's too risky or complicated. It's not. Anyone can do it.
 
My best investment to date has been IBM. Bought 100 shares at $38/pc, it's now worth $180 a share plus I reinvested the dividends into the stock, so now I have 103 shares.

For $3800, I've made around $18,000. There are a few others too, but I like IBM and think it's a good company.

If I had $40k sitting in a bank, the first thing I would do is take it out and put it in a credit union. You can earn interest on it at-least this way. Take 10k and put it into a high yield, 10 year CD (You can take it out early if you have to have it, but you'll pay a huge fee and may take a loss depending on when you take it out, otherwise, leave it alone and forget about it) This would be a great retirement package to start out with. When the 10 years is up, take all that money and do it again. Reinvest it into another high yield CD. Just keep this going for the next 30/40 years and you may have doubled your money or more. It all depends on what type of CD you buy.

You could do the day trader thing too. Read. Read. Read. Listen to NPR or some other news station that has a Money Market program. Usually they tell you about upcoming IPO's. I made the mistake of not investing in ZipCar for a day trade. I could have made $11,000 in 3 days, but I didn't have the money readily available. Day trading is fun and you can make a lot of money quickly, but it's a high risk situation. You set it up so that you buy X amount of shares when the IPO launches, keep a very close eye on it. Download E-Trade or something on your smart phone and always keep an eye on that stock. Have a stock ticker on your desk, etc. When you feel it hits a good price, maybe $10 a share more than what you paid for it, sell it. You can set up an auto-sale too. For example, you can buy 1000 shares of Apple for $10 each. Auto-sell it when it reaches $15 a share, or even $20 a share. Make your money. You might kick yourself because the stock could even triple or more after you sell it, but that's the risk you take. I think as long as you really do some good research into the stock you want to buy, especially a new IPO, you will make the right choice on what to do with your money.

Groupon is coming out with their public shares. It has made a lot of buzz. Google tried to buy them for like $1 Billion last year, now they think they are worth $10 Billion or something. I don't recall the exact numbers. This would probably be a really good day trade start out. Drop $5000 on day one of the IPO release. Keep an eye on it all day. It will fluctuate, that's normal. Sell it the next day or when you feel it. So far, my gut has always been pretty damn good, and I kick myself for not going to investing school and becoming a trader. Oh well.

Google, Amazon, Apple are all good companies, but they are huge also. Huge companies like to collapse at any given time. I would say Google is probably the better choice out of the 3. Apple just lost Steve Jobs, and is losing its market share in the smart phone field and tablet. Google is taking over it with its Android OS and devices. They are about to launch their own version of "itunes" type software, which is good. Everything Google touches seems to turn to gold. Their stock is pricey though, and it wont change soon. Do a 2 or 3 year share price graph chart on them. Anything further than that is just expected honestly.

So, lets say you invest in a 10k/10year CD, you invest another 10K in a stock you have done plenty of research on. This leaves you with 20k. Maybe you drop 15k on a new BMW M3 or something cool, or even drop it on a house. You are still young, now is honestly the best time to buy a house. Make that extra payment a year and pay your house every 2 weeks. You'll have it paid off in no time and for cheap too. Then in 10-20 years you no longer have a house payment. More money for you to enjoy and travel or something fun.

No matter what you do, I would personally keep $5000 in your account. You never know what might happen and you may need some money quickly. Investing in stocks can be good, but your money is tied up for a few days, or weeks. So you'll want to keep something handy. Maybe even buy a safe for your house and keep some money in that too, just in case, but don't tell anyone except your parents or someone you can trust that wont kill you for your key or combo lol :D

And after all this, it's still a gamble. That's how stocks are. The Global economy is fucking stupid nuts right now. You have to really look into a lot of different aspects. How was the recent unemployment rate? It went down, which is good and usually stocks do better on news like this. However, you have the whole Europe debit crisis which also can effect stocks and usually makes them drop. There are just so many factors when investing yourself.

You could just give $10,000 to a stock broker and say "make me the most amount of money" and he might, or he may not. Depends on how good he is and the resources he has. Remember, the stock market trades in milliseconds. Those people have huge servers and software dedicated to making money. So don't foreget about that too. You'll just have to pay them a fee (usually a percentage of what you invest and make)
 
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