Stocks & Mutual Funds Information
Fake Money
Reach in your pocket and take out that big roll of bills. Depending on how many of them you have you feel pretty good.
Stock Analysis
I receive emails from Morningstar. This company provides statistics and analysis of just about every publicly traded stock company you can think of as well as voluminous information on mutual funds around the world.
NASDAQ 800?
In November of 2000 when the NASDAQ was trading at 3000 I wrote in this column that the NASDAQ Index would fall to 1500 and I got lots of heat for saying it. Microsoft had fallen from $129 to $60 per share.
Low Expense Ratio
One of the big advertising kicks today from mutual funds is to tell how low their expense ratio is and that you will make a great deal more money if you buy and hold with them. Partly true, but that is not the whole story.
Valuation
Every day I hear from the "experts" on CNBC-TV and the radio gurus that the way to buy stocks is find value. One man's Rembrandt is another man's connect-the-dots and fill in the spaces.
Inertia Syndrome
When it comes to buying a stock or mutual fund most people act pretty quickly. There are some who will take the time to get a report from Morningstar (it is worthless) or get reports from their broker (also worthless) or even do a search on the Internet (if you know what you are doing).
Perfect Storm
Having lived aboard a sailboat for 2 years I was stricken when I saw the movie "PERFECT STORM". I know these are things you want to avoid at all costs.
Complacency Indicator
If you haven't heard of the technical indicator with the stock market symbol VIX it is now time to pay some attention to it. When the number is running low, as it is now, around 15 to 18 it means everyone is happy and thinks the stock market is going to continue up or at least continue on its current path and there is no need to sell anything.
Paddle Your Canoe
At some time in your life you have been on a river in a canoe and hopefully you had a paddle. You know about being up the creek without one.
Trading Systems
To become a successful trader you must have some kind of method or system to follow that will keep you on track. You may be buying and selling on tips, the weather or phases of the moon (there is a system like that).
Expense Ratios
Mutual funds and brokers are always preaching not to buy any fund with a high expense ratio. That is the annual costs of the fund to pay for trading of stocks within their portfolio, salaries, rent, telephone, analysts, etc.
Protectionism
First let's see what protectionism is. According to Mr.
Stuff
I continually hear from economists, talking heads, other market letter writers, analysts and assorted "experts" that I need to know all kinds of "stuff" about the stocks and mutual funds I am going to buy and I should keep up with them on a regular basis.What is this important "stuff"?Let's see.
Discipline
One of the great "secrets" of successful people is discipline and it doesn't make any difference whether it is manufacturing, processing, servicing or investing in the stock market.Before you can have that discipline you must have a successful plan and stick with it.
What Are You Waiting For?
Do you own any mutual funds? In an IRA or 401K or wherever. Privately or at work.
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Let's hope you did not have any of the Enron stock. Maybe you know someone who did and lost everything, but you certainly might know several people who owned stock that lost almost everything.
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Take The Time
You must take the time once a month to review your investment portfolio. It won't take long - less than one hour, maybe 15 minutes.
Its Better
Question: How does it get better when it gets worse?Last week we had a jobs report from Washington that there were fewer jobs created than they had anticipated, but the stock market took that as good news and the DOW had a strong rally. WOW! The bad news somehow turned into good news because the unemployment rate dropped one tenth of one percent.
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The Cub; II
We keep hearing about this bear market and that the bottom is "in" or "very close" so we should be invested in these bargain basement prices to take advantage of the next bull so we won't lose out on the expected huge profits.This is not a big bear market - yet.
The 1% Solution
You probably know the story of Sherlock Holmes and the 7% solution. He had a drug addiction.
Stock Market Insanity
Let's first define insanity. It is doing the same thing over and over and expecting a different result.
The Surgeon General
The Surgeon General of the United States says that smoking cigarettes is harmful to your health. It is printed on every pack of smokes you buy.
Investment Capital Gains
Have you bought any mutual funds this year or late last year while the market was doing its skyrocket thing? Last year it was hard to lose money. This year it has been easy.
Lemmings Are Gathering
Before they go over the cliff to their destruction these little furry ones get together for a party and celebration. Each tells the other how smart he has been with his investments and buying and selling of stocks and real estate.
Trapeze Artist - Swinging with the Stock Market
When we go to the circus we see a trapeze artist working on a high wire or swing either alone or with other athletes. They know what they are doing because of constant practice, but every once in a while there can be a mistake, even a small one that can cause one of them to fall.
Investing in Stocks and The Game of Monopoly
To begin, you might look at playing the stock market as though you were playing a game of Monopoly. That's right; for playing the stock market 'game' is not unlike playing a game of Monopoly.
The Secret to More Winning Trades is as Simple as Avoiding This Common Mistake
If you're a normal human being, your need to feel good about yourself probably causes you to sell your winners too soon - and -- your need to avoid feelings of regret, causes you to hang on to your losers too long.At one time or another, we're all guilty of letting our emotions dictate our investment decisions.
Small-Cap Stocks: The Beginning of the Journey
When an individual investor wants to roll up his sleeves and do some research in the pursuit of the next big winner in the stock market, the place many start is in the small cap sector.As with the other capitulation sizes (capitalization is a stock's market value), no one can completely agree on a precise definition, but corporations under $2 billion are often considered small caps.
Low Tide
When you stand on the ocean shore and watch the waves breaking you might become aware that the tide is coming in or going out. It is a slow process to watch the water retreat and when it finally gets to its lowest point it is almost impossible to tell if it has stopped or will retreat further.
Selling Strategies - Setting a Stop Loss
Sometimes the best way of lowering exposure to risk is not to invest at all! However, when we make the decision to jump into the muddy waters of the stock market, its always a good idea to have a life jacket ready, just in case.We all have stories of that "must have" "can't lose" stock that looking back, we didn't really need to buy, and it definitely lost.
The Stock Market - How Just One Question Will Tell You All You Need To Know About Your Stock Broker
Last time we looked at the real performance of the stock market (we used the Dow Jones as a reference point) and the apparent performance that makes the headlines and can be seen by a casual look at a chart or "ballpark" figures - briefly; the Dow went up, for example, less than 50 points between April 1999 and April 2005 - essentially 6 years with no growth!But behind that seemingly "becalmed" Dow there were at least 10 significant moves each and every year totalling many thousands of points!But did the Wall Street Moguls, the so-called "Masters of the Universe" make you any money from those huge movements? No.Of course they didn't!Here's how I know.
Hill of Hope
Just about now everyone is confused as to which way the stock market is going to go - up or down. For the past 3 years it has been headed south, but the Wall Street experts have told us that the market never goes down 4 years in a row so this has to be an up year.