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Abrak
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Quote: from DaffyDuck on 5:37 pm on Feb. 8, 2008
Now, what I find fascinating, especially coming from you, a proclaimed stock analyst, is how you are shortsightedly fixated on AAPL dropping, and acting as if it were the only stock in the market dropping. In case you didn't notice, nearly all stocks had dropped significantly during that same period when AAPL went from $200 to the present state. It's the economic outlook, silly, that's driving these drops and this selling-off of stocks, and it's happening across the board.
Daffy, you might know quite a lot about computers but it is pretty obvious that you dont follow markets very closely. The Nasdaq has fallen about 12% this year while AAPL has fallen 37%, so to attribute the stocks dramatic collapse to the general fall in markets is just complete nonsense. You dont have to be an analyst - and I havent worked as one for over ten years - to see that.
(Incidentally Daffy dont you think it is exactly what analysts and fund managers focus on - stocks that suddenly dramatically underperform or outperform the market?)
Now the fall could reflect the fact that the fundmentals have changed but there doesnt seem much evidence of that. It could just be a trading anomaly in which case AAPL is the mother of all buys. I do however think there is a reason.
Last year, three stocks - google, RIMM and AAPL - became the darlings of the NASDAQ. Traders bought them on their growth story irrespective of their fundmentals - a bit like internet stocks in 2000. They reached levels that were fairly out of whack with their fundamentals. At US$200 AAPL was trading on 50x PE of trailing earnings. Google, Rimm and AAPL accounted for 75% of the rise of NASDAQ last year.
This year these stock stories are unwinding - the fundamental story is still there, the companies are still great growth companies - but the shares have simply returned to more normal levels.
In the past every sell off in AAPL has been a great buying opportunity. But from an investors perspective this time looks very different. When the stock bounces from current depressed levels I think a lot of long term investors will use it as an opportunity to get out.
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Thai Girls : Meet Sexy Thai Girls
Posted on: 9:02 pm on Feb. 8, 2008
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DaffyDuck
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Quote: from Abrak on 12:17 pm on Feb. 9, 2008
Again, you may be right in your overly cautious analysis of the situation (and why not be cautious when money is on the line), and you are most likely right that many investors hanging on right now, will get out when the stock bounces back up (most likely encouraged by their analysts, advising as you are right now).
I've explained my strategy, which is simple, and I'm sticking with it. The most I would do, ever, is sell of 50% of my AAPL holdings when the stock reaches $200 again, to keep and hold until the next dip. Nevertheless, I will continue investing more in AAPL at present rates - essentially, I am generally moving any money that I don't need, and won't miss, into AAPL, every month or other month. Once there, I don't touch it. Simple.
You may be right that I am overly optimistic, but then again, it's buoyed by understanding what lies ahead, and how Apple's strategy (well, Steve Jobs') develops. Google too, is still a good buy - especially since it is down nearly $100 right now, and if the Microsoft hostile take-over of Yahoo were to go through, it would only benefit Google in short and long run.
We'll see how the market responds when Apple meets their sales goals for iPhone, and as it expands into other markets, and diversifies the iPhone product line.
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Bangkok Women : Meet Sensual Bangkok Women
Posted on: 9:48 pm on Feb. 8, 2008
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DaffyDuck
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Quote: from S M E G M A on 7:21 am on Feb. 9, 2008
Although nasty, epicaricacy can be really fun. Depending on the target.
Oh, don't get me wrong - I enjoy a good helping of Schadenfreude. In fact, in many cases, it is my raison d'čtre.
It's when the antagonist fails, miserably, at dishing it out, that it turns into a pathetically flailing display of failure - which, of course, just allows me to indulge in Schadenfreude again, months and months later. But hey, in the meantime, it's like watching Steve Ballmer decry how the iPhone will never gain any marketshare... 
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Thai Girls : Meet Sexy Thai Girls
Posted on: 9:50 pm on Feb. 8, 2008
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S M E G M A
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Quote: from Abrak on 12:17 pm on Feb. 9, 2008
Now the fall could reflect the fact that the fundmentals have changed but there doesnt seem much evidence of that. It could just be a trading anomaly in which case AAPL is the mother of all buys.
Trading anomaly?
Hmmm... I disagree with that on principle ((U of Chicago: markets are perfect as prices reflect that momentīs consensus based on all publicly available information) ). Trading anomalies are very rare. And when they occur is because they havenīt been noticed (January 1st effect, or triple witch), and are not stock-specific related; once noticed, markets adjust ahead of them or immediately.
When there is no change in fundamentals, it is then a change of market sentiment for that company. Why? Most likely a change in expectations. Now why expectations changed? Well, that is what every market pro tries to explain after the fact.
At todayīs prices, there is equilibrium between sellers and buyers. Sellers think that it will go further down (or else they wouldnīt be selling) and buyers that it will go up (or else they wouldnīt buy). Tomorrow when prices change again, it could be argued that either the sellers or the buyers were wrong. That is why in order not to attach pride to trading positions, professional traders mark to market every day, and they see every day as starting from zero gain and zero loss, regardless of how much may have been made or loss the previous day on a position.
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Bangkok Girls : Meet Sexy Bangkok Girls
Posted on: 10:11 pm on Feb. 8, 2008
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ThaidUp
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Quote: from DaffyDuck on 1:05 pm on Feb. 9, 2008
... and you are right about that, and that will happen. I just find it hilarious that the service hasn't even been out a month, and already you are complaining how immature it is...! Dude, did you ever check how the iTunes music business grew, over time, building up momentum? He has all the studios on board, but nowhere was it claimed that ALL movies, of ALL TIME were available for rental -- you know there's a physical limitation to how fast stuff can be digitized? I have a vague connection to a studio, somewhere, and I can tell you that this doesn't happen overnight -- and he was pretty clear that 'new movies will be available for rental within 30 days of DVD availability', and that newest releases will be available first, and then studios will work towards growing their libraries with the legacy products. This is just common sense. Complaining in the infancy of the service, that there aren't a gazillion movies available is just plain silly.
Obviously, blinded by your love of Apple you missed the point. It is NOT a digitization proble, but rental versus sales issue. Many of the decent movies are available FOR SALE only on iToons, not Rental.
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Thai Women : Meet Matured Thai Women
Posted on: 3:06 am on Feb. 9, 2008
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ThaidUp
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Quote: from S M E G M A on 1:26 pm on Feb. 9, 2008
Trading anomaly?
Hmmm... I disagree with that on principle ((U of Chicago: markets are perfect as prices reflect that momentīs consensus based on all publicly available information) ). Trading anomalies are very rare.
Not exactly, you just have to smart enough to find them. I met a guy who was making a very large of money finding these and then building models to exploit them. First he would examine tons of trading data and then reserach to find out why they occurred. The best one I like that I remembered was he figured out how to make trades that would generate revenue during the time the senior traders took time off to get lunch, the junior traders left in charge were not allowed to make major trading poistions! He was under contract with a major investment firm and not allowed to trade himself as this would potentially give himself an unfair advanatge as he could piggyback the models used by them and make more money at their expense.
The buy and hold stategy is not a good one to imploy on individual stocks. I know a lot of individuals still holding their Internet stocks that is if they they still exisit. Buy and Hold should be used on stock market indexes which is the most efficient way to make money in stocks. Individual stock ownership should be avoided unless you have the large amount of time that is required to maintain proper trading techniques. Most do not and fall in love with the stock. The exception would be for company workers that through incentive plans get a discoiunt to market on holding the companies stock.
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Bangkok Women : Meet Beautiful Thai Girls
Posted on: 3:17 am on Feb. 9, 2008
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S M E G M A
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The guy you mention spent his time doing that. Once he finds one that can be statistically significant, his own acting on it, would help get rid of it. Anyway, what you mention is not an anomaly per se, but a lag in the speed at which the market adjusts due to the players not being there to react.
Also you have to include opportunity costs (the cost of having to forego other activities to pursue this).
All things included, best strategy (statistically) for the mass is "buy and hold". By strategy I mean a definite model that can be explained in black and white and can be replicated by anyone. In the long run, still nothing beats (statistically) "buy and hold".
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Bangkok Girls : Meet Attractive Thai Girls
Posted on: 8:56 am on Feb. 9, 2008
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SidWenes
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Quote: from S M E G M A on 12:11 am on Feb. 10, 2008
All things included, best strategy (statistically) for the mass is "buy and hold".
I think this is the 3rd time you've mentioned this, and I've finally taken the bait.
Some blog author claims 33 percent of all stock issues roundtrip to zero. Stocks do go down.
Buy and hold is always recommended with another system of risk management. Usually it's buying every security in a large index, via a mutual fund. Stocks are sold when they're taken off the index.
I held Enron. In the current market, buy and hold with a small number of stocks is something only for the prescient or the true believers. Risk management, preventing losses from taking you out of the market, is for the rest of us. Know when to fold them.
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Thai Girls : Meet Active Thai Girls
Posted on: 3:11 pm on Feb. 9, 2008
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S M E G M A
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Well, it means go for the long run. Do not spend time time trying "to time" each stock. Buy and forget about playing the volatility game. From time to time, yes screw ups do happen and you have companies that go down for good. When that happens it was an outside factor that surprises most of the people at the same time. Pitiful is when you end up loosing your shirt just because you think you know better, and you start playing the ups and downs.
Now, buy and hold goes together with diversification. I am sure you have heard of something that goes along the lines of "do not put all your eggs in the same basket."
BTW, notice I said it is the best strategy for the masses and also statistically.
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Thai Women : Meet Matured Thai Women
Posted on: 3:47 pm on Feb. 9, 2008
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DaffyDuck
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Quote: from S M E G M A on 7:02 am on Feb. 10, 2008
Pitiful is when you end up loosing your shirt just because you think you know better, and you start playing the ups and downs.
Yep, happened to a good friend of mine, who fancied himself a day trader. Was able to initially turn his meager savings into a decent amount of money (somewhere around $500,000), and then lost it all in a week's time, when he 'knew better' and had 'a system'.
Now, he's essentially flipping burgers, sadly.
As you so wisely pointed out, there's also the opportunity cost - when he did that, that ALL he did, nearly 24 hours a day (when he wasn't trading, he was 'studying' the markets'. He kept trying to encourage me to invest my money in him, and he would double it. Good thing I did not. So far, my simplistic 'buy and hold' strategy has pretty effectively resulted in me generating not just more than he had, but doing so safer, and at a near zero opportunity cost (the money I invest is money I do not 'need', or won't miss if I lost it). Yeah, it took me longer, but he's still flipping burgers, and I ain't :-(
Quote: from S M E G M A on 7:02 am on Feb. 10, 2008
Now, buy and hold goes together with diversification. I am sure you have heard of something that goes along the lines of "do not put all your eggs in the same basket."
Which is good advice as well, and the only shortcoming of my portfolio - it's all in tech stocks, and bio-engineering stocks, so if we ever change to a mostly agrarian, pre-industrial society, I may be screwed :-(
I'm considering diversifying a bit more after next year, or whenever an opportunity presents itself (I am expecting economic factors to further depress stocks and investments by next year). Good advice, overall, SMEGMA.
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Bangkok Girls : Meet Attractive Thai Girls
Posted on: 6:46 pm on Feb. 9, 2008
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