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[jamesinclair]

unomas, you expect to make a 100% return off gold based off buying ata round $1,500 and expecting the price to hit $3,000.

You do understand the basic relationship between risk and return in the market right?

You know, the reason treasuries return 1%, municipals 3%, big stocks 7%, penny stocks 15% etc etc? (historically)

An investment cannot both be extremely safe and bring in an extremely high return.

When something is promising you 100% return, no risk, sure thing, etc etc....

 

[Piecake]

unomas, you expect to make a 100% return off gold based off buying ata round $1,500 and expecting the price to hit $3,000.

You do understand the basic relationship between risk and return in the market right?

You know, the reason treasuries return 1%, municipals 3%, big stocks 7%, penny stocks 15% etc etc? (historically)

An investment cannot both be extremely safe and bring in an extremely high return.

When something is promising you 100% return, no risk, sure thing, etc etc....

well, I think the problem is that his gut is telling him to invest heavily in gold

 

[unomas]

unomas, you expect to make a 100% return off gold based off buying ata round $1,500 and expecting the price to hit $3,000.

You do understand the basic relationship between risk and return in the market right?

You know, the reason treasuries return 1%, municipals 3%, big stocks 7%, penny stocks 15% etc etc? (historically)

An investment cannot both be extremely safe and bring in an extremely high return.

When something is promising you 100% return, no risk, sure thing, etc etc....

So where exactly should I be putting my money since gold and silver are a farce? And how much gold and silver do you own? You would be saying the same things if I had invested in gold a year ago, you would have said then don't put your money in gold it's a bubble, and I would have missed out on profits. Same then, same now, and the economic indicators show that.

 

[spiderman123]

So where exactly should I be putting my money since gold and silver are a farce? And how much gold and silver do you own? You would be saying the same things if I had invested in gold a year ago, you would have said then don't put your money in gold it's a bubble, and I would have missed out on profits. Same then, same now, and the economic indicators show that.

He's saying that expect the bubble to burst. Don't invest heavily into a security that continuously sees it price inflated at an unsustainable rate. Know when to cut your losses. I invested in gold but not as much as some people in this thread recommended. I don't think the bubble will burst anytime soon ( but that is a beauty of a bubble it's unpredictability ). Keep a diverse portfolio and manage your risk.

 

[Piecake]

So where exactly should I be putting my money since gold and silver are a farce? And how much gold and silver do you own? You would be saying the same things if I had invested in gold a year ago, you would have said then don't put your money in gold it's a bubble, and I would have missed out on profits. Same then, same now, and the economic indicators show that.

Well, what he is saying is be responsible. Also, you havent earned any profit yet. You only get that when you sell, and if you sell too late you are basically fucked since it seems like you have very little diversification and put all your eggs in the gold basket

 

[Cromat]

Question for Americans, isn't it better for you to invest in real estate? (if you have a respectable sum). Buy in a good location and rent. From what I understand it's incredibly cheap at the moment.

 

[jamesinclair]

He's saying that expect the bubble to burst. Don't invest heavily into a security that continuously sees it price inflated at an unsustainable rate. Know when to cut your losses. I invested in gold but not as much as some people in this thread recommended. I don't think the bubble will burst anytime soon ( but that is a beauty of a bubble it's unpredictability ). Keep a diverse portfolio and manage your risk.

Well, what he is saying is be responsible. Also, you havent earned any profit yet. You only get that when you sell, and if you sell too late you are basically fucked since it seems like you have very little diversification and put all your eggs in the gold basket

Exactly right.


Right now you say youve made big bucks...and will surely make so much more.

But if gold crashes tomorrow (unlikely, but possible) youre now looking at big losses.

Question for Americans, isn't it better for you to invest in real estate? (if you have a respectable sum). Buy in a good location and rent. From what I understand it's incredibly cheap at the moment.

Shockingly enough, home prices are STILL going down. We havent hit bottom.

Note: This is in general, each market is obviously different. Places like Boston actually saw prices rise over the last 4 years.

 

[Cromat]

Shockingly enough, home prices are STILL going down. We havent hit bottom.

Note: This is in general, each market is obviously different. Places like Boston actually saw prices rise over the last 4 years.

I see. Real estate might still be a much safer investment than shares or precious metals these days. At least you can sleep in it.

 

[Javaman]

I see. Real estate might still be a much safer investment than shares or precious metals these days. At least you can sleep in it.

I don't see house prices overall going anywhere but down or sideways for the next 5 to 10 years. Interest rates are super low right now and can really only go up. When that happens it is a downward push to house prices since loans become less affordable. There's millions of baby boomers retiring and scaling back on their houses. Lastly there's a massive backlog of shadow inventory that banks haven't started processing yet. I can't speak for investment real-estate or the commercial market but don't expect residential to move up anytime.

On gold, I stay far far away due to the volitility and the fact that stocks do much better in the long term.

 

[jamesinclair]

I see. Real estate might still be a much safer investment than shares or precious metals these days. At least you can sleep in it.

If you want a house to live in and work from and whatever?

Go for it. Best time to buy. Cheap interest, cheap homes and a huge selection available.


Want to make an investment? Look elsewhere. At least for the next couple of years. As Javaman said, banks are still holding onto a shitload of foreclosed homes.

 

[Ether_Snake]

Look at this chart. What do you think people in 1979 were saying?

Now make a note of where it ends, and what the scale is at that point.

So what? People keep pointing at the height of the gold rally in the 70s, as if people who still held when things went down lost everything. They didn't, unless they were idiots investing based on chatter. The others continued to accumulate on regular intervals which erases your losses over time. By 1985 you could have ended up with a nice profit if you followed that idea.

So yeah, gold prices might fall back down to 2005/2006 levels. Big deal. Accumulate more over time. This is more applicable to gold than things like company stocks, where accumulating more can lead to losses.

I'm far more worried about my stupid solar company stocks than gold really. Gold is a safe investment at any time if you accumulate more over time, much safer than any company stock. Your chart proves it. Business go bust, gold stays.

 

[jamesinclair]

Yes, accumulating a metal can never result in losses.

At least those who bought coffee in 1977 could brew it.

If you had bought Gold in 1979, it would have taken 26 years to cover your loss, if you had held on.


Protip: Lets talk in 2025 when gold is sitting at $950 and you feel so great about having accumulated gold at between $1,200 and $2,000

Any day now, youll make it all back. Aaaaaaaany day now.

 

[spiderman123]

This is a good article on Reuters on why the price of gold is rising

http://uk.reuters.com/article/2011/08/19/uk-markets-global-idUKTRE77E0BL20110819


But don't use this as an excuse to be financially retarded and not spread your risk.

 

[Tenck]

So the guy I PMed never replied to me =/

So I'm going to ask this question here.

The guy I messaged said he had this service (I think it was free) that would comment on what companies to invest in and what not to invest in. Basically giving you a push in the right direction. They would comment on the good and the bad aspects of the company and at the end it was up to the user to listen or not. Anyone know of a service like this or something similar?

 

[MesserWolf]

COncerining gold I suggest a very interesting analysis published in july 2011 : http://www.gata.org/files/ErsteGroupGoldReport-07-04-2011.pdf

And give the current economic situation I do believe that the gold has still not reached the peak.


Plus this crisis could very well become a currency crisis ... with the gold becoming the only real international currency.


That said I do believe that gold is starting to become a bubble .... but still ... all these Quantitative Easing .... de facto justify the growth we have seen so far in the gold price (in my opinion of course).


Bottom line I included gold in my portfolio ... not much but having some it isn't such a bad idea diversification wise.


We have 2-3 years of recession ahead if this recession develop like the '29 one (and I do believe that's what is going to happen) ... therefore I don't believe that gold is at the end of its run yet.

 

[spiderman123]

So the guy I PMed never replied to me =/

So I'm going to ask this question here.

The guy I messaged said he had this service (I think it was free) that would comment on what companies to invest in and what not to invest in. Basically giving you a push in the right direction. They would comment on the good and the bad aspects of the company and at the end it was up to the user to listen or not. Anyone know of a service like this or something similar?

Alright

Firstly, For Free service is sketchy. Research to go that into "safe investments" ( firm securities aren't safe BTW) aren't 100% and extremely expensive. I don't know who the user was or who you talked too or what his profession is? but I am going to assume that you were feed bullshit.

Secondly, I stress this to all investors understand the market, don't go by what people say. Do your own calculations and research. This is a golden rule

Finally, I am going to give you a tip, THE MOST important tools in firms profitability is ratios and financial models. If you have an excellent understanding of finance I recommend this TO ALL investors.

Know this model in particular : Black Scholes Model If you know this model, then you understand how how the market functions . TRUST ME ON THIS. Particularly on Volatility measure.



I am not the type of person to tell another person on what to invest in. That is up to you. The best way to learn is to do your own research.


I am sorry if this isn't the answer your looking for but for your sake I hope you consider this.

 

[MesserWolf]

Alright

Firstly, For Free service is sketchy. Research to go that into "safe investments" ( firm securities aren't safe BTW) aren't 100% and extremely expensive. I don't know who the user was or who you talked too or what his profession is? but I am going to assume that you were feed bullshit.

Secondly, I stress this to all investors understand the market, don't go by what people say. Do your own calculations and research. This is a golden rule

Finally, I going to give you a tip, on of THE MOST important tools is ratios and financial models. If you have an excellent understanding of finance I recommend this TO ALL investors.

Know this model in particular : Black Scholes Model If you know this model, then you understand how how the market functions . TRUST ME ON THIS. Particularly on Volatility measure.



I am not the type of person to tell another person on what to invest in. That is up to you. The best way to learn is to do your own research.

I agree with you but:

B&S is useful to price derivatives but I wouldn't say that you need it to be able to invest with good results.


One thing must be clear : Volatility == Risk == opportunity to gain a lot or to lose a lot (and small investor typically lose a lot because they have as opponent on the market big institutional investors who make the market and professionals with superior knowledge, experience and tools.)

Invest in risky assets money you can lose .... if you need that money than don't gamble .

 

[spiderman123]

I agree with you but:

B&S is useful to price derivatives but I wouldn't say that you need it to be able to invest .


One thing must be clear : Volatility == Risk == opportunity to gain a lot or to lose a lot (and small investor typically lose a lot because they have as opponent on the market big institutional investors who make the market.)
.

I agree but the purpose of telling him/her to understand this model is that it covers the basic understanding of stock volatility and movement. You don't need to learn unless your willing to learn derivatives and reading long ass reports but I think that if people understood how basic firm information/ Index Information and Government Information/Reports on how they are all interconnected and collected then I believe the question "of What stocks should I invest in?" would be minimal. This is how this financial crisis started ( well not necessarily but for the most part) people went by what they were told than rather what they researched.



edit: I usually invest in a bunch of IPO's and IPO's are incredibly risky especially if the name isn't established. That is one of the reasons that drives my desire for information.

 

[JoshuaJSlone]

Can anyone recommend a decent historical trading simulation program or site? My attempts to find such a thing on Google have been giving me three main results.

1. "Be sure to get one that's good so you don't get false ideas." (Yeah, that's what I'm trying.)
2. "Try our present-day stock simulator site/game." (Useful, but not what I'm looking for.)
3. "Look at archived data and calculate it yourself." (I love spreadsheets more than the next guy, but simplifying tasks with insane amounts of data is why we have computers.)

 

[Stumpokapow]

If you had bought Gold in 1979, it would have taken 26 years to cover your loss, if you had held on.

OTOH if you had a sensible stop loss order/trailing stop (say at 15-20%), you would have recovered your losses very quickly

I mean, I'm assuming no one here is dumb enough to invest significant amounts in anything without a stop loss order, right?

 

[MesserWolf]

OTOH if you had a sensible stop loss order/trailing stop (say at 15-20%), you would have recovered your losses very quickly

I mean, I'm assuming no one here is dumb enough to invest significant amounts in anything without a stop loss order, right?

stop losses with such high volatility can be really tricky to set .... I'm not a real fan of SL to be honest.... probably because I'm more a long term investor then a short term speculator.

But generally speaking you are right: better have them than not... especially for when you cannot follow the market minute by minute like it would be necessary these days.

 

[Seraphinianus]

edit: nm, should've read OP first

 

[teh_pwn]

Look at this chart. What do you think people in 1979 were saying?

You didn't adjust for inflation. In that time period, gold owners weren't even close to recovering to 1980 value.

http://goldprice.org/inflation-adjusted-gold-price.html

I think they're just now breaking even. The inflation in the 1980s was huge, so they really lost about 80% of their value during that decade. Great investment, huh?

 

[Ether_Snake]

Again you guys are acting like people who bought then would not have continued to buy with equal sums of money at regular intervals.

What if you put 1000 every four months in gold? You would have made your money back. And that's taking the worst case scenario where someone invests at the height of the bubble.

 

[shahkur]

First time posting in here though I've been eyeing this thread for some time now.

I've read the OP and everything, so here goes...

I wanna start stock investing, but I've never done it before. I DO understand the basics of how it works (buy low, sell high etc.) But I wanna know what is the best site for trading as I want to start small, maybe ~£100-300. Yeah, UK here. So, please, anyone care to help?

 

[Xisiqomelir]

First time posting in here though I've been eyeing this thread for some time now.

I've read the OP and everything, so here goes...

I wanna start stock investing, but I've never done it before. I DO understand the basics of how it works (buy low, sell high etc.) But I wanna know what is the best site for trading as I want to start small, maybe ~£100-300. Yeah, UK here. So, please, anyone care to help?

Get your hands on these and read them

http://www.marketfolly.com/2009/08/dan-loebs-recommended-investing-books.html

 

[shahkur]

Get your hands on these and read them

http://www.marketfolly.com/2009/08/dan-loebs-recommended-investing-books.html

So many damn books. I know I shouldn't just jump into this and I'm not. I'm actually currently reading Stock investing for dummies.

How is £200 for a starting point? It's not like I'm expecting huge profits or anything, it's all just to get a gist of things.

 

[Piecake]

So many damn books. I know I shouldn't just jump into this and I'm not. I'm actually currently reading Stock investing for dummies.

How is £200 for a starting point? It's not like I'm expecting huge profits or anything, it's all just to get a gist of things.

You could always invest in index mutual funds if you are unsure/not confident. Well, youd need to put way more than 200 in since I think most mutual funds have minimums, but they are safer than picking a stock and dumping some money into it

 

[MesserWolf]

So many damn books. I know I shouldn't just jump into this and I'm not. I'm actually currently reading Stock investing for dummies.

How is £200 for a starting point? It's not like I'm expecting huge profits or anything, it's all just to get a gist of things.

too low ....
commissions would make it impossible for you to gain anything. That means that you could only lose money

with 1/2000£ it's already better but still it would be almost impossible to built a proper portfolio with that , you could just buy an ETF or fund (they would do the diversification for you )

you could think about using leverage to buy more, but with this market it's suicidal

 

[Javaman]

Again you guys are acting like people who bought then would not have continued to buy with equal sums of money at regular intervals.

What if you put 1000 every four months in gold? You would have made your money back. And that's taking the worst case scenario where someone invests at the height of the bubble.

Perhaps you might have broken even, but what if you hade done the same with stocks since the 80s? Quite a different result

 

[shahkur]

Mutual funds and ETF, huh. I'll have to think this through properly then, but the whole stocks thing definitely interests me.

 

[Stumpokapow]

So many damn books. I know I shouldn't just jump into this and I'm not. I'm actually currently reading Stock investing for dummies.

How is £200 for a starting point? It's not like I'm expecting huge profits or anything, it's all just to get a gist of things.

If your point is to learn, use a simulator until you get enough money to actually invest. 200 Euro won't cut it.

 

[JambiBum]

If your point is to learn, use a simulator until you get enough money to actually invest. 200 Euro won't cut it.

How much would you suggest to start with? In US dollars.

 

[spiderman123]

If your point is to learn, use a simulator until you get enough money to actually invest. 200 Euro won't cut it.

we used simulators in our finance class and they assigned numbers for each individual in the simulation ( these represented investors in the Secondary Market). They gave us bearish and bullish market scenarios and at the end they would post a bar charts comparing the P/L for each investor ( student). Everyone, including myself made a loss in the some of the scenarios.

Apparently that have competitions based on these simulations ( in Canada or NA).


edit: Rotman Interactive Trader, is what is called ( for order driven markets)

 

[Ether_Snake]

Perhaps you might have broken even, but what if you hade done the same with stocks since the 80s? Quite a different result

Sure, but it doesn't make gold a bad investment, even at the height of a bubble, if you invest responsibly. It's always been a good long term investment if you invest in it at a regular pace in balanced amounts.

 

[TylerD]

Bank of America hit a new 52wk low this morning at 6.01 after opening at 6.37.

 

[Zyzyxxz]

Bank of America hit a new 52wk low this morning at 6.01 after opening at 6.37.

Yeah I got in at $7 with the possibility of it hitting lower. I'll wait and see what tomorrow brings to see if I should buy in more to bring my average price down.

 

[jamesinclair]

Hm, I fucking hate BoA but that price is looking attractive.

Its like buying a forclosed home to flip that located in hades

 

[Zips]

Hi guys,

I started an RRSP and TFSA with my bank early this year (balanced and conservative mutual fund portfolios, respectively), and for a while it was overall making some slight money, but now lately with the stock market tanking again the value of them has been sinking and is now down by about $550 total (which is about 3.3% of what I have invested).

I'm not sure what I should do, if anything.

This is through my bank, so I'm not picking the stocks/specific investments myself.

Any tips?

 

[TheRagnCajun]

Hi guys,

I started an RRSP and TFSA with my bank early this year (balanced and conservative mutual fund portfolios, respectively), and for a while it was overall making some slight money, but now lately with the stock market tanking again the value of them has been sinking and is now down by about $550 total (which is about 3.3% of what I have invested).

I'm not sure what I should do, if anything.

This is through my bank, so I'm not picking the stocks/specific investments myself.

Any tips?

Do nothing. The market fluctuates. Nothing you can do about it. Hopefully it wasn't money you needed any time soon.

 

[Zips]

Do nothing. The market fluctuates. Nothing you can do about it. Hopefully it wasn't money you needed any time soon.

Ok that's what I figured. No I don't need the money soon, I'd just like to see some actual positive growth.

Thanks!

 

[Pachimari]

I started practicing the basics in Stock buying/selling/limiting/stops etc. on the Investopedia Simulation two days ago. I'm excited about all this, but when I finally decide to jump in for real (will probably be at the start of next year, after I have practiced and studied most things) I'm contemplating doing it myself instead of letting a bank do it; they'll apparently take a lot of money.

Would it be possible to do long-term investments (10 years, 20 years) and short-term investments (months) at the same time? One of my customers suggested, that at the start, I should try an buy cheap, then sell when it rises a little, and then buy again when the stock falls - just to feel how it is to actually gain from the market.

By the way, would $10,000 be a good amount to invest in the start or at least $6000?
I don't have a ton of money lying around just to be spent, as I'm still only 22 years old.

 

[MesserWolf]

I started practicing the basics in Stock buying/selling/limiting/stops etc. on the Investopedia Simulation two days ago. I'm excited about all this, but when I finally decide to jump in for real (will probably be at the start of next year, after I have practiced and studied most things) I'm contemplating doing it myself instead of letting a bank do it; they'll apparently take a lot of money.

Would it be possible to do long-term investments (10 years, 20 years) and short-term investments (months) at the same time? One of my customers suggested, that at the start, I should try an buy cheap, then sell when it rises a little, and then buy again when the stock falls - just to feel how it is to actually gain from the market.

By the way, would $10,000 be a good amount to invest in the start or at least $6000?
I don't have a ton of money lying around just to be spent, as I'm still only 22 years old.

6000$ it's already a good start.

To have 10000$ at 22 years old it's not bad at all ...

 

[Pachimari]

Alright. Right now, I am reading through the tutorial and trying out the simulation at Investopedia. Then my plan is to eventually join the game in here you got going, and try out various simulations to see how I fare and how much I understand it. Read up on articles and especially study some corporations here in Denmark as well, as I'll probably be investing a lot in the Danish C20 index, alongside the American.

Then I'll talk with an advisor from my bank, but I'm still contemplating if I should do it all alone or let one from the bank control some of my investments - I read that will cost me more though. The plan is, to start investing at the start of 2012.

Sounds like a reasonable plan?

 

[MesserWolf]

Alright. Right now, I am reading through the tutorial and trying out the simulation at Investopedia. Then my plan is to eventually join the game in here you got going, and try out various simulations to see how I fare and how much I understand it. Read up on articles and especially study some corporations here in Denmark as well, as I'll probably be investing a lot in the Danish C20 index, alongside the American.

Then I'll talk with an advisor from my bank, but I'm still contemplating if I should do it all alone or let one from the bank control some of my investments - I read that will cost me more though. The plan is, to start investing at the start of 2012.

Sounds like a reasonable plan?

yes.

Just remember an obvious thing: that if you plan to invest in another currency you increase the risk ....

DAy 1

with 10EUR you buy 10 $ (for simplicity sake) and then you buy 10 shares Z

Day 2
Shares Z are up and now they are worth 12$ yeeey ,,, too bad that now the dollar is down and now 1$= 0,5 EUR

Ergo => now you have 6 € instead of 10€ even if the company you chose had a good performance.

of course it can happen the opposite as well.

 

[Pachimari]

Wow, so I need to both keep an eye on the currency and the stock, I'll be wary of that. =)

Are any of you, beside long-term investing, also doing short-term ones? And what did you guys do when you first entered the market? Did you try and invest, then sell it to gain a few dollars quickly just to get a taste of what it feels like? Or did you only do long-term investment? What would be the best way of doing it as a beginner (after having studied everything as I talked about before) ?

 

[Javaman]

Wow, so I need to both keep an eye on the currency and the stock, I'll be wary of that. =)

Are any of you, beside long-term investing, also doing short-term ones? And what did you guys do when you first entered the market? Did you try and invest, then sell it to gain a few dollars quickly just to get a taste of what it feels like? Or did you only do long-term investment? What would be the best way of doing it as a beginner (after having studied everything as I talked about before) ?

Just keep in mind that trading fees will eat a LOT of your profit or even net you into a negative if your investment only earned a little bit if you trade very often or with a small amount.

 

[Gallbaro]

Question for Americans, isn't it better for you to invest in real estate? (if you have a respectable sum). Buy in a good location and rent. From what I understand it's incredibly cheap at the moment.

Its better to buy in a bad location, and rent in a good location.

 

[Pachimari]

Just keep in mind that trading fees will eat a LOT of your profit or even net you into a negative if your investment only earned a little bit if you trade very often or with a small amount.

So what is long-term investment to you guys? Is it 5, 10, 30 years? Or do you just sell when you feel like, it won't be able to get back to the same worth?

Besides investing in NKT Holdings, Vestas, Novo Nordisk and all those Danish companies, Apple would be a pretty good investment as well I feel. That one would be a long-term investment to me, as I think it'll stay high with numorious iDevices, the headquarter building and me thinking they'll bring a whole new product to market.

 

[Secks4Food]

Oh wow Steve Jobs just announced he's stepping down as CEO of Apple, AAPL's price just ate shit and died as a result.