Post by oldman on Oct 19, 2013 8:09:46 GMT 7
I have 2 kinds of stocks.
One, I call my pillow stocks. These are stocks that I put under my pillow and every now and then, I will collect more. I usually collect more of these when the general market is down... hence, my need to get a feel of the market. Yes, I don't rush into collecting but I would time my entry as there is nothing better than to feel that you got it at its lows.
I am willing to wait years for these pillow stocks to mature. To me, this is like going to the casino and selecting a number and every spin after that, is free. Sooner or later, I feel that my number will be called. Of course, there are at least 600 stocks and it may take years before my number is called. If one selects the pillow stocks carefully, chances of it being called up should be much higher. Yes, I am talking about reversals, capital reductions, change of management, astute use of resources, etc.... anything that will tranform the company.
Yes, these pillow stocks are the fundamental stocks that I talk about.... stocks where I have a damn comfortable margin of safety. Stocks that I can sleep on very peacefully at night because of the high margin of safety.... yet, any transformation of these stocks is likely to result in a multiplication of its share price. Hence, I contain my risk and yet, at the same time, if I got it right, I can increase my net-worth significantly. These pillow stocks are essentially low risk, high return investments.... but one needs truck loads of patience.
The other kind of stocks are the tikam stocks. These are stocks in which I will buy and sell for the fun of it. For these stocks, one needs to get a good feel of its market rhythm, the price bracket in which it moves and the market momentum. I seldom talk about these stocks because this is not where I make most of my money and this is not what I encourage others to do.
There is a lot of discipline required.... stealth and promptness is the name of the game. There really is no time to share as decisions have to be made very promptly and without hesitation or consultation. Moreover, even if one has the time to share, if one recommends a buy and then, a second later, he feels like selling instead, he may end up selling to those whom he recommended to buy. Either way, the person who shares willingly may instead compromise himself.
When one is a small trader, he may want others to join him. Hence, he has incentives to share his punt. But, as his trade size increases, he should have enough ammo himself unless of course he wants to unload to those whom he had recommended a buy.
Knowing that big money moves the market, taking a punt with a small investor is unlikely to be a wise strategy. Yet, knowing that the big money can already move prices themselves, then following their calls too is unlikely to be a wise strategy.
Hence, punting or tikaming the market is best done in stealth mode... secretly and by yourself.... with a bit of help from technical analysis and of course, more importantly, one's own gut feel of the current market sentiments.
One, I call my pillow stocks. These are stocks that I put under my pillow and every now and then, I will collect more. I usually collect more of these when the general market is down... hence, my need to get a feel of the market. Yes, I don't rush into collecting but I would time my entry as there is nothing better than to feel that you got it at its lows.
I am willing to wait years for these pillow stocks to mature. To me, this is like going to the casino and selecting a number and every spin after that, is free. Sooner or later, I feel that my number will be called. Of course, there are at least 600 stocks and it may take years before my number is called. If one selects the pillow stocks carefully, chances of it being called up should be much higher. Yes, I am talking about reversals, capital reductions, change of management, astute use of resources, etc.... anything that will tranform the company.
Yes, these pillow stocks are the fundamental stocks that I talk about.... stocks where I have a damn comfortable margin of safety. Stocks that I can sleep on very peacefully at night because of the high margin of safety.... yet, any transformation of these stocks is likely to result in a multiplication of its share price. Hence, I contain my risk and yet, at the same time, if I got it right, I can increase my net-worth significantly. These pillow stocks are essentially low risk, high return investments.... but one needs truck loads of patience.
The other kind of stocks are the tikam stocks. These are stocks in which I will buy and sell for the fun of it. For these stocks, one needs to get a good feel of its market rhythm, the price bracket in which it moves and the market momentum. I seldom talk about these stocks because this is not where I make most of my money and this is not what I encourage others to do.
There is a lot of discipline required.... stealth and promptness is the name of the game. There really is no time to share as decisions have to be made very promptly and without hesitation or consultation. Moreover, even if one has the time to share, if one recommends a buy and then, a second later, he feels like selling instead, he may end up selling to those whom he recommended to buy. Either way, the person who shares willingly may instead compromise himself.
When one is a small trader, he may want others to join him. Hence, he has incentives to share his punt. But, as his trade size increases, he should have enough ammo himself unless of course he wants to unload to those whom he had recommended a buy.
Knowing that big money moves the market, taking a punt with a small investor is unlikely to be a wise strategy. Yet, knowing that the big money can already move prices themselves, then following their calls too is unlikely to be a wise strategy.
Hence, punting or tikaming the market is best done in stealth mode... secretly and by yourself.... with a bit of help from technical analysis and of course, more importantly, one's own gut feel of the current market sentiments.