View Full Version : Financial markets and trading
ukrainian_CA
12-01-2007, 22:55
Hey,
I thought it would be interested to discuss some trading and financial ideas here.
I "saw" couple of you , includes Kui, discussed those over coffee and juice.
I love to use options. Never used futures or options on them yet.
I was thinking about using one future those on
www.intrade.com
I wanted to buy "Hillary will be a candidate from a democr. party in 2008", never bought it I thought I shouldve at 0.35.
that's not financial markets and trading, though; this is simply gambling... and it's a different world in the stock (or whatever vechicle to use) market...
ukrainian_CA
13-01-2007, 05:49
that's not financial markets and trading, though; this is simply gambling... and it's a different world in the stock (or whatever vechicle to use) market...
That was exactly what i thought. I assessed the risk as it was too high for me to handle over 2+ years. My wife would bid on that, I felt like it was going to a casino and freeze the money over 2 years... I passed.
I short and sell puts short. Most of the time I own ( buy as a part of a plan and options grant) and then sell covered calls aganist the LRCX (lam research) position. Lam Research is due to report next week, close to all time high. I just sold some ... Will sell more if we go beyond 55
I forgot tp clarify if that wasnt obvious that I work for lrcx. Enjoying it too.
that's not financial markets and trading, though; this is simply gambling... and it's a different world in the stock (or whatever vechicle to use) market...
Well that one example he's giving is gambling. Actually the whole concept of investing is gambling, for it involves financial risk.
I havent looked at the curent asking price for the Hillary contract meesh. At the previous 0.35, I'll asssume the asking price was $3.50 per contract/share. You've got to confirm this with me Meesh. Anyway what is the asking price now?
In any case, if you decide to buy the Hillary option, be sure to cut the risk by making a hedge on another candidate be it a fellow dem or against a gop candidate who might actually win. In fact... hedge it with the plain DEM to win 2008 option. You see Hillary might not even run. If her value has gone up significantly, I believe too many are over-speculating that investment with so many uncertainties coming up in the near future.
I have other questions regarding intrade.com meesh. Can I sell my contract before the specified event(Party Convention or General Election Day) to an open buyer on imtrade if the price is right? Are we using a binary 0-100 format where the specified event results at 100 and every other circumstance ends at 0(zero)? What is the payout per contract if your future ends up being correct?
You see... I'm not too sure if your payout is fixed at a certain rate per share or if the value of the contract(s) is your payout. Seems like a sucker bet to buy $50. per one(1) future contract if the payout is only $10 per one(1)share(if the event comes i.e. Hillary winning). You would be paying $5 to win $1 if what I'm guessin at is correct. You got let me know.
ukrainian_CA
13-01-2007, 05:58
Well that one example he's giving is gambling. Actually the whole concept of investing is gambling, for it involves financial risk.
I havent looked at the curent asking price for the Hillary contract meesh. At the previous 0.35, I'll asssume the asking price was $3.50 per contract/share. You've got to confirm this with me Meesh. Anyway what is the asking price now?
In any case, if you decide to buy the Hillary option, be sure to cut the risk by making a hedge on another candidate be it a fellow dem or against a gop candidate who might actually win. In fact... hedge it with the plain DEM to win 2008 option. You see Hillary might not even run. If her value has gone up significantly, I believe too many are over-speculating that investment with so many uncertainties coming up in the near future.
I have other questions regarding intrade.com meesh. Can I sell my contract before the specified event(Party Convention or General Election Day) to an open buyer on imtrade if the price is right? Are we using a binary 0-100 format where the specified event results at 100 and every other circumstance ends at 0(zero)? What is the payout per contract if your future ends up being correct?
You see... I'm not too sure if your payout is fixed at a certain rate per share or if the value of the contract(s) is your payout. Seems like a sucker bet to buy $50. per one(1) future contract if the payout is only $10 per one(1)share(if the event comes i.e. Hillary winning). You would be paying $5 to win $1 if what I'm guessin at is correct. You got let me know.
I think right now that contract is at about .50 meaning 50% probability of the event.
I forgot what the numbers are, basically it is value from 0 to 1, 0 meaning it doesnt occur, 1 - otherwise. Payouts will be either 0 or 1. I am too sleepy, gotta hit the bed.
Later, guys)))
ukrainian_CA
13-01-2007, 06:06
http://www.intrade.com/jsp/intrade/contractSearch/
Hillary about 49% then Obama or Edwards about 20 % each.
Outsise is at cold as it gets here, we expect 25F, or -4C by the sunset. That will be a record for lat 15 years.
ukrainian_CA
13-01-2007, 06:06
http://www.intrade.com/jsp/intrade/contractSearch/
Hillary about 49% then Obama or Edwards about 20 % each.
Outside is as cold as it gets here, we expect 25F, or -4C by the sunrise That will be the record low for last 15 years.
Also... with your your Lam Corps shares, I hope you've been investing also with a direct competitor of them? Be sure to also come up with different startegic models other than your current method(s) to increase your "in the money" chances. I'm certain your company offered you preferred stock options as a perk. My friend has the same deal at his workplace McAfee. The reason why I advise you into "privately" investing in the competition is because any broker will tell you it is foolish to invest in your own company. Do so of course, but keep in mind not to put your eggs all in one basket. For one thing your employment with the company is already a personal investment. No sense to put your paid income back into the company. Let the consumers do that for you. In many cases where companies fold, go under, get bought out, reorganized, or failed to meet their financial target... two things commonly happen. One there are lay-offs and Two a fluctuation (decrease) in the value of company shares. It is bad enough that you lose value of your shares and THEN all of a sudden to lose your job soon thereafter. Just ask the folks at ENRON.
Now your current stratagem is wise for it is safe and conservative. Just keep in mind of the pitfalls that exist when investing in your own company.
I think right now that contract is at about .50 meaning 50% probability of the event.
I forgot what the numbers are, basically it is value from 0 to 1, 0 meaning it doesnt occur, 1 - otherwise. Payouts will be either 0 or 1. I am too sleepy, gotta hit the bed.
Later, guys)))
okay... how much per contract???
the two things that interest me the least (or scare me the most): gambling and politics. :D :guw:
ukrainian_CA
13-01-2007, 18:40
the two things that interest me the least (or scare me the most): gambling and politics. :D :guw:
Exactly the reasons why I did not buy that.
Uncertainty is big issue too.
ukrainian_CA
13-01-2007, 18:48
Also... with your your Lam Corps shares, I hope you've been investing also with a direct competitor of them? Be sure to also come up with different startegic models other than your current method(s) to increase your "in the money" chances. I'm certain your company offered you preferred stock options as a perk. My friend has the same deal at his workplace McAfee. The reason why I advise you into "privately" investing in the competition is because any broker will tell you it is foolish to invest in your own company. Do so of course, but keep in mind not to put your eggs all in one basket. For one thing your employment with the company is already a personal investment. No sense to put your paid income back into the company. Let the consumers do that for you. In many cases where companies fold, go under, get bought out, reorganized, or failed to meet their financial target... two things commonly happen. One there are lay-offs and Two a fluctuation (decrease) in the value of company shares. It is bad enough that you lose value of your shares and THEN all of a sudden to lose your job soon thereafter. Just ask the folks at ENRON.
Now your current stratagem is wise for it is safe and conservative. Just keep in mind of the pitfalls that exist when investing in your own company.
Good thinking, Kui.
I had been in some smaller companies, start-ups, and my options eventually turned sour but .. since I bought shares of our main competitors, Soitec in France and IBIS in the US, I was much better off.... )))
With IBIS, I kept having some information about their technology, so I had been in and out of them even though IBIS had very low float and almost no options. They are three quarter dead by now.
With Lam Research, I just sold my last vesting of my options and we are not getting any more soon. We are given restricted share units now, vested in the future. So, it makes sense to sell not-covered (naked) calls when I need money for other projects in the future, if you know what I mean.
ukrainian_CA
13-01-2007, 18:55
okay... how much per contract???
each contract is $10, or 10 cents per point:
from 0 to 100 pts, 0 - being NO this didnt happen, 100 pts - Boolean YES.
Comissions are 4 cents per contract, quite steep, huh?
Well that one example he's giving is gambling. Actually the whole concept of investing is gambling, for it involves financial risk.
I beg to differ with you here. From my own investment experience, Investment is not gambling as a result of risk; there are, I believe, successful formula in investment. The question is how you manage risk.
Unless you would like, I will not go further into this now.
That was exactly what i thought. I assessed the risk as it was too high for me to handle over 2+ years. My wife would bid on that, I felt like it was going to a casino and freeze the money over 2 years... I passed.
I short and sell puts short. Most of the time I own ( buy as a part of a plan and options grant) and then sell covered calls aganist the LRCX (lam research) position. Lam Research is due to report next week, close to all time high. I just sold some ... Will sell more if we go beyond 55
I forgot tp clarify if that wasnt obvious that I work for lrcx. Enjoying it too.
Can you briefly describe what Lam Research does as its core business?
ukrainian_CA
14-01-2007, 00:45
Can you briefly describe what Lam Research does as its core business?
Lam makes semiconductor equipment for large chip-making firms.
Lam grew its share and now is the leader (45% and growing) in so-called etch market. Lam mostly sells etchers but also has recently introduced new products in couple other
processes, cleaning etc.
Etchers are special machines with low pressure plasmas that allow to carve in very narrow features in different materials on Si wafers. I won't go into more details, since it is very technical. All i will say It is very tricky to etch 40 nm channel or via in depths of 3 micron, for example in flash memory chips.
Customers are some or all of the following: AMD, ST Microel., Texas Instruments, Samsung, IBM, INTC, TSMC, UMC etc.
I'm going to have to break down what you are saying here.
I beg to differ with you here. From my own investment experience, Investment is not gambling as a result of risk;
If it clears your conscience to not consider it gambling, let me clue you in on a number of definitions.
1. to play at any game of chance for money or other stakes.
2. to stake or risk money, or anything of value, on the outcome of something involving chance.
3. to wager or risk money or something else of value.
4. to take a chance on; venture; risk.
5. any matter or thing involving risk or hazardous uncertainty.
6. a venture in a game of chance for stakes, esp. for high stakes.
Now I think six reasons is enough to weigh against your stance. I was born at night Jeff but I wasnt born last night. Besides I can tell you someone smarter made these sets of definitions... not me.
But let us put your definition in consideration further....
there are, I believe, successful formula in investment. The question is how you manage risk.
Could I come up with a succesful formula of risk management to cut the odds my way in a certain game in a casino and consider that "not gambling"???
Look I do this for a living. Call me a hedger, trader, broker, principal investor, venture capitalist, etc, etc, etc. It is gambling.
Unless you would like, I will not go further into this now.
I really hope you will go further into this.
I really hope you will go further into this.
I'm not going to, it takes too much time (literally, not because I Can't convince you). But my bottom point is clear.
Investment is a lot harder, but at the same time easier, than many people thought. Hard because it takes a lot of time to do an analysis; hard because it drives your feelings crazy; hard because it requires some honest thinking..
easy because it's less complicated than a lot of people thought. I'll rather go back to the original purpose of the post to discuss the definition of investment. But I beg to differ with you investment = gambling.
Lam makes semiconductor equipment for large chip-making firms.
Lam grew its share and now is the leader (45% and growing) in so-called etch market. Lam mostly sells etchers but also has recently introduced new products in couple other
processes, cleaning etc.
Etchers are special machines with low pressure plasmas that allow to carve in very narrow features in different materials on Si wafers. I won't go into more details, since it is very technical. All i will say It is very tricky to etch 40 nm channel or via in depths of 3 micron, for example in flash memory chips.
Customers are some or all of the following: AMD, ST Microel., Texas Instruments, Samsung, IBM, INTC, TSMC, UMC etc.
Get back to you later. Just for your information though: I know a lot more about the Hong Kong market (Hang Seng Index is the major index) than the US, but let's chat about the US market here too!
Later, I'm goign to watch the Reggina game now :)
I'm not going to, it takes too much time (literally, not because I Can't convince you). But my bottom point is clear.
No you wont convince me about something I actually do for a living Jeff.
investment is a lot harder, but at the same time easier, than many people thought. Hard because it takes a lot of time to do an analysis; hard because it drives your feelings crazy; hard because it requires some honest thinking..
easy because it's less complicated than a lot of people thought. I'll rather go back to the original purpose of the post to discuss the definition of investment. But I beg to differ with you investment = gambling.
You dont say??? :rolleyes:
Investment is a lot harder, but at the same time easier, than many people thought. Hard because it takes a lot of time to do an analysis; hard because it drives your feelings crazy; hard because it requires some honest thinking..
easy because it's less complicated than a lot of people thought. I'll rather go back to the original purpose of the post to discuss the definition of investment. But I beg to differ with you investment = gambling.
I have got to go back with what you've just said because I'm shaking my head with a little laughter. Is THIS your reasons why you consider it not gambling???? ... cause its a lot harder.... BUT easier.
You know what you've said above can be applied to any person walking in a casino and and coming out with more than what he came in with.
I wonder why you want to change the subject when you were 1/2 part in starting it??? Again some more definitions for you to ponder on.
Investment.... the putting forward of money or capital in an ATTEMPT to gain profitable returns, as interest, income, or appreciation in value.
note the word ATTEMPT...meaning risk involved.
Yeah change the subject. PLEASE.
Stezagud
14-01-2007, 09:53
Kui is right, gambling is gambling, whether you are investing in business or particular football results if you are taking a financial risk on something that isn't a certainty then it is a gamble!
You can certainly narrow the odds through research but no matter what you invest in there are variables beyond your control..
No you wont convince me about something I actually do for a living Jeff.
oh you are an investment banker or something along this line?
And for doing for a living, I think I'm doing it for a living, for now at least, too, since my main stream of 'income' comes from investment?
But no; from my philosophy of investment in the stock market, investment is not a gambling. You may laugh me off, but I don't consider 'put' or 'call' or 'long' or 'short' as a siginfiicant way to earn in the stock market. I Consider them as hedges, (from a persoal investment point of view, of course) and most of the time I do not beleive in Technical Analysis. Headline like, "Buy ABC now for it hit the bottom" never appeals me. If I invest in a stock, then I have enough (more than enough) reasonings to buy the stock. I have recent success with a stock that rose by 40% (not blue chips, nor <HK$10) and I still believe that it's very undervalued right now. So what people call as 'risk' to buy the stock, I think it's a bargain.
Ultimately, of course, you (investors) make the decision. If i don't know anything about the company then yes it's a gambling. But if you know enough about the company (its financial statement, management etc) then you are in a better position than a lot of people in the stock market.
You can certainly narrow the odds through research but no matter what you invest in there are variables beyond your control..
I definitel agree with you becaues not all risk can be reduced. So that is the side of the 'gambling' that they are talking abuot. I'm talking about the 'research' side, because it can significantly reduce your risk, (i.e., degree of gambling). i don't think we are on a different ground here, but I think a lot of people underestimate of just spending an hour or so looking at hte financial statements of a stock and to decide whether it's a good one or not.
Jeff... if you dont consider it gambling, I got no problem with that. It is what it is. No matter how good any investor out think their stratagem models are, whenever there are outside forces beyond the control of human intervention (CHANCE) you have whatever you want to call it (gambling, investing, etc).
(i.e., degree of gambling).
you mind explaining what you just posted here? Did I not just see you explain a reason because you're reducing your risk (i.e. degree of gambling) that it isnt GAMBLING? LOL!
I definitel agree with you becaues not all risk can be reduced. So that is the side of the 'gambling' that they are talking abuot. I'm talking about the 'research' side, because it can significantly reduce your risk, (i.e., degree of gambling). i don't think we are on a different ground here, but I think a lot of people underestimate of just spending an hour or so looking at hte financial statements of a stock and to decide whether it's a good one or not.
When you're talking about a research "SIDE" what other side are you leaving out? The gambling side perhaps? Otherwise... research is just research dude.
When you're talking about a research "SIDE" what other side are you leaving out? The gambling side perhaps? Otherwise... research is just research dude.
research is just research, of course; I"m just surprised (and I'm not saying you of course) that a lot of people underestimate the power of research and go for the peripheral route. I do believe that knowledge is the key in our life. Gambling side, of course. Insider information side? Knowing about the industry side? etc...
And perhaps, I never have luck in gambling; so I rather rely on something more concrete than just leaving it to the God of Luck, although I can only agree with you that luck is part of our life...
Again, all I"m saying is the mindset. If you treat investment as a gambling, then it's a gambling. But if you treat investment as something that requires time, energy, emotion etc., then it's certainly more than just gambling.
Arrr.. one more thing Kui, when I say research I'm not talking about Goldman Sachs or Morgan Stanley's analyst rating...
Anyway.. back to financial market... I have never really had any interest in hte US market, although I did try. The problem si that I'm a foreigner and I find it difficult to succeed in a market where you do not have an understanding of the culture; when I say culture I mean things like how things work, what works best... say everyone in America knows about Walmart but I'm not at all familiar with the company, even from my personal experience as I just do shopping. But say if you are talking my home place (hong Kong and thus Hong Kong stock market) I can tell you how good this restuarant, which is listed, is in Hong Kong, its reputation, its improvement (or no improvement) etc...
To Ukarinian: It sounds like Lam Research is one of the top companies in this area. I'm not at all familar with teh tech market, so I never imagine myself investing in it. But here are the things I usually consider:
1) Financial statement: Does it have a healthy balance sheet, income, and cashflow? Does it have debt? If income or EPS jumped significantly in one year, is it because of the expansion of business or one-time profit? Is current ratio an acceptable one in this area?
2) Management. Do they have a lot of turnover recentlyl? Did their CEO / Board buy back stock? Did their CEO stick to what they said a couple years ago about their strategy? In other words, do they stick with what they say?
3) What's the future about the company? is it a monopoly, or there are many competitors? What makes the company competitive in the future (e.g., able to consistently introducing new technologies).
4) Is the price (and I mean PE) too high? Is it acceptable to buy now? Chinese Insurance (2628) is a great stock, but it's currently trading almost 60 times of its EPS. is it worth THAT much, even if it's a great one?
Cheers....
j
ukrainian_CA
14-01-2007, 14:51
3) What's the future about the company? is it a monopoly, or there are many competitors? What makes the company competitive in the future (e.g., able to consistently introducing new technologies).
4) Is the price (and I mean PE) too high? Is it acceptable to buy now? Chinese Insurance (2628) is a great stock, but it's currently trading almost 60 times of its EPS. is it worth THAT much, even if it's a great one?
Cheers....
j
These are all quite typical questios things on has to consider before investing into a comp.
I will get back to you later. We are having a birthday party tonight, need to get ready.
P.S.: what do you think of PEG number and the 3 questions I left above in respect to GOOG. I know one guy for is retiring from Google and he is only 40+ or so.
I see two questions, not three?!
3) Future is positive if not bright. The management is definitely very competitive, as recently seen by the acquisition of youtube. This is also consistent with their strategy to acquire other smaller 'companies' or 'firms' early to edge out their competitiors, such as yahoo!. I don't consider it monopoly, but they have been very quick in snatching acquisition opporutnity. Some say that acquiring youtube is a failure because of the litigation issue, but I believe that GOOG has made the right move because 'watching video online' IS the trend now, and technology is all about trend.
Who's the Person of the Year, according to the Times magazine? YOU. not the Chinese president, nor Bush. YOU. We are the Person fo the Year because of our ability to communicate faster, and upload videos and to get first-hand information. Police abuse? busted. Best moment in your life? Shown. attract potential employers by makinga video? no longer a dream. With youtube, you can do everything.
And GOOG got it, first.
If the line of record that GOOG shows is not enough to convince people that they can remain competitive in the years to come, I don't know what willl.
4) Good question. PE ratio = 64.26 ( Idon't have the PEG ratio with me here ,but I imagine it to be quite high as well?) and that's 127.25% above the industry. Does this mean that it's expensive? No. It simply reflects the potential that Google has. Yoru question about retiring from GOOG and he is only 40+ or so, that I don't know, but I know that GOOG has just been selected as the best company to work with. What does this tell you about Google? They take care of their people, and Human Resource, in my opinion, is an extremely important asset that again will give them a competitive edge. Research (in business about organization and management) shows that there is a positive correlation between job satisfaction and job performance, job satisfaction and commitment, and a host of other positive outcomes such as organizational citizenship behavior. GOOG in this area thumbs everyone.
In terms of recent price, GOOG is trying to beat the resistence again. Should it break, it may be a good time to buy. I hope that this will answer people why GOOG is 160% up a year ago while Yahoo down by 20%? The high PE (or PEG) ratio doesn't mean that it's expensive as a result of people betting (or gambling) on the future; it's a truthful reflection of their competitive edge.
J
kastriot
14-01-2007, 17:11
....................
kastriot
14-01-2007, 17:13
I would have to agree with Jeff on this, you can`t call Investment a gambling, not in its literate meaning..
Definitely you can control most of the variables,and the ones you can`t with a lot of research(a successful one) you can manage the risk to its minimum... And all this is valid if we are talking about stable Country,with stable economy and politics.Not some country in transition.
I won`t bother with formulas but I have to say this. How come if its gambling the same rich people get richer by day.. or how come they always invest in the right place...is it because they are LUCKY,or because they simply know smth that most people don`t..People like Bill Gates, Warren Buffett,Lakshmi Mittal and my favorite one George Soros (what this guy did can`t not be consider gambling,thats work of art). But I am younger than all of you here so I`ll just shut up listen to what you have to say :respect:
But I am younger than all of you here so I`ll just shut up listen to what you have to say :respect:
I'm pretty young too :)
Let me be diplomatic here Jeff. I see where you are coming from by not considering it gambling. To a certain dergree of cutting risk, and where analysis becomes close to being a science, investment=gambling is far and wide apart. However from the insider view that I have, I'm well aware of the beast that lurks in and around the financial waters.
However from the insider view that I have, I'm well aware of the beast that lurks in and around the financial waters.
*nod* *nod*
Anyway.. back to financial market... I have never really had any interest in hte US market, although I did try. The problem si that I'm a foreigner and I find it difficult to succeed in a market where you do not have an understanding of the culture; when I say culture I mean things like how things work, what works best... say everyone in America knows about Walmart but I'm not at all familiar with the company, even from my personal experience as I just do shopping. But say if you are talking my home place (hong Kong and thus Hong Kong stock market) I can tell you how good this restuarant, which is listed, is in Hong Kong, its reputation, its improvement (or no improvement) etc...
Being a foreigner is actually an advantage when playing in the US Market. You should consider gettin in the game dude. Go international.
Now I'm impressed with your knowledge as of yet. What I do ab intra the kitchen is something entirely different though. I can care less if a company is being run well or not. Just one example that I deal with are brokers (some in different markets like DAX, LSE, Nikkei, et al.) that I know on a professional level who are lookin to trade specific derivatives on any given transaction. I cant trade something an x broker has that I need, unless I have what he's looking for. The game of arbitrage is at play between myself and other parties. This is why I would encourage you to at least try and trade in the US market. I dont know... perhaps your happy at the what you're doing right now which seems to be doing well for you. However you said you like to hedge you investment. Consider this Jeff... what may be trash in the US might be gold in Hong Kong. By playing the different markets Jeff, you can get an advantage at the price differentials.
Being a foreigner is actually an advantage when playing in the US Market. You should consider gettin in the game dude. Go international.
Now I'm impressed with your knowledge as of yet. What I do ab intra the kitchen is something entirely different though. I can care less if a company is being run well or not. Just one example that I deal with are brokers (some in different markets like DAX, LSE, Nikkei, et al.) that I know on a professional level who are lookin to trade specific derivatives on any given transaction. I cant trade something an x broker has that I need, unless I have what he's looking for. The game of arbitrage is at play between myself and other parties. This is why I would encourage you to at least try and trade in the US market. I dont know... perhaps your happy at the what you're doing right now which seems to be doing well for you. However you said you like to hedge you investment. Consider this Jeff... what may be trash in the US might be gold in Hong Kong. By playing the different markets Jeff, you can get an advantage at the price differentials.
Right; I appreciate your input. For now, I am yet to feel comrfortable investing in the US market, but I may in the future. One good thing about investing in HK is that there is no capital tax. If I earn $1, I earn $1. In the US, if I earn $1, I earn... how much? $0.5? or $0.6 only? And, as you know I'm a young kid, so I don't have enough capital to get into the investment market. BUT I have started, and I think this is important considering my age. Also, I treasure the experience to go through the emotions... So, I would consider myself a young investor then, but not those that go reckless and buy whatever people ask him/her to buy...
Right; I appreciate your input. For now, I am yet to feel comrfortable investing in the US market, but I may in the future. One good thing about investing in HK is that there is no capital tax. If I earn $1, I earn $1. In the US, if I earn $1, I earn... how much? $0.5? or $0.6 only? And, as you know I'm a young kid, so I don't have enough capital to get into the investment market. BUT I have started, and I think this is important considering my age. Also, I treasure the experience to go through the emotions... So, I would consider myself a young investor then, but not those that go reckless and buy whatever people ask him/her to buy...
I'll also assume that with your youth, you're also expanding your horizons via University (unless done already). Good as you seem to be on your way to making something big of yourself. I know so by just reading this...
Who's the Person of the Year, according to the Times magazine? YOU
You're well on your way. "Young" investor or not, I'm impressed with you just being investor.
Yeah... I like the tax breaks HK has. If I'm not mistaken, do you guys have a flat tax? Over here in the US, for every $1. earned can fluctuate .50-.60 depending on the overall earining. After a certain x amount of dollars, it will be considered a capital gain and thus taxed as such.
Well I must have missed you Jeff between our last two postings. Anyway let me go on with arbitrage. Today was a good example to capitalize on price differentials of certain commodities since the US market is closed today. So closing values of certain commodities are fixed until the next trade day here. I can take advantage of the commodity by putting the contract up in the European market that was open today. Can you see the developement here? Seriously dont hesitate to go global when you're ready.
Well I must have missed you Jeff between our last two postings. Anyway let me go on with arbitrage. Today was a good example to capitalize on price differentials of certain commodities since the US market is closed today. So closing values of certain commodities are fixed until the next trade day here. I can take advantage of the commodity by putting the contract up in the European market that was open today. Can you see the developement here? Seriously dont hesitate to go global when you're ready.
Hi, I am sort of familiar with the concept of arbitrage, but I am never sophisticated in this area, at all. What do you think about this: If, say, CNOOC (HK: 0883; US: CNOOC), an oil company that is listed in both the US and Hong Kong, rose by about 2% yesterday after the recent drop in oil price. Do you think it'll make sense to buy CNOOC in the US now? Can this be considered as arbitrage?
When I am ready... I don't know when this is going to be, especially if I'm pursuing my graduate study. But, I'm at least happy with the progress that I'm doing, I know I have started ahead of many people... Anyway, thanks for your compliment.
ukrainian_CA
15-01-2007, 14:21
I see two questions, not three?!
3) Future is positive if not bright. The management is definitely very competitive, as recently seen by the acquisition of youtube. This is also consistent with their strategy to acquire other smaller 'companies' or 'firms' early to edge out their competitiors, such as yahoo!. I don't consider it monopoly, but they have been very quick in snatching acquisition opporutnity. Some say that acquiring youtube is a failure because of the litigation issue, but I believe that GOOG has made the right move because 'watching video online' IS the trend now, and technology is all about trend.
Who's the Person of the Year, according to the Times magazine? YOU. not the Chinese president, nor Bush. YOU. We are the Person fo the Year because of our ability to communicate faster, and upload videos and to get first-hand information. Police abuse? busted. Best moment in your life? Shown. attract potential employers by makinga video? no longer a dream. With youtube, you can do everything.
And GOOG got it, first.
If the line of record that GOOG shows is not enough to convince people that they can remain competitive in the years to come, I don't know what willl.
4) Good question. PE ratio = 64.26 ( Idon't have the PEG ratio with me here ,but I imagine it to be quite high as well?) and that's 127.25% above the industry. Does this mean that it's expensive? No. It simply reflects the potential that Google has. Yoru question about retiring from GOOG and he is only 40+ or so, that I don't know, but I know that GOOG has just been selected as the best company to work with. What does this tell you about Google? They take care of their people, and Human Resource, in my opinion, is an extremely important asset that again will give them a competitive edge. Research (in business about organization and management) shows that there is a positive correlation between job satisfaction and job performance, job satisfaction and commitment, and a host of other positive outcomes such as organizational citizenship behavior. GOOG in this area thumbs everyone.
In terms of recent price, GOOG is trying to beat the resistence again. Should it break, it may be a good time to buy. I hope that this will answer people why GOOG is 160% up a year ago while Yahoo down by 20%? The high PE (or PEG) ratio doesn't mean that it's expensive as a result of people betting (or gambling) on the future; it's a truthful reflection of their competitive edge.
J
G in PEG is the key.
Since the value of a company can be thought of as the NPV of all future earnings, the growth factor affects the company's value tremendously.
To assess the value of GOOG one needs to project the future growth rates and assume that earning grow a certain way with respect to the growth of revenue, isnt this called some kind of leverage?
It is clear that a company cannot sustain the growth of 50-100%.
Many established industries that eventually become commodity industries, i.e., auto-, chemical, semicondutors have gone through a phase with explosive growth. Take semis, for example, over last 30 years the average growth rate has been 16%, now everyone agrees that the semis have almost reached "commoditization" and the g. rate will be in mid-to high single digits depending on the world economy growth.
Also, every new development and cycles seem to take less time with
the progress of civilization.
I expect that the internet industry to reach maturity and "commoditization" faster than the semis have. So the point is that at some point the growth rates projected for the future won't as stellar and the value of the companies will be lower. This is all hand-waving, of course, and noone really knows what models and future growth rates the big guys are using to evaluate this or that company.
My prediction is that GOOG will start to tank slowly but surely, I am not sure when though.
Shorting is a risky thing though.
I am sure you guys heard this problem:
lets consider a stock that flactuates between 50 and 100. It cycles perfectly everytime peaks at 100 and bottoms at 50.
One investor buy ideally at 50 and sells at 100, the other one sells short at 100 and covers at 50. Whose rate of return is higher? I think it is quite obvious, isnt it?
ukrainian_CA
15-01-2007, 14:29
. How come if its gambling the same rich people get richer by day.. or how come they always invest in the right place...is it because they are LUCKY,or because they simply know smth that most people don`t..People like Bill Gates, Warren Buffett,Lakshmi Mittal and my favorite one George Soros (what this guy did can`t not be consider gambling,thats work of art). :
We have got a typical selection problem at hand.
You mention these name because they had already become rich (invested in the right place at the right time).
They have already been pre-selected from billions of people.
The other people who were not as successful are not even considered or mentioned. Am I making myself clear?
ukrainian_CA
15-01-2007, 14:35
Well I must have missed you Jeff between our last two postings. Anyway let me go on with arbitrage. Today was a good example to capitalize on price differentials of certain commodities since the US market is closed today. So closing values of certain commodities are fixed until the next trade day here. I can take advantage of the commodity by putting the contract up in the European market that was open today. Can you see the developement here? Seriously dont hesitate to go global when you're ready.
In an ideally efficient market, there is no arbitrage opportunities.
These arbitrage opportunies can exsist only when markets are not fully efficient, there is some information that some parties are not aware of :-)
Right, Kui?
ukrainian_CA
15-01-2007, 14:51
Hi, I am sort of familiar with the concept of arbitrage, but I am never sophisticated in this area, at all. What do you think about this: If, say, CNOOC (HK: 0883; US: CNOOC), an oil company that is listed in both the US and Hong Kong, rose by about 2% yesterday after the recent drop in oil price. Do you think it'll make sense to buy CNOOC in the US now? Can this be considered as arbitrage?
That would be an arbitrage if the price in the US did not change,
however in efficient market when you would want to bid for CNOOC in the US, the price would already be higher.
That would be an arbitrage if the price in the US did not change,
however in efficient market when you would want to bid for CNOOC in the US, the price would already be higher.
Theoretically we all know about efficiency theory, but we all know that it's not that efficient (refer to Buffett's essays on his view on the efficiency market theory).
On Google: I agree with you about this, and as an investor I won't go for GOOG personally. But if anyone is interested in tech stock, then GOOG should be given prime consideration. Other than that, I pretty much agree with what you say. Pro and con... pro and con... these are the things that investors have to consider.
Anyone of you fmailiar with the stock market in HK? Let me share some of my stories.
I remember telling my friend that Cathay Pacific (HK: 0293) will be a great buy like a year ago because oil prices have already gone up and people are underestimating its values and its management. (Due to liquidation reason I didn't buy it at that time, as I spot an even more attractive investment). My friend dismissed me saying that there are just too many factors that can lead its stock price tumbling. Ex that she gives: oil price, 911 attack or any similar attack, competition... and my reply to her is that yes, it's true that it fluctuates with oil and oil has been a primary demon against its stock. But I said at that time that taken oil price into account, the price is still very low, when you compare with other chinese-owned air companies. More, cathay pacific has great customer service, brand, vision of management (what's better than an acquisition of Dragon Air which has many access to mainland China. This is a little bit of a history: Cathay Pacific is owned by Swire, a British company that also invests heavily in Hong Kong property (80%). As it's a British company, there are many reasons why Chinese governments have prevented them from exploiting in mainland China. The fact that cathay Pacific is successful in acquiring Dragon Air, therefore in my opinion, is a break-through). As a blue chip, I thought at that time that Cathay was undervalued. It was $14 in the summer when I told my friend about Cathay Pacific, and now it's $20.95. It rose yesterday despite oil price increases.
Wait, I'm not trying to say that I'm smart or what, that I got something right; I'm just pointing out that investment that looks like s*it to people can be a real germ. Unfortunately, my knowledge is just this, and I can't delve into more insider information, or even more powerful evidence. But a preliminary analysis of Cathay's background should warrant further investigation into its financial history.
ukrainian_CA
16-01-2007, 01:03
...my favorite one George Soros (what this guy did can`t not be consider gambling,thats work of art).
Are you aware that George Soros since he had made his money on the collapse of the British Pound has lost quite an amount in different hedge funds, at least in two funds. He lost nillions but not his own money.
There was an article at prudentbear.com last year or so.
BTW, did you read/hear about Amaranth's hedge fund loss last year?
http://www.washingtonpost.com/wp-dyn/content/article/2006/09/19/AR2006091901388.html
Pretty education story, confirming the old saying that
"The markets can remain irrational much longer than one can remain solvent".
The hurricane season did not show up last year, so this fund went belly up
with its bets. And they thought they had one of the best "risk management"
policies in place ...
As the collapse of Long Term Capital management (LTCM) did nearly a decade ago, that “controlled” or “hedged” risks can easily go awry ... :hammer:
In an ideally efficient market, there is no arbitrage opportunities.
These arbitrage opportunies can exsist only when markets are not fully efficient, there is some information that some parties are not aware of :-)
Right, Kui?
Let me back up. A few more postings than I had expected so let me answer this question first and than get to answering Jeff's question.
For your question... YES.
Arbritrage is succesful if certain parties are not aware of certain vital info of a commodity, etc, etc.
Limitation to an arbitrage can also occur in certain high profile regulated bodies such as OPEC that set prices for all petrolium for member countries and industries. This invokes the Law of one price concept. YET... when it comes to certain by products of petrolium such as GASOLINE, supply and demand in different markets can give a trader succesful arbitrage. Limits to arbritage also occurs when there is no free trade agreement rule between to markets.
Arbitrage does work if certain buyers out there lack the ability to acquire/sell some particular item(s) in a different market for a good price opposed to an identical item(s) in their respective market.
This is how some arbitrage works in my world. Let me use a silly analogy to make my point.
Broker a has in his possession something I need(want). What he has in his possesion is worthless to him yet it is marketable outside his market control. After a negotiated bid/ask settlement is made on the value of such item(s), he expects a trade not in $US or Euro or YEN. He wants me to provide a specific derivative that is expensive in his market and cheap in my market. This works not only in goods (hard or soft), commodities, but also certain options not available or not yet valuable in a given market.
Analogically speaking, arbitrage would be a semi-truck full of mango's crossing into the Canadian border to deliver to broker/trader a who has in his wharehouse pallets of preserved bear gall bladders (to later broker in China) that I will trade with him. From there we take these items into familiar markets. We attempt to cut out the middle by placing ourselves there without intruding on each others market. Ask no questions, tell no answers in all our deals between each other.
Keep in mind that this is only one small facet in a bigger diamond that I operate around. In about 7-8 years I'll gladly hang my boots up, retire and do something totally different. 40yrs of age is my target, yet it could go for another 17 yrs til I hit 50. I'm thinking really of cashing in at 40 though. From there I wouldnt mind living in solitude someplace really really quiet.
Hi, I am sort of familiar with the concept of arbitrage, but I am never sophisticated in this area, at all. What do you think about this: If, say, CNOOC (HK: 0883; US: CNOOC), an oil company that is listed in both the US and Hong Kong, rose by about 2% yesterday after the recent drop in oil price. Do you think it'll make sense to buy CNOOC in the US now? Can this be considered as arbitrage?
In theory... YES. Keep in mind what Meesh has said. An efficient market will work fast to adjust the differential. How fast to you have to be? Like lightning fast. Keep in mind that other brokers/arbitrageurs with different intentions will be in the game against your target interests. You want to engage in arbitrage when the Hong Kong holding DROPPED 2% lower than the market closed value of the American Exchange markets. Sell your holdings at the next opening American value +2% before the adjustment of -2%(even trade) takes place.
I have to go on about this arbitrage concept Jeff. Remember our slight disagreement about investing? Where I considered it gambling whilst you did not? You can take advantage of teach others risk assesment/threshhold to influence brokered deals. Different philosophies in the market is a key component in trading and succesful arbitrage. A no brainer of course but worth mentioning.
G in PEG is the key.
Since the value of a company can be thought of as the NPV of all future earnings, the growth factor affects the company's value tremendously....
I would do so, i.e. play this ratio in new or developing companies, the risk of course that such companies dont go bottoms up. You cant count on all well established companies growing bigger than they already are. Growth IS the key. So good point Meesh and your latter assesment of certain growth prospects of the aforementioned companies/industries.
Stezagud
18-01-2007, 11:20
I have to go on about this arbitrage concept Jeff. Remember our slight disagreement about investing? Where I considered it gambling whilst you did not? You can take advantage of teach others risk assesment/threshhold to influence brokered deals. Different philosophies in the market is a key component in trading and succesful arbitrage. A no brainer of course but worth mentioning.
Yeah, that is one area that isnt gambling but you really do have to be quick/have great connections to take advantage. There is a sports equivalent where you can bet with 2 different bookies at different odds on the same event, guarenteeing you will win whichever way the event swings. I've found a few myself but generally dont have the time to go looking for them and tend to come across them by chance, though there are companies that scour the markets and sell the information on.
A good example will be in the Aussie open right now, these are perfect as the event can only go one of 2 ways, guy A or guy B will win. As the players tend to be of different nationalities its often the case that domestically they will be backed at shorter odds than elsewhere (meaning that the opponent will be at longer odds than he should be) for example 2 players who are generally considered evens to win may be both at 6/5 with their domestic bookies. This is a small difference on paper but it is a guarenteed 10% profit.
Not strictly related to the topic but the principle is similar and its certainly an interesting way to make money, though betfair will probably kill it in the long term :cool:
Well I had done a theory of what Moggi was doing or for what motive. I had theorized he influenced Football matches across the board in order to cut the risk in dealing with gaming houses.
Stezagud
18-01-2007, 11:31
definately plausable. Managers, chairmen and so on all have faster access to info and im sure a lot use it to their advantage, just not on the scale Moggi potentially did.
I know that a lot of Harry Redknapps close friends made plenty of money backing him at long odds to return to Pompey from Southampton. At the time they were backing him both teams chairmen and Redknapp all strenuously denied it and he was floating around 30-1 with about 10 guys ahead of him in the race for the job, a few days later and he was back at Fratton Park ;)
ukrainian_CA
18-01-2007, 16:14
http://finance.yahoo.com/q/bc?s=LRCX&t=5d&l=on&z=m&q=b&c=
This is why we sold at lrcx at 52-54 and kept short calls, (50 January07).
Risk/reward was too high, especially when considering that I work for this co.
and my future is dependent on their performance too.
Sigh... Let me get with market forecasts for 2007. I'm banking on a trend that hasnt failed for about the last 20-25 years. Keep in mind that near the ending of a 2 term US Presidency, we normally see a mini crash i.e. 1987 (Reagan), 2000 (Clinton), and perhaps another of this term. It has nothing to do with economic policies of any particular administration, but more so of the market cleaning the trash on its own. It just coincidentally matches the time close to the end of a 2 term Presidency. Perhaps in 2007 due to an over speculated market creating an exuberant environment? Its ripe time to thinning out the herd. My guess of course. I'm looking perhaps in March or sometime August-October. Again a wild guess, but I sensed some things of interest in what Bernanke has said recently.
To continue... let me sway a bit from the doom and gloom of the financial market and do a little deviation of the topic and talk a lil bout another market called calciomercato. I chose to do it here cause the other threads are full of wrong speculation and I prefer to do this with those who know how market forces and forecasts work (Meesh, Jeff, and Stez).
So here's one small bit of analysis to ponder on. With regard to Cafu... did we aqcuire him as we did Gila for the future prospect of this team? Its a trick question but something I have established as a possibility move by Milan. I'd like one, either, all three, or anyone else to come up with an answer to my "clue in" forecast. I'm hoping anyone of you have picked up on the reasons as I have to why Cafu is still with us and why we got him in the first place? Impress me and we'll analyze this question.
btw meesh... please tell me that the one day decline of LAM last week didnt affect you? I hope not.
ukrainian_CA
22-01-2007, 14:22
btw meesh... please tell me that the one day decline of LAM last week didnt affect you? I hope not.
Neah, it did not:)
Since I am diversifying out of it mostly and fixing gains with covered calls etc.
I cannot be affected much until we start losing business market share.
I knew that the management was thinking in December about mid.07 orders, that is their forecast of future orders. Since our business is intrinsically cyclical in nature it would be too stupid to hold on and wait for future upside from here. Plus, I knew I would have to start some remodelling in Spring elsewhere I had to plan for it. I think semi cycle will take us down maybe even more and ...
And at some point there will be a good entry point, sorry for the unintended pun.
Isn't this cyclical?
http://finance.yahoo.com/charts#chart8:symbol=lrcx;range=my;indicator=volume;charttype=ohlc;crosshair=on;logscale=off;source= undefined
And at some point there will be a good entry point, sorry for the unintended pun.
Isn't this cyclical?
http://finance.yahoo.com/charts#chart8:symbol=lrcx;range=my;indicator=volume;charttype=ohlc;crosshair=on;logscale=off;source= undefined
Sorry... for my tardiness at looking at this. Yes Meesh the trend here looks like high and lows between a 13-14 day perdiod. Seems the stock is very volatile this year as in comparison to 2005-2006. Currently the trend looks cyclical.
ukrainian_CA
30-01-2007, 01:39
Sorry... for my tardiness at looking at this. Yes Meesh the trend here looks like high and lows between a 13-14 day perdiod. Seems the stock is very volatile this year as in comparison to 2005-2006. Currently the trend looks cyclical.
lrcx used to be even more volatile with beta of 3.5 or something. It should be smaller these days, but still...
I must disappear for few days or longer. Hope will talk to you soon.
I must disappear for few days or longer. Hope will talk to you soon.
Disappear??? Is it about that "thing" we discussed earlier? Good luck to ya and I hope everything comes out well Meesh.
ukrainian_CA
05-02-2007, 18:47
Disappear??? Is it about that "thing" we discussed earlier? Good luck to ya and I hope everything comes out well Meesh.
Oh, thanks, my virtual friend :-)
I am back. Twas a success, the surgeon was good and managed to put the solid piece back onto its place. My head have been swelled and sore and now I feel fine. I cannot play my favorite game for a while though.
Kui, I will send you a link in PM about the stuff we talked about.
ukrainian_CA
28-02-2007, 14:33
Yesterdays plunge and the 3 pm drop reminded me a lot of Oct. 19, 1989 crash. Glad to see that the technical issues didn't escalate into something bigger than what we saw at 3p.m. EST on Feb. 27th.
Do you think this drop is just a beginning of a large correction?
Several days ago I thought that the equity markets would start correcting sometime soon. IMO, we need to shave off 10-15% off SP500.
Posted a month and a half ago! D@mn I'm too good.
http://www.milanmania.com/forums/showpost.php?p=410859&postcount=54
Sigh... Let me get with market forecasts for 2007. I'm banking on a trend that hasnt failed for about the last 20-25years.............. Perhaps in 2007 due to an over speculated market creating an exuberant environment? Its ripe time to thinning out the herd. My guess of course. I'm looking perhaps in March or sometime August-October.
Not too bad by zero-ing in on it by a couple of days/weeks. Yesterday was the slaughter but today was the bloodfest as the sharks went for a feeding buying up knock-down investments. I kinda feel bad because I knew this would happen and it was just too hard to nail this within closer time frame. Nonetheless, people should have heeded the warning signs months ahead and made the proper safeguards for it. Of course... who would ever know this one would occur.
I'll talk a little bit more about it in another post.
Yesterdays plunge and the 3 pm drop reminded me a lot of Oct. 19, 1989 crash. Glad to see that the technical issues didn't escalate into something bigger than what we saw at 3p.m. EST on Feb. 27th.
Do you think this drop is just a beginning of a large correction?
Several days ago I thought that the equity markets would start correcting sometime soon. IMO, we need to shave off 10-15% off SP500.
Anyway... back online here. By setting myself up for this, me, my partners, and our clients did not get affected ny this hiccup at all. As I said in the previous post as well as the post made a month and a half ago, I was expecting this to happen and advised all concerned about this. Most heeded but those who I know invest through other means i.e. online brokerages etc, kinda took it in the rear. Perhaps and oppurtunity for me to change there ways.
On a personal level, so many people have been bombarding me with how well I handled in this little panic that occured Tuesday. So you all know... I happen to be on my typical personal day off and was teeing off at hole #3 at my usual golf haunt. LOL! Some other club member behind me was all in a tissy fit of panic wonderig what the heck was going on with his investments. Him not being anyone I do business with got a response by moi... "Excuse me... I'm trying to hit my tee shot here. Quiet PLEASE!". LOL!
Let see here... Monday morning I had a chattie with Debs on instant message. I had to cut our conversation short because I was closing portfolios of mine as well as some clients. She remembers it go ask her. I recall telling her I was having a really busy day as Mondays is my typical busy days. It is so because, and as a coincidence I always play golf at my country club on tuesdays. I dont like to hold many investments out there on days where I do not physically participate in trading. I can already see the red flags there if anyone in enforcement were to look. LOL! Well I got my alibi and it is legit. LOL!
And on now to Wednesday. Another day where I chose not to trade. Why the heck would I do that??!!! Granted it was a good day to buy and buy cheap. Personally I dont do that. Its not in my moral fiber to go and partake in the bloodfest with the sharks. Do I lose out? In some ways... perhaps, but really not at all. Its days like these where I am glad to be in no way part of this madness. Let the dogs and ***s play in the filth I say.
Hopefully no one here got it real bad on Tuesday. Actually at -400 something, it isnt really bad at all. Like I said... thinning out the herd happens occasionaly and is a good thing. We havent seen the bad happen yet Meesh. So to answer your question FINALLY... yes tuesday would've been one of those large corrections. From here, it would be up to the mood of the investor to where this wild horse will go. We already had this huge correction Tuesday. I suspect that the remaining correction will be a slow slip into a bear market. If not, and the bull is still in the mood to buck, watch out for the cowboys out there who will again make sure there is another LARGE CORRECTION, sometime in last quarter. Dont mark me on this but I always keep a steady eye on the first and last qrtrs for these things to happen.
Yep, I can back Kui up, we did indeed chat a bit on Monday and he had to leave due to stuff he was working on. Wait, why am I vouching for this guy? He could be an insider trader for all I know and Feds will be after him!! :str: :str:
Kui, the Stock Market is like someone speaking in Greek to me. Is there cause to be concerned after that huge one-day drop? I ask b/c my Dad's got some stock or somethign in his retirement funds and that last big drop a few years ago hit him hard. Not only that, but my school's retirement thangie is stocks and bonds.
The term "large correction" always puzzled me and made me somewhat suspicious. Can you explain it in real simple terms??
BTW, you do realize, don't you, that it's a miracle I'm even posting in this topic? I don't understand this stuff....
Yep, I can back Kui up, we did indeed chat a bit on Monday and he had to leave due to stuff he was working on. Wait, why am I vouching for this guy? He could be an insider trader for all I know and Feds will be after him!! :str: :str:
Trust me toots. I do things by the book... somewhat. LOL! All I'm saying is that I wasnt there for the riot cause I golf on those days(Tuesdays) I wasnt taken to the slaughter house cause I knew something like this would happen sometime this year; when I heard about it on the #3 Hole teebox, it didnt surprise me one bit. Dont forget I was only off by like a couple of days when I predicted March and/or August-Sept that this would happen. Besides this wasnt too bad. There will be days in the future where it gets so bad that the market as a mandate freeze all trading on such and such a day if there is a huge one day loss.
Kui, the Stock Market is like someone speaking in Greek to me. Is there cause to be concerned after that huge one-day drop? I ask b/c my Dad's got some stock or somethign in his retirement funds and that last big drop a few years ago hit him hard. Not only that, but my school's retirement thangie is stocks and bonds.
To answer your question first off. No... there is no need to be concerned after this one day correction. Now the folks that need to hear this are the idiots who are trading in a fit of panic. I say so and believe it philosophically because only idiots like sheep would jump on the band wagon in droves leaping over a cliff to their doom. Sheep have been known to do this. The "wolves" didnt even start or engage in the chase. They merely watched from a hillside at the chaos and on Wednesday got a free meal at the bottom of the pit (and profited from it). I'm not one of those wolves, as I said... I played golf. LOL! That's what you and the world saw on tuesday. Keep in mind Debs, this may have been a good thing. Hint...hint... Too many sheep puts a detriment on the livelihood of the whole herd. I actually have a headache today, not because of the turmoil but because my eyes keep :rolleyes: rolling back :rolleyes: at hearing the nonsense reasons for Tuesday. Here's what I learned over the years. People hate it when I use these silly analogies all the time, but this is the best way I can explain it....
"Many people know how to swim and do so very well. What will get them into dire trouble is not understanding the waters they tread in." - Kui :devf:
You can apply this principle to just about anything out there. One may be very learned, but do they no how to teach? Many know how to enjoy food, but can they cook? Many can operate a vehicle, yet do we not see too many who do not know how to drive? Anyone can know how to play cards, throw dice, pull a slot machine lever, yet in no way should they ever run or work within a Casino! Them snots who live in Seattle drink a lot of coffee, yet I know these louts know nothing about growing and harvesting it but they truly believe themselves top be the "coffee experts". You see... too many people partake in things where in truth they're quite oblivious to the environments which they dwell in when partaking in it. A big one that irks me is the stock market, which includes many licensed security brokers who dont know their rear from their elbows. I had been one of those idiots years ago and I learned from it. :devf: You can quote me on this one as well! :devf: "Many continue to live the life of sheep instead of a shepherd."
For your pop's investment and for your school's/work retirement fund, "be sure not to put all your eggs in one basket". Remember that 'lil back and forth I gave you on IM? Hedge or diversify your money so that a loss in one sector is a gain for you in another. Heavily invested in a bank? Back it up with equity in gold in the case where a bank may fail. It can be as easy as groceries being to high... perhaps a small garden on your property. Them interest rates too high on your credit cards/loans? I say invest in those very institutions (other than borrowing) to reap dividends so that your interest rates are cut down to nil. Electric/heating for your home, gas for your auto to high??? Perhaps reciprocate that expense/loss with an investment/gain return in the energy and utility market Debs. There's one hometown company I have for you and it is doing me very well. PPL Corp (Allentown, PA) is an energy and utility holding company, that engages in the generation, transmission, and distribution of electricity primarily in the northeastern and western portions of the United States. PPL Corporation (NYSE: PPL) on Friday increased its common stock dividend by 11 percent. With this increase, the dividend will have risen 130 percent over the past five years. So you and your dad dont need to know Greek to inderstand what I'm getting at. There's a big difference between you and the idiot. The idiots believe because they know how to swim, they're experts in any environment(water) they tread in.
The term "large correction" always puzzled me and made me somewhat suspicious. Can you explain it in real simple terms??
LOL! Let me take my LDS priesthood hat off and now just don the securities hat on. You'll get this large correction when there is an exuberant market. What is an exuberant market??? There are a number of factors. Again with my analogies! $16. for a bottle of Budweiser is quite exuberant isnt it? Well that's what is going on in the market so to say. People unaware of the true environment, being oblivious to the true worth/situation of "stuff". $10 for a Bud is exuberant enough but if it can go up to $16, you'll have and cant blame people engaging in these sort of trades. You can now see that at some time you will get a correction in the market. I always use the term "thinning out the herd". Take a given market for example.... another analogy. I have a bigcat who's a big mover and shaker with buku $$$. This bigcat has buku xxx amount of bud in his fridge that he initially got at $4 now up at $16. He wants more yet $16 is just too much for more. How can he go about getting more? At his initial buy of $4. he can dump half of his initial stock and offer his xxx amount to $8. per bottle/share. What has he done as an indicator? He let all suckers realize that what they have isnt worth $16. Thus... the fall and the confusion/panic of those who bought/held their shares at +$8.00. Should they hold or cash in? Those cashing in cause the prices to fall. Those who are holding are like guys finding it hard to leave the craps table after a huge gain followed by a string of losses. The panic/confusion is due not so much at a loss of initial $$$ but a loss in built up capital. However... the panic can potentially cause a loss of initial overhead. Call it wrong time, wrong place, wrong stuff to get themselves in. Was this simple to understand??? I'm not trying to stupify the reason. It was quite hard to come up and put it in this sort of example. I sure you got the drift now.
BTW, you do realize, don't you, that it's a miracle I'm even posting in this topic? I don't understand this stuff....
At least I know you look up all posts and messages Debs. :grinser: I'm sure you have got a clearer picture now than before.
End note... sorry for all the typos and all redundancies. The theirs/there's/they're, an/and, no/know, new/knew, is/are, aint/isnt/arent, by/buy, who's/whose, and so forth. :uhm:
Well... here we go again. Another day of plunging investment coming from Asia. I wonder how it will reflect at the NYSE (Wall Street) this morning in about 2 hrs time? I guess I should stay away and not trade at all. We shall see huh?
A good rally this morning! Mondays are always the best day to trade IMO. What's even better is on Tuesday, I go golfing. Historically Tuesdays have been more bear market days than bull market days.
ukrainian_CA
09-04-2007, 19:03
A good rally this morning! Mondays are always the best day to trade IMO. What's even better is on Tuesday, I go golfing. Historically Tuesdays have been more bear market days than bull market days.
I plan to keep selling just-out-of-the-money (Jan 08 and other long-term kinds) calls against my future lrcx long positions (employee stock purchase and stock unit grants). Those positions will also be trimmed, sold the same day at 35-50% gains, by roughly 20% to keep only the number of shares divisible by 100.
This way I have about 20% down-side protection and some 20-25% (annual rate) upside. I cannot figure out if I need more down-side protection or higher Rate-of-Return on these, so I picked them the same (ca.20%). I am not too greedy with 20%, I am getting more risk-averse I guess. Too soon to become risk-averse at 37, but I cannot help it. What do you think, guys?
P.S. I am also holding a large-number-of-share option (well in the money) grant.
P.S.S. If I sell futher out-of-money calls, the RoR will be higher (30-50%) but the downside protection takes a dive to 10% and below. I feel that risk/reward is too high for this stock. Debating writing (selling) in-the-money
calls with even higher protection and forfeiting the tax benefit of12 month holding rule (to get to long-term capital gain) .
I plan to keep selling just-out-of-the-money (Jan 08 and other long-term kinds) calls against my future lrcx long positions (employee stock purchase and stock unit grants). Those positions will also be trimmed, sold the same day at 35-50% gains, by roughly 20% to keep only the number of shares divisible by 100.
This way I have about 20% down-side protection and some 20-25% (annual rate) upside. I cannot figure out if I need more down-side protection or higher Rate-of-Return on these, so I picked them the same (ca.20%). I am not too greedy with 20%, I am getting more risk-averse I guess. Too soon to become risk-averse at 37, but I cannot help it. What do you think, guys?
P.S. I am also holding a large-number-of-share option (well in the money) grant.
P.S.S. If I sell futher out-of-money calls, the RoR will be higher (30-50%) but the downside protection takes a dive to 10% and below. I feel that risk/reward is too high for this stock. Debating writing (selling) in-the-money
calls with even higher protection and forfeiting the tax benefit of12 month holding rule (to get to long-term capital gain) .
Sorry for neglecting your post here Meesh. Besides this, try to invest also against your company's costs and liabilities. I'm for sure that Lam is doing this themselves. While you're at it, also invest against your personal costs and liabilities. With gas being the highest in California and the Energy sector making huge profit, it would be wise to get some return on that with an energy portfolio. The greater your personal wealth gets, it isnt bad to also getting in the govt bonds, especially when there is a high chance of a bear market or a major one day drop.
ukrainian_CA
10-05-2007, 13:18
Sorry for neglecting your post here Meesh. Besides this, try to invest also against your company's costs and liabilities. I'm for sure that Lam is doing this themselves. While you're at it, also invest against your personal costs and liabilities. With gas being the highest in California and the Energy sector making huge profit, it would be wise to get some return on that with an energy portfolio. The greater your personal wealth gets, it isnt bad to also getting in the govt bonds, especially when there is a high chance of a bear market or a major one day drop.
I have not noticed being ignored - too busy to notice anything here.
Well, as soon as I reduced my risks and got decent protection we started to correct as I thought it would.
My plans are generating enough protection to the future cash-flows for some remodelling for the future rental in Russia.
As you may know Moscow elite real estate has been blazing hot for as long as oil and gas prices remained high and as long as the dollar weakens.
The trend on the dollar seemed to have no end due to the US trade and budget inbalances. So there is no point for me to go long on energy, since I am already long gas and oil via RE in the middle of gas-oil center (there is plenty of petrodollars flowing in and noone wants to hold either the US greenback or the deflating rouble).
Goverment Bonds ... emmm, I decided that I am too young to invest in low-risk stuff. When I need low-risk investments - I pay down my RE (rental and primary in the US) debts. While I understand the difference between saving and investing in "fixed-income" things. After April 17th, the payment day, I tried to explain my spouse the difference between saving and earning.
Saving 1 buck is close to making 2 bucks before taxes in here. Still, no clear picture in her mind. She thinks like Pele - "We will score (earn) twice as many goals (dough) as we concede (spend)". For gods sake, could you save to the future of your kids and their education?
I cant determine if being out of the market game was a good thig or bad thing.
Since on mission I've not watched or care to watch what was going on in the markets. I knew this was going to happen as it always does in this 2 term election period.
I'll just have to wait another 8 years for another oppurtunity to gain on a panic market.
kastriot
18-09-2008, 10:53
I cant determine if being out of the market game was a good thig or bad thing.
Since on mission I've not watched or care to watch what was going on in the markets. I knew this was going to happen as it always does in this 2 term election period.
I'll just have to wait another 8 years for another oppurtunity to gain on a panic market.
That is so true, this was bond to happen sooner or later!!
My estimate... DOW Industrials will plummet to mid 4000 pts. I hope those with portfolios can hold on to it til that time. Then double up and match your existing investments with more capital.
Wait for the DOW to hit the 4000 mark (important!) than play in which ever market some of you invest in be it FTSE, DAX, Hang Sheng, Tokyo etc etc.
ukrainian_CA
27-11-2008, 17:41
I pay no attention to Dow index. S&P500 is a good representation.
Not sure where the bottom will be, there will be many locals ones for several years. The nearest one is around 700 for SP500, I like "golden ratio", 61% below
the top looks like a golden ratio to me. Japan's index in 89-early 90th had a similar drop.
BTW, do you know that the golden ratio is also a ration of two large subsequent Fibonacci numbers (the ones that start as 1,1,2,3,5,8,13,21)
it is x=(sqrt(5)+1)/2, which can be derived from 1/(x-1)=x how funny is that,
even Da Vincci knew this one in his drawings.
One another note, what a bloody Oct... and August I have had, Volatility was higher that the implied one on the options...
Over all, by the year's end I gotta have a good number, i hope the thing behaves well in December and no more surprises to any sides
, which is not unheard of.
I have never seen anything so volatile as LRCX in October:
from under 18 to 25 to 15 and back to 21 all within 5 weeks.
How are you doing, Kui? How is the family?
I hope all is well.
My life is busy and fun, kids continue to bring sunshine into our house.
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