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Title: Was "help me to decide" in the Canadian Stocks forum Post by: garilou on January 18, 2010, 05:55:57 PM Reply to post: http://www.superstockpicker.com/forum/index.php?action=post;topic=1708.0 Akis, I am really astonished by the amount of loss that you took on TD Bank. (You wrote $200,0000.00: did you mean $200,000.00 or $20,000?) In any case, it is too much. (See the PS) Because to take such a loss, especially on margin, if you are telling us the truth, you must really have a lot of money in you portfolio(s)... or you are joking with us, or want to test I do not know what. If ever you are serious, I think that you should consider letting professionals manage the biggest part of your money, at least while you learn, and keep a smaller account were you are prepared to take losses without compromising your future. But again, I have a hard time to trust what you write. So what ever I write after this introduction is simply because I like to write, because it helps me my-self, because it could help others.... and because the market is so dull and quiet today ;) (apart from my short on SXC that I will not cover today! Has quietly lost another $1.40 today!) But nothing that I will write is very original, it has been said and written over and over. To "learn how to pick stocks with high return" is not easy, like the gains you made might have led you to believe. So one or 2 bad losses should not take away your confidence, it should mostly turn a blinking red light on: on the stock (or any other) market, you are good if you pick a winner 6 times out of 10, the idea is more to minimize the losses on the 4 that were bad picks. What can change from one person to the other is that exact definition of a big loss ;-) Spending your gains - unless you absolutely need the money - is not too good an idea, but you recognize it your-self. For my part, I only use the gains from my shorts to eventually invest on my house (this time I guess my gain on SXC will go to Haïti though). I do not think any one on this forum would want to take the responsibility of teaching you. Although most of us have read lots of books of all kind, but one always really learn "on the battle field". Exchanging on a forum like here can also help to see how others react in different situations. Remember that each time you buy, you buy from someone who either 1.thinks the stock will go down, or 2.does not want to be to "greedy" and take its profits, or 3.might be shorting the stock... 4.might have found another stock with better growth probability There are certainly many other good or bad reasons to sell you the stock. And each time you sell, well, its the reverse... But in any case, never forget that it IS a battle field : some people may get together to make transactions to boost the price of a stock, but for you and me, we are alone against the world ;). You'll often read about "the buyers" (or the Bulls), and the "sellers" (or the Bears): I find this very dangerous to try to give the impression that there are kind of 2 well formed armies, whose members work hand in hand. Of course, a strong upward momentum means that more people think that the stock will go higher, but this can also generate real bad bubbles. So nothing is ever "certain", otherwise there would be no markets at all. With the kind of money you tell us that you "play around", you could consider being a day trader, where 1 cent increase in the stock price represents a good $ profit, but to be a good day trader, you'd have still more to learn! It is true (or it was in "normal times"), that any intermediate to long term holding portfolio should contain banks... but even if the Canadian banks are more secure then the American ones, they have become a risky investment too! I have made a lot of money (to my scale of course), by shorting TD Bank many times last year. Then when I thought that the situation had stabilized, I have tried to enter some bank shares in my RRSP, where such a big percentage is invested in fixed (very low) income). I tried the Royal Bank, and quickly jumped out with a loss, and it kept going down, and has not even yet reached the level where I got out. The simple notion of a "blue chip"seems to disappear. You might want to look at SSP portfolios, study carefully their system , and try to follow one. At least you will have the chance to grab stocks that do have momentum, and receive sell orders to limit your losses. Even SSP is way not perfect, if you go with a big start capital, you might have to buy lots a shares from a stock that does not have enough volume for you in the first place to buy them, and them to sell them. This could be a start, meanwhile, read a lot. My problem with SSP is that I should too often invest in stocks that I do not want to buy, as I said in my previous post. OK that'll be it for today, hope you'll convince me that you are honest in your posting. Louise PS. Recently, I was talking with some one who I know is really extremely rich, and I joked with him when I mentioned the amount of $10,000.00. I said, "Of course for you $10,000.00 is nothing", he replied "Oh no! $10,000.00 is not nothing for me (he had just spent almost $200,000 -this is my guess- to treat a cute little mare who had such a bad accident that anyone else would have chosen to put her asleep: he did not only pay the vets bills, he paid her first class "hospital room"). Anyway, I kept playing the game , lowering the amount to $5000,00 and so on, and he stopped at $50.00, maybe the amount where I could have stopped to. Millionaires who were not born millionaires, are so because they do care about each dollar! |