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3200% Return
- Thread starter ByLoSellHi
- Start date
Quote from Opra:
What is the anualized return of her portfoliio over those 27 years?
From $0.10 to $47 in 27 years. Not accounting for dividends, that is 25% annualised. That is not so impressive for a day/swing-trader like the folks on this forum. If you apply yourself to studying the markets, it may be achievable (if you can stay trading for 27 years), but it will not be with one stock. The great traders/investors whose annualized returns over 20, 30, 40 year periods surpass that, like Michael Steinhardt, Warren Buffet, George Soros etc, have different methods, but hardly staying with the same stock for 27 years (except Buffet).
Quote from neke:
From $0.10 to $47 in 27 years. Not accounting for dividends, that is 25% annualised. That is not so impressive for a day/swing-trader like the folks on this forum. If you apply yourself to studying the markets, it may be achievable (if you can stay trading for 27 years), but it will not be with one stock. The great traders/investors whose annualized returns over 20, 30, 40 year periods surpass that, like Michael Steinhardt, Warren Buffet, George Soros etc, have different methods, but hardly staying with the same stock for 27 years (except Buffet).
That's what I was trying to get at. You cannot just pick out one big tree and not to mention the the woods. Not to sneer at 25% annualized return of AFL, but if every stock in her portfolio can have that kind of return, that will be something remarkable.
My opinion is that its ok to swing for the home runs just so long as you KNOW what your doing.
I will now give you a few examples.
I read the Yahoo message boards for certain companies chronically. Most of the information on there is junk, but there are always a few people who seem to be in the know. After a while, you can tell who actually knows and what is actually junk. I will say 95% of it is junk while 5% are in the know.
Last year, there was a certain small cap oil company that was losing steam quick. It was cut down right to 2 dollars from 7 from June to November. Right before the election, there were a few people on that message board who seemed to be waiting around for something. They wanted in bad in the 2s. I wasnt sure why and I read eagerly to see if they might jump in.
Honestly, I would have been scared to death to jump in on a stock that went from 7 to 2 dollars. All of a sudden, right after the November election, this small cap stock rocketed from 2 to over 3 dollars in the course of 24 hours. It was truly an amazing site.
Next example is Verasun. VSE was going to hit support from 15-16 dollars. Goldman came out with a "sell" rating placing the target price somewhere in the 12s. I've been watching Goldman analysts for a while and know that they are not always honest with what they do. Anyone who knows anything about the summer driving season knows that oil prices go up right before. The Goldman analysts probably came out with a sell rating because they wanted their clients to accumulate some in the 15s. Last quote I checked today, VSE was over 19 bucks.
Radioshack. I dont need to tell anyone this story. The time to get in was right before Christmas. Stocks that did fairly badly in the old year usually get boosts in the new year. Why? I dont know the exact reasons. However, thats how it always seems to play out. There are many bulletin board stocks that rocket up during January and February.
SanDisk. SNDK was going to hit a major support at around 35 dollars. It hit it and then the talking heads came out with some stories so the stock would bounce. Yes it did bounce at 35 and went to 45.
AMD&MARVELL&RACK. These are broken stocks. They tried to rally these stocks up from their support with rumors of "buyouts". Didnt work. Time will tell if anything works to bring these dogs back up. These are good examples of failures.
etcetcetc
So all of Wall Street is this big game. Its not about fundamentals, its not about P/E ratios or anything else. Its about learning how they play the game. Once you learn the game, then you can start hitting the home runs. Unfortunately, it takes time to learn all these games. That learning period for some might be weeks, months or several years.
Another concept is diversity and risk management. Not throwing all your eggs in one basket. Lets take the above examples that I have written. Lets say you have $50 grand to invest. Why not invest an equal percentage into each of the above examples at the particular times where you feel that they would have hit support? AMD would have been a loser, but the others would have made up for it. If you placed your stop-loss at the right point, then AMD would have triggered around 15 when the support was compromised minimizing the loss.
So I think you can go for the lotto ticket stocks, but you have to know what your doing and diversify the risk. Knowing what your doing sometimes takes years to learn...
I will now give you a few examples.
I read the Yahoo message boards for certain companies chronically. Most of the information on there is junk, but there are always a few people who seem to be in the know. After a while, you can tell who actually knows and what is actually junk. I will say 95% of it is junk while 5% are in the know.
Last year, there was a certain small cap oil company that was losing steam quick. It was cut down right to 2 dollars from 7 from June to November. Right before the election, there were a few people on that message board who seemed to be waiting around for something. They wanted in bad in the 2s. I wasnt sure why and I read eagerly to see if they might jump in.
Honestly, I would have been scared to death to jump in on a stock that went from 7 to 2 dollars. All of a sudden, right after the November election, this small cap stock rocketed from 2 to over 3 dollars in the course of 24 hours. It was truly an amazing site.
Next example is Verasun. VSE was going to hit support from 15-16 dollars. Goldman came out with a "sell" rating placing the target price somewhere in the 12s. I've been watching Goldman analysts for a while and know that they are not always honest with what they do. Anyone who knows anything about the summer driving season knows that oil prices go up right before. The Goldman analysts probably came out with a sell rating because they wanted their clients to accumulate some in the 15s. Last quote I checked today, VSE was over 19 bucks.
Radioshack. I dont need to tell anyone this story. The time to get in was right before Christmas. Stocks that did fairly badly in the old year usually get boosts in the new year. Why? I dont know the exact reasons. However, thats how it always seems to play out. There are many bulletin board stocks that rocket up during January and February.
SanDisk. SNDK was going to hit a major support at around 35 dollars. It hit it and then the talking heads came out with some stories so the stock would bounce. Yes it did bounce at 35 and went to 45.
AMD&MARVELL&RACK. These are broken stocks. They tried to rally these stocks up from their support with rumors of "buyouts". Didnt work. Time will tell if anything works to bring these dogs back up. These are good examples of failures.
etcetcetc
So all of Wall Street is this big game. Its not about fundamentals, its not about P/E ratios or anything else. Its about learning how they play the game. Once you learn the game, then you can start hitting the home runs. Unfortunately, it takes time to learn all these games. That learning period for some might be weeks, months or several years.
Another concept is diversity and risk management. Not throwing all your eggs in one basket. Lets take the above examples that I have written. Lets say you have $50 grand to invest. Why not invest an equal percentage into each of the above examples at the particular times where you feel that they would have hit support? AMD would have been a loser, but the others would have made up for it. If you placed your stop-loss at the right point, then AMD would have triggered around 15 when the support was compromised minimizing the loss.
So I think you can go for the lotto ticket stocks, but you have to know what your doing and diversify the risk. Knowing what your doing sometimes takes years to learn...
Quote from ByLoSellHi:
I first regretted starting this thread, but there have actually been some wise comments in response to it.
The concise lesson that many seem to be trying to convey is that if you swing for home runs, you're going to strike out a lot.
And it makes perfect sense.
Maybe the far more sensible path is to hit lots of singles and doubles, and keep advancing the runner.
Quote from ByLoSellHi:
I know.
But I want a 3200% return on something. Anything.
I am playing DRL as my shot at a 10 bagger or more, truth is you could have done this with many stocks, PVN, ACF to name a few.
OH YEH....and how bout TSO!
Nothing wrong with take a shot on a few of these things, risking a couple grand, or a few % of your account on these trades, IMO. If you are making money trading and can finance the carrying costs, and get the trade to break even if it goes belly up, it's a no brainer, IMO.
Not sure, but it is significant with a couple stocks doing that well.