short, long or both?

[bungrider]

Quote from Avalanche:



Where and when did he say that? I can't imagine him ever writting those words or saying that. I think that is a miss attributed to him.

Cheers.

yeah, he definitely said it in one up on wall street.

he's a yutz, and he's full of sh!t.

this is the same guy who cried "fundamentals" when he had erlanger and a boatload of other TA's working for him while he ran magellan...

(btw, read schwager's stock mkt wizards book and you'll see what a piece of crap magellan has become since lynch left)

if it smells like bullsh!t and looks like bullsh!t, it probably is bullsh!t...

 

[vladiator]

Quote from hermit_trader:

It seems many traders only long and never short

It's b/c if someone has no clue what will happen, the odds are better if you go long. In other words, unless you know a specific reason why a stock should decline, the expectation is it will go up gradually (even assuming randomness, most models of random walk include a positive drift for this reason). I stated this elsewhere on ET, stock price is an increasing function of time.
Edit: PS That and the asymmetric payoff structure of long vs. short positions.
Cheers.

 

[bungrider]

Quote from vladiator:



It's b/c if someone has no clue what will happen, the odds are better if you go long. In other words, unless you know a specific reason why a stock should decline, the expectation is it will go up gradually (even assuming randomness, most models of random walk include a positive drift for this reason). I stated this elsewhere on ET, stock price is an increasing function of time.
Edit: PS That and the asymmetric payoff structure of long vs. short positions.
Cheers.

maybe, if that stock is part of an index.

i believe that most stocks tend to go down over time. the fact that they rebalance indexes is testament to that fact...

 

[hermit_trader]

Quote from vladiator:



It's b/c if someone has no clue what will happen, the odds are better if you go long. In other words, unless you know a specific reason why a stock should decline, the expectation is it will go up gradually (even assuming randomness, most models of random walk include a positive drift for this reason). I stated this elsewhere on ET, stock price is an increasing function of time.
Edit: PS That and the asymmetric payoff structure of long vs. short positions.
Cheers.

I know so many stock market crashes and I know many victims of them. How many of us know stock market boom? Only stocks of companys that was taken over might gap up 20 or 30%. The indices never able to do so.

 

[vladiator]

Quote from hermit_trader:



I know so many stock market crashes and I know many victims of them. How many of us know stock market boom? Only stocks of companys that was taken over might gap up 20 or 30%. The indices never able to do so.

Talk about represetatitiveness heuristics, ha?
I stand by what I said. Unless a company has 100% dividend payout ratio, the price will be an increasing function of time, there are other explanations too, but this one is the simplest.
This of course is a long term perspective. Since most investors are long term, being net short for them is not wise, to put it mildly.

 

[vladiator]

Quote from bungrider:



maybe, if that stock is part of an index.

i believe that most stocks tend to go down over time. the fact that they rebalance indexes is testament to that fact...

No (twice).