I don't know the terminology which is one of the main reasons I'm looking for something to explain the basics. I ordered "Investing Online for Dummies" and hope that will help. Otherwise I guess I'll take each term and try to find the definition, and what the person meant when they used it. For example you mentioned investment fundamentals. I looked into it briefly and so far it's leading to books and pdfs but I got the impression you meant it as a more general thing. From my ignorant position it seems my confusion would be between day trading and swing trading, but I only learned of the latter term yesterday and only learned that day trading is specifically restricted to only one day for each trade yesterday. So far placing such a restriction on yourself still seems absurd to me. When a person buys a stock it seems to me they must expect it to rise to a certain point and then sell it. If it doesn't happen to do that on the day they bought it it seems they should wait and see if it does it the following day, or the next. But then they don't have the money to play with as you mentioned and it could keep going down for a while. So from my ignorant pov it seems that's the time to buy more, not sell at a loss. If they buy a stock and they lose money that day does it mean they'll never buy that stock again? Or do they sometimes buy it and sell it for a loss, and then later buy it again hoping for a better result? I mean...they already had bought it so why create the need to buy it again?
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
Very basic newbie questions
- Thread starter nopeda
- Start date
Would you be willing to share any of the specific companies you're referring to, or explain how to find similar ones? Can we search for stocks that are in a price range from $... to $..., for example?
Some of it is study, like companies that are doing poorly for whatever reason, you think of whether some company that has huge amount of employees would go out of business, you look over financials to see if it is poor management mistakes or why they are losing. So it is often judgements of huge companies and if I think they are truly worthless like Enron, or if they have some goodness in them like shopping.
Charting, if you go into most charting stock books, shows that stocks that go sideways for long period of time normally will go up, you just make many notes, but in mean time, if going sideways, let's make some money, on lows, but them and sell put credit spreads, on highs get out, when it does punch out, buy first retracement. I love using weekly bars, the volume better to show possible up move coming as volume increases, volume is interest in that stock.
http://finviz.com/
Excellent site, just below middle of page shows stocks in different chart formations, read and study about formations and how to trade them, I get most of my choices from this site. Plus it a very good scanner, you can play with this site days and take long time before you run out of what it has to offer.
I ordered "Investing Online for Dummies" and hope that will help.
I haven't read it, but for myself I wouldn't expect a book about investing to be particuarly helpful for trading. That's exactly what I was alluding to, in my post above. I may be wrong. Just be aware that terminology can sometimes be defined differently in different contexts, and investing is surely a very different context, in this sense, from trading. (The author may distinguish clearly between the two, though - those "For Dummies" books do tend to be pretty well written and edited, in my limited experience of them.)
From my ignorant position it seems my confusion would be between day trading and swing trading
"Swing trading" is a classic example of a term that different authors use with very different meanings.
For example, Alan Farley, the author of what's very widely in some circles regarded as the standard textbook on swing trading (The Master Swing Trader) goes to quite some lengths in the opening few pages to explain that "swing trading" isn't "in contrast to daytrading" at all, that the term "swing trading" in itself has nothing to do with the duration of the trades, and that "swing trades" can be intraday or over longer periods. (I don't like his book, myself, don't regard it as well written, and didn't find it helpful at all, but others may well disagree, and in fact it seems they probably do, because the book's certainly become "the authority" on the subject.)
placing such a restriction on yourself still seems absurd to me.
It will, perhaps, until you know more about how the markets work on a practical level, margin requirements, and so on.
When a person buys a stock it seems to me they must expect it to rise to a certain point and then sell it. If it doesn't happen to do that on the day they bought it it seems they should wait and see if it does it the following day, or the next.
Again, you're looking at trading in terms of investing, with that comment, David.
But then they don't have the money to play with as you mentioned and it could keep going down for a while. So from my ignorant pov it seems that's the time to buy more, not sell at a loss.
That's called "averaging down" and is something to avoid. The rationale is that if it was a good buy at $x, then it "must be" an even better buy at a lower price than $x. The fallacy is that some trades are good and some are inevitably bad, and one of the ways to identify the bad ones is that they move against you quickly.
This is especially true of penny stocks (since you mentioned those in your OP), in which typically one's expectation is that the great majority of trades will lose money, but the occasional successful one can pay for them many times over. The economics of doing that are somewhat similar to those of fiction publishing, from a trade publisher's perspective: 90% of titles actually lose money, but the business can still be very profitable overall, because of the occasional "jackpot". Some businesses are like this. It's particularly important, if embarking on them, to be both very well informed and very well funded!
I mean absolutely no disrespect at all, and I appreciate of course that you're at the start of a learning-curve, here, but for what it's worth I repeat my original suggestion (also apparently shared by some others replying to you) that penny stocks and daytrading should both be high on your list of things to avoid.
Also - you should definitely listen to Handle123, on this subject: I know that he has more directly relevant experience of it than I have.
Thank you Handle123 for your help, and everyone else who has been helping me!!! I don't understand the vast majority of what people are telling me, but am putting significant things in my notes and will keep going back re-reading them over and over. I've ordered some books and hopefully after reading them will be better able to comprehend the advice you nice people have been sharing with me.Some of it is study, like companies that are doing poorly for whatever reason, you think of whether some company that has huge amount of employees would go out of business, you look over financials to see if it is poor management mistakes or why they are losing. So it is often judgements of huge companies and if I think they are truly worthless like Enron, or if they have some goodness in them like shopping.
Charting, if you go into most charting stock books, shows that stocks that go sideways for long period of time normally will go up, you just make many notes, but in mean time, if going sideways, let's make some money, on lows, but them and sell put credit spreads, on highs get out, when it does punch out, buy first retracement. I love using weekly bars, the volume better to show possible up move coming as volume increases, volume is interest in that stock.
http://finviz.com/
Excellent site, just below middle of page shows stocks in different chart formations, read and study about formations and how to trade them, I get most of my choices from this site. Plus it a very good scanner, you can play with this site days and take long time before you run out of what it has to offer.
I haven't read it, but for myself I wouldn't expect a book about investing to be particuarly helpful for trading. That's exactly what I was alluding to, in my post above. I may be wrong. Just be aware that terminology can sometimes be defined differently in different contexts, and investing is surely a very different context, in this sense, from trading. (The author may distinguish clearly between the two, though - those "For Dummies" books do tend to be pretty well written and edited, in my limited experience of them.)
Thank you Xela, and everyone who has been so helpful!!! At this point I believe not understanding the distinction between investing and trading probably resulted in me buying a book that doesn't well apply to what I'm hoping to do, but I am used to making such mistakes and of course wish that could be the worst investment I end up making.
I do listen and think about what he tells me, and what you tell me. So far it's way beyond my level of understanding to be able to comprehend the vast majority of what people are nice enough to explain to me, even though it's very simple and basic from you people's pov. But I will keep trying...so far it's only been a few weeks and I haven't even gotten the first book yet. I'll order The Master Swing Trader next thing because of the fact that you said it's highly regarded by many people, and I've nothing at all better to try. It may not have been helpful to you, but you did get it to find out if it could be. Myself being in an entirely different position than you are, and were when you read it, there's no way it couldn't be helpful to me and from this position it could be very helpful. Thank you again for your suggestions and the things you're willing to share!"Swing trading" is a classic example of a term that different authors use with very different meanings.
For example, Alan Farley, the author of what's very widely in some circles regarded as the standard textbook on swing trading (The Master Swing Trader) goes to quite some lengths in the opening few pages to explain that "swing trading" isn't "in contrast to daytrading" at all, that the term "swing trading" in itself has nothing to do with the duration of the trades, and that "swing trades" can be intraday or over longer periods. (I don't like his book, myself, don't regard it as well written, and didn't find it helpful at all, but others may well disagree, and in fact it seems they probably do, because the book's certainly become "the authority" on the subject.)
. . .
Also - you should definitely listen to Handle123, on this subject: I know that he has more directly relevant experience of it than I have.
the guy cant even explain himself properly. and you all are here pontificating.. books, action lists etc.. fucking mother geese ..
the guy will be doing research in AI tomorrow, then change to perpetuum mobile invention then tap dance then flying to mars, then learning Cantonese.. then just give up and smoke dope..
if you have so much time in your life and willingness to help. go help children or homeless or better those animals are dying out because the east so prolific in reproduction activities..
jeez.. you people..
the guy will be doing research in AI tomorrow, then change to perpetuum mobile invention then tap dance then flying to mars, then learning Cantonese.. then just give up and smoke dope..
if you have so much time in your life and willingness to help. go help children or homeless or better those animals are dying out because the east so prolific in reproduction activities..
jeez.. you people..