| Author | Message | ||
| Mike Clark (Vipersrt)
Junior Member Username: Vipersrt Post Number: 66 Registered: 10-2002 |
Think long term such as S&P 500 and just put some money in their and let it sit for the next 15-20 years. | ||
| Andrew Wanamaker (Androza)
New member Username: Androza Post Number: 5 Registered: 2-2003 |
Ah, much thanks. I've never dabbled in the stock market before, though I've been researching it for about a year. I do have about a thousand shares of Altria (was PM) but I've never actually touched it. What would you do if you were starting out and didn't know much? | ||
| Jim Schad (Jim_schad)
Member Username: Jim_schad Post Number: 887 Registered: 7-2002 |
from my etrade help menu. Just as buying a stock allows you to profit when the price rises, selling short makes it possible to profit from a decline in the stock's value. The traditional way of making money on a stock is to buy low and sell high. When you sell short, you do just the opposite with this strategy. You first sell shares you don't already own (which you borrow from your broker), and then you buy them back later (hopefully at a lower price). There are certain risks when you sell short, and it's important to know what they are before you place this kind of trade. There are some rules involved with this; for example, your broker must have the shares you want to borrow. In addition, you can't sell the shares short while the price is going down (the stock's price has to be neutral or going up, what's called up tick or zero plus tick. You must have a margin account in order to place short sales. When you use margin, you are borrowing money from E*TRADE Securities based on the value of the cash and securities you currently have in your account. You're charged interest on the amount you borrow; and the holdings in your account act as collateral to secure the loan. You can hold the shares short as long as you meet the margin requirements for the position, and E*TRADE Securities is able to can continue to borrow the shares. When you're performing these transactions, you'll want to enter a "sell short" order to "open" the position, and a "buy to cover" (not a regular buy) to "close" the position. The buy to cover effectively returns the borrowed shares to your broker. | ||
| Andrew Wanamaker (Androza)
New member Username: Androza Post Number: 4 Registered: 2-2003 |
How does one go about borrowing stock? | ||
| Mike Clark (Vipersrt)
Junior Member Username: Vipersrt Post Number: 63 Registered: 10-2002 |
Should of borrowed stock when it was at like 1.50. It is down to .82 now! Could of should of made some money! | ||
| Mike Clark (Vipersrt)
Junior Member Username: Vipersrt Post Number: 60 Registered: 10-2002 |
But, the war is not over yet, and more fires could be lit. But lets assume, not much more damage is done. They can't possibly be running with that much inflation in its stock, so it is bound to fall? | ||
| Jim Schad (Jim_schad)
Member Username: Jim_schad Post Number: 866 Registered: 7-2002 |
I was wondering the same thing. It is back at 1.32 and was at .13 prior to all of this. THere are few fires compared to the 700 of 1991 so they may not have much work to do since we have basically secured the oil fields I think. What do you all think? | ||
| Mike Clark (Vipersrt)
Junior Member Username: Vipersrt Post Number: 59 Registered: 10-2002 |
Would it be a good time to invest in WEL now to sell short in the future, or should one hold off? | ||
| Jim Schad (Jim_schad)
Member Username: Jim_schad Post Number: 865 Registered: 7-2002 |
Halliburton just got awarded the contracts to put out the fires and they subbed it out to WEL and it is back up to 1.23 now. Good thing you shorted and sold when you did I guess. Got down as low as $0.80 | ||
| William H (Countachxx)
Intermediate Member Username: Countachxx Post Number: 2148 Registered: 2-2001 |
LOL, looks like my predictions have been crapp so far  Well the war is still young, we'll see what develops. I think its a Very volatile market, Wouldnt put a lot of faith in this little rally until it lasts over 1 month | ||
| Doug O (Little_o)
New member Username: Little_o Post Number: 31 Registered: 6-2002 |
Jon, Thankyou, very informative post from a professional. Doug | ||
| Jon P. Kofod (95f355c)
Member Username: 95f355c Post Number: 519 Registered: 8-2001 |
Wow! Nice collection of cars you have there. Looks like a C5, ZO6 and a Viper GTS Coupe. Nice to have another car gal on this board. Not sure how I missed your other 300+ posts. Regards, Jon | ||
| Bonnie (Admirable)
Member Username: Admirable Post Number: 328 Registered: 1-2003 |
i cant believe we are at war. Its necessary i think, but all the innocent people that are gonna be hurt by this, its unbearable to think about. I have not watch the news, nor have i seen any bombing on tv, i cant watch it. Its so sad. | ||
| Jon P. Kofod (95f355c)
Member Username: 95f355c Post Number: 516 Registered: 8-2001 |
Doug, I try to make it a rule not to give advice over the Internet. One because I might be wrong (despite being a professional) and two, because you should always do your own research or hire someone to do so. You know the story of free advice. That being said I will say that I think the stock market has priced in a very swift, short, and decisive war. If this is indeed how things turn out we have gotten past one of two hurdles, the second being a weakening economy. I strongly feel that the last two months of war debate with the UN and US has started to have real negative effects on our economy. Most of the business owners I talked to in late February and early March said their customers were making no spending plans until the Iraq issue was done with. Consumers are starting to do the same. We had real good signs in early January of the economic strenght but that evaporated quickly with all the war talk. The range of people I have talked with goes from a few medium to large Fortune 500 companies to smaller companies such as a friends packaging business in WV. My concern is that consumer spending is slowing down at the same time that business spending is still dead and the war has just delayed capital spending further out. I don't think many professionals know when business spending will pick up because the job outlook is still very bad. I think the market is glad that the uncertainty of war is gone hence the first 500 point up move. I think the second 500-point up move was pricing in a short war. What comes next depends on how the war goes. If the war goes as planned then the market will start focusing on the next future event, which will be the economy. I would say that my concerns are the following: 1) Business spending remains flat to down 2) Consumers start spending less 3) Job outlook doesn't improve by summer 4) Housing market starts to drop 5) Budget deficit estimates, including the cost to rebuild Iraq are too low 6) Profit growth stalls and operating earnings fall (as opposed to earnings gains through cost cutting) The last item, profit growth, concerns me the most. The profit growth we have seen in the past two quarters are being generated one of two ways. Either by huge cost cutting and non-operational items OR by taking market share away from smaller competitors. Cost cutting has run it's course, you can't fire the entire staff. The market share issue is forcing smaller compaines out of business and causing large layoffs especially in the tech induistry. the strong are doing well the weak are going out of business. Larger firms are taking business away from smaller competitors such. I think that once the war is over investors (not traders) will assess the state of our economy and decide if it's time to invest or not. You may even see the market move on the economic issues before the end of the war, if things are going good in Iraq. This is what you saw with the last 500-point advance. The market started pricing in a quick victory a week before the war even began. Keep in mind that much of the market activities over the past month has been driven by traders not investors. Investors have sat on the sidelines unwilling to take any risks. The data shows that up until yesterday this was still the case. Investors will likely continue to take a wait and see approach. So in closing I would say I am highly optimistic the war will be quick and successful, however the economy has real problems that I think will take time to work through. I am sure you've heard the often used phrase "buy the rumor sell the news". The war rumor has been bought next up is the economic rumor. Question will be if the rumor is good or bad. I think if the war goes well the market will make a very swift decision on the state of our economy soon, most likely before the war is even over. You can come to your own conclusions of where the market is headed. Regards, Jon | ||
| Doug O (Little_o)
New member Username: Little_o Post Number: 30 Registered: 6-2002 |
Jon, With you as a professional, I value your opinions more than the rest of us armchair investors. How much legs does this market have assuming no big surprises in the war. NASDAQ, S&P? Seems like the market is trading on momentum, the economy is still weak. When momentum shifts, downside could be just as swift? Can you see the the S&P hitting 920? Thanks, Doug | ||
| Jim Schad (Jim_schad)
Member Username: Jim_schad Post Number: 847 Registered: 7-2002 |
congrats! so how do you protect yourself against a price runup? Is that what the option or put is for? I wasn't sure on shorts how the time frame was set up. Say I buy IBM today.....how long do I have til it needs to drop? | ||
| John (Cohiba_man)
New member Username: Cohiba_man Post Number: 24 Registered: 1-2003 |
update: I sold at 39% down for a profit of around 20K in a few hours, if it hits 180+ again I'm going to buy a HUGE put on it for 12 months from now when the war is somewhat more resolved. I think in a years time it should be back to .13ish levels... | ||
| Jon P. Kofod (95f355c)
Member Username: 95f355c Post Number: 514 Registered: 8-2001 |
Jim, A short position works the following way. You borrow shares of say IBM from someone, for this example 100 shares. Let's say they are trading at $80 per share. You immediately sell the borrowed shares in the market and pocket $8000 (100 x $80). You wait a few weeks until the stock drops to $60 then buy back 100 shares in the market costing you $6000 (100 x $60). You then return the 100 shares to the borrower (covering your short). You sold the borrowed shares for $8000 and rebought them for $6000 and get to keep a $2000 profit less interest owed for borrowing the shares. Problem is a short position has unlimited loss risk. A stock can't go lower than zero, but it's upside is unlimited. If the stock in the above example shot up to $160 you would have had to buy the shares back at that price. Also some further clarification. Many investors use the term "short" to specifiy a more general position of benefiting from a stock or market drop by holding various other instruments such as options and futures. MATT: Get the Challenge car ready. April weather is looking pretty encouraging and Trackmasters and FOW have events planned at Summit. I am cramming everything into March and April before the baby arrives. Regards, Jon | ||
| William H (Countachxx)
Intermediate Member Username: Countachxx Post Number: 2132 Registered: 2-2001 |
Matt, I'm watching the boards now, there has been a slight 4% dip in the NASDAQ & DJI. Seems trading is low, a time of great indecision. Could go anyway right now. I think its a great time to negotiate a new car or home now though | ||
| Jim Schad (Jim_schad)
Member Username: Jim_schad Post Number: 844 Registered: 7-2002 |
Explain how shorts work in laymans terms please. You buy at a price expecting it to fall. so you buy at 2.50...it falls...at what point do you get to cash out? what if it falls to $2 then back up to $2.50 then back down? Does fluctuation matter or you just hang on and sell at lowest price you are comfy with? | ||
| Howie (Brokerofexotics)
Member Username: Brokerofexotics Post Number: 442 Registered: 11-2001 |
John, As your broker I advise the following: Windfall profit...liquidate NOW!!! OR Liquidate half your position now and hold the rest for "the pull". | ||
| John (Cohiba_man)
New member Username: Cohiba_man Post Number: 23 Registered: 1-2003 |
UPDATE!!! I just checked it and it has dropped 42% so far today and its only 10:30!!!! I just almost doubled 50K!!!! Thats my biggest gain in the shortest amount of time EVER!!! Im soooo happy.... So, should I sell and take the profit or wait for it to go back to .13? | ||
| John (Cohiba_man)
New member Username: Cohiba_man Post Number: 22 Registered: 1-2003 |
"The big war play was WEL...Boots and Coots.....they take care of oil well fires. Went from 13 cents in November to a high of about 2.65....up over 1900%...." I shorted that at 2.50 yesterday, Im going to wait till it falls back down to .50 or less after the war, obviously the company didn't increase its capacity to make money 19 times in the last few months, its inflated on speculation, so I would suggest shorting and waiting for the war to end. | ||
| Matt Karson (Squidracing)
Member Username: Squidracing Post Number: 443 Registered: 3-2001 |
William, on January 30th you said "You just know the prices on EVERYTHING are going through the floor when the bombs start falling in Bagdhad & people in the US & EU & basically everywhere start thinking that Armageddon has arrived." The S&P went down 7.5% since you made that statement. Once Bush made his "48 hour" threat, and the market place finally had some certainty as to what was going to take place, the market has gone up 10%. My response at that time was "The market always discounts news ahead of the actual event. Prices are already built in to the market, before anything takes place. Institutional participants hate uncertainty, and the market will always be punished for it....as it already has." The market held true to what I mentioned. I'm no guru, but market psychology is one of the easier facets to read when assesing the overall status of the market place. If the war goes smoothly, we should continue to see support in the various indexes. Bad troop casualities as a result of bio/chem attacks from Saddam (you all know...the stuff france (won't even bother capitalizing their name) denied Iraq has) will have a negative impact on the market. Of course, none of this is important when compared to the safety of our fighting forces. I wish them all the safety possible, and look forward to getting them home as soon as possible. | ||
| Howie (Brokerofexotics)
Member Username: Brokerofexotics Post Number: 441 Registered: 11-2001 |
John, Congrats! Glad it worked for you! Perhaps a Cohiba to celebrate? Howie | ||
| Jon P. Kofod (95f355c)
Member Username: 95f355c Post Number: 513 Registered: 8-2001 |
John, Nice play. Just sold my options/futures contract a few minutes ago as Bloomberg shows Crude oil for April delivery fell as much as $1.88 to $28.00 a barrel in after-hours electronic trading on the New York Mercantile Exchange. William: The market would have to tank a 1000+ points to make your March 7th statement true. Were up nearly 800 points in the past six days prior to this evening's attack. The Nikkei is up 175, S&P futures are up +2 over fair value and the dollar is up sharply. The time to buy was a month ago. Unless the war goes terribly wrong I don't see a big sell off. Same thing happened in 91 when the market dropped 20% before the bombs droped. First day of bombing the market was up sharply and never looked back. The easy money has been made! We might sell off until the certainty of an easy war is clear (2-3 days) but I don't see anything negative unless Saddam prevents us from securing the oil fields or he starts using chem/bio weapons. Regards, Jon | ||
| C. Smith (Italianauto)
Junior Member Username: Italianauto Post Number: 139 Registered: 10-2001 |
The big war play was WEL...Boots and Coots.....they take care of oil well fires. Went from 13 cents in November to a high of about 2.65....up over 1900%.... | ||
| John (Cohiba_man)
New member Username: Cohiba_man Post Number: 21 Registered: 1-2003 |
"The minute war breaks out, short crude oil." Thanks a lot Howie! I shorted at 37 a barrel, got out at 30 a barrel, nice little profit. | ||
| William H (Countachxx)
Intermediate Member Username: Countachxx Post Number: 2086 Registered: 2-2001 |
a month ago I said that the market would keep going down & drop steeply when the bombs start falling oin Bagdhad. Some people said that professional investors are running the show so that would not happen yet the market keeps dropping like I said it would. I dont think the big investors are infallible. When the bombs fall its probably going to be a good time to Sell arms manufacturers. BP looks good to me cus they dont rely so much on mideast oil, they get their oil from the deep sea, china & russia | ||
| DES (Sickspeed)
Advanced Member Username: Sickspeed Post Number: 2644 Registered: 8-2002 |
John, i think it's commendable that you're willing to retract this post in consideration that it might offend someone, but you, yourself have the right to free speech (sorry, i just got out of the Toni Smith thread ), so either way, this should stay... i'm not saying this 'cause i'm offended by this thread- i'm not; just wanted to point out that that was a cool gesture, highlighting the fact that you were willing to give up your right to free speech out of respect for the others... That's cool... | ||
| Taek-Ho Kwon (Stickanddice)
Junior Member Username: Stickanddice Post Number: 110 Registered: 11-2002 |
I think it's a little late for a lot of this stuff. Most of the heavy investors have already made their move. You might gain a profit, but the amount of money you'll have to put in will not be worth the risk vs. reward. There are a lot of people hoping to capitalize on your exact moves. Trying to find a way to make money from war. Just my thoughts. | ||
| Howie (Brokerofexotics)
Member Username: Brokerofexotics Post Number: 430 Registered: 11-2001 |
The minute war breaks out, short crude oil. | ||
| Steve Magnusson (91tr)
Intermediate Member Username: 91tr Post Number: 1480 Registered: 1-2001 |
The interesting thing is that the Iraqi stock market is up something like +50% -- which IMO signals they themselves think things will be much better post-Saddam. | ||
| John (Cohiba_man)
New member Username: Cohiba_man Post Number: 20 Registered: 1-2003 |
BTW, I just realized that this topic could offend some, so if it does, let me know and I'll delete it. | ||
| Dr Tommy Cosgrove (Vwalfa4re)
Member Username: Vwalfa4re Post Number: 677 Registered: 5-2001 |
Companies that sell to Iraq | ||
| James Glickenhaus (Napolis)
Member Username: Napolis Post Number: 718 Registered: 10-2002 |
Companies that make body bags always do well in times of war. | ||
| John (Cohiba_man)
New member Username: Cohiba_man Post Number: 19 Registered: 1-2003 |
I am just wondering what others have in mind for capatalizing on the changes in the economy as we go into war and emerge from it later. Stocks to short, comodities to buy, businesses to buy... any idea? BTW, im not just interested in making money off it, if it comes time that the U.S needs our help (I'm in Canada) I will be volunteering for service. Thanks |