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When would you get in? Stock Market


akaM2

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Ok, well luckily I am still pretty young (23) and really dont have much in the stock market but my small 401k at work. I have however saved up a nice little savings and I think I want to roll the dice and throw a majority back into the stock market when I feel we are at the lowest.

 

My question to everyone that follows stocks is, when would you buy? What would you buy?

 

I am not looking for a long term investment, maybe just 3-5 years so I can then take this money plus any profit and put it down on a house.

 

I have been looking at more volatile stocks like apple and other tech stocks that are at a low that we havent even seen in the past 2 years. I feel these are the kind of stocks that will jump back up.

 

Or should I just stay away from the market? Let the housing market go even lower and then just use this money as a down payment so I can get into the housing market while it is low.

 

So basically what would you do?

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funny you should bring that up. I was thinking around the same idea. I'm also fairly young at 25 and would also like to capitalize on what's goin on. Next to my RRSP at work (a.ka. 401k) and company stocks I dont have much to show for. Even those aren't doing too well these days.

 

I dont follow the stock market closely but I am considering getting some more information on it and possibly put some cash into it.

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I have no idea about the stock market as a whole...but Apple is expected to announce new laptops (possibly a sub-$1000 Macbook) next week and I can guarantee that their stock will jump from that. It always does.

They opened today at $85/share but are now at $92/share. Making small gains is still profiting.

 

Sadly I don't even have enough savings to make it worthwhile.

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I was actually talking with a good friend of mine tonight about the same thing. We are gonna talk about it some more tomorrow, on whether to actually go into the stock market or venture into something else. Mainly the economy is so crap, something that wasn't as profitable as the stock market years ago, can now be extremely profitable.

 

I'll really bad at "financial" situations in trying to maximize what I have. But I'll share what I remember tomorrow, and share ideas. As for the stock market, I think it will keep falling for another week or two, but when it starts up, be prepared to jump on it immediately.

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If you have money in, I'd leave it. Not sure that was actually mentioned, but I read somewhere that 80% of the losses are recouped in the first couple of weeks of the rebound. Pulling money out and timing the rebound is way to subjective to try to time the market with.

 

I've been reading up on stuff a bit lately trying to gather some knowledge so that when I free up some money after getting rid of the mountain of debt my wife and I have run up I'll know what to do with it. If you're in the game for just 3-5 years you'll probably do just as good in a high interest money market account as you would do in the market, especially considering the uncertainty in the market right now.

 

As far as what I'm investing right now, I'm pumping all of mine and my wife's 401k monies into fairly aggressive mutual funds hoping to take advantage of the rebound knowing that I might go the wrong direction first.

 

If you were going to invest in the market right now for the short term I'd stay you could hedge your bets by making sure to diversify well and probably stay in some sort of stable value or money market mutual fund. You aren't going to see high percentage gains in them, but they are going to outpace the volatility of the market at least for the next several years.

 

IMO, cash is king at the moment, the last thing I'd do is push my money into individual stocks. Again, the market is too volatile and is swinging (I think we went from a low of DJ -600 to a high of DJ +150 during trading yesterday) to sharpely for me to feel comfortable in an individual stock. Every little piece of news is causing wide swings.

 

Just stick with a mutual fund that invests in the sector you feel comfortable with and it will at least bridge the shock an individual stock can take by spreading its assets over several funds in the same sector.

 

My 02 cents. I'm by no means a financial guru, but I did sleep in a Holiday Inn last night.

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I take a different tactic.

 

Never buy in a down trend.

 

You are not smart enough to find the bottom and are basically trying to fight what is actually happening. Now if you want to play risky go right ahead. Which leads to my second point...

 

Always buy in a up trend.

 

But it has to prove to me that it is not just a 'correction'. Think of it as forces. One force is pushing it down and prevailing but the up force is still there and at a certain point it will be at a point to overcome the downward trend. I play it safe and wait for conditions where the up swing is firmly established.

 

This stuff works better in a market index or actual futures. And all my experience is based on observation not actual live trading.

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well most financial experts have determined the true bottom to be in that range. And I trust my adviser since he's made me a comfortable person at a young age. It might be naive but I take his word as gold and if I get more money in when the market is down there is a very good chance that I will be able to turn a good profit eventually.

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listen to con.. Coming from a day trader for the past year(myself).. I will never buy into a downtrend. I personally think your a nuts to play the upside of the market now. Sure it will rebound a little, but that absolutely doesn't mean we are out of the down trend.. If your wanting to make money, why not go with the trend and sell short? We have just seen the beginning of what could be a downtrend.. there no idea when it could stop.

 

There is no telling how long this recession will last, but remember that during the great depression the majority of investors did not live long enough to see the market comeback to the value it was. Also remember the market plunged in 1929 just like it did this month.. but it took the market another 2 years before it reached the bottom.

 

Our banking system is bankrupt. They've lost more money than our national debt of 10 trillion.. and our government is going to buy all of them with 700 billion? Our government will be forced to print off money to buy more of the bad loans.. thus inflation and falling dollar will come. I think we have a long way to go before she's hit bottom. I'm guessing we will be around 7000 within a few weeks or a month. But just remember if she bounces back to 8000, doesn't mean we are out of the downtrend. Stocks will always stairstep down or stairstep up.

 

I moved all of 30k out of my mutal funds after taking a 30% loss before she really tanked over the past 2 weeks.. People told me I was stupid because in the long run it would come back. But i just saved myself another 25% loss. When I think we have hit near a bottom, I will re diversify my money. If I miss a 25% bump, oh well.. That is the 25% that I have already saved by moving my money already. It stupid to hold onto a sinking ship.. just hop back on when she starts to come back up. I know its really hard to let go and hop back on later. But I was trading about 10 grand of my personal cash and I couldn't sell after taking a loss, I'd just hang on and watch it keep sinking. That was a great lesson to learn because I decided not to do that with my 401k and I got out somewhat early.

 

EDIT* One more note.. please do your math.. When you lose 50% of your $100 dollar investment. That will leave you with $50. A 25% bump on you now $50 doesn't cover half of what you lost, but only a 1/4th.. You will need a 100% increase to cover your losses. With that said, the fear of missing a 25% gain on a rebound is not a good enough reason to stick around and hold.. IMO.

Edited by .fx
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I told people to invest in Apple last week when it was in the mid $80's. Not one person I told listened to me (except people who didn't have the money to invest) and now it's sitting nice and pretty at $110 a share.

I wish I had money to put in the stock market...

:(

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Selling off good long term investments in inherently successful companies now after this downturn would be rediculously silly. The financial companies have brought the entire market down, many stocks are way down without justification. Only sell positions in companies that do not have a decent future left in em.

 

True buying in now to failing companies would be equally silly, but there are a ton of stocks out there that are on their 52 wk lows, but have solid economics. They will bounce back and bounce back well once people's irrational fear of a failure of the US and world economies pass and investors start actually looking at the prospects of a company instead of just selling everything they can. If you are still nervous, buy in to the companies you like 1/4 at a time (ie buy 1/4 of what you want 4 wednesdays) to lessen the chance of a continued down slide over the next few weeks.

 

If you got out where fx did (or earlier) you might be ok staying out till the market comes back to reality, but selling now seems crazy to me. If you sell and lose 30%, then miss out on half the upturn you will have to go that much farther to get back to start. Focus on the companies that have strong numbers and you will be fine investing now for the long term. If you are trading, the game is way different. I don't day trade, I invest. Always research a company before they buy their stock. Use whatever markers for sucess you want but don't just base it off of some story you read online about a upcoming move.

 

Now if you are invested in 401K accounts or retirement mutual funds, selling out of them now would be crazy. They are generally well rounded and researched accounts that are meant to pay off over the long term. Trying to play the market on these is silly unless you are really lucky.

 

Have patience. If you don't want to day trade for individual stocks and don't need the money now or soon... try and keep it where it is, the economy is not in that bad of a shape, just alot of fear and instability right now.

 

Just my personal opinion. I work in the financial sector but in no way am responsible for any actions based off this ramble :)

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Selling off good long term investments in inherently successful companies now after this downturn would be rediculously silly. The financial companies have brought the entire market down, many stocks are way down without justification. Only sell positions in companies that do not have a decent future left in em.

 

True buying in now to failing companies would be equally silly, but there are a ton of stocks out there that are on their 52 wk lows, but have solid economics. They will bounce back and bounce back well once people's irrational fear of a failure of the US and world economies pass and investors start actually looking at the prospects of a company instead of just selling everything they can. If you are still nervous, buy in to the companies you like 1/4 at a time (ie buy 1/4 of what you want 4 wednesdays) to lessen the chance of a continued down slide over the next few weeks.

 

If you got out where fx did (or earlier) you might be ok staying out till the market comes back to reality, but selling now seems crazy to me. If you sell and lose 30%, then miss out on half the upturn you will have to go that much farther to get back to start. Focus on the companies that have strong numbers and you will be fine investing now for the long term. If you are trading, the game is way different. I don't day trade, I invest. Always research a company before they buy their stock. Use whatever markers for sucess you want but don't just base it off of some story you read online about a upcoming move.

 

Now if you are invested in 401K accounts or retirement mutual funds, selling out of them now would be crazy. They are generally well rounded and researched accounts that are meant to pay off over the long term. Trying to play the market on these is silly unless you are really lucky.

 

Have patience. If you don't want to day trade for individual stocks and don't need the money now or soon... try and keep it where it is, the economy is not in that bad of a shape, just alot of fear and instability right now.

 

Just my personal opinion. I work in the financial sector but in no way am responsible for any actions based off this ramble :)

 

 

+1

 

Read Peter Lynch's books, one of the most successful investors of our time. He also doesn't just "trade". He invests. If a company is strong, has good future, and the price is cheap enough to justify, why wait for the market trend? He also doesn't go "oh, I think the market will bottom out at XXXX and I will get in on that time." Most importantly, he's got the results to back up his strategy.

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I was talking with one of my buddies who plays the stock market, though is portfolio has taken a small hit he's not too worried. He's actually considering taking out a loan to invest into RIM (Research in Motion, the guys who make blackberries). Their stock is sitting at $60 and it's usually over $100 easily.

 

But i dont know if i wanna risk taking out a loan at this point.

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why doesn't he just trade on a margin account?

 

We saw a rebound and you would have been crushed today if you bought into the rebound... She call fall just as easy as she can go up. I'm still betting on a downtrend. One of my positions is up 30% today, of course its a short etf :)

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But I was 100% right on Apple stock.

Too bad I don't have the cash to invest.

 

Last week - $85/share

Two days ago - $110/share

Today - $90/share

 

SOMEONE INVEST IN ME!!! I WOULD MAKE YOU PROFIT!!!

 

 

On a different note.

What stocks are most likely to recover first? Things like food companies? Car companies? Technology companies? Pigs? What?

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  • 6 months later...

Now that it's a few months later. Did anyone get in on the market that was nothing?

 

I did. And I'm loving every day since. I'm really interested in seeing who got in, and what you have gotten out of it, and I will brag after I see some posts :P

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AIG 195% ROI (only $2000 though and not intended for buy and hold).

 

Ford 117% ROI

 

GE 37% (late).

 

Read. Read. Read. Also, buy some options to hedge against your purchase or, if you're really brave, invest in options alone.

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