No, it's not another Chinese spammer. It's me MarkShot (from before there was an Internet).
Someone sent me an invitation to join up. So, I just did.
Subject says: Hello! I am relocating to Taiwan in October.
You may recall that I was giving away my games last year for a relocation to New Mexico. So, we decided to just go a little further like 13,000 miles to China.
I've been very busy. Hardly any time for games. Busy with relocation. I already speak Cantonese and I am now busy brushing up on my Mandarin and working for the first time on becoming literate in Chinese.
Take care, all.
BTW, "that who won WII" activation question was discriminatory. How do you expect to sign up younger wargamers when you ask such challenging questions. Definitely a case of reverse age discrimination. :)
Hey Mark! Good to hear from you. They do have the Internet in Taiwan so please don't be a stranger when you get settled in over there. ;)
Good to see you busy. We'll play an ROC v. PRC scenario next time in your honour.
Keep an eye out for those new "stamina" pills.
Herman,
I hope you'll do something to balance the scenario. Like consider it an ROC win if Taiwan manages to hold out for two weeks! :)
MARKSHOT!
Occasionally I would ask myself, "I wonder if MarkShot is ok." Since I didn't know, I could never answer myself. ;)
Glad to see you again!
Cantonese? Then your Mandarin shouldn't be too bad. Best of luck on the move!
If I want to sound like I just got off the plane from Hong Kong!
Here is the amazing thing. In two weeks, I have gone from total illiteracy to writing Chinese emails back and forth with my wife's friends and family members. Now, I am not using Google Translate, but taking advantage of Cantonese I know already and with PC based technology tools I am bridging the gap of illiteracy. But while I am doing this, I am actually beginning to recognize a lot of written characters and vastly speed up my Chinese keyboard input and becoming literate. I would have never thought this possible.
Professor SoM,
As a "latte drinking" intellectual aren't you sorry you weren't in Marseilles to witness France's swing left? :)
Good for you, Mark. I've always wanted to learn Cantonese but never had the need. I heard with 13 tones it's far more complex than Mandarin, and that if you can master Cantonese, Mandarin is simple in comparison.
I spent a few weeks in Hong Kong years ago, and my Cantonese is restricted to a few phrases all of which are dirty, most of which are double entendres that draw dirty looks (in a bad way) when I visit Chinese restaurants in the US...
Welcome aboard Mark!
The truth is that you can get by in Chinese without tones. If I say or hear one word, it would be unclear. But things are always clear in context, since there is always a lot of redundancy in human languages.
If I say to you, "I have two blue book." Yes, it sounds a little awkward, since I failed to form the plural properly. But still you fully understood what I said. Chinese can be handled just like that if you cannot manage tones. Of course, you'll have an accent.
My mother-in-law says my Cantonese sounds like those White actors you always see on Hong Kong soap operas portraying evil British Opium dealers. :) On the other hand, she is always happy to talk to me.
Tiawan? Wow. I think I would suffer from serious culture shock from the sure number of people.
We were originally going to Macau which has one of the highest population densities in Asia. Also, the area Macau we had selected was one of the most congested sections.
But reason prevailed. Taiwan's cost of living is 1/3 to 1/2 of Macau. And Taiwan has a very good National Health care system (includes dental); less than $100 USD/month for two people. (I am sick of the situation in the USA. Paying for health insurance and health care is going to bankrupt us, and not having health insurance will bankrupt us.) Now, I can stop worrying if this will ever get fixed and I can put this huge chunk of money towards living a better life!
Also, I worked for the military in Taiwan over thirty years ago. I went weeks without any real English dialogue. There was only one real English language bookstore in Taipei. But the World is now a very different place, the USA and it's culture is now just click away.
Well. I got to run. I just wanted to say it was great to run into all of you again!
I still love wargames. I've squeezed a few games of CMBB/CMAK when I get a chance. An occasional game of chess on my iPad when I find the time. I still prefer the sense of noise, confusion, and battle to the mechanical precision of chess. But I am always amazed endlessly deep chess is, and I know it is one AI that I will never be able to wipe the floor with. Every war gamer needs such an electronic friend to get through those hours from dusk to dawn. :)
PS: Many you will recall for three years I was a stock trading nut with 1830-PC. BTW, I did the stock trading thing for real for a good part of 2011. But that's a story for another post.
Take care Mark and don't be a stranger.
Welcome...and goodbye?
Quote from: Silent Disapproval Robot on May 07, 2012, 05:10:19 PM
Keep an eye out for those new "stamina" pills.
Like having eggs for breakfast!
Except, instead of chicken fetuses - it's human ones!
;)
It's people!!
Good to hear from you Markshot and I hope you find success and happiness out there. I'm really impressed at your progress with Cantonese. I wish I could learn it as fast as you in order to talk to my good friend in his native tongue.
Markshot, you SOB! I'm glad you found us. Most excellent!
only thinking about you yesterday Markshot - sat playing Port Royale and wondering who was that guy that did all the stock trading with the railways - ive forgotten before, and ill forget again!!!
take care
Let me tell you as hard as 1830-PC AI was, there was a logic to it.
Ah, but when it got to real stock trading ... a friend, Pocus (who develops for AGEOD/PI), had warned me, "the markets will have more randomness than any game you have ever played". He was right.
I studied math, trading strategies, macro economics, micro economics, fundamental analysis, technical analysis, market indicators, software tools, wrote my own code, etc... and still the movements in the markets could be totally baffling at times.
Additionally, gamers talk about AIs that cheat. Well, let me tell you that that you can clearly see cheating in the markets. The fair market says that all investors have access to the same information; because trading on anything else is against the law and called insider trading. But you'll see a stocks break up or break down for a day or two, and then, there will be some key announcement. You're not going to convince me that some hedge funds weren't tapping information that the general public doesn't have and rebalancing their portfolios. Over the last year, 60 Minutes did a very nice report on how the US Congress and staff were not prohibited from trading in stocks while privately meeting to make policy that would impact millions/billions of dollars worth of corporate P&Ls. You can win at the game, but it is rigged.
I found out that Jim Cramer (who I always found very amusing to watch on CNBC) isn't right all that much of the time. However, you rarely see his bad calls get much air time. What I learned is that if you can't make the write picks having a TV show, Web site, and selling a new book every year also can be quite profitable.
Another one of my favorites was Investors Business Daily (much more detailed than the Wall Street Journal). Everyday, they publish the "Big Picture" ... almost a pseudo-market weather report letting you know if it is safe to go long or should you start closing positions. I ultimately saw that trading based on these forecasts always had you lagging to market. By the time, you got in, the mini-rally was done.
Finally, there was MetaStock from Equis International; an extremely impressive analytic tool for technical analysis. If you play chess, it was kind of like having the power of a chess engine and opening database analysis ... that was user programmable. Anyway I back tested (applied historically) a lot of different trading strategies. My conclusions. In a real bull market, despite any strategy you were better off picking the right stocks (like APPL, GOOG, AMZN) and simply holding than trading them in and out. l also found out that in a sidewards trading market most of these algorithms performed poorly. Traders hate sideward markets, because they are very hard to make money ... you really need a trending market to take a position.
Well, I learned a lot. I probably got out too soon. Should have kept playing longer and learning. Another thing about the markets ... there is no beginner mode. When you fund that trading account, you're playing on Deity Mode. Of course, there are paper accounts you can practice with, but still there is no simple mode.
Finally, one of the most amazing things I found about technical analysis was that for the most part, there are very few inputs: open, close, low, high, and volume. And yet you wouldn't believe the amount of indicators and plots that can be built on those five inputs. We're talking hundreds here.
It was all very educational and I only scratched the surface putting in 14-16 hours days. But I think I like war games better. In fact, I know I like war games better.
Nice insight, Mark. Thanks.
Good luck in Taiwan, Mark!
My son has started to get interested in 1830...! :)
One of my greatest regrets is that Apple's police state management of the App Store caused the expulsion of DOSBOX for the iPad. There are just so many great DOS games which would be perfect for the iPad. Of course, I know you can jail break, but I don't want to go that route.
Nice to hear from you again, James!
Quote from: W8taminute on May 08, 2012, 05:44:41 AM
Good to hear from you Markshot and I hope you find success and happiness out there. I'm really impressed at your progress with Cantonese. I wish I could learn it as fast as you in order to talk to my good friend in his native tongue.
Actually, most Westerners think Chinese is very hard, but not really. I know 6 languages and Chinese is quite approachable. However, reading and writing is really hard. Here is an excerpt something I posted someplace regarding Chinese:
Quote
Personally, I think spoken Chinese is very easy to learn. In many ways, it is similar to Haitian Kreyol. There are no conjugations or alterations of subjects. Everything depends on word order.
Mandarin (written in a Pin Yin, a phonetic system used in the PRC):
Wo = I, me, mine
Ni = you, yours
Gei = give
Shu = book
Zuo tian = yesterday
Wo gei ni = I give you.
Ni gei wo = You give me.
Wo di shu = My book.
Zuo tian, wo gei ni = Yesterday, I gave you.
Kreyol (written in a phoentic system popular in the 1970s, but it has been replaced/modified)
Mouin = I, me, mine
Ou = you, yours
Ba = give
Liv = book
Ye = yesterday
Mouin ba ou = I give you.
Ou ba mouin = You give me.
Liv mouin = My book.
Ye, mouin te ba ou = Yesterday, I gave you.
Of course, Chinese is much, much harder to learn to read and write. Kreyol after a few simple rules, if you can say it, then you can read and write it. BTW, I used to teach Kreyol literacy to Haitian peasants and fishermen in NYC (English too).
The hardest part with learning Cantonese is that Mandarin is the official dialect of Chinese. Mandarin instruction in the USA (assuming that's where you are) is much more prevalent these days. However, there are not that many universities which teach Cantonese. You'll find Cantonese spoken in Hong Kong, Macau, Canton (Southern China), and many overseas Chinese communities. In 1932, Cantonese had lost by one vote becoming the official dialect of China. (something that my wife will forever hold a grudge for)
Hey, MarkShot. Sounds like you're having quite the fulfilling adventure. ;D
Interesting read MarkShot. It sounds like there really is no grammatical rules to process? Merely learning words and putting them in correct order?
Well, syntax (word order) by linguistic standards is still grammar, but you don't have to deal with a lot rules that are fairly common in Western languages. So, if you ask me which is more complex to learn to speak German or Mandarin? Then I would say German for sure assuming you don't already speak a language which is quite similar.
I just Googled, there are a couple of universities offering Cantonese in NYC (Colombia and Baruch). Then, you can go downtown to Chinatown for some good food and practice.
However, if you are going to invest the time and unless you have a real pressing need to speak Cantonese, I would recommend learning Mandarin instead as it is the official language. If you ever plan to use your language skills professionally or travel in China, you'll get a lot more mileage out of Mandarin.
Even in Macau ... 10 years ago, you could barely find anyone who spoke Mandarin. These days with the surge of economic growth in China, the lifting of travel restrictions, ... you'll find many Chinese working in Southern China (culturally Cantonese) who are Mandarin speakers. Besides those transplants (public school education and the presence of so many Mandarin speakers) has also caused many of the younger Cantonese to know Mandarin.
Quote from: Arctic Blast on May 08, 2012, 09:13:55 PM
Hey, MarkShot. Sounds like you're having quite the fulfilling adventure. ;D
You may infer that I wasn't doing that well with real stock trading ... otherwise, I would still be doing it.
Watching the stock market can be stressful some days. I'm up! I'm down! I'm up! I'm down! I'm...ah, the closing bell.
I'm a barely able to talk in english some days.
He he he ... if you're short or have puts, then YOU can be up when things are down. Or you can buy the VIX and if the market moves through huge swings you can gain.
Like the pedagogical analysis of wars and history, the day's trading activity always makes sense after the close. The challenge is to know what is going on when you are mired in up ticks and down ticks.
Although I wouldn't advise trading with CNBC's Cramer (Mad Money) one his best lines from 2011 went something like: "When you buy stock, you must have conviction. But how will you test your convictions? No need to worry about that, the market will do that for you."
Reminds me when I bought a car and the salesman said, and I quote, "Payments are a state of mind."
Actually, if you are a gamer who loves spreadsheet games, then stock trading could potentially be a lot of fun.
Imagine the most data overwhelming game you have ever played ... then think of trading as game where the amount of data and analysis (paid and unpaid) is totally unbounded.
So, a gamer needs to spend time identifying the most important factors to look at. So, does a trader. That's going to vary based on market conditions, sectors, particular stocks, etc...
It's a bull market and everyone is looking for those stocks with growth potential like techs. Who cares if they ever paid a dividend or if their business models are somewhat shaky. Oh no, the bear is on the prowl, time to look for those defensive stocks which never show much appreciation, but pay a solid dividend ... public utilities, OTC drugs, tobacco companies. There is always a lot of money sloshing around back and forth, and it is important to know which way it is sloshing. You can look at which stocks are under accumulation or distribution, but the mutual funds are only required to report quarterly.
Also, a gamer needs to have a strategy. Do prefer attrition or maneuver tactics? Traders/Investors must also have a strategy. Are you a growth investor? Will you buy those stocks already setting new highs, but could well go higher? Or are you a value investor? Are you looking for those stocks that are under valued? Perhaps the assets the company is sitting on well exceeds the current book value? Or are you only trading on technicals? Perhaps, you are looking for a stock trading in a well defined channel so that you can know when to get in and out.
And then there is the fun of earning season (more or less quarterly). I was had a position in NKE one of the biggest footwear manufacturers in the World. However, CROX reported a few days before and disappointed the analysts. This little company that only had a fraction of NKE's market cap sent NKE shares tumbling. Everyone was dumping footwear shares. Later, NKE reported and did just fine. However, my position was already closed as I had set a STOP-LOSS order to limit my downside.
It's the ultimate game. 24 hours/day. There is always trading somewhere and when the US markets are closed you can watch the S&P futures gyrate on news out of Asia and Europe before the opening bell.
That does not sound heart healthy. I've got my investments going, but I've never be into following the market day to day let alone hour to hour.
It's good to see you posting once again, Mark.
According to my wife, this was all one single bad trade:
Quote
NEW YORK (CNNMoney) -- JPMorgan Chase, in a surprise announcement, said Thursday that it has suffered trading losses of $2 billion since the start of April.
He he he ... I guess I shouldn't feel too bad about my own poor performance.
Another big difference I found between war gaming and trading is that are so many different time frames you can be operating on. You can sell something just because the market is surging with good news. Or you can buy options which expire so you have to be pretty confident about the time frame in which believe something will happen. Or you can hold something as it sinks believing in the more strategic vision. When we play games, the time frame for a given game tends to be fairly tight. So, it is not often that "losing now" doesn't also imply "losing later". However, with trading, winning and losing can also very much be tied up with the time frame for which you define your strategy.
Then, a very big challenge was the idea of cutting your losses. Do you stay with a failing attack or do you withdraw? The attack might be failing, but if you hang in long enough will the momentum reverse and will it turn into a route? Or will you p*ss away your company and tanks? This was a big philosophical debate I had with my wife on STOP-LOSS orders. These are orders you put in to close out a position when a loss reaches a certain point (I was using about -7% from the entry). Traders say, "you need to let the winners run and cut your losers off quickly". Now, that makes perfect sense. By following such a strategy, you can actually have a positive P&L even though you lose more often than you win. But the problem is that the market is volatile and huge swings happen quite frequently (much more now due to high speed program trading). So, using STOP-LOSS although seemingly protective, means you simply get stopped out on wild days ... It would be the equivalence of prematurely withdrawing out a fight before the battle turns for you, because you simply said after 15% WIA/KIA, I am packing it in.
Of course, once you are in a losing position, like engaging in a battle, your options have become limited. Now, if you are fully engaged. There is no way to disengage, and therefore, there is no way to exploit an opportunity which opens. Similarly, as you sit with losing or stagnating positions, you are missing the chance to be in something else.
So, there were definitely similarities to war gaming and trading at the macro level. Also, war gaming against real players is very much about psychology. If you are a technical trader, then much of it is about investor psychology. A common trading tool is Japanese Candlestick charting. This tool's main premise is to graphically depict the battle between the Bulls and Bears. By looking at a price chart, you can see where the bears gained strength, met resistance, finally broke, and the indication that they are throwing in the towel (covering their shorts aka a "short squeeze"). Upon looking at such a pattern, you know the next session is likely to see a climb in the stock price especially if the general indexes are favorable as well.
Well, I wrote a lot ... but gaming, markets, and trading have their similarities. It's the biggest MMPG out there. :)
BTW, if anyone is interested, there are ways to play this game simply for fun.
In years past, people used to use spreadsheets to do paper trades. But that is very labor intensive and does not give the real feel.
There are also Web sites to which you can subscribe which will allow you do have a paper portfolio. Although far better than a spreadsheet, compared to a real brokerage account its the difference between playing a flight sim with abstracted and simplified tools or getting in a real cockpit. So, I would not recommend this either.
With TDAmeritrade, you can open a trading account. Without funding it, you will get access to a paper money account which models trading/markets/tools on various integrated PC (JAVA) trading platforms and mobile devices. At which point, you can play with the real market and real tools. However, I would recommend that you fund your account (put some real cash in; they say as little a $1 will do it). Once you do that, you request "realtime quotes". This means that the prices you see in paper trading correctly mirrors those from the exchanges. Otherwise, your quotes are 20 minutes delayed. If you really want to play with paper money (even if you are not day trading), you should use real time data. Why? Well, most of the day's volume happens in the first 30 minutes and last 30 minutes of the sessions. You are not really going to experience all of that with delayed quotes. With a few simple exceptions, your paper trading is as real as it can be ... closer than any flight simulator. (One of these exceptions would be you couldn't exercise an option before expiration, but, of course, you could trade it.)
Lastly, you should remember that the feel between paper trading and real money trading is very different. Similar to playing an FPS or really having live rounds being shot at you by some jihadist.
He he he ... I can see that you guys are just as interested by real trading as my two 1830-PC threads at the WG! :)
Not at all Mark. It's interesting and you always bring a unique perspective to your endeveurs.
Quote from: MarkShot on May 12, 2012, 06:52:56 PM
He he he ... I can see that you guys are just as interested by real trading as my two 1830-PC threads at the WG! :)
One of the posters I NEVER miss. Been thinking about getting into the market once I clear the debt off my books. Nothing big, but something to play with. Looking mostly for stocks that pay dividends and have consistent value. I also wanted to try and stay focussed on a small area of stocks before diving into the big pool.
I'm sort of surprised that you didn't make out big Mark. I always assumed that, if you put your effort into the market, you would walk away the next Warren Buffet. But I suppose the market is far less rational than it should be. Your insights are highly educational!
Or maybe its rational enough the the computers are beating everyone.
Glad to see your posts markshot!
Hello Markshot. Longtime no see. So how come Taiwan?
Best of luck and have a great new life.
Closer to family. A lower cost of living. Unlike the USA a good National Health Insurance system ranked one of the best in the World. (not having to go bankrupt because of the cost of insurance or because you don't have it)
Could have come to the UK and got your health for free. Well except prescriptions. However I'd advise against it as the UK is a dump and the society has gone to hell.
Well, actually I don't know that my trading results were so poor. The problem was that I had set a very aggressive timeline of milestones by which success or failure was measured. Perhaps way too aggressive, but life decisions needed to be made on whether I proved myself or not. So, I passed a couple of milestones while falling a little behind schedule. After months of multidisciplinary study, in a month of paper trading, I generated almost a 10% portfolio return while during the same period the SPX posted a 0.5% return. This was very encouraging, but I failed my next milestone. As a serious systems project manager, I pulled the plug rather than move on to faith-based trading.
My advice to anyone who is seriously considering trading would be both to allocate a lot time to self-education, but also a lot of time to practicing via paper trading or with a small toy portfolio. Ideally, you want to be at the trading for an entire year. Go through seasonal impacts on markets, a few global crisis, earnings seasons, etc... This will not give you a feel for every type of market, but it will be a start. Within the market there are many cycles. There are bull markets that usually run for about three years; there are bear markets that usually run for about a year; there are mini-bulls and mini-bears (outsiders mistakenly think that the direction of the market is much more clear cut than it is - just like warfare, battles only exhibit perfect clarity in history books); there is the US four year presidential election cycle; you have long multi-year cycles in various heavy industries such as aircraft where is takes a decade for fleets to be replaced ... although history never repeats 100%, there are certainly prior precedents. Furthermore, learning to trade is about understanding the tremendous interconnectedness between many things and trends; recognizing patterns. It is not enough to know how to read a stock chart just doing technicals, since your chances of doing well going long are poor if the indexes don't climb too. And even that is not good enough, since picking the best performer in an industry group won't generate good returns if the group itself isn't experiencing an influx of investors. Finally, as the home gamer, you really need to pay attention to where the big boys/girls (mutual funds, hedge funds, institutions) are parking their money. Since you could pick the most promising company in the World because you are visionary, but if the tide is going out, your positions are going to get hammered.
One more comment about trading with a small toy portfolio, your results are going to be somewhat skewed, since the cost of trades will be disproportionately large. Whether you buy a 100 or 1000 shares, the trade costs the same (however, this is not true with option contracts). So, in terms of evaluating your results and extrapolating, you may want to factor out the transaction fees.
I would avoid leverage when starting out. This means purchasing on margin (borrowed money) and using options. Remember 99% of all options expire out of the money.
Going back to the prior STOP-LOSS debate (meaning getting stopped out or holding), remember that even with a -7% STOP-LOSS, you can lose 20%. How? Normally, stocks tend to open at the prior sessions close price. However, news is often announced after the close. So, a stock can gap up or down at the open ... some really bad news can have a stock open well below your STOP-LOSS. You'll take a loss (be stopped out) larger than you had planned. Of course, you can see it coming as many stocks trade electronically prior to the open, but there is not much you can do about it. You could trade pre-market, but that has its risk, since volume is low. When volume is low, prices can sometimes get very skewed. Effectively, one large trader with an itch can move the price disproportionately.
Quote from: Mr. Bigglesworth on May 13, 2012, 02:46:26 AM
Or maybe its rational enough the the computers are beating everyone.
Glad to see your posts markshot!
With just a regular brokerage account, you can get pretty fancy with your orders.
You can put orders in to only trigger in a certain time frame when a certain price threshold has been crossed, but not to pay more than a certain price. All to happen programmatically. You can put in an order to buy one of four stocks when a certain price is reached and cancel the purchase of the other three. A common "bracket" order generates two other orders when a stock gets purchased. So, you immediately (programmatically) create a STOP-LOSS as soon as you own it to limit your downside, but at the same time you create another SELL-STOP if it should appreciate more than a certain amount. Often you'll may want to adjust your STOP-LOSS orders daily after the close to lock in some gains while limiting the downside.
The above was orders. However, when it came to ALERTs (emails/texting), you could get infinitely more sophisticated if you knew how to program. You could set up alerts which would fire only if a stock was breaking through a certain price on heavy volume (more than the 30 moving average) and the SPX was up 1%. At which point, you could check out the market and decide if this was the sign you were waiting for to get in.
Beyond that TDAmeritrade has a totally retail investor programmable trading platform. You could define the rules and it would merrily place trades on your behalf at the speed of electrons until your account went bust. So, you could be just like the big boys and flash crash with the rest of them. I never really looked into it, since I preferred to lose my money the old fashioned way by hand.
One of the toughest buy decisions was setting the price for something at the open. Studying the chart and trying to think of a fair price so that you wouldn't over pay, but you wouldn't miss your chance. Then, second guessing yourself for an hour from 8:30-9:30am as you watched the S&P futures dance before the open. :)
Quote from: MetalDog on May 12, 2012, 09:02:31 PM
One of the posters I NEVER miss. Been thinking about getting into the market once I clear the debt off my books. Nothing big, but something to play with. Looking mostly for stocks that pay dividends and have consistent value. I also wanted to try and stay focussed on a small area of stocks before diving into the big pool.
You want to limit the number of positions you take at any one time. In part, this will vary to some extent on the size of your portfolio and your free time. Probably somewhere between 3-10 stocks.
To really do it justice, you don't want to load up on a lot of stock, because then you won't be able to focus. Once you start going beyond that, then you might want to consider mutual funds and ETFs. Because if your portfolio has a large enough basket of stocks, then you can simplify the headache by simply buying a basket to begin with. ETFs have no management fees, can be traded intra-day, and are not subject to good or poor management ... so, if you want to own coal miners or a broad spectrum of Brazil's market, ETFs are the way to go. You'll reduce some risk, but also limit some upside. (However, remember with foreign market ETFs, you have both the market movement and the FOREX movement relative to the USD.)
For technical traders, you are going to have your eye on some key sectors and stocks. You'll be watching the market to send you a signal before you get in. For example, charts form resistance lines. A price at which the market will not pay more than. You'll see the stock rise to that price and pull back many times. Now, if one day, you see the stock surge through the resistance on heavy volume (means there is institutional buying), this could be your entry to buy. You'll also be looking for a stock which has lost value over 8 weeks or longer and kind of stagnated in terms of price. This indicates that ownership has been swapped. Those who were tired of the losses or lack of appreciation close their position (shaken out). New owners mean fresh momentum. You'll be looking for a stock that hasn't seen a substantial price drop in the last 6-12 months (no overhead supply). Those who purchased at a much higher price will be holding and looking get out even as soon as it begins to climb. This overhead supply will dampen any rally in the stock and weaken any upward momentum.
So, a stock is a commodity. A company may be solid or shaky, but your decision is also based on past chart behavior. Good companies can make bad stock picks. Especially, some very good companies, because by the time everyone in the World recognizes them, the biggest gains have been gotten. You're joining the party too late. As you and many other small fish are loading up, the institutions are slowly unloading. They can spend months gradually unwinding a position. (They dump little by little so that there is no big hit to the price.)
So, you are a hunter. You are going to identify some good candidates and stake them out for exactly the right time. Knowing when to enter is tough and knowing when to exit is even harder (the signs are less clear).
All this talk of stocks ... making feel a tinge of guilt for having gotten out. Oh, well ...
Quote from: MarkShot on May 13, 2012, 02:03:04 PM
Quote from: MetalDog on May 12, 2012, 09:02:31 PM
One of the posters I NEVER miss. Been thinking about getting into the market once I clear the debt off my books. Nothing big, but something to play with. Looking mostly for stocks that pay dividends and have consistent value. I also wanted to try and stay focussed on a small area of stocks before diving into the big pool.
You want to limit the number of positions you take at any one time. In part, this will vary to some extent on the size of your portfolio and your free time. Probably somewhere between 3-10 stocks.
To really do it justice, you don't want to load up on a lot of stock, because then you won't be able to focus. Once you start going beyond that, then you might want to consider mutual funds and ETFs. Because if your portfolio has a large enough basket of stocks, then you can simplify the headache by simply buying a basket to begin with. ETFs have no management fees, can be traded intra-day, and are not subject to good or poor management ... so, if you want to own coal miners or a broad spectrum of Brazil's market, ETFs are the way to go. You'll reduce some risk, but also limit some upside. (However, remember with foreign market ETFs, you have both the market movement and the FOREX movement relative to the USD.)
For technical traders, you are going to have your eye on some key sectors and stocks. You'll be watching the market to send you a signal before you get in. For example, charts form resistance lines. A price at which the market will not pay more than. You'll see the stock rise to that price and pull back many times. Now, if one day, you see the stock surge through the resistance on heavy volume (means there is institutional buying), this could be your entry to buy. You'll also be looking for a stock which has lost value over 8 weeks or longer and kind of stagnated in terms of price. This indicates that ownership has been swapped. Those who were tired of the losses or lack of appreciation close their position (shaken out). New owners mean fresh momentum. You'll be looking for a stock that hasn't seen a substantial price drop in the last 6-12 months (no overhead supply). Those who purchased at a much higher price will be holding and looking get out even as soon as it begins to climb. This overhead supply will dampen any rally in the stock and weaken any upward momentum.
So, a stock is a commodity. A company may be solid or shaky, but your decision is also based on past chart behavior. Good companies can make bad stock picks. Especially, some very good companies, because by the time everyone in the World recognizes them, the biggest gains have been gotten. You're joining the party too late. As you and many other small fish are loading up, the institutions are slowly unloading. They can spend months gradually unwinding a position. (They dump little by little so that there is no big hit to the price.)
So, you are a hunter. You are going to identify some good candidates and stake them out for exactly the right time. Knowing when to enter is tough and knowing when to exit is even harder (the signs are less clear).
All this talk of stocks ... making feel a tinge of guilt for having gotten out. Oh, well ...
Thanks for taking the time to explain that to me. It's as I suspected, difficult, fraught with choice, wrapped around an ulcer waiting to happen with a jackpot if you know when to get in and get out :-) By the by, what's an ETF? Is it what you intimate, a Mutual Fund you can create yourself?
A Mutual Fund has a professional management and there are usually fees involved. They have a state objective like "Invest in Tech Companies in the People's Republic of China". The management will decide what stocks to accumulate and what to distribute. Like anything else, their expertise will vary. Also, they are constrained by objectives and bylaws of the fund. So, it might be that Chinese energy stocks are hot, but they cannot buy them, because it is a tech fund. However, it gives you a chance to play Chinese tech without having to what to buy and what to sell.
An ETF (Exchange Traded Funds) is simply a basket of stocks formed by I believe brokerage house. Suppose there is a technology index on the Shanghai exchange. This basket then owns stock which mirror that index. There is no management ... it's like buying the index. You own shares of the basket which trade just like stocks. It's a way for you take a broad position without putting down a lot of money.
When it comes to technical analysis (price & volume), stocks, commodities, futures, options, funds, ETFs all exhibit common behaviors. The behaviors are simply manifestations of supply and demand and investor psychology. That Japanese Candlestick charting began hundreds of years ago with the rice spot and futures market.
I am off to go play some CMAK and enjoy some totally non-P&L related diversion. :)
Here is a good site for ETFs.
http://etfdb.com/
Although I didn't buy any ETFs ... well, I did one GLD (which tracks the spot price of gold more or less), I used the ETF symbols in my trading platforms to track the general performance/charts of foreign markets (indexes).
For a while I owned ARCO (Arcos Dorados), a relatively new IPO, which is effectively the McDonald's franchise in Argentina. I made around 8% with that one. You cannot directly own foreign stocks in the USA, but they trade as ADRs (American Depository Receipts).
Thanks again, Markshot. Quite helpful and I'll look into it.
Books I would recommend are:
http://www.amazon.com/Stan-Weinsteins-Secrets-Profiting-Markets/dp/1556236832/ref=sr_1_1?s=books&ie=UTF8&qid=1336950518&sr=1-1
http://www.amazon.com/Money-Stocks-Complete-Investing-System/dp/0071752110/ref=sr_1_2?s=books&ie=UTF8&qid=1336950680&sr=1-2
http://www.amazon.com/Japanese-Candlestick-Charting-Techniques-Edition/dp/0735201811/ref=sr_1_1?s=books&ie=UTF8&qid=1336950573&sr=1-1
Read in that order.
Weinstein's book is a classic, and one of the most lucid.
O'Neil's is another classic in its 5th. Edition. It covers his personal hybrid of value added fundamental analysis plus technical analysis. It is a complete system which goes hand in hand with Investors Business Daily. Known as CANSLIM.
Nison's book is another classic. He popularized Japanese Candlestick Charts in the USA. The two previous books use OHLC bar charts.
Mark dives fully into a project when he decides to pursue it. I remember when he started to play chess. He could fill you in on all the different chess programs along with strengths and weakness and that was just in the first week of picking up the game.
Funny you should say "dive".
I was waking up every morning with my current positions feeling that I was drowning. But I would tell myself, "No problem. I am going to swim my way out.". Finally, I woke up one morning and realized that I didn't know how to swim. Thus, I got out. :)
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BTW, the other big thing in my life is that I have lost 25Lbs in three months. (became a vegetarian ... nothing socio/political/religious just for health reasons) Still got about 17Lbs to go before I will be fit.
Quote from: MarkShot on May 14, 2012, 10:36:10 AM
BTW, the other big thing in my life is that I have lost 25Lbs in three months. (became a vegetarian ... nothing socio/political/religious just for health reasons) Still got about 17Lbs to go before I will be fit.
This is outstanding Mark. Congrats! Are you working out too?
Generally, 90 minutes a day on the treadmill, but I was excising before. I think it is mainly the change in diet. It's vegetarian with no eggs or dairy, no salt, sugar, or added oil. Most foods are whole. Very little processed food like pasta or bread. Lots of fruit, vegetables, nuts, seeds, roots, beans, brown rice, and soy products.
One of the main reasons this is working is that there is no requirement to be hungry or disciplined. I can eat whenever I feel hungry without counting calories and servings. I can easily keep doing this for the rest of my life (it's beats putting on pounds year after year). Also, in Taiwan choices in Taiwan a vegetarian life style (especially when eating out) will be much easier than here.
Diet and exercise can really do amazing things for energy levels, awareness and stress relief. I know I feel better after a good workout.