I usually always shoot for the 100% gain stocks (not 3200%) and it brought me 50% loss to my total equity last January. I've learned my lessons. I'm here for the long run so it's important to also calculate the risk (because if you do, the profit will eventually come anyway). Now I've made at least 35% in the last 2 months. It will still took me quite a while to recoup my previous loss but nonetheless, that teaches me a lesson: "Mind the risk, the return will come eventually"
I would have to say that there are few people on here that would have lasted through the volatility. Most people on here would have probably grabbed some when it traded in the low single digits waited for a few dollar gain and then traded out of it without giving it another thought. I wonder if there are some olds posts about AMR from 2003. In retrospect, the people who were not "traders" probably made the most money during the time period of 2003-2006. Those who simply threw their cash into the market back in 2003, went to work each day and never looked at the account might have been more successful. Those people who subscribe to the Motley Fool and just piled their cash into their picks in 2003 were probably very successful. I have made the same mistake as many others in 2003 not being able to recognize a bottom in the markets. In the past year, I have studied Fib. retracements, technical theory and many other variables. In fact, I have learned more in the last year then in any other year of my life. I predicted on here very accurately the facts about the current "correction". Your mistake now is looking back at time, slapping yourself in the head and saying to yourself what you should have done. You should instead recognize your mistakes, educate yourself on what you did wrong and look forward to the future. I have noticed on other message boards that there are some people who are able to very accurately pick when (and how) a stock moves and turns. These are the people who usually embrace technical analysis and have studied market theory. So instead of looking back and wondering what you should have done, you should always look forward and educate yourself on how you can prevent the same mistakes again. If you studied put/call options and market sentiment then you would know that it was time to buy back then. I didnt know that myself back then, but now I do know. Im not going to sit here and bat myself over the head because I missed something. Instead, I will plow forward. There are always opportunities in the market and looking forward is the only way you can resolve the issues.
It is more than realistic that some months you will make 20%, it is typical. I said 'Plan for' not AVERAGE OUT TO. In any given year, you will have down months that will take out your best months. Some years a lot of down months. Realistically, if the S&P averages an 8-10% a year, do you see a common average gain every month? What kind of statement is that?
I first regretted starting this thread, but there have actually been some wise comments in response to it. The concise lesson that many seem to be trying to convey is that if you swing for home runs, you're going to strike out a lot. And it makes perfect sense. Maybe the far more sensible path is to hit lots of singles and doubles, and keep advancing the runner.
Ding, ding, ding! Find a system that CONSISTENTLY brings in $$$, learn to execute your system without too much emotions, and build wealth and experience first. When you do that, over time, you will be MORE LIKELY to hit home runs than strike out and crash & burn, like so many dreamers that look for easy money in the market.
Actually I wasn't thinking of NEWC. That one is a big turd and should be avoided at all costs. However, a lot of other sub primes have been beaten with the ugly stick and will more than likely survive. A name like NFI comes to mind. Maybe wait until they announce that they are cutting their dividend and if the stock gets beaten up step in a scoop it up. Could be a very nice investment. That said, with tongue firmly in cheek. Past results may not be indicative of future gains. Individual results may vary. This is not a recommendation to purchase securities.
A client I have has several 1,000+% returns in her portfolio. What did she do? Buy and hold for 27 years. Drawdowns were 50% at times. If you want to know the stock, see what AFL traded at in 1980. I'll give you a hint, it's less than 10 cents on a split adjusted basis. That's how you get the returns you're looking for. Granted when this client bought it, it was at $70 per share. Later, after many stock splits, the cost adjusted basis is less than a dime. That's how to make the returns you want. Since it is obvious you have no patience, I can't see you ever succeeding at this. That's my advice.
Thats cause people NEED to fly No matter how much money airlines loose people aren't gonna take the queen marry overseas or use train. The fast paced society demands air travel. AMR is the #1 airline in the world and the Gov would not let it go away. Thats why it rebounded from its low. Also AMR has thousands of employees and millions if assets. It wasn;t gonna all dry up overnight. SOme tupid obscure .com that falls form 2000 to 2 with only 12 employees and almost zero asets has no chance of a bailout. It comes dowen to assets, infastructure, and demand. Thats why NEWC is a great buy and will rebound to 24 in the coming years
While patience is key, Inflation kills your returns though and this aint the 80's. Investing in these markets requires a more aggresive strategy.