Take 5K. It doubles to 10K within 12 months. That new year you add maximum allowable to IRA which is currently 4K. Instead of 10K, you have 14K to initiate new position. Next 12 months that 14K doubles to 28K. Add 5K (maximum allowable for 2008) to position for 33K to initiate next position. Repeat next year. The odds of doubling every year are greatly against. Even if you only earn 10% you're still coming out ahead. What the f*ck is so hard to understand about that. It is true, losing traders complicate. Winning traders simplify.
Because the odds are greatly against success. I can stomach a loss of 5K. I can't stomach a loss of 50K. What most losing traders fail to recognize is that they take on too much of a position and not fully compehending the true risks involved. The goal is not to get rich quick. It's to see if this strategy will work. Check on DTV in August 2007 from 18.60. If it doubles or close to, I'm a genuis. If not, a shithead. Let time decide.
You'll have to trust me that I have mapped this out to hedge fund proportions many many months ago (as a result, I have had the time to walk forward and verify results). Those who have been in the hedge fund arena understand that such arenas are neat places to find sharp people but rarely a place that cultivates growth and new ideas. I am waiting for the day when you find a google labs equivalent for hedge funds. Most traders you see here are seekers of information. There are only a handful who spend the time to sit there and think for themselves and develop robust and rigorous frameworks. The issues you percieve are a fringe and relatively negligible effect. Just to put things in perspective, I have subdivided the bigger picture (that you are seeing the fringe of) into sectors and redistribute capital across the more liquid sectors. 2% in a week is more than reasonable gain after costs have been accounted for. I can point you to places where folks regularly do 2% in a single day. What I am mentioning to you is simply the pillars. My playing field is the ENTIRE market (ie. all stocks are game). My selection criteria is only limited to liquidity constraints (ie. capital injection upper bound without slippage and with respect to position change effects), this is something that I find few traders putting into what I consider to be a proper perspective. The heretical part is that I do not choose the stock, but rather the market does. How can this be? It is a picture adjustment for me. A gentleman by the handle of acrary had one recently. His was different from mine but we originally operated out of the same space (probabilities and statistical confidence). My picture is one of a race track. I watch the leader board and I watch the vehicles (ie. stock) running the race. The leader board (like the posts earlier in the thread) tells me who has earned the right to use my capital. The track shows me which vehicles are in threatening positions to take over the leader board as they edge and drift farther or closer... Start asking yourself the tougher questions. That's when you start to see the big picture. Deploying billions is very challenging as is several million. 50K to 100K is reasonable. Usually the top 15 vehicles on the leader board can take this type of capital without too much of disturbance... Since I trade both LONG and SHORT, positions moving against me is not what you think. You have to ask yourself a very different question...
Winning traders simplify their methodology, not make it retarded. Why not go invest $5M into a stock trading at 1cent - if it ever goes up to 2cents you'll have $10M! ZOMG! What happens if it climbs to 10cents!@@!!!!!! What couldbe simpler than that? Hell, that's how people usually end up winning those online stock trading contests
OK makosqu. The stock market as a horse race. Jesse Livermore once made the same comparison. Can you post recent examples, why the choices were made and the results for a better understanding without giving anything proprietery away? I don't spend hours hunting for the perfect company. Quite the contrary. I used a (over) simplified criteria available in a financial publication available to most. It took me all of 60 seconds to make my pick. I think independently, have limited execution and research resources so I keep it as simple as I can so that a 'moron' would understand. I'd be delighted if you could provide further details and examples as you would permit.
Because 99atlantic, having a stock double is risky, trading penny stocks ADDS to that risk. Man, you people just don't get it.
in the 24th year you'll have 2.5 billion to invest in one company you expect to double in the next twelve months. . after you fully invest 2.5 billion . . .and then on top of that you have to get out. THat also applies for year 23, 22, 21 and so forth all the way down to a reasonable size trade. Not to mention the probability of picking 25 consecutive winners plus the 12 month time frame . .
I think everyone is "getting" it. IT just doesn't seem likely, You might as well spend 5K on lotto tickets spread out over 25 years. You'd have just as much chance and probably a better return in the end.
Personally, rather than picking, you can just watch the leader board and ride shotgun with the leader. As a result, the winners just fall right into your lap. Why ride shotgun with a loser when you can always ride shotgun with a winner. The key is executing exactly when the WINNER becomes the first LOSER!!! This is the picture difference between predicting what stocks to choose and letting the market decide for you. To anticipate the upcoming next trade, you watch the rear view mirror of the vehicle to see who is inching up on your tail... Forget the billions... That is a whole different problem to have that can be handled in a completely different market arena (ie. where the large banks play)... Currently, I am putting half a billion US dollars to work for my superiors... They just want 25% return which is trivial in our arena... They fully expect to double their capital in 4 years. According to our projections, it is a piece of cake, but that's easy to say because we have done it before. The screwup is that they can't see the other 99% of the opportunity that is really on the table... All they hear is the noise from the ordinary folks as opposed to extraordinary... MAK