I will stop being a trader, to become a value investor

Discussion in 'Psychology' started by crgarcia, Nov 17, 2008.

  1. Trading is not too predictable, and technical analysis doesn't work in the long run.

    In the short term, stocks move randomly, but longer term, they reflect fundamentals.

    So I'll stick to Value, the smart way to do it.
     
  2. You are so awesome. Good to hear you are still looking for a holy grail.
     
  3. ess1096

    ess1096


    Could not disagree more.

    Don't take it the wrong way but it sounds to me like you tried to catch a bottom and now you feel trapped, therefore you rationalize your position by turning a trade into an investment.
     
  4. I didn't know there was value in this market.

    :eek: :confused:
     
  5. DrEvil

    DrEvil

    You don't need to predict to make money trading. All you need to do is cut your losers, let your winners run (even better add to them as well as letting them run).
     
  6. Trading hasn't been predictable since online investing became hot for retailers, and since the market moved to using round numbers instead of percentages. Some folks are not geared for fast trading. Nothing wrong with that! I cannot stand buy-and-hold! I am geared somewhere between scalping and intraday, so that is where I rule. Don't fight your natural talents unless someone is paying you handsomely to do it, and you have unlimited time/desire to facilitate such change.
     
  7. Technical analysis is no better or worse than fundamental analysis and it's the analyst that generates the profit or the loss, not the method. You have to find your area of competence and spend all of your time conducting that activity. Once you step outside your comfort zone you will begin to lose money.
     
  8. You haven't thought this through properly...

    If you think that value investors aren't traders, think again. Until now they have simply been trading the massive trend called U.S. corporate dominance (i.e. long SP500). I also hate to break the news to you, but stocks to not necessarily reflect fundaments, they are driven by liquidity and whoever has big money (i.e. hedge funds). Also, if you are investing in small-mid caps you can easily experience a total loss.

    Since the 80s there hasn't been any value and even then I would have rather held an SP500 index, than invest in single stocks. How many of those are still around from then? Could you have really seen Walmart back then? And now, with credit concerns, forget betting on smaller companies you will probably lose big time.

    The market has become much too efficient for value investing (especially with the introduction of stock screeners).
    And you'll never know if an opportunity will turn into a value trap since you'll be investing with the sharks who will know what is wrong with a company long before you do:

    http://money.cnn.com/2008/11/17/new...ider_trading/index.htm?postversion=2008111712

    Value investing seems smart, at least at first. But it is a sucker's game.
     
  9. The only way your stance would be correct is if there wasn't any traders making money. Do you think there are zero traders making money?

    You sound more juvenile than my wife's third grade class.
     
  10. oraclewizard77

    oraclewizard77 Moderator


    Tell that to Buffet who made $ billions. Look at MCD, if you bought low, you would still have made money not even including the dividends. Value investing works fine if you are sure the company will continue to have long term value. The problem with investing in some companies that they are fads or if they are technology company, something better comes out while they are asleep.
     
    #10     Nov 17, 2008