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Message
re: Thinking about quitting stock picking
Posted on 8/25/14 at 1:43 pm to Teddy Ruxpin
Posted on 8/25/14 at 1:43 pm to Teddy Ruxpin
quote:
Do you know what the average starting salary is of a young professional? Where are they getting 10 grand to put down on one stock?
A prudent saver starting at a young age when they have minimal living expenses should be able to accumulate a 5 digit investment fund before the age of 30 easily.
Perhaps $10,000 was too extreme, but the same holds true using a few grand.
1
Posted on 8/25/14 at 1:53 pm to rintintin
Very easily I would say
Posted on 8/25/14 at 1:58 pm to Iowa Golfer
quote:
risk manage the trade. I've had numerous small losses due to this,
This is key in trading anything. If this is done correctly one can trade individual stocks, futures (commodities, currencies, bonds, etc), forex (not that I advocate FX trading), etc. The only worry in stocks is that trading is only 8 hrs a day, so opening gaps can run in stops. This isn't as big of an issue in futures/FX.
I currently don't trade individual stocks. I trade futures in my trading acct and leveraged ETF's (2x only) in 401k.
Posted on 8/25/14 at 1:58 pm to LSUtoOmaha
quote:
Also, what are the chances of hitting a "5 bagger"
0 if you don't make an attempt.
There are a plethora of small and mid cap stocks that have achieved that in only the last couple years. Of course you'd have to be on the train early, and the odds are stacked against you, but a 5 bagger isn't like picking lotto numbers, it's more common than you think.
Posted on 8/25/14 at 2:55 pm to Teddy Ruxpin
quote:
Hell, I don't even have 10 grand to risk on one stock and my household income is pretty substantial.
10k on a 250k portfolio is quite reasonable, that is 4% of your overall portfolio. Stocks rarely go to zero, and you can always put in some stops to make sure you don't take a bath.
If you have less than 250k, I wouldn't really put anything into individual stocks if it was me.
Posted on 8/25/14 at 3:23 pm to Hawkeye95
quote:
If you have less than 250k, I wouldn't really put anything into individual stocks if it was me.
Ya, I just doubt the average person has 250k at 25 years old or whatever nebulous "young age" we were talking about.
I'm all for the idea of taking the big swing with a side cushion existing, but if all your money is tied up in these big swings and you have little to show for it at 35 or 40, you're going to feel pretty dumb.
quote:
Perhaps $10,000 was too extreme, but the same holds true using a few grand.
That changes things a bit.
This post was edited on 8/25/14 at 3:27 pm
Posted on 8/25/14 at 3:31 pm to Teddy Ruxpin
quote:
Ya, I just doubt the average person has 250k at 25 years old or whatever nebulous "young age" we were talking about.
I think its reasonable if you are a young professional, married, you could have 250k by the time you are 30. I would consider that young but maybe I am old.
I don't want to OT brag here, but I certainly had that by the time I was 30. And I wasn't doing that well (75k or so).
eta: I think we agree though, buying individual stocks is stupid for a low wealth investor.
This post was edited on 8/25/14 at 3:32 pm
Posted on 8/25/14 at 4:16 pm to Hawkeye95
We do. I think my issue is more on the statistics side of what the average young person has and makes, not to mention my own experience if you do more than 4 years of university studies. Which in hindsight, I wish I hadn't 
Also, when you start as late as I did, you end up doing a lot of stuff in a compressed time frame. Instead of 8 years to dick off, buy a house, get married, etc, you do it all in about 3.
I'm sure doctors go through the same thing.
Also, when you start as late as I did, you end up doing a lot of stuff in a compressed time frame. Instead of 8 years to dick off, buy a house, get married, etc, you do it all in about 3.
I'm sure doctors go through the same thing.
This post was edited on 8/25/14 at 4:19 pm
Posted on 8/25/14 at 4:25 pm to Teddy Ruxpin
quote:
I think my issue is more on the statistics side of what the average young person has and makes
well I would assume that posters here have a much higher income, if they have money to invest.
I would encourage a young person to invest anything if they have it, but honestly until you can sock away $10K+ a year, any strategies other than buy low cost ETFs are a waste IMHO.
Posted on 8/26/14 at 4:03 am to rintintin
quote:
There are a plethora of small and mid cap stocks that have achieved that in only the last couple years.
depends on how one defines 'plethora'.
according to Fidelity, screening for over 500% return over last 3 years:
49 out of 3,807 with sales over 100mm (1.3%) and 74 with sales over 25mm (1.6%).
Can be done, but I sure wouldn't plan on it...it's certainly luck, not skill when one hits one of these as unknowable variables are virtually always the primary factor.
having rained on the parade, I'm believe that I am going to spend the next few hours finding the next one
since the market has been on an historic run the last 3 years, I'd guess the number that return 500% over the next 3 will be less than 1/2 of the last 3, so there are about 20 companies of the 5k or so listed I have to locate...maybe it will take more than a few hours
Posted on 8/26/14 at 4:16 am to Ole War Skule
After doing some reading, I have no idea why the average joe blow would pick individual stocks, other than the thrill of gambling.
Posted on 8/26/14 at 9:32 am to Ole War Skule
Why you gotta go and throw facts out to crush my dreams?
In all seriousness though, I'm not advocating everyone putting all their money in individual stocks and swinging for nothing but homeruns. As I've stated in this thread I have a good portion of my money in index funds just like everyone else. I just don't subscribe to thought of not even attempting to pick stocks because it's a "fools errand" or whatnot. Many things are a fools errand until they work out. There's only one guarantee in the stock market, and for life in general really, and that's if you don't try it surely will never happen.
In all seriousness though, I'm not advocating everyone putting all their money in individual stocks and swinging for nothing but homeruns. As I've stated in this thread I have a good portion of my money in index funds just like everyone else. I just don't subscribe to thought of not even attempting to pick stocks because it's a "fools errand" or whatnot. Many things are a fools errand until they work out. There's only one guarantee in the stock market, and for life in general really, and that's if you don't try it surely will never happen.
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