Well, I've been playing on the market for a little while now, and I'm not sure if I know more than when I started, or less. I've seen some pretty tricky moves by companies to boost their stock price, only to do a mass sell that triggers a collapse a day later. Things move pretty quickly and theres a good amount of money involved. Sometimes you really have to act right that day in order not to lose out, cause its gone the next. Other times selling too quick means you miss out on a good climb.
I've tried dollar cost averaging which sounds really good, but you have to remember that it only applies to a healthy company, and you have to stay with it long enough to see them go upwards eventually. It doesn't apply to dying companies like Yellow Pages or RIM - if they are gone, so is your investment. I suckered myself into thinking that YLO would come out on top sooner or later, but their 30c shares are currently now 7c shares and not much of an outlook for improvement.
Everyone is talking about Apple stock - I bought some too at when the craze was starting up. I went up with them from about $500 or so, to about $580 and I sold. I didn't want to have too much riding on them in case everyone screaming about how it will go to $1000 was wrong. There are a lot of people out there saying lots of things - you really have to be careful whose advice you take or what news source you read. In the end they are all guessing. Sure they are educated guesses, but there are no guarantees - anyone could suddenly have a downturn in sales or a lawsuit, or even some exec suddenly deciding to sell off a massive amount of stock, triggering a slide. Right now, Apple is sitting at about $627, and the stock's been floating around $600-$630ish for about a month now, and is definitely not the surefire, you-can't-lose stock that people were making it out to be.
Here's another fun one - Zynga, that I've alluded to a couple of time already. I bought a bunch of their stock on the news of buying the Draw Something game. The stock shot up nicely, $12 became $13, then the CEO or CFO or someone at Zynga sold off a crapload of stock - bam, the stock tumbled down to $11, and now is kind of half in half out at $11-$12, $11.56 at the moment actually.
I also picked up some Netflix stock a while ago - After it crashed from 120 to about 80, I picked it up, thinking that in the long term, with their expanding markets, they should do well. However, analysts were screaming that Netflix is doomed, they wont survive, and the stock dropped further down to about $60. This was after a harrowing ride of 70s-90s for a while, and the stock was "reassessed" to be worth $60. I eventually sold it, disappointed. Now, it's back up to $110-120 range with everyone saying how great they are.
What the fuck man? Basically the lesson I took from this is that I can't believe any of the shit I read on the market news, unless it's a fact, like "someone sold x" or "stock x went up 20 cents today". I have to stop reading the "Apple is going to reach $1000 by the summer!" type of news and read instead about what day the iPhone 5 is coming out, and if they are having any manufacturing difficulties, how much heat the Windows and Google phones are giving them, then decide on that.
My last set of trades haven't been so good - I was trying to make the high-volume trade ratio for the quarter and I tried out some tech and software stocks. However tech is not doing so well and all the ones that people were talking about on the news as 'recommended' have been pretty shitty so far. Maybe it will turn around in the fall when titles are coming out and they are actually selling games, rather than right now where they are pouring money into development and not selling anything. I guess this would be a good time to "buy" since they are dropping. Then when the games are out and the revenue is coming in, pick a good time to sell the boosted stock.
In the meantime though, anything I sell will be at a loss, so I probably have to hang on to them and keep an eye out for developments.
Upsen.
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