Posted on 06/20/2019 8:22:33 AM PDT by sonrise57
“this past month” hahaha.....
has been among the most screamingly bullish periods I have EVER experienced in over 20 years of trading. I mean, out of control.
On 03 JUN SPY (SPYders, the stock equivalent of the S&P500 index) was at about 274. It’s a bit shy of 295 right now. That’s a 7.6% gain, what a conservative investor is more or less happy with in a YEAR. 7.6% doesn’t sound all that dramatic, but a 20 point SPY move (or 200+ S&P points, which are each equal to 7 to 10 DJIA points) is a whompin’ rally in a month. Huge. Perhaps one of the top ten biggest rallies of all time, but that is completely a guess. Trust me, it’s a big fat sloppy move THAT ALL WENT IN ONE DIRECTION. On 03 JUN the DJIA (what people usually use to gauge the market but is an inferior item to use for that purpose) has rallied over 400 points. Is that a lot? Yes, it is.
You’ve done better than that, congrats! What you probably do not realize is just how wild bullish this past month has been.
The amount of info generally needed to invest in the stock market is vast, and you could lose your $2K ten or twenty times over learning it. So, I am not going to advise you one way or another; I am only going to inform you that if you started early June, you stepped onto an airport moving conveyor belt and judging by how fast the walls are going by, perhaps you now think you can walk a solid twice as fast as you really can.
Well, OK, the tip I’ll give you is to measure market activity by the SP500, not the DJIA. You can get that number @ investing.com, probably a good site for you.
You got an 11% return in one month, that is at least 132% if it lasts for a year {month over month} keep on doing what you did.
I think there is good and interesting info in posts 37 and 40.
One very critical issue is your age, and whether you are working/earning income. I don’t think you can contribute to an IRA, if you don’t have earned income.
Thanks. Good advice.
anything gold related will do well for the next 18 months or so.
A good friend of mine is an RR. Because I only had about 20k, he recommended ETFs, one is the Dow and the other S&P.
Less costs and maintenance fees and if you want to sell, it closes at the current price, not at the end of the day, like a mutual fund.
Get the book ‘A Random Walk Down Wall Street’.
The author takes apart, with great knowledge and meticulous argument, pretty much every stock ‘system’ besides market tracking index funds. The book is magnificent because he covers just about all of the fads and fancy ideas, explaining the rationale behind them, the circumnstances when they have been valid, and why they are not a good idea in most circumstances.
I really like authors who present the STRONGEST case for things that they then shoot down.
Essentially, outside of just tracking the market there are two ways to go: technical analysis, and fundemental analysis. The first is basically tring to figure out how emotion, news, and buzz will move a stock, the second is based on buying the company- well a small part of it - and looking for companies that are well run, with a good product, in a good market.
Both sometimes work, but often don’t.
Technical analysis requires you have the absolute ultimate in latest information and industry news (dubious for all but a few) and fundamental analysis requires you have actual, accurate, honest, unbiased information (in other words NO errors, omissions or BS from anyone within the company or watching it, not bloody likely).
If you really want to invest in individual companies, one of the best ways is to look for companies that make goods or provide services that you like and use; obviously make sure they aren’t way overvalued (P/E ration), but look around at the things you like using every day, that seem well made, and see about investing in the companies that make or provide those.
A well-diversified portfolio, based upon age and risk tolerance, is one of the first and foremost principles of successful investing. You cannot possibly create a well-diversified portfolio of individual stocks and bonds with a mere $2,000 as the initial investment. I suggest that you open a brokerage account with Vanguard and buy a mutual fund or exchange traded fund (ETF). I suggest the Vanguard Total Stock Market ETF or one of Vanguard’s balanced ETFs, which includes both stocks and bonds.
Yes, I understand that my recommendations are boring, but if you want to buy excitement with your $2,000, then I suggest casinos or horseracing.
All seriousness aside, check out this guy...interesting approach. There's a book he wrote on Amazon that explains his method.
http://www.cdx3investor.com/ns/pages/purchase_renewindiv.htm
Seems like a person could get an index fund and buy it and sell it on the daily or weekly fluctuations.
You would have to use exchange traded funds (EFT) for that I would think.
Open a TD Ameritrade account, use their free info to learn to trade options.
First thought: pay off all debt possible, since the return is equal to the interest rate you are paying.
Second thought: health savings account (HSA) contribution. Tax deductions for the contribution, tax free growth, money available to pay for future medical bills.
I think this is all that needs to be said except that investing in qualified dividends for the distant future can pay very well.
If you want to be a trader go to the casino. It may be much more fun and just about a profitable.
LOL well I thought I read enough. You did read that I’m over 80 right?
Yep, my understanding is it would need to be an ETF if you wanted to do real time trades at very low cost.
A very rational strategy. I’ll bet it has served you well.
flr
To be honest, the ONLY reason I thought of this approach was that I wanted to keep this small IRA separate from the rest of my retirement funds -- which meant I wasn't adding anything to it. Doing the investing/selling cycle was the only way I could generate any ongoing investing within the account to take advantage of down markets.
It's actually worked out pretty well!
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