 Financial Advice for younger person? |
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 Why do LIBERALS cheer when the stock market goes down and business suffers? |
| Why do LIBERALS get so happy when there is bad economic news? Why don't LIBERALS want America to succeed?... |
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 What are the reasons for Nike & Apple deciding to locate in China? |
| I would like reasons relating to Nike & Apple investing in China for the manufacturing purposes.... |
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 Stocks/investment for a 17 year old? |
| I am 17 and want to put about $250 into something and not mess with it for about 10 years and hopefully make a profit....would stocks? (if so which ones are good right now?) or something else be good ... |
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 How much money do I need to start investing in stocks? |
| How much do I need to invest to offset taxes and commision?... |
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hs29 | Why people chase momentum stocks but not value stocks and repent later? |
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The Mutual Fund Investor
 |
Hello,
Many people prefer momentum growth stocks over value stocks despite the overwhelming statistical evidence that value outperforms growth over time. There is a very good research report on the Tweedybrown.com website that shows how stocks with specific value and growth characteristics have performed over time. Just go to the research & reports link and click on "What Has Worked In Investing." Since the begining of time, people have had the tendency of doing what is not in their own best interests. The reasons a person would prefer a momentum/growth stock are behavioral in nature. Some people prefer popular stocks and find comfort in the fact that alot of other people are in the same investment boat with them. If he or she loses money so will everyone else. To some people, value stocks are very boring and do not appeal to the the thrill seeking people that prefer the excitement that can be found in growth or momentum stocks
I hope this helps.
Michael A. Weiss, CFA
The Editor
The Mutual Fund Investor
http://www.mutualfundinvestor.net |
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countess almasy
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GRQ fantasies die hard...
(get rich quick) |
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warman111
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not all it depend on the strategy you follow |
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thiagu1978
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It's Money Honey |
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antdu
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That really depends when you get into the momentum stocks.
If you hop on early and the momentum carries it for a while, you make the money and move on. A value stock, you hold up your money to wait for the market to turn in its favor. you can hop on board 4 or 5 momentum stocks by that time.
I think investors should be doing both and searching for companies that are undervalued. While not overlooking what momentum will do to company or industry.
Personal holdings and recent moves.
I own TCX - I feel this is very undervalued trading under a dollar and has been profitable. I seen it and had to jump on. The price was to low not too.
The problem is that too many people get in after it is too late and the price drops or the are too greedy and look for the extra .03 and in effort to get it, they end up losing .05. |
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Bhau
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1. Mass in general follows the present information more
2. Many don't understand the statements and so value stock
3. If value stock information is available to mass in free, many will go for it |
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Naren
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to burn their fingers |
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BigBen
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normally, people chase for momentum stocks because they can't resist their temption (or greedy) to make much money in stock after hearing so many successful stories from their firends, colleague, relatives etc. they really assume the process is that simple!
without knowing the stock market is full of syndications to attract 'fresh money', they fall prey to this almighty giants (fund managers, hedge funds, speculator, wealthy investors) soon after they managed to make 'few buck' (if any). this mostly happen to novice investors, who don't know who are they playing with, and how to play it right.
Some story about stock market cycle
http://www.stock-investment-made-easy.com/stock-market-cycle.html
and some info who are playing the market
http://www.stock-investment-made-easy.com/investing-personality.html |
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ajay k
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you are absolutely right, people and that too small investors who remain trapped by odd lot theory only burn their hands by chasing momentum stocks more often than required, even when we have some of the best companies from all sectors are at cheaper valuations than momentum guys.
what people should understand that
" if you keep doing what you did, you will keep getting what you got"
in this case loss loss losssss unless you start respecting valuations ahead of movements and briskness of returns.
equities are a long term game and we need to respect this, just be patient or be spectator of a movement stock all your life and repent later as you said my friend |
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