Stocks: Anybody buy in October and hoping for a November spike

My take is that the stock market is driven by 2 factors...good value (known by research and experience) used mainly by professional investors. And optimism, given more weight by amateur investors. Right now the optimism has evaporated and will be unstable for at least another 6 months. No one knows where the bottom is for sure, but I don't think we're at the bottom yet (although statistically it's looking like we have found a floor at around 8500...FYI the DJIA was at 10588 when junior took office and at this moment it is at 8631). In my most pessimistic moments I think it will bottom out around 5900. I'm holding lots of cash and waiting a bit longer. I'm thinking of going rash with a small amount of funds and playing the puts and calls game instead of my usual December in Hawaii. I am not in any mood to fly again so soon after my last short trip where I felt emasculated and at the mercy of the abusive airlines and their petty fees and policies. Sailing to and from HI would take about 6 weeks so that's out for this winter. Better to stay home and make money, and to know me is to know that's a major change in attitude.

 

I think you are a blend of realist and smart. The AIG bailout alone should take at least a half a year for regulators to get a clear picture on.

 

Anyone who really knows what the market is going to do will be rich enough to give us all a million dollars. Anyone who thinks he knows what the market is going to do is probably delusional. Nobody who tells you he knows what the market is going to do should be trusted.

The best time to buy will probably become evident after it is long past.

Personally, I would never buy stocks with borrowed money. That's a lot like gambling in Las Vegas with borrowed money.

 

havent checked mine lately but was up like 9% for this month this was about a week ago. but still does not account for 30% drop of last year.

 

I bought in November. Opened a Roth with the max, which I think was $4,000.

I bought three stocks, two my Dad suggested and one *I* picked. The one I picked has gone up, his have gone down. I don't really care. These are for my retirement which won't be for 10 years. I'll keep putting a few thousand in it every year. By the time I retire I'll have a little extra money above and beyond my pension and TSA for either traveling....or to supplement my medical insurance costs.

I figure the market can't get much lower so now is the time to buy.

BTW I bought GE, J P Morgan Chase (Dad's picks) and BP. He suggested Exxon. No way. I chose BP because they are investing in solar and other renewables. I think I'm going to look into buying Phoenix and A123 next time.

 

heck i bought 500 shares @ 1.85 of a solar company in AZ... they are currently .98
also got some shares in a company that is looking at more efficient ways to convert power via wind, solar, etc. bought at .88 they are currently .65, it like goes on and on... so its simply a question of not how low can you go? its can these small companies survive long enough to ride out the recession??

 

This is what I'm hoping for as well. Historically, the market goes up in the long term. Of course, there's also the possibility of general economic collapse, but in that case the collapse of essential services would mean that no investment (stocks, land, gold, guns) would be able to save you from one horrible fate or another.

My thinking as well! Diversity is my watchword, and mutual funds are the way to do that. Except that I see no advantage in ETFs over no-load funds from a reputable fund family like Vanguard.

These are start-up industries. Typically in start-up industries there will be hundreds of companies at first, but only two or three will survive. If you'd bought Apple at the beginning, you'd be filthy rich now. But at the beginning, Apple looked no different than the hundreds of other tiny computer companies, nearly all of which are gone now.

As Fibb suggests, you'd be safer in an industry-specific mutual fund, of which there are probably many. It's likely that every major fund family has one for any given major category. I happen to like Vanguard, as there are no loads (there are no brokerage fees or other charges when you buy or sell) and costs are low (every mutual fund has to pay its managers, but some pay more than others).

As an example, I have a couple of funds that invest in health. With the aging population, and skyrocketing health costs, I figure these will be profitable industries. (I also have funds in other industries, and funds that are not industry-specific. As I said, diversity is my watchword.)

Investing in individual stocks is highly risky.

 

I didn't realize that. I'm surprised.

 

That is an incredibly risky bet. Only 3 stocks? I would recommend an index fund. Of course you didn't ask me.


I'm not worried about the market. The only thing that bothers me right now is that we had to cut back on investing 50% since I lost my job in October. Now would be an excellent time to buy stocks. I can't touch my accounts without penalty for another 30 years so I let it ride.

 

i agree diversification is the only way to invest, but the stocks i bought were not really for investment purposes. my 401K is used for that.

i bought the stocks on speculation. spent money i dont need (at least not right now??) i basically look at the purchase as like buying lotto tickets, it boils down to options, that is WIN BIG or go home...

i also bought Zenn stock as well, betting on an announced technology, now 4 years old, that it may go somewhere. on that, i made 4 separate purchases, the last 2 simply because the stock was so low, and plan to ignore the stock until summer 2010. dont really expect it to do much until just before that time anyway.