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What to know about the stock market (2007)

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Re: What to know about the stock market (2007)

#281

Post by hartator »

shoto_io wrote: post #157
cehrlich wrote: post #85

This is a great article that explains markets (not just the stock market really) in an easy to understand way. The one thing I believe people should know about the stock market is: There are people with more capital, time, and knowledge than you who will consistently beat you. Picking individual investments is mostly a sucker's game. Buying tech stocks and/or crypto in the last couple of years has been a consistent e…

My stock advice for any rookie has always been the same: - Buy S&P ETFs, most preferably by Vanguard, because they are a non-profit and thus have very low fees - If you have a large sum of cash, go all-in immediately, don't wait for the perfect time - Now, just wait, ideally 10+ years, before looking into your account again

> Buy S&P ETFs

Nitpicking but S&P has multiple indexes. And you probably mean just a total stock market indexes; not necessary S&P.

Re: What to know about the stock market (2007)

#282

Post by nickpp »

epistasis wrote: post #250
logicalmonster wrote: post #226

Earlier quoted context omitted.

Historically speaking, I think this has been one of the best things an average person could do within the context of a stable, safe, free, and productive society, but I don't think this kind of generic advice is really persuasive in the different and more turbulent world that exists right now. Additionally, because of many societal conditions, right now many people think they need to hit on a moonshot to have a good…

Owning equities (through index funds) is one of the best ways to always beat inflation. They are the part of the economy that appreciates because of future returns, in future money, not past dollar amounts. That said, most of current CPI "inflation" is not economy wide price increases, but comes from 1) car prices, because car manufacturers massively messed up and production is way down for the past two years, and 2)…

But most of all, the insane amount of money printing that went on during the pandemic.

Re: What to know about the stock market (2007)

#283

Post by brendoelfrendo »

sleepingadmin wrote: post #243
bradfa wrote: post #117

Earlier quoted context omitted.

I've invested in GM and avoided investing in Tesla. Mostly just because I understand GM, their business and financials and stock price history makes sense to me. I do not understand the valuations on Tesla, and hadn't even long before COVID and the most recent run-up in value. Clearly I've missed out on massive earnings if I had invested in Tesla instead of GM (although GM's done decently lately). To me looking at th…

>I've invested in GM and avoided investing in Tesla. Mostly just because I understand GM, their business and financials and stock price history makes sense to me. I do not understand the valuations on Tesla, and hadn't even long before COVID and the most recent run-up in value. Clearly I've missed out on massive earnings if I had invested in Tesla instead of GM (although GM's done decently lately). I'm not currently…

There's lots of weird takes in your comment, but this one:

> I'm not currently invested in automotive. Just drive by some dealerships, empty lots. Not because they are selling out but because business is bad.

is a bad take. Dealer lots are empty because of supply chain constraints. Cars are selling as fast as they come in. Desirable new models like the Ford Maverick have months long waiting lists. Used cars that are 2, 3 and even 4 years old are selling for new or higher-than-new prices.

Re: What to know about the stock market (2007)

#284

Post by llampx »

blurker wrote: post #269
llampx wrote: post #111

Earlier quoted context omitted.

When I was completely new to investing I put my money into AAPL, TSLA, AMD and TSM based on my experiences with them. That portfolio would have done extremely well had I stuck with it. I think the dogmatic "nobody can beat the markets" is hurting people who then think they may as well give up, and patently not true when you look at traders who beat the market year in and year out, and minimize their losses when they…

Actually I think you have it backwards. The notion that traders consistently beat the market is hurting a lot of people. There are extremely few traders who beat the market year over year. It becomes vanishingly fewer every year you add. Which is what you would expect for a system where luck plays a big role and nobody can actually predict the market. Tldr; way too many people believe that a lot of people can beat th…

How much do you know about the stock market and trading? No offense but I want to know whether I am speaking with someone who has been trading for a few years and has come to this conclusion or someone who read it on a headline somewhere.

Re: What to know about the stock market (2007)

#285

Post by leetcrew »

sleepingadmin wrote: post #243
bradfa wrote: post #117

Earlier quoted context omitted.

I've invested in GM and avoided investing in Tesla. Mostly just because I understand GM, their business and financials and stock price history makes sense to me. I do not understand the valuations on Tesla, and hadn't even long before COVID and the most recent run-up in value. Clearly I've missed out on massive earnings if I had invested in Tesla instead of GM (although GM's done decently lately). To me looking at th…

>I've invested in GM and avoided investing in Tesla. Mostly just because I understand GM, their business and financials and stock price history makes sense to me. I do not understand the valuations on Tesla, and hadn't even long before COVID and the most recent run-up in value. Clearly I've missed out on massive earnings if I had invested in Tesla instead of GM (although GM's done decently lately). I'm not currently…

> The second big disruption is efficiency. AC motors have regen, their motors are ~90% efficient. This creates the new generation of car. A model 3 performance(inexpensive sedan) has a 0-60 of 3.2 seconds. That's faster than all production Corvettes. Faster than a Hellcat. As fast as a Mclaren F1 from back in the day. About as fast as a Nissan GTR or Porsche 911. All the while not being annoying loud, far more practicality, and no emissions.

meh. even cheap hot hatches are close to being too fast to fully use on public roads these days. the race to ever quicker 0-60 times is incredibly boring and misguided imo.

a model 3 probably is superior to a hellcat in every measurable way, I'll give you that. although I doubt most hellcat owners would willingly trade them in for anything lacking a loud V8.

but people don't buy Porsches to drag race. there have always been much cheaper vehicles that would beat them handily on a drag strip; it's not what they're are designed for. they are pretty fast on the track, but unlike a Tesla, the appeal of a Porsche cannot be summarized in a single performance metric.

Re: What to know about the stock market (2007)

#286

Post by ra7 »

mypastself wrote: post #82

Can anyone recommend a quality book with similar content? Mind you, not about investing strategies, but just basic facts about financial markets (including stocks and bonds). I’m fine with textbooks, provided they’re relatively easy reads, and under 500 pages.

I'm also interested in this. I've been looking to understand the mechanics of financial markets and I don't know where to start.

In particular, I'm really curious about ETFs/mutual funds and what exactly happens "behind the scenes" when I buy a share i.e. what a share of a fund represents, how it translates to individual companies' shares, NAV, creation/redemption etc. I've heard these terms before, but I haven't been able to build a full picture.

Re: What to know about the stock market (2007)

#287

Post by ra7 »

is0tope wrote: post #224
dthul wrote: post #47

Does anybody know what happens when the bid is not equal to but higher than the ask? What is the price that will be used? Or will this not lead to a transaction at all?

As others have mentioned this depends on how matching works on the exchange. The case where the bid is higher or equal to the ask is known as a "crossed book". I most cases, this should never happen and if it does it would be as a result of a bug in the matching algorithm. If you place a buy/sell order with a price that is in excess of the best ask/bid respectively then that order will be matched against the opposite…

Thank you for this! This is exactly what I was looking for.

Re: What to know about the stock market (2007)

#288

Post by runarberg »

JohnJamesRambo wrote: post #71
sdevonoes wrote: post #11

Am I the only one in HN who is not into the stock market? I live in Western Europe and I would say 75% of my acquaintances don't do stock market. People I have known in the past (old people) didn't do stock market either. They all seem to have lived a normal life (decent jobs, decent house, decent family). Nothing extravagant but they got enough money to be "happy" in life.

Where do you and they keep your retirement money?

In Iceland there is mandatory retirement funds. You can choose which fund and many people pick a fund that is only made off of government bonds. More people probably don’t have a clue what their retirement fund is made off, it is just some number on their paycheck, so they participate in the stock market both indirectly and unknowingly. I think it is kind of a stretch to say that these people are doing stocks. Most people I know use every opportunity to withdraw early from their fund.

At most these people do stocks like a person who returns their compost to the city does public gardening.

Re: What to know about the stock market (2007)

#289

Post by SantalBlush »

shoto_io wrote: post #239
logicalmonster wrote: post #226

Earlier quoted context omitted.

Historically speaking, I think this has been one of the best things an average person could do within the context of a stable, safe, free, and productive society, but I don't think this kind of generic advice is really persuasive in the different and more turbulent world that exists right now. Additionally, because of many societal conditions, right now many people think they need to hit on a moonshot to have a good…

That's the story for many decades now. It turned out wrong every time. See for example: https://ritholtz.com/2019/08/death-of-equities-40th-annivers...

Very true. On the other hand, it was previously believed that the real estate market could never go down, which led to highly leveraged positions in that market from homeowners to banks.

Re: What to know about the stock market (2007)

#290

Post by lotsofpulp »

vel0city wrote: post #259
lotsofpulp wrote: post #173

Earlier quoted context omitted.

Pretty impressive to have foreseen, as a college freshman in 2006, the proliferation of broadband mobile internet and the development of mobile devices capable of taking high quality photos and video, mapping services, video calls, health tracking, and other functions that would obviate and consolidate multiple industries.

I was a teenager in 2006 and still understood mobile devices with fast internet connectivity with photos, videos, mapping services, and video calls were going to be a big thing soon, as to a tech nerd like me it was already partially a reality. By that time I already had Google Maps on my phone, was uploading photos to web services through MMS gateways, was browsing the web with Opera Mini, had my email on my device,…

> In 2006 I don't know that I would have thought Apple would have dominated the market as much as it has,

But that is the most important point. The rest is trivial, but knowing which organization will be able to capitalize on it is the only relevant fact if you are trying to optimize for a return.

In 2006, the mobile network owners seemed in prime position to use their monopoly to squeeze everyone else, as well as Blackberry completely dominating the ecosystem.

In 2006, I do not know what kind of evidence a person would have had to KNOW apple, alphabet, Microsoft, Amazon, and Facebook would be where they are relative to ATT/Verizon/T-Mobile/Blackberry.

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