New answers tagged stock-markets
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The EMH cannot tell you the future growth rate of a company. There is no way to accurately predict the future growth rate even from private information. The EMH claims that stocks are fairly prices if all investors have access to all public information. It does NOT say that stocks are correctly priced. Market conditions change, companies make bad (or good ...
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EMH tells me that securities will be fairly priced since all information are available to investors.
No, it doesn't. It says all publicly available information is priced into the stock. The Efficient Market Hypothesis says there is no way to accurately predict the future value of a stock.
You can use DDM, but that goes against the Efficient Market ...
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If there are no taxes because these are retirement accounts, and there are no fees.; then there is no difference between the options..
Doubling $400 gives you $800 as does doubling two piles of $200 each. The same thing is true iif it drops 50%. $400 becomes $200 no matter how many piles it is divided into.
Taxes and fees will change the math.
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My guess would be that this is simply a coincidence. Unless someone can point to an event which is scheduled for the 19th of every month and that could affect the stock market. Like if some government agency releases its economic projections on the 19th of each month or some such. If someone on here knows of such a regularly schedule event, please post.
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The Super Bowl Indicator, attributed to Leonard Koppett, states that a if it is won by an original National Football League team (pre AFL/NFL merger) then the market will be up for the year. If the AFL team wins, the market down will be down. In the first 23 years, it was correct 21 times or 91%.
As with your observation about the market dropping on the ...
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Buy Limit and Buy Stop orders are triggered when the Ask reaches your order's price.
Sell Limit and Sell Stop orders are triggered when the Bid reaches your order's price.
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You can't " ' time ' " the market.
("Timing" the market is just, another, utterly pointless/meaningless word made-up by the financial press to try to pretend there is rationalism in trading.)
Every single fund does worse than a simple index fund - end of story. That's all there is to "stock picking".
3
When a global pandemic causes the markets to crash. You might not get in on the bottom but you can do pretty well by having cash ready to invest during rapid downturns like that. In general though, it's a poor idea to try and time the market and time in the market is more useful.
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Why is it so hard to time the market?
The problems of timing the market are manyfold. First there is the taxation and transaction cost problem. Moving in and out of the market is costing you some money every time. Granted, if you manage to sell at the top and buy back everything one year later for half the price, you will still make a reasonable profit. The ...
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It is very easy to time the market, no expertise is really needed. Those that bought at the worst possible time, during the last major crash in 2007, are enjoying healthy profits now.
For example, if you look at SSO, a S&P500 ETF and bought a bunch in Oct of 2007, you would have paid 23.87/share. On 1/9/2009 your investment would have been worth less ...
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Anyone that can outperform the market by timing is not going to reveal their secret formula, unless they are feeling really generous. Gurus like Tim Sykes are very expensive and hit or miss in terms of how much money you can make from their lessons.
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For most people, never. You may think the market is on a long bull run now but no one knows whether it is going to hit the peak tomorrow or next week or next month or 3 years from now. If you wait on the sidelines, you could miss out on a lot of growth between now and then. And, of course, you have the same problem in a bear market where you can miss out ...
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What are the reasons the index is so high with 1000% growth now compared to 12 years ago? Is one reason, the people have bought more
stocks and invested 1000% now compared to the year 2010?
One reason for the growth was that 2010 was at/near the bottom for stock prices. The index went up because stock prices went up. They went up because money flowed into ...
1
Where Did "Bulls" and "Bears" Come From?
...the actual origins of these expressions are unclear. Here are two of the most frequent explanations given:
The terms "bear" and "bull" are thought to derive from the way in which each animal attacks its opponents. That is, a bull will thrust its horns up into the air, while ...
1
Tl:dr Finance/Economics is arts(social 'science') pretending to be science.
It's the bane of modern society.
See Prof. Feynman's lecture "What is science" 1966.
From an interview with the BBC:
“Because of the success of science, there is a kind of a pseudo-science. Social science is an example of a science which is not a science. They follow the ...
-1
The value of a stock is determined by the people buying and selling it and their believes. The value of a stock is not necessarily determined by the value/success of a company, except if people belief those two to be related.
Models are valuable in that they might be used to predict how people might end up feeling about the stocks they own in the future.
...
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Price is based on whatever human beings are willing to pay for it (or not). Prices get "too high" and so people sell and they fall until they are "too low" and then people buy and they rise. No model can ever hope to predict that with accuracy. The markets are human beings buying and selling and are unpredictable except in the very ...
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A model is a mathematical formula that tries to explain something or predict something based on a set of inputs or conditions.
The price of an item in a free market doesn't have to obey any model. If a bunch of people think that something will become more valuable or less valuable in the future that will drive the price change because people are either ...
1
It depends on the conditions attached to your order.
If you place an All Or None (AON) limit order and there aren't enough shares to fill your order at your price then there is no trade execution.
If it's a limit order without the AON stipulation then you get whatever number of shares are available at your limit price and the rest of your order will only be ...
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A stop (limit) sell order means "execute this order if the price goes below X". For a sell, that price is the bid. So your stop at 0.35 would be executed. That would then create a limit sell which means sell at any price higher than Y. So your stop order would create a limit sell at 0.35 which would likely be filled since that's the current ask.
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The bid is the lower price and the ask is the higher price so someone has made a typo.
A sell stop-limit order combines a stop order and a limit order. If the stop price is reached, a limit order is triggered to execute at a specified price or better.
Your question only contains one price so I'm wondering if you meant a limit order to sell rather than a ...
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You have a fundamental misunderstanding of how exchanges work.
The "share price" is not the price you can buy or sell at. It is just the price at which the last transaction was executed.
At any point in time, there is a list of people who want to buy those shares, each with a maximum quantity and a maximum price. And there is another list of people ...
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IT depends on the order book and which exchange. If it closed at 10 and it looks set to open at 9 your broker should fill it close to that opening price. A NYSE specialist would fill your order at 10 by shorting it and immediately buy it at 9 hoping there won't be a complaint.
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The idea of a stock having a concrete price at any given moment in time is a description of the stock market, not a fundamental reality.
When you say things like:
From my understanding, my limit order is run/executed in any case since I made a limit order at x, and the share price must be a continuous function. The cases x<y and y<x at the instance of ...
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the share price must be a continuous function
Even if this were true, at least 17.5 hours pass between the close and the next open in US stock markets. The "true" price can change throughout this time. Sometimes the price remains visible, as with after-hours and pre-market trading. Sometimes the price is not quoted but people's views on the stock ...
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From my understanding, my limit order is run/executed in any case since I made a limit order at x, and the share price must be a continuous function. The cases x<y and y<x at the instance of market opening can not occur since that would mean that the value can be arbitrary at market opening.
No, share prices do not have to be continuous, and the ...
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The market is an auction and a security's price is determined by supply and demand. If there is a order imbalance (net excess buy or sell volume), overnight price will change. This may occur during after hours trading and if there is none, at the open of regular hours trading.
If you place a limit order at X, you'll be filled at X if the security trades at ...
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