I would love to spend the next 5 yrs. or so just getting to know 3 or 2 companies so thoroughly that I could predict fairly accurately what direction I felt their stock was about to go.
I know, I know: there are thousands of analysts who attempt to do this and fail miserably. But isn't that because they stretch themselves too much and watch so many companies at once?
2007-09-11 16:02:57 · 5 answers · asked by Anonymous in Business & Finance ➔ Investing
Just a thought. If your mind is geared toward analysis of underlying conditions and how they will affect future prices, you might want to consider trading in commodities. Many traders prefer commodities because there seems to be more of a rational connection between the underlying conditions and the direction of prices. In stocks there are always a thousand different subjective factors which can wreak havoc on what the stock price 'should' do according to the fundamentals. In commodities, if war breaks out in the MIddle East you can bet oil prices are going to rise, and if drought destroys the corn crop you know there will be a shortage.
2007-09-13 02:23:00 · answer #1 · answered by Todd 3 · 0⤊ 0⤋
Sometimes that's the case and often it is easier to predict earnings. I've made great money by following oil tanker rates in trading FRO, OMI, GMR, and video game data for ATVI, ERTS, TTWO but often unknown or unidentifiable entities enter into the calculating of earnings. checkout earningswhisper.com I've done better watching revenue growth and buying good companies on the dip like HCSG +400% returns on some shares; NSSC 571% with some shares.
2007-09-11 23:34:09 · answer #2 · answered by crim 3 · 0⤊ 0⤋
you might have a better feel for a couple of etfs and instead of calculating earning, only buy or short based on momentum. trading SPY or QQQQ based on over selling or over buying could be a simpler way to make investment decisions. Using a year time line and a dual moving average is a simple way to see momentum.
2007-09-11 23:35:38 · answer #3 · answered by slara512 2 · 0⤊ 0⤋
One way to estimate earnings growth is to multiply the return on equity by the percentage of the earnings retained, In other words the percentage of earnings not paid out in dividends.
2007-09-11 23:27:18 · answer #4 · answered by jeff410 7 · 0⤊ 0⤋
The pros put out estimate Then the company gives guidence up or down and the Pros revise their estimates and the company will say they are comfortable with the estimates and then the company will beat the estimate by a couple cents which makes everybody happy. Thats how it works.
2007-09-11 23:16:03 · answer #5 · answered by redd headd 7 · 0⤊ 1⤋