|
|
| Author |
Message |
mcpoz
|
|
Dow Jones performance
| 
Dec 9 23:58 UTC 1995 |
I heard a commentator on TV indicate that the Dow Jones is expected to go over
6000 by the end of 1996 and hit 10000 by year 2000. This seems pretty
optimistic - what do you think?
|
| 19 responses total. |
srw
|
|
response 1 of 19:
|
Dec 10 02:48 UTC 1995 |
This is guesswork. Your guess is as good as mine, or anyone else's for that
matter. The experts are very often wrong. Both are distinctly possible. I'd
give each one of those predictions about a 50% subjective probability.
The Dow is at 5156 now. It would have to continue to grow at about 15% annually
to reach 6000 by the end of 1996. That's a bit high, historically. To get to
10000 from 5156 in a tad over 4 years is a growth rate of 17.6%, which is more
of a stretch, as the law of averages will eventually win out. 10% annually is
the average over good and bad years. The farther out you go, the more likely
it will approach this average.
So the 6000 is more believable than the 10000.
On the other hand, if you extrapolate this year's growth into the future
(a very dangerous way of predicting anything, I might add), both marks will be
passed well in advance of the deadlines given.
|
zook
|
|
response 2 of 19:
|
Dec 10 20:19 UTC 1995 |
No, I don't think so. The market is overpriced now. The chance of
continuing to surge without mishap for such a period seems overly
optimistic. Will it get there eventually? Probably.
|
srw
|
|
response 3 of 19:
|
Dec 11 06:33 UTC 1995 |
Not everyone agrees that the market is overpriced now. That's why some people
are buying while others are selling. Your opinion is shared by many, but not
all.
|
mcpoz
|
|
response 4 of 19:
|
Dec 12 03:05 UTC 1995 |
Isn't there an analytical method to determine if a stock is overpriced?
Something like: Stock value = (Total assets + Owner's Equity)/(no of shares)
?
|
zook
|
|
response 5 of 19:
|
Dec 13 02:51 UTC 1995 |
Overpriced is in the eye of the beholder. Stock is a piece of paper.
It's worth only what someone is willing to put up to buy it.
Steve, that's true - when all agree it's overpriced it will drop for sure :-)
|
mcpoz
|
|
response 6 of 19:
|
Dec 13 03:29 UTC 1995 |
stock is more than a piece of paper. It is a share of ownership of the
company.
|
srw
|
|
response 7 of 19:
|
Dec 13 07:46 UTC 1995 |
mcpoz is right about that. THere are a zilllion ways to value it.
Book Value is (assets-liabilities)/shares
EPS is (income-expenses)/shares
the price should be greater than these, and is usually compared to them by
the formation of a ratio. Price/book and P/E. What is the "right" value for
these ratios? This question is unanswerable, because it depends upon your
model for the businesses.
When Netscape went public it shot up from about 28 to 70 or so the same day.
Was that overpriced? The P/E test couldn't even be applied, because their
earnings were (and still are) negative. But I wish I had bought some, as it
is way over that now.
By classical measures, the market is probably just a bit overpriced, but there
are plenty who believe the classical measures don't and shouldn't apply any
more.
|
katie
|
|
response 8 of 19:
|
Dec 13 16:31 UTC 1995 |
There's also a greater than ever demand for stocks now, as most longterm
investors want them in their portfolios. And the market is now driven
more by institutional investors (mutual funds, pensions, insurance companies)
than by individuals, which should mean less panic-prone decision makers
in the equation.
There are now more mutual funds on the market than there are stocks to
put in them.
|
mcpoz
|
|
response 9 of 19:
|
Dec 15 02:07 UTC 1995 |
Great discussion & thanks. With all the institutional investors, are there
any likely "triggers" which kicks in computerized major scale buy or sell
orders?
|
mcpoz
|
|
response 10 of 19:
|
Dec 16 03:15 UTC 1995 |
Today was a new record for volume on nyse. Something like 638million shares
exchanged - touched off primarily by the "triple witching event" and computer
buying. Can anyone refresh our memories as to what the 3 events are that make
up the "triple witching?"
|
srw
|
|
response 11 of 19:
|
Dec 16 08:20 UTC 1995 |
One of them is Options Expirations.
|
patches
|
|
response 12 of 19:
|
May 26 08:12 UTC 1996 |
looks like this particular column is dying. where are all the business majors
what has happened here. all you traders/investors get bought out:)
my charts as of january sez that the dow wants to go to 6112.00 plus or minus
50 bucks before the next bear market. im not really interested in when as
i am only a trader <day>..
tripple witch is when all of the different options arenas options expire
at the same time. if you only trade the market that one day you can
rest for the next 3 months providing you are charting the right stocks. oh,
forgot to add that you need a few bucks and the guts to stay with the trend:).
anyone interested in trying their luck in a mock trading game <NYSE> STOCKS
only, i would be happy to host the game. you get 100,000.00 bankroll to
play with. the game will run for 60 days at a time, then a new game.
top winner announced every week. this game is for trading only. no investors
allowed:). this game is designed to make you an expert chartist. you must
have a chart before you enter. if you miss a buy or a sell, you get a
reprimand. three reprimands and your out till the next game. this will
give you a chance to bone up on your errors and prepare for the next game.
the trick is to pick a stock. thats right, only one, and get a chart
started. typically you should have 75 days of data plotted and ready to
go when you want to start.
anyone interested can email me and we can discuss this further. you should
learn more here in a year than you can learn standing on the floor of the
stock exchange in 6 months. email to <cs_cuv@cs4.lamar.edu>
|
lucey
|
|
response 13 of 19:
|
Jun 4 03:48 UTC 1996 |
If you hosted an INVESTING game, sure. But I think you know my position
on charting the market :)
|
patches
|
|
response 14 of 19:
|
Jun 10 09:42 UTC 1996 |
hi dennis----im not trying to get anyone to change their ways. just thought
there might be a few technicians that would like to sharpen up their
turning points. nice to be able to do it without actually going broke.
during the winter i teach beginners. i look at it as another trick inyour
bag. never saw a good magik man with just one trick in his bag....how
about you:). if you ever get the urge just give me a shout. its fun and
educational. or you can email me at <stocks@eskimo.com> w/o the brackets.
it was my intention to post the buys or sells for the next day here on the
bbs, but it is too hard to get in and the server is so slow that it isnt
worth it. i will be running on batteries this summer and wont be able to
call a slo server. maby this fall when we get back from the badlands.
have a good summer and good trading..........patches.
|
lucey
|
|
response 15 of 19:
|
Jun 17 03:36 UTC 1996 |
That's one of the advantages of trading vs. investing: you can take a break
from the market for the summer and come back, look at some charsts, and be
back where you started without missing out on too much news. Have fun in the
badlands.
|
i
|
|
response 16 of 19:
|
Apr 19 17:03 UTC 1998 |
Well, less than two years after last entry in this item, the DJ30
"industrials" have pushed past 9000. 10000 by 2000 looks like it
could be easy.
These new ever-higher highs seem to be mostly a Wall St. event
though. Corporate profits have done nothing resembling keeping
up with stock prices in the great bull market of the 80's and 90's.
Esp. in recent coverage, i've noticed "more invester's money chasing
fewer shares of stock" being cited as the reason for the market
going up, as opposed to "shares of DilbertCorp. are really worth
$XXX.XX and are a reasonable and prudent purchase at that price".
True to form, Washington is pumping up the bubble by slashing taxes
on capital gains (always the more risky & speculative part of
investing) and ignoring interest and dividends (certainly a more
sober, stable influence on the market).
Anyone with a grip on market history and reality knows that the current
trends can't continue for very long. Whether the market will crash a la
1929, go into a protracted bear period (like the 1970's or the Tokyo
market of recent years), or something else is mostly a matter for
speculation. Back in the real world, the little guy has to decide
whether to put the $200 he's budgeted to save for retirement this
month into a bank account, mutual fund, or something else.
Figuring that our little guy is >15 years from retirement, saving in an
IRA (ignore most tax stuff), saving monthly (he can meet mutual fund
minimums, buy stocks somewhat economically, etc.), and not interested
in speculative investment, what advice do you give him? Safe, solid
short-term Treasury bonds? Is there some decent stock still selling
at *historically* reasonable ratios (without any rose-colored-glasses)?
Bury gold coins in his back yard?
|
srw
|
|
response 17 of 19:
|
Jun 27 05:39 UTC 1998 |
With > 15 years to go, I would still be mostly in the stock market. It
may do badly in the short term. but over time periods like that is has
almost always beaten treasuries, gold coins, etc. I would put it in a
no-load stock fund. Not necessarily an index fund.
If you are sure that the market is going to go down, then you probably
want to be in bonds until you thin otherwise. This amounts to market
timing, though, and I know that I am no good at it. SO I have not
indulged in this kind of behavior.
|
eprom
|
|
response 18 of 19:
|
Oct 10 08:01 UTC 1999 |
reading re# 0 makes me laugh :D
|
i
|
|
response 19 of 19:
|
Dec 21 05:35 UTC 2000 |
I think that the NASDAQ 100 closed today at about 2350, after peaking
around 5050 in March. Those who believed the hype and bought into the
sure-thing fabulous-growth-rates tech sector back in those glory days
have seen over half their investment vanish down the toilet in about 9
months. Many dot-com's are down more like 90% from their highs. Do
you think that investors have learned some wisdom from this crash, or
do the fools just have less money now that they need to be parted from?
|