Anyone Know How The Stock Market Works?

[bradleysnyder]

i have really been wondering for quite some time how the stock market works.

anyone have any good suggestions on how i learn exactly how it works?

any good websites that make it simple to understand?

[rugbybdyb]

Buy stocks at a low price and sell them at a high price and you make money

Buy stocks at a low price and sell them at a lower price you loose money...

Really very easy.....

[Red_Sux]

here is the synopsis. rich people print money by issue stocks to the public. you buy these papers, and speculate on how much it is worth on the stock exchange. when the rich people cash out, you'll be left with bunch of papers. so you gotta time it right when to open/close your position.

[hoopster42]

the stock market is based mostly on speculation, rumor, innuendo, just like sports betting, the difference is, you usually dont lose a ton of money in the stock market over the course of 3 hrs like you can in sports betting, theres a dude here i think his name is rage wizard, he knows a ton about the market, look up his threads youll learn a lot

[Red_Sux]

the stock market is based mostly on speculation, rumor, innuendo, just like sports betting, the difference is, you usually dont lose a ton of money in the stock market over the course of 3 hrs like you can in sports betting, theres a dude here i think his name is rage wizard, he knows a ton about the market, look up his threads youll learn a lot

not if you're selling naked puts on BSC

[RageWizard]

It goes like this.

A company needs to raise capital so they issue stocks out of some market somewhere. The public will then buy those stocks and trade the stocks with each other. People will speculate on how much a company is worth and how much business that the company is going to do in the future in order to pump up a stock resale value. Then when the time is right people will unload their stock on somebody else and make either a profit or loss. You know what just search this forum for "Stock Market 101" and you can learn how to invest in the market and not lose money. I have 1 more lesson that I was supposed to put in on Monday, but I am having a rough time finding a company that has the correct chart to show.

[RageWizard]

You can also go to philsgang.com. He will teach you the same thing that I do only it cost $40 a month.

[BigBollocks]

Rage I've been hoping you'd use the Bear Stears case sometime to further highlight when would have been the best time to head for the exit door. If you ever get a chance to further explain what you'd said about the time to get out being a year ago with chart analysis I'd appreciate it. Cheers

[RageWizard]

Rage I've been hoping you'd use the Bear Stears case sometime to further highlight when would have been the best time to head for the exit door. If you ever get a chance to further explain what you'd said about the time to get out being a year ago with chart analysis I'd appreciate it. Cheers

I will see if I can put something together with historical data that will show everyone when the time to unload the Bear Sterns and most other financials too, occurred.

[RageWizard]

O.K. ask and you shall receive. This will probably take 5 different postings so it may also take some time. Here we go.

A look below shows the Bear Sterns chart from Jan 1, 2007 until Nov 1, 2007. I have circled three opportunities that anyone who can anaylze a chart would have been using the chace to leave and save money if they had a long play on this stock. Before about the middle of February this was an excellent stock for a long position. Then almost without warning the stock dropped about 17%. If I had this stock at this time it would have triggered a stop loss, or even a trailing stop that I ALWAYS EMPLOY as an insurance policy. If your a hardy investor who can take a 20% hit and didn't sell then there was a second chance to recover some money around the May time period. This would represent only a 6% loss from the years high. The third chance came back in the begining of October when the market had a big rally led by the financials. The stock came back up to 130. Still a loss of 24%, but by this time everybody knew about the mortgage crisis and anyone going for a long term long play here must have been nuts, or an insider. Before the 3rd chance there was an extended time period of almost 3 months where the stock was declining and the volume was going up. A very bearish sign.

[bettilimbroke999]

I will see if I can put something together with historical data that will show everyone when the time to unload the Bear Sterns and most other financials too, occurred.

Rage claims as all do that he knows the "key" to the stock market, unlikely but if so they shoulda hired you at Bear Stearns they have lost billions in the past few months, apparently they didn't understand investments to the level Rage does. The truth is that the stock market is easy to make a small percentage return on your money when the economy is stable (10-11% APR S&P500 index ...not bad) and easy to lose a large percentage when the economy iturns bad. Make no mistake about it the stock market is legalized gambling, plain and simple, if you want to bet legally simply pick a stock and go short or long and take your chances. Ask someone who paid 160 for Bear Stearns (the world's fifth largest investment firm) last June who cashed out for 4 on Monday if the stock market is gambling or not. People obviously didn't imagine the stock's "true value" at 4 bucks or else they would've sold their positions instantly and/or shorted the stock and it would've dropped in a day. No one knows the future, which is why billionaires can go broke betting on the market, just like you or I can.

[bettilimbroke999]

O.K. ask and you shall receive. This will probably take 5 different postings so it may also take some time. Here we go.

A look below shows the Bear Sterns chart from Jan 1, 2007 until Nov 1, 2007. I have circled three opportunities that anyone who can anaylze a chart would have been using the chace to leave and save money if they had a long play on this stock. Before about the middle of February this was an excellent stock for a long position. Then almost without warning the stock dropped about 17%. If I had this stock at this time it would have triggered a stop loss, or even a trailing stop that I ALWAYS EMPLOY as an insurance policy. If your a hardy investor who can take a 20% hit and didn't sell then there was a second chance to recover some money around the May time period. This would represent only a 6% loss from the years high. The third chance came back in the begining of October when the market had a big rally led by the financials. The stock came back up to 130. Still a loss of 24%, but by this time everybody knew about the mortgage crisis and anyone going for a long term long play here must have been nuts, or an insider. Before the 3rd chance there was an extended time period of almost 3 months where the stock was declining and the volume was going up. A very bearish sign.

Obviously anyone looking in hindsight could circle an infinite number of places one should have closed out a long position. B/c they know that 8 months from now the stock's worth 6 bucks/share lol. With that information no one would hold onto the stock, but the circles you have are price jumps that were clearly an indication that investors were not sold on the level that risky investments had damaged Bear Stearns. If you could predict that you would be the wealthiest investor alive and would have 94% ROI and would be laughing at Warren Buffet with his meager 25%. If everytime there was a S&L crisis or a mortgage crisis or the economy was headed towards recession stocks lost 94% of their value it wouldn't take 8 months for them to do it, it would happen instantly b/c all the large investors would see it coming and sell the shit out of it.

[RageWizard]

Now for the actual signs that could have been used to get out with the money. Below is the chart for the time period of Feb 1, 2007 to Apr 2, 2007. The chart shows that before the decline volume was light and the stock was sitting on top of the 50 day moving average. The 50 day moving average acts like resistance when a stock, or index approach from the bottom, and like support when the stock , or index approach from the top. Usually when a stock crosses the 50 day moving average it is done on increased volume and the stock gets a pop in either direction. At the end of February the stocks volume increased and the stock fell out of the sky for a good week to a week and a half. A use of a stop loss set right below the 50 day moving average is a good short term play for a quick trade, but the stock even fell below the 200 day moving average, which acts just like the 50 day moving average when it comes to support in this case. A lot of long term players use the 200 day for support and place a stop just under this level for a stop loss.
Then the stock traded in a tight range or "consolidation" as they say right around the 200 day moving average. Usually a consolidation around a moving average gives a volatile swing either way.

[RageWizard]

Obviously anyone looking in hindsight could circle an infinite number of places one should have closed out a long position. B/c they know that 8 months from now the stock's worth 6 bucks/share lol. With that information no one would hold onto the stock, but the circles you have are price jumps that were clearly an indication that investors were not sold on the level that risky investments had damaged Bear Stearns. If you could predict that you would be the wealthiest investor alive and would have 94% ROI and would be laughing at Warren Buffet with his meager 25%. If everytime there was a S&L crisis or a mortgage crisis or the economy was headed towards recession stocks lost 94% of their value it wouldn't take 8 months for them to do it, it would happen instantly b/c all the large investors would see it coming and sell the shit out of it.

I am addressing exactly when to get out and when to buy. Of course this is't an exact science but a look at history only makes it easier to spot the signs. BTW XLF has finally taken flight.

[jstblaze]

Npv

Net Present Value

You make a series of predictions, based on industry, competitiors, peers, about things like the future growth rate of revenues, the future growth rate of costs (as well as when these will increase or decrease)

you then take their present cash flows, and predict them out for the life of the company for every year, including into perpetuity.

these cash flows are discounted back to present day, at which point you come to a value for the company. If this value is more than the current value, you look into why, and challenge your own assumptions.

if you think your assumptions are correct, and the company is undervalued by the public, you buy.

this is how invetsment proffessionals invest, not day traders who are trading just on momentum and other factors.

[RageWizard]

Alright now where the hell was I. Oh yeah consolidation of a stock over an ever extended time signals a volatile movemment in that stock. It is hard to determine which way that stock will go even with some other charts of indexes and market sentiment. This chart is from begining of april to the middle of June. As you can see below in this case the stock took flight and return back up almost to the levels of before, but a look at the volume shows that it did it with no increase in volume. This means the demand for the stock didn't increase but the stock did. These moves are another signal for people who own the stock to get out while the getting is good. After the initial rise the stock started to sell off again with no increase in volume. This is when I believe the insiders where hitting the road.

[RageWizard]

Net Present Value

You make a series of predictions, based on industry, competitiors, peers, about things like the future growth rate of revenues, the future growth rate of costs (as well as when these will increase or decrease)

you then take their present cash flows, and predict them out for the life of the company for every year, including into perpetuity.

these cash flows are discounted back to present day, at which point you come to a value for the company. If this value is more than the current value, you look into why, and challenge your own assumptions.

if you think your assumptions are correct, and the company is undervalued by the public, you buy.

this is how invetsment proffessionals invest, not day traders who are trading just on momentum and other factors.

I don't day trade, just short term investments that can be in the range from a day to a year or so depending on the chart. I place absolutely no credit in the fundamentals, they represent things that can be altered and manipulated easily which only make it easier for the fantasy story to be told. It is true that 3 out of 5 times I lose money, but that is only because I use very tight stops and get out when it isn't going my way, then I let the winners run.

[RageWizard]

O.K. a continuation of the time line from the start of June to around mid-August shows a steady decline. Then as the volume increased the sellers started coming and this is when everyone started to become aware of the housing problem. You could have known this way back in March when the govermently altered housing starts report show a decline. Furthermore another fixed government report showed an increase in foreclosures.

[Red_Sux]

i appreciate your effort. i did learn something, but i still feel that the stock market is the second largest casino...i only put in whatever i can afford to lose

[RageWizard]

At no time does this stock make any indication that it is a canidate for a long term play. Actually it is exactly the opposite a long term short play along with the builder's stocks. So the chart below shows a time period from the middle of July to the middle of October. The stock came down and fond some support at the 120 level for a while. Eventually the 50 day moving average came down to around this level. When this happens the stock needs a increase in volume to get above the moving average but if the volume doesn't stay up the rally will fail. This is exactly what happened in the first couple of weeks of October. An initial boost with a little increase in volume to push it over the 50 day moving average, but then no follow thru. This is a signal to sell because the buyers are not willing to keep paying more for the stock even though the price is still increasing. Eventually the stock price will come back down for the short term.

[RageWizard]

i appreciate your effort. i did learn something, but i still feel that the stock market is the second largest casino...i only put in whatever i can afford to lose

Of course this is staright gambling. You don't even need to go offshore for this and it really is easy after a couple of months I believe anyone can pick it up. Just try it with some fantasy cash and a couple of learned techniques. After while you will see that you don't need to know all the fancy words or fundamentals. All you got to do is follow the money. The people who really control the stock prices are the big boys with the mutual funds retirement funds etc. Those are the people who are buying millions of shares a day and when they buy or sell they move stock prices, which is all I care about.

[Red_Sux]

Of course this is staright gambling. You don't even need to go offshore for this and it really is easy after a couple of months I believe anyone can pick it up. Just try it with some fantasy cash and a couple of learned techniques. After while you will see that you don't need to know all the fancy words or fundamentals. All you got to do is follow the money. The people who really control the stock prices are the big boys with the mutual funds retirement funds etc. Those are the people who are buying millions of shares a day and when they buy or sell they move stock prices, which is all I care about.

i like fx. it is gambling, but it is on 24/7 for the weekdays.(i get the gitters when the stock casino close at 4pm) and some of the skills cross over from stock spectulation to fx. like basic candle stick patterns, fibbonacci lines, trends etc. and best of it all, it is LEGAL.

[RageWizard]

Rage claims as all do that he knows the "key" to the stock market, unlikely but if so they shoulda hired you at Bear Stearns they have lost billions in the past few months, apparently they didn't understand investments to the level Rage does. The truth is that the stock market is easy to make a small percentage return on your money when the economy is stable (10-11% APR S&P500 index ...not bad) and easy to lose a large percentage when the economy iturns bad. Make no mistake about it the stock market is legalized gambling, plain and simple, if you want to bet legally simply pick a stock and go short or long and take your chances. Ask someone who paid 160 for Bear Stearns (the world's fifth largest investment firm) last June who cashed out for 4 on Monday if the stock market is gambling or not. People obviously didn't imagine the stock's "true value" at 4 bucks or else they would've sold their positions instantly and/or shorted the stock and it would've dropped in a day. No one knows the future, which is why billionaires can go broke betting on the market, just like you or I can.

I made some comment in bold face for two reasons. You're right about the 10-11% thing only it's more like 13-17%. It doesn't matter whether the market is going up or down you can make just as much money either way. Actually you can make more when the market goes down and quicker too.

The second bold face just makes my point for me. YOU NEED TO PUT A STOP LOSS or TRAILING STOP ON EVERYPOSITION THAT YOU HAVE. It is like an insurance policy.

Bear Sterns went down because of exposure to the sub-prime mortgages. They saw quick and easy bucks and everything was great until the housing prices stopped going up. They don't need my help anyways, they are in the back room making deal right now probably. The fat cats will come out of this feeling fine, the people who will get fucked are the little guys. My tricks aren't meant for the big guys just the ones with less than $200,000 to invest. So I doubt that any financial companies will like my help. Unless they would like to build a auto driller sex toy for themselves. Then my other talents would come into play as a builder of fine equipment.

[imgv94]

rage wizard is a stock wizard

[bettilimbroke999]

Alright, well I'm down a good percentage over the last two weeks in the market. Give me some picks, what stocks to long or short. Also if you can average 17% return I assure you there are a TON of investment firms that will hire you in a New York Minute, unless you come in to work naked or jackoff into your bosses coffee you will be a millionaire investor if you have secret to generate that rate of return, hell the credit card companies don't even charge me 17%. But anyway, fuk it I'm down so give me your picks and I'll ride your worthless picks to the gutter just like I would my own.