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Showing posts from February, 2018

Exactly what is a Short Sale? ~ Reader question Sunshine Rae, Saxony, UK

"What is a Short Sale? Glad you asked Sunshine, it is rather a simple concept if you realize investing in a stock so that it goes up in value over time is one way to make money in the market this actually what is know as being "Long" a stock.  Is not the only way you can make money.  You can also make money by being "Short" a stock. So say you believe a stock is trading way, way to high and the economic outlook does not look good.  You "Short" sell the Stock a $150 a share (of 100 shares) so in a week the price of that stock has fallen to $100 a share, you then go into the market buy 100 shares to cover the "Shot Sale" and collect the price difference in the profit between he2 of $50 a share. Investors look at ow many short sides a company has on it's books, companies trading high in short sales would be Sears, J.C. Penny's and other retailers.  f the company actually goes completely bankrupt you can still buy the shares penn

Why did balanced funds lose 7% last quarter? ~ Question from Reader

Why did balanced funds lose 7% last quarter while bonds increased in value. Was it the volatility of the stock market? Rising inflation? ~ Tim B. Los Angeles, CA While interesting to look at the correlation between the two indicators and they can always have the same inverse relationship you are asking about during the beginning of a Bear market; in this case I believe it is due because of two different factors.  But before I get into answering your question, for the sake of our other readers lets break down exactly what we are talking about. So for readers that don't understand what the term "Balanced Fund" is let me explain.  We are speaking about a specific type of Mutual Fund run by large corporations like Dreyfus, Prudential and Fidelity that maintain a diverse "Balance" inside the fund.  Specific Mutual funds may be directed into investing into industries like Oil and Gas, Telecom, or High Tech   so that while diversified the main reason they a

Liars and Buyer's and Bear's oh My!!!!!!!!! The Dow drops another 1000 points!

  VS.    If you have read my previous articles over the last couple of days I said I would be more worried if the DJIA corrected 2600 points in one day (10%)  well as of today that leaves us around 2,100 points off last week Wednesdays open.  I am still not in a panic and here is why: Bulls vs. Bears I'm looking at you right now stop talking to your dog and trying to make his head tilt to the side so you can do the Scooby Doo voice and say "Huh?" What are they? Why do people on Wall Street keep referring too all these Bull markets, all these Bear Markets?  Why do people on Wall Street go South most of the time, North every so often but never East and West? These are terms that Wall Street users identify certain periods of time.  A "Bull" market is one that is charging upward (like a Bull lifting its horns upwards no end in site) while a "Bear" market means things are on the way down (like a bear striking with its claws downward)

Full on Correction Dow Jones Down Over 1000 Points During Day?

Yes full on correction, so far lost all the gains for the year! Now hang tight lets see what happens through the week.  If you were thinking about investing but haven't think of today as a really great Black Friday sale day when everything is at a discounted price.  Remember you want to buy stocks cheap then sell when you made a resonable profit, not hold out until the market plummets like today.  If you didn't sell hang tight, avoid these panics and daily fluctuations, if you are in it for the long haul and you are invested in solid companies don't panic, I can assure you even if the stock dropped Coca Cola and General Motors aren't going anywhere. How about my stock picks while down they are except of course for the latest RMD are all still up.  If you were thinking about RMD it's on sale!!!!! We are going to hear pundits yak, and advisors scramble and news reporters sqwuak, yes there are economic factors that led to this correction.  Main one being that

600 Point Drop in Todays Market - Why all the Alarm Bells?

Run!, Run!, Run! Run!, Run!, Run! Most news reporters today put the fear of god into you to be alarmed at the 600 and some odd drop in the market today.  Just like listening to a weather report from a Ground Hog, don't listen.  What they didn't say in their commentaries is that over the course of the last few months the Dow Jones rose over 1,000 points its fastest climb in history.  Look at the over all market from the last few months this correction speculated over a rise in interest rates is a lie!  Wait Wall Street would lie to you? Wall Street has already known that the interest rate hikes would be happening, while a factor in the decline not the reason, the reason is because the steep climb over a short period of time caused Hedge Funds and Portfolio managers to sell to lock in profits, this happens all the time.  Reporters think this is such a huge number 600 points.  Yes years ago a 531 point drop in one day was a big deal that caused trading to halt so the market w