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Anybody feel like teaching stock trading in layman's terms?

JNHEscher

JNHEscher

Red Skull Member
Joined
Jun 7, 2020
Member Number
1892
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2,999
Loc
Dogwood, MO.
Preface:

I've tried to learn a bit. Couple people that attempted to teach it weren't all that great. Watched some videos a few years ago, didn't do much for me. I'm definitely a numbers/math guy, but need repetition to make some things stick.

Used Think Or Swim a bit and did some actual traded a few years ago. Candlesticks, bullish/bearish stuff, etc. confused me at the time.

Any good reading or videos on the subject to get a newb on his feet?
 
billdacat said:
You need to know EVERYTHING about the company you are going to buy stock in.
For a novice; consider ETF's.... (Exchange Traded Funds). :smokin:
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I'll get right on researching companies when I can figure out which to look for. I still follow Clay Trader here and there. Would like to take his class. Think I need to play with ToS some more before I put any doll hairs into anything.
 
They have things called Financial Advisors, they do this sort of thing:grinpimp:

My kid has been turning 20+% on Mutual Funds this year, I told her to not to get used to it, but she is digging it
edit 22.77 on her Mutual Funds
 
What are your goals? income/ long term returns/ alternative cash burn to hookers & blow?

Year after year, It is very difficult to out perform an index fund by picking stocks even for a professional. The odds are slightly better than beating the house at a blackjack table in a Vegas casino. So unless you have a genuine interest in it, or are looking to pursue a new hobby, go find an ETF/ index fund. If you don't know what you're doing picking sticks you wont beat a savings account rate unless youre lucky.

When I had a 9-5 office job ( finance / banking career) it was easier to burn company time monitoring performance and doing research several times a week while looking busy sitting at my desk when the boss walked by, and usually end up at least not picking a loser, but once I broke out of the desk jockey life and had irregular schedule/ better things to do with my free time I don't have the ability nor desire to put in the time needed to maintain it. when it all went to plan, the few percent I might have beat a S&P500 fund by probably amounted to approximately fast food wage rates .


stockanalysis.com

Is It True That Almost No One Can Beat the Market? - Stock Analysis

The stock market is the market for buying and selling stocks. It consists of stock exchanges, indexes, investors, and speculators, to name a few.
stockanalysis.com stockanalysis.com
 
WTF? said:
What are your goals? income/ long term returns/ alternative cash burn to hookers & blow?
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Could use income and want to build up long-term. Genuine interest in it. It's be right up my alley if I could figure out a good start.
 
Buy Canadian bank stocks (such as RY).

Hold them for years and profit.

Don't need to watch the market or know shit about fuck.

You're welcome.
 
Jump on Reddit and watch Wallstreetbets
Don’t do what they do… which sounds exactly like what you want to do.

Solid advice here with ETF.

For everyone saying just buy ETFs… here is an example for you out of my portfolio:

I own some Snap-On (SNA) and I am up 45% with a huge run up yesterday (I am including my dividends in this %)

And bought it just under two years ago

If you look at the 5 year chart it’s had a 110% run up (divy not included). Compare that to SPY which is at 91%

Snap-ON took a bit of a dive several months back and I was almost just breaking even… should have grabbed some more.

Why did I buy Snap-ON over Spy? Fun… I believe in the industries they are tied into. I HODL
 
The fool proof way is to just buy major company stock when it crashes after some disastrous bullshit. Those companies will always get bailed out by the Feds and that stock will always go back up.

I don't buy often, but I've never lost money doing that. Like after the BP shit in the gulf their stock shit the bed big time. Bought a bunch and just waited. Went from $110 to $58 over night, bought it at $58. In less than a year it was back up to $92. You gotta look for major events though, like Bud Light and the Dylan Mulvaney shit. If a company is going to shit just because of bad business practices don't buy that when it's getting low because it'll probably stay there.
 
Motorcharge said:
The fool proof way is to just buy major company stock when it crashes after some disastrous bullshit. Those companies will always get bailed out by the Feds and that stock will always go back up.

I don't buy often, but I've never lost money doing that. Like after the BP shit in the gulf their stock shit the bed big time. Bought a bunch and just waited. Went from $110 to $58 over night, bought it at $58. In less than a year it was back up to $92. You gotta look for major events though, like Bud Light and the Dylan Mulvaney shit. If a company is going to shit just because of bad business practices don't buy that when it's getting low because it'll probably stay there.
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This is good advice if you insist on picking stocks
 
Motorcharge said:
The fool proof way is to just buy major company stock when it crashes after some disastrous bullshit. Those companies will always get bailed out by the Feds and that stock will always go back up.

I don't buy often, but I've never lost money doing that. Like after the BP shit in the gulf their stock shit the bed big time. Bought a bunch and just waited. Went from $110 to $58 over night, bought it at $58. In less than a year it was back up to $92. You gotta look for major events though, like Bud Light and the Dylan Mulvaney shit. If a company is going to shit just because of bad business practices don't buy that when it's getting low because it'll probably stay there.
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Good practice, but make sure you understand the actual driver to why it dropped so you don’t buy into a failing company and lose it all or just get stuck in it for a small eternity waiting for it to recover/ rebound.
 
WTF? said:
Good practice, but make sure you understand the actual driver to why it dropped so you don’t buy into a failing company and lose it all or just get stuck in it for a small eternity waiting for it to recover/ rebound.
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I got one of those..... company I worked for I was getting employee discount buying with paycheck deduction....then a big recall ... stock went to shit...I was selling in small batches up until then but had the watch the gains. Still pays a dividend and I could use some looses this year so will do that.
 
I just put $$ in an account. Has done around 9% overall since 2007, so decentish?
 
Most of this applies to trades, as that's mostly what I do. I'm a hack, so definitely my .03, YMMV, this is not investment or trading advice :flipoff2:

-Be patient, always take into account the macroeconomic conditions.
-Don't chase price up or down to either buy or sell. Desperation/emotional response on either end will screw you.
-Skip the penny stock junk. Trade what you don't mind owning (quality), if you get caught out on price movement, your trade becomes an investment.
-Individual stocks are far more risky than indexed or ETFs. Example: I like the Direxion Dailys. You can own these but the price action lends itself to trading. Tech: SOXL, TECL. Homebuild/Construction: NAIL. Aerospace and Defense: DFEN - these have been good to me. Those are bull funds, they also do bear funds of many of the same industries, but I don't trade those.
-Don't spread yourself too thin, while it's good to be diversified, it's also important to understand the price targets and ranges on either end for what you're trading.
 
WTF? said:
Good practice, but make sure you understand the actual driver to why it dropped so you don’t buy into a failing company and lose it all or just get stuck in it for a small eternity waiting for it to recover/ rebound.
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Indeed! Beware the "catch a falling knife scenario". There's a reason it dropped, most stocks don't "V" instantly. I do like trades like this, but practice a 2-3 day rule. Don't buy immediately after a dump, the price may continue to fall for many reasons. Wait until some kind of bottom is in and the trajectory begins to change.

Example, let's say earnings are weak after hours. The stock tanks in aftermarket trading. The next day in pre-market, maybe more. Then, when the next trading day officially begins, traders that can't trade the pre/post market dump it, and it tanks more. THEN, the next day, the entire market dumps for some Macro reason (interest rates, something in the news cycle, etc...) and it drops even further. Worst case scenario, but I speak from painful experience :homer:
 
Those that can, do

Those that cannot do, teach

Do you really want to follow somebody on X, YT, FB, or IG who is charging you to teach you what they profess to know everything about. If they were so good at what they are doing, would they have not retired on the proceeds already? Altruistic enough to share their expertise? Bullshit.

There is NOTHING new to learn in FinTwit, the most successful trading room I have belonged to uses patterns developed over 120 years ago. These young punks are not the next Paul Tudor Jones or John Paulsen, or Jesse Livermore.

From just two statements in your OP it is clear you should in no way be involved with "investing" or "trading" your own money (don't understand bulls/bears and candlesticks). Unless it is lotto winnings or inheritance that you can afford to lose the entire amount. If the money you have to invest, assuming retirement, college accounts, saving for a house, something important, then I suggest

Take your X amount of investment dollars out of your paycheck immediately, preferably through automatic withdrawal.

Put 1/4 X into a SPY index or SPY ETF
Put 1/4 X into a Tech index or ETF(s)
Put 1/4 X into your kids college funds, they will be very limited in what you can invest in within the fund. Choose Growth funds.
Put 1/4 X into dividend generating ETF's. These focus on returning dividends to investors and reinvesting these. Personal favorite is SCHD, VOO.

Max out any contributions you can. HSA, 401K, especially if you are in any company matching scheme.
Your HSA can be self managed, but the selection of funds will be restricted to "safe" funds, you still need to do the bare research to pick which funds have decent records and which cannot even beat the market.
Be Patient for next (however many years until your retirement, or whatever goal you set) and Profit.

Please don't take this the wrong way but

there are likely less than 2% of folks capable of handling their own financial planning or investing.
Not your fault, heck most high schoolers graduate without being able to balance a check book.
Then you have to rely on some financial broker at the bank or brokerage or worse some Redditor, or IBB "expert", and ask yourself, if they are so good at this advice thing, why have they not managed to retire yet? Because they suck, and give shit advice, and charge you between 0.5% and 5% on funds that cannot beat the SPY.

A very small % of even seasoned investors have the MENTAL fortitude to deal with the stresses of trading and investing.
Ask yourself,
Can you stomach a month's losses, what about 6 months? What about a red year?
Can you deal with two green days in 3 months of trading while losing 6 figures. Gone 6 figures, not shitty stock you can bag hold and hope it recovers, Gone.
Can you deal with several months of your stops being snipered? Then the stock rebounds, you red, them green, your thesis works but you lose money? Say for 6 months while you lose 1/4 mil on your accounts?
Say goodbye to Sundays while you study charts, news, earnings, ten times worse if you try this while gainfully employed. Say goodbye to any sleep patterns at all while you stress about trades taken, trades not taken, and about how much money you stand to lose on market open tomorrow because you called some earnings wrong and you cannot manage risk properly until you have bled those dollars yourself.

Now thing seriously about what you want to get into.

:flipoff2::flipoff2:
 
my stock portfolio has nothing to do with my retirement anymore. so i can stomach 100k losses in stupid trading. i put a big chunk in AMC a while back. i was way down, i just blew it off and then it took off a few months later and i sold out way too early. i still made a good profit. i find the my biggest losses have come because i hang on to a bunch of stuff all the way down. i need to place stop losses on most of my bigger trades. and i have been very successful now that i am not as greedy. a 1 or 2% gain is a great trade for me now a days.
 
I've had accounts at Schwab, Vanguard and Fidelity and I like them in that order. I have a local Schwab account manager or I can call their 888 numbers if there is something I don't understand about the account. I have the dividends scheduled to be transferred into my bank account at the end of every month, it keeps my balance up to run the house. Once I sell this place and no longer have a house payment, I'll probably convert some of my holdings back into DRIP status.

Also, make sure you understand the tax implications of trading, capital gains and/or Federal and State income taxes. There are tax loss harvesting strategies that help, but taxes are not going away.
 
Buy the hype, sell the news.
 
I'm sure someone mentioned this - generally, use limit orders and stop losses. You lose some degree of control when executing at market rate. These tools can help you semi-automate some of your trades.
 
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