Numismatic stock picking...
MrEureka
Posts: 24,240 ✭✭✭✭✭
If you had to buy one coin related stock, which would you choose?
If you had to short one, which would you choose?
If you had to short one, which would you choose?
Andy Lustig
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
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Comments
Seth
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Wait! They aren't publically traded! Sorry.
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<< <i>Looked at the price and it is now $18+. What happened? I thought this was a certain winner. >>
Did you check the complete history? Maybe it's split a time or two.
Russ, NCNE
Short US Dollar
I could be wrong though. I think it was J.P. Morgan who stated "markets fluctuate".
-Brian
I have read statistics that say that, on average, folks who invest in individual stocks average 7% return per year. Individual stock investors have the following problems:
1. They are usually PART-TIME, vs. full-time for mutual fund managers and other professionals.
2. They have HUGE per transaction cost vs. mutual funds, who purchase thousands or millions of shares at a time and spread the cost out to almost nothing per investor.
3. They usually have much HIGHER turnover rates than good growth stock mutual funds, thus further increasing their costs.
4. They have a tendancy to jump in and out of the market (i.e., market timers) at any whim, thus further reducing their gains over good growth stock mutual funds where you dollar cost average your investments over a long period of time.
A good growth stock mutual fund, on average over a long period of time, will get you easily 12% per year. So, statistically, you are LOSING 5% of your money. Compound 5% per year over several years, and your stupidity will multiply!
Edited to Add: The only people you make rich when you purchase individual stocks are the BROKERS. Why do you think they are called BROKERS? They make you BROKER!!!!! Don't play their game!!!!!
Check out a Vanguard Roth IRA.
Disclaimer - just a satisfied buyer of I-shares, not in the business, nothing to gain with this post.
Greg Manning
Collectors Universe
Superior Galleries
Odyssey Marine Exploration
Did I miss anyone?
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Disclaimer - just a satisfied buyer of I-shares, not in the business, nothing to gain with this post. >>
By the way, thanks everyone for letting me vent a little here. I realize this is a bit off-topic, but I want to take this opportunity to pass on my lessons learned. Please take this as some wise advice from a guy who started with nothing, built wealth, lost everything, and rebuilt it again from nothing, and don't learn it the hard way. I was stupid myself, and traded individual stocks. I quit doing poor-people things like this, and started doing rich-people things like long-term investing in good growth stock mutual funds. Even full-time actively-managed mutual funds, most of the time, are not perfect. Check out this article: Three Challenges of Investing: Active Management, Market Efficiency, and Selecting Managers
By the way, if ETFs are the only way you will invest in good growth stock mutual funds, this is much preferred to individual stocks. I really don't like ETFs for the following reasons:
1. They make it too easy to jump in and out of the market, and
2. The per-transaction fee, assuming you make periodic investments, combines together over time to be more than you would pay in a good growth stock mutual fund. In other words, ETFs are more expensive than good growth stock mutual funds.
Please take the following point from my rant. THIS IS A GAME. Brokers -- not you -- make money off of you buying and selling stocks. It's like a bookie. When gamblers place bets with a bookie, the bookie doesn't care who wins or loses -- he makes his money off of his "cut" from each bet placed with him. This is just what a stockbroker does. This thing of trading individual stocks is a middle class game that rewards the stockbrokers. Don't play their game. Play the game of the rich.
Check out a Vanguard Roth IRA.
roadrunner
Edited to Add: Regarding the 12% annual ROR for good growth stock mutual funds, check out the Vanguard 500 Index Fund (VFINX). I looked it up just now, and, SINCE ITS INCEPTION WAY BACK IN 1976, IT HAS AVERAGED 12.44% PER YEAR! Here is the link: Vanguard 500 Index Fund (Investor Shares).
Check out a Vanguard Roth IRA.
I considered purchasing Coinstar stock abut five years ago when it was around $30. Forgot about it until your message. Looked at the price and it is now $18+. What happened? I thought this was a certain winner.
The recent decline (July 03) occured when Safeway gave them the boot.
However the big drop which occured in 3rd Q 1999 was blamed on a "coin shortage", partially caused by the introduction of the state quarters...interesting economics, here's an article on the 1999 drop.
Coinstar loses 50%
Very simple-
Short the basket ( of coin related securities); long their accountants).
I prefer to trade mutual funds that have no short-term trading fee over ETF's. No issue of spreads, weak volume, commissions, or settlement delays. Mutual funds are the ultimate trading vehicle. Plus, with ETF you get on their mailing list and every steenking proxy comes your way.
All numismatic and pretty much all collectable related stocks are bad bets in general, especially over the long term. If anyone can show me any coin or collectable related security that is trading above its IPO price after 3 years I'd be surprised.