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I don't think it's worth taking this very seriously (I am a full-time trader at a hedge fund). Most of it is technical analysis type stuff, with very little to

I don't think it's worth taking this very seriously (I am a full-time trader at a hedge fund). Most of it is technical analysis type stuff, with very little to nothing backing it up. The decent bits of advice that I can filter out are > Concentrate on current investments, not past or future ones. Good advice in general. A similar motto applies in poker - once your money is in the pot, it's no different from anyone else's money. Don't get hung up on sunk costs. However, you might occasionally give a thought to your future investments, especially if your current ones are somewhat illiquid (free cash is optionality). > Always keep some cash for short term opportunities. Decent advice, though it's questionable how many short-term opportunities you're going to spot if trading isn't your full-time occuptation. > You don’t need to trade every day! You don’t need to trade every day! In fact, if you're not a professional, the less you trade, the better. > If a company publishes earnings and the stock doesn’t move much it might be that most people already own the stock. It could go down. Or, more likely, the earnings figure was already priced in and it is as likely to go up as down. > Stay away from penny stocks. Very good advice. Stay the hell away unless you have some privileged information on the the company (and even then, stay away 90% of the time).

RockyMcNuts 13y ago
true...wouldn't pass for particularly insightful advice on a day trading forum, never mind Hacker News. The very first thing, volume is the cause for price, is only true in 'normal' markets, until it isn't. When there's no bid, prices drop massively on no volume, see e.g. Russia this week. Go read Schwager, John Train, Buffett, Graham, Bernstein, Malkiel.
bunderbunder 13y ago
> if you're not a professional, the less you trade, the better I once found some numbers that relate frequency of trading to earnings for individuals, & was initially shocked by just how strong the inverse correlation is. Though on further reflection, I'm not sure it's really counter-intuitive. The more money you spend on broker commissions, the more you have to profit just to break even.
- superprime 13y ago
  At large enough size, commission/trading costs are not necessarily a significant factor--individuals are just not great at stock picking and timing the market.
  - bunderbunder 13y ago
    Absolutely true. However, individuals don't necessarily have enough money in their brokerage accounts to hit the point where trading costs become insignificant, especially if they're trying to diversify.
  - HockeyPlayer 13y ago
    At those larger size, the bid/offer spread becomes much more significant, and is usually a bigger cost than the commission.
dragons 13y ago
> Stay the hell away unless you have some privileged information on the the company (and even then, stay away 90% of the time). You may not want to trade based on "privileged information" either... if it's insider information you can get in trouble. http://en.wikipedia.org/wiki/Insider_trading http://en.wikipedia.org/wiki/Insider_trading
- gutnor 13y ago
  It is very tough to prove insider_trading. As long as you don't put anything in writing, you can get away with insider trading even if you are the wife of an executive and got the tip during pillow talk.
  - gutnor 13y ago
    Well, since this get downvoted, and I cannot edit my post - here is more meat. The case I'm thinking about is the case of http://en.wikipedia.org/wiki/Karel_De_Gucht http://en.wikipedia.org/wiki/Karel_De_Gucht Not saying that it is not illegal, but insider trading and even the definition itself is a huge gray area ( like when you talk to a friend at the pub about the new cool project you are working on, you are giving privileged information ) So although insider trading legislation are good, in practice they have less teeth than they should. When investing, it is a safer approach to assume others have privilege information. Even in the case you have insider information, that is also better to assume others have better one, hence the GP advice to stay away from the peny stock even when you know someone. Here is the interesting bit about De Gucht. ( He could be saying the truth or not, that's not my point, but under strict insider trading regulation this coincidence would not have passed ) "On 3 October 2008, his wife, Mireille Schreurs, and brother-in-law sold their shares in Fortis Bank after a governmental crisis meeting to deal with the precarious financial situation of the bank, hours before the public announcement that the Dutch arm of the bank would be nationalised and the partly nationalised Belgian and Luxembourg branches sold to BNP Paribas.[7] An anonymous complaint was received by the Belgian Banking, Finance and Insurance Commission alleging De Gucht's wife sold €500,000 worth of Fortis shares.[8] De Gucht acknowledges that his wife and brother-in-law sold their mother's shares in Fortis Bank on the date in question for a smaller amount than alleged, but they deny that any insider trading was involved. He also points out that he personally lost €85,000 as a result of the nationalisation and sale, and that his son, Jean-Jacques De Gucht, and mother kept their shares in the failing bank."

RockyMcNuts 13y ago

true...wouldn't pass for particularly insightful advice on a day trading forum, never mind Hacker News. The very first thing, volume is the cause for price, is only true in 'normal' markets, until it isn't. When there's no bid, prices drop massively on no volume, see e.g. Russia this week. Go read Schwager, John Train, Buffett, Graham, Bernstein, Malkiel.

bunderbunder 13y ago

> if you're not a professional, the less you trade, the better I once found some numbers that relate frequency of trading to earnings for individuals, & was initially shocked by just how strong the inverse correlation is. Though on further reflection, I'm not sure it's really counter-intuitive. The more money you spend on broker commissions, the more you have to profit just to break even.

superprime 13y ago
At large enough size, commission/trading costs are not necessarily a significant factor--individuals are just not great at stock picking and timing the market.
- bunderbunder 13y ago
  Absolutely true. However, individuals don't necessarily have enough money in their brokerage accounts to hit the point where trading costs become insignificant, especially if they're trying to diversify.
- HockeyPlayer 13y ago
  At those larger size, the bid/offer spread becomes much more significant, and is usually a bigger cost than the commission.

dragons 13y ago

> Stay the hell away unless you have some privileged information on the the company (and even then, stay away 90% of the time). You may not want to trade based on "privileged information" either... if it's insider information you can get in trouble. http://en.wikipedia.org/wiki/Insider_trading http://en.wikipedia.org/wiki/Insider_trading

gutnor 13y ago
It is very tough to prove insider_trading. As long as you don't put anything in writing, you can get away with insider trading even if you are the wife of an executive and got the tip during pillow talk.
- gutnor 13y ago
  Well, since this get downvoted, and I cannot edit my post - here is more meat. The case I'm thinking about is the case of http://en.wikipedia.org/wiki/Karel_De_Gucht http://en.wikipedia.org/wiki/Karel_De_Gucht Not saying that it is not illegal, but insider trading and even the definition itself is a huge gray area ( like when you talk to a friend at the pub about the new cool project you are working on, you are giving privileged information ) So although insider trading legislation are good, in practice they have less teeth than they should. When investing, it is a safer approach to assume others have privilege information. Even in the case you have insider information, that is also better to assume others have better one, hence the GP advice to stay away from the peny stock even when you know someone. Here is the interesting bit about De Gucht. ( He could be saying the truth or not, that's not my point, but under strict insider trading regulation this coincidence would not have passed ) "On 3 October 2008, his wife, Mireille Schreurs, and brother-in-law sold their shares in Fortis Bank after a governmental crisis meeting to deal with the precarious financial situation of the bank, hours before the public announcement that the Dutch arm of the bank would be nationalised and the partly nationalised Belgian and Luxembourg branches sold to BNP Paribas.[7] An anonymous complaint was received by the Belgian Banking, Finance and Insurance Commission alleging De Gucht's wife sold €500,000 worth of Fortis shares.[8] De Gucht acknowledges that his wife and brother-in-law sold their mother's shares in Fortis Bank on the date in question for a smaller amount than alleged, but they deny that any insider trading was involved. He also points out that he personally lost €85,000 as a result of the nationalisation and sale, and that his son, Jean-Jacques De Gucht, and mother kept their shares in the failing bank."