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Mooers' Stories
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Mooers Lab がディスカッションに参加しました · 2022/10/08 22:25

Mooers' Stories Vol.7 - bullrider_21

Hi, mooers. Welcome back to "Mooers' Stories", where we present mooers' insights and experiences. Have you ever done technical analysis to decide if it's the right time to buy? This time, we invited @bullrider_21, who has more than 20 years of experience in investment, to share his trading strategies and explain why he always performs TA before buying a stock. Let's take a look!
Mooers' Stories Vol.7 - bullrider_21
Notes: All the information comes from the interviewee and is published under the interviewee's consent. The testimonial provided herein may not represent other customers' experience, and there is no guarantee of future performance or success.
Mooers' Stories Vol.7 - bullrider_21
Investing story: Before I buy a stock, I'll get my trading plan ready. DYODD and perform TA. Then I'll buy.
1. When and why did you start investing?
When I started working, a colleague showed me the ropes of investing and that got me interested. I started with IPOs. Back in those days, IPOs were hot. They would rise a few times above their IPO prices on their debut. Later, I slowly graduated to other stocks.
2. What kind of trader are you?
I've experienced bull markets and also bear markets like the 2008 Recession and the 2000 Dot-Com Bust. I am more of a short/medium-term trader than a long-term investor. If I can catch near the bottom in a financial crisis, I may hold longer for 1-2 years until the trend changes. A financial crisis generally occurs every 10-15 years and they are the best times to invest when the prices are very depressed. My reasons are explained in this article: Long-term investing vs short/medium-term trading.
3. What are your trading routines?
I read company announcements and microeconomic (company) and macroeconomic (industry and other economic) news throughout the day. I'll make sure I'm informed of the latest news that may affect a stock. Sometimes, I'll perform TA after a stock rises or falls. I will also read analyst reports. But I'll take them with a pinch of stock as discussed in this article: Analyst Reports.
4. What are your key methods for trading?
I will not buy illiquid or tight trading range stocks. It's hard to buy or sell at the price you want when the volume is low. You can't make much profit from a stock with a tight range. Besides, it's boring. I prefer mid/ small caps over blue chip stocks. Blue chip stocks tend to be more mature and the companies' profits are growing at a slower rate.
Always have a trading plan for investing. After my research shows that a company has good fundamentals, I'll use TA to determine if it's the right time to buy. I will determine the support and resistance levels for my buy and sell prices. I do swing trading and aim to make at least 10% profit each time. I set my cut loss at 10% in case something goes wrong.
This way, I minimize my losses and preserve my capital. So even before I buy a stock, I already have a trading plan in place.
5. Where did you start on your quest for knowledge of trading strategies?
I knew nothing about TA when I started investing. One day, I read some analyst reports on TA and found them quite accurate. So I started to learn TA from websites and honed my skills through the years.
Before I discovered TA, I was trading in a haphazard manner. I just anyhow buy and sell at prices I thought was reasonable. And I made losses. There must be a method to all these and that's where TA came in. With TA, my success rate improved greatly and I made profit consistently.
TA is very useful for the following reasons:
1) Determine support and resistance levels for buying and selling at the best prices.
2) Determine the trend of a stock- uptrend or downtrend.
3) Determine whether a stock is overbought or oversold.
4) Determine the momentum - strong or waning.
5) Determine breakouts.
6) Determine reversals.
7) Minimize emotions.
Besides Warren Buffet, I also follow another investment guru: Jim Rogers. Here are some of his notable quotes which I follow:
1) Never act upon wishful thinking.
Act without checking the facts, and chances are that you will be swept away along with the mob. Always check the facts before you invest.
2) If anybody laughs at your idea, view it as a sign of potential success!
If you have done your analysis and believe you are right, just do it. You may be the only person correct.
3) Bottoms in the investment world don't end with four-year lows; they end with 10- or 15-year lows.
A bottom in the market only end when there's a financial crisis which occur every 10- 15 years. And one may be due next year.
4) Do not buy the hype from Wall St. and the press that stocks always go up.
There are long periods when stocks do nothing and other investments are better. Stocks don't always go up over time. For example, Intel is still below its ATH in 2000 after 22 years. Sometimes, commodities outperform stocks.
6. What's your best trade ever?
I bought Riverstone Holdings at $0.35 in Mar. 2020 near the start of the pandemic. I figured the glove and personal protection equipment (PPE) maker would benefit. Then I sold at $2.20 in Aug 2020 when it was very overbought.
7. What lessons have you learned?
I made many mistakes earlier in my investment journey. These are the lessons that I learned.
Don't speculate.
Don't buy a stock if you don't know the reasons why it is rising or falling.
Only buy a stock if you know the business the company is in.
Don't be emotional on a stock. This is one of the worst mistakes in investing.
Don't love a stock.
Don't buy it just because you made money from it previously.
Don't just look at it from a bullish point of view.
Accept bad news.
Sell at a reasonable price and don't be greedy.
Buy at a low price and be patient.
Don't FOMO and chase a stock.
TA is very useful in minimizing emotions from investing. Although I may still be greedy if I use too high a resistance level as my selling price.
8. How do you describe a successful investment?
A successful investment is one where you don't lose money and make as much profit as possible. Always have a stop-loss strategy. You may have bought at too high a price or the wrong stock. Cut loss if the price falls 10% below your buying price or if it rises 10% when you short-sell. For the HK and U.S. markets where stocks are more volatile, you may use a higher percentage. I choose 10% because a stock may lose <10% and then rebound above your purchase price. Stop loss is important for minimizing losses and preserving capital.
9. How do you deal with your losses or trades that turned out badly?
A stock's price may fall 50% or >90%. You may even lose all your money if the company goes bankrupt. So it's very important to be disciplined in cutting loss to prevent your loss from becoming greater.
Don't just treat it as a paper loss. Treat it as a real loss. Otherwise, you become complacent and let your loss mount. A paper loss is still a loss. Maybe you bought the wrong stock, so sell and buy a better stock. You don't have to keep buying a lousy stock to average down. Sell your losers and let your winners run.
Words for newcomers
a. Start as early as possible. You can use the compounding effect by reinvesting your profits and dividends so that you can have a comfortable retirement income.
b. Focus on quality. Warren Buffett won't buy struggling businesses, regardless of how cheap they become. One of the best Buffett quotes new investors can absorb is, "It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price."
c. Don't follow the crowd. Here's another piece of Buffett advice that is extremely important for beginner investor. Don't buy certain stocks just because everyone else is. But also do not aim to always be a contrarian and sell the stocks that everyone else is buying. As Buffett does, the best way to invest is to ignore the crowd entirely and focus on finding value on your own. He also says, "The most important quality for an investor is temperament, not intellect. You need a temperament that neither derives great pleasure from being with the crowd or against the crowd."
d. Don't be afraid to sell if the scenario changes. A famous Warren Buffett quote from when he was asked about an investment he decided to sell at a loss, "The most important thing to do if you find yourself in a hole is to stop digging." While he certainly wants to own every stock he buys forever, the reality is that outlooks change. A couple of decades ago, Buffett bought a large position in mortgage agency Freddie Mac (FMCC). A few years before the financial crisis, he noticed the lender's management had started to take unnecessary risks with the company's capital and decided to sell. A few years later, when the financial crisis hit, it became clear that Buffett had made a smart move.
Here are some interesting articles, which I hope will be helpful for you.
Why moomoo?
It's very convenient. I can trade SG, U.S., and HK stocks on the same platform. Has many tools for analysis and TA. There's a good community here and I can interact with other mooers by posting comments.
Interactive Activity
1. Make your choice
2. Spark meaningful conversations
Topic: What else do you want to know about bullrider_21? Any other topics you wanna discuss with him? Comment below to let us know.
Bonus:
1. 30 points for mooers who raise insightful and bullrider_21-related questions
2. 70 points for bullrider_21's each reply to mooers' questions
Duration: From now to Oct. 30 23:59 ET
(Rewards will be distributed within 5–10 working days after the activity ends.)
Notes: We encourage benign and in-depth interaction, from which all mooers can learn from each other, helping our community members be more courageous and not alone in the investing journey.
We truly appreciate @bullrider_21 for sharing his valuable and inspiring experience with us! Feel free to interact with him if you have anything to say! Just in case you didn't know, you can also be the one to tell the story. Interested? Comment below to let us know! We'll contact you as soon as possible! Thanks for your time. See you next time!
Mooers' Stories Vol.7 - bullrider_21
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Disclosure: The testimonial provided herein may not represent other customers' experience, and there is no guarantee of future performance or success.
Disclaimer: This presentation is for informational and educational use only and is not a recommendation or endorsement of any particular investment or investment strategy. Investment information provided in this content is general in nature, strictly for illustrative purposes, and may not be appropriate for all investors. It is provided without respect to individual investors’ financial sophistication, financial situation, investment objectives, investing time horizon, or risk tolerance. You should consider the appropriateness of this information having regard to your relevant personal circumstances before making any investment decisions. Past investment performance does not indicate or guarantee future success. Returns will vary, and all investments carry risks, including loss of principal.
免責事項：このコンテンツは、Moomoo Technologies Incが情報交換及び教育目的でのみ提供するものです。 さらに詳しい情報
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