Killer investment advice on TV


S

stone583

I'm sooo confused!

I read newsgroups like this one and the consensus is I can't do better
than an index fund for long term growth.

But I'm also an insomniac, which means I watch a lot of Really Good
TV. Every week I see some dude (who is clearly my new best friend)
tell me if I just send $29.95 for his package, he will show me how to
double my money annually. I just need the right investment tools. It
is in various domains: FOREX trading, stock market tools, real estate
- but it's all the same idea.

So - are all of these offers just trying to scam me out of $29.95? Or
is it in fact possible to beat the index?

My first thought is if I knew how to double my money annually, I'd be
*doing* it, not trying to sell you the secret. Hmmm.

But I'd love to see some knowledgeable comentary!
 
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W

Will Trice

So - are all of these offers just trying to scam me out of $29.95? Or
is it in fact possible to beat the index?
Both. It may indeed be possible to beat an index, but these ads are
scams. You said it yourself below:
My first thought is if I knew how to double my money annually, I'd be
*doing* it, not trying to sell you the secret. Hmmm.
-Will
 
D

Douglas Johnson

So - are all of these offers just trying to scam me out of $29.95? Or
is it in fact possible to beat the index?
Both. They are trying to scam you out of $29.95. But it is also possible to
beat the index. But barring a run of luck, it takes a lot of study, an
expensive education (bought by making and learning from mistakes), and finding a
market nitch (some kind of trading/investing where you have an advantage over
other traders/investors).
My first thought is if I knew how to double my money annually, I'd be
*doing* it, not trying to sell you the secret. Hmmm.
Yep.

-- Doug
 
J

joetaxpayer

I'm sooo confused!

I read newsgroups like this one and the consensus is I can't do better
than an index fund for long term growth.
It's not that you can't, it's just very unlikely. There is far more
evidence to agree with this statement than disagree. If the long term
return of the market is 10%, I've seen many studies that show the
typical investor manages to see 3-4%, not due to fees, but bad timing.
Getting in at tops, out at bottoms, etc. If I can get 9.9% over that
period I pat myself on the back.
But I'm also an insomniac, which means I watch a lot of Really Good
TV. Every week I see some dude (who is clearly my new best friend)
tell me if I just send $29.95 for his package, he will show me how to
double my money annually. I just need the right investment tools. It
is in various domains: FOREX trading, stock market tools, real estate
- but it's all the same idea.

So - are all of these offers just trying to scam me out of $29.95? Or
is it in fact possible to beat the index?
The market is not 100% efficient. It's possible to study a number of
stocks to discover those which are undervalued, but this takes time,
patience, and a lot of discipline. Cramer is quoted as saying that you
must be willing to devote 1 hour per week to follow each stock you own.
For most people, this implies you can't own more than 10-15 individual
stocks. If one or two goes up 5 fold, it's a nice return, but only a
small fraction of your portfolio. If one tanks, likewise.
My first thought is if I knew how to double my money annually, I'd be
*doing* it, not trying to sell you the secret. Hmmm.
If I knew how to double my money annually, I'd be selling the method for
millions, not $30. Risk follows reward. Any return above the averages
requires some level of risk. Even my comments above don't suggest that
level of return. If your really good, a small premium to the market, not
100%.

JOE
 
K

kastnna

go read elaine athttp://elainemeinelsupkis.typepad.com/
report back when you're read a months worth

as to the markets, expect around mid-august a very substantial correction to occur
I also read the worlds gonna end in early-August so I'm not too
worried about it.
 
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K

kastnna

Stone,

Try googling "efficient market hypothesis". Under the hypothesis/
theory (there's still some debate, I believe) there are levels of
efficiency. All levels except for the perfectly efficient level allow
for minor inefficiencies in the market to be exploited (few argue that
we are in the 'perfectly efficient model').

This suggests that you can "beat the market". But as everyone else
here said, its very hard to do and worth a whole lot more than $29.95.
Oh yeah, and once a method becomes common knowledge, it gets
incorporated into the market movements and it no longer works as well
(or at all). Doesn't that stink!

If you could systematically beat the market, it would be insane to
tell everyone for $29.95.
 
R

Ron Peterson

I read newsgroups like this one and the consensus is I can't do better
than an index fund for long term growth.
Like the other replies, I think that you can beat an index fund that
comprises all stocks.
So - are all of these offers just trying to scam me out of $29.95? Or
is it in fact possible to beat the index?
Yes, its a scam. But, it is possible to beat the index.
But I'd love to see some knowledgeable comentary!
Just read the Random Walk book or one on contrarian investing to get a
better idea on how to increase your investment skills.

For instance, foreign stocks are doing better than domestic stocks, so
buy some EWY. And, of course, energy stocks will continue to do better
than average.
 
J

joetaxpayer

For instance, foreign stocks are doing better than domestic stocks, so
buy some EWY. And, of course, energy stocks will continue to do better
than average.
I hope this is a tongue-in-cheek quip given your Jan 2 '07 post:

"On July 6, 2006, I made a claim in this news group that XLE would be up
10% more than the S&P at the end of the year.

The S&P is up 11.33% and XLE is up 2.01%, just the opposite of what I
predicted. I am just lucky that I am diversified in my investments."


In the last 6 months, XLE has outperformed. Maybe you were just 6 months
early on a good prediction. I guess timing is everything.
JOE
 
R

Ron Peterson

In the last 6 months, XLE has outperformed. Maybe you were just 6 months
early on a good prediction. I guess timing is everything.
It takes a long time to establish a trend, and new technology can
change everything.

Currently oil peaks in the late summer because of added travel, so an
annual change is better judge of enery stocks.
 
R

Robert

kastnna said:
I also read the worlds gonna end in early-August so I'm not too
worried about it.
perhaps I was off with my comment by five days, nevertheless, I stand by my original
warning

I *did* try to give you a warning about the markets
 
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W

Will Trice

Robert said:
perhaps I was off with my comment by five days, nevertheless, I stand by
my original warning

I *did* try to give you a warning about the markets
You're still a little early, a "substantial correction" (as you
predicted) has not yet occurred. Although it still could...

-Will
 
K

kastnna

perhaps I was off with my comment by five days, nevertheless, I stand by my original
warning

I *did* try to give you a warning about the markets
I was just clownin around with ya.

I'm a buy and hold investor so I really don't care about short term
corrections. IMO, I don't believe this is a "correction" anyway. Just
as markets can get overly "pumped up" by investor sentiment, they can
get unjustly supressed. I think the media is using fear to instill the
later scenario.

Most of our volatility has been subprime mortgage and credit crunch
worries. When looked at logically, the subprime loss will only be
about 1% of the mortgage market. Furthermore, mortgage backed
Securities only make up a small percentage of the total market. The
"correction" shouldn't have even been noticed.

Hedge funds and traders have overinflated the seriousness of current
events to scare everyone and create volatility. The aforementioned
groups profit from volatility regardless of overall gain or loss.
 
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R

Robert

kastnna said:
I'm a buy and hold investor so I really don't care about short term
corrections. IMO, I don't believe this is a "correction" anyway.
you're only at the start of the drop.....
 

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