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      09-01-2014, 01:21 PM   #2553
jasonn
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Quote:
Originally Posted by MrPrena View Post
Sorry for misunderstanding.
I meant 90% as 9/10 trade has been all gains since 2006.
Don't give me too much credit for it during 2007-2009. I had to bag hold few stocks till it was on positive side.

edit to add:
Yeah, Beta is basically a "multiples" of risk volatility.
Depends on which school (Econ or Finance), they will approach you with capm systemetic risk, or basically a scaler multiple of risk respect to change in indices.
For an good example would be if "beta" is 2, and the stock is in S&P500. If S&P500 went up 5% in 1month, you should "expect" the stock to go up 10%. If it went up lower than 2% , it didn't do good.
If S&P500 went up 5% and if your stock went up 8%, you actually did not beat the market.
Here are basic models which some "finance for dummies" classes teaches.
http://quant.stackexchange.com/quest...-line-straight
http://www.fundmanagersoftware.com/h...lculation.html
http://www.fundmanagersoftware.com/h...lculation.html
http://www.finquiz.com/blog/2013/04/...h-derivatives/
http://www.columbia.edu/~ks20/FE-Not...Notes-CAPM.pdf
Thanks again MrPrena; I checked out all of those finance for dummies links and it's gibberish to me currently hahaha.

For your example, the stock increase of 8% technically still did better than the S&P 5%; it's just that for the risk you took, it should have done better right?
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      09-01-2014, 01:29 PM   #2554
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Well, if beta was 1 and S&P500 gain was 5%, 8% gain on one specific stock is consider beating the market.

Well, if beta was 2 and S&P500 gain was 5%, 8% gain on one specific stock is not consider beating the market. You took 2x the risk than the index/indices market. Therefore you should have 2x more gain.



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Originally Posted by jasonn View Post
Thanks again MrPrena; I checked out all of those finance for dummies links and it's gibberish to me currently hahaha.

For your example, the stock increase of 8% technically still did better than the S&P 5%; it's just that for the risk you took, it should have done better right?
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      09-01-2014, 01:39 PM   #2555
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Originally Posted by MrPrena View Post
Well, if beta was 1 and S&P500 gain was 5%, 8% gain on one specific stock is consider beating the market.

Well, if beta was 2 and S&P500 gain was 5%, 8% gain on one specific stock is not consider beating the market. You took 2x the risk than the index/indices market. Therefore you should have 2x more gain.

gotcha,

I just looked at my stocks' betas, they are all below 1 except two which are 1.18 and 1.09. Those are also the only two in the red currently.
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      09-01-2014, 01:42 PM   #2556
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Hey so my next question is if anyone here ever buy stocks based on acquisition announcements.

Like recently:

the Amazon acquisition of Twitch

the Burger King acquisition of Tim Hortons

the potential Activision acquisition of Take-Two

if you do buy, do you typically buy the company that is being acquired? or both? or?

many thanks as always.
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      09-01-2014, 10:44 PM   #2557
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Quote:
Originally Posted by jasonn View Post
Hey so my next question is if anyone here ever buy stocks based on acquisition announcements.

Like recently:

the Amazon acquisition of Twitch

the Burger King acquisition of Tim Hortons

the potential Activision acquisition of Take-Two

if you do buy, do you typically buy the company that is being acquired? or both? or?

many thanks as always.
You buy before the news comes out. Twitch was also never a public company so you couldn't have bought it.
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      09-02-2014, 12:03 AM   #2558
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M&A behaves very similar to Ricardian Trade Model.

MOST of the time, smaller companies who are getting acquired or merged together gains. HOWEVER,,,,,,,,,,,,,,,, when the company pays about < ~28% premium, it is actually not a premium. If you look at M&A or LBOs, it is usually just giving tax premium to the share holders.

CASE EX (again example): You bought TTWO for $5/sr few mo ago, and you want to keep that for a year to just pay the Capital gains tax. Mo after you purchased TTWO, ATVI offered $7/sr. WHen the merger finalize in 5mo (again ex), you only held the stock for ~6month. It means, you have to pay investment income taxes (not cap gain taxes). The premium ATVI gave to shareholder are mainly going to IRS' pocket. You basically didn't make too much $$ as you wanted.



Quote:
Originally Posted by jasonn View Post
Hey so my next question is if anyone here ever buy stocks based on acquisition announcements.

Like recently:

the Amazon acquisition of Twitch

the Burger King acquisition of Tim Hortons

the potential Activision acquisition of Take-Two

if you do buy, do you typically buy the company that is being acquired? or both? or?

many thanks as always.
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      09-03-2014, 03:49 AM   #2559
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Sprint....
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      09-03-2014, 02:45 PM   #2560
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Quote:
Originally Posted by MrPrena View Post
M&A behaves very similar to Ricardian Trade Model.

MOST of the time, smaller companies who are getting acquired or merged together gains. HOWEVER,,,,,,,,,,,,,,,, when the company pays about < ~28% premium, it is actually not a premium. If you look at M&A or LBOs, it is usually just giving tax premium to the share holders.

CASE EX (again example): You bought TTWO for $5/sr few mo ago, and you want to keep that for a year to just pay the Capital gains tax. Mo after you purchased TTWO, ATVI offered $7/sr. WHen the merger finalize in 5mo (again ex), you only held the stock for ~6month. It means, you have to pay investment income taxes (not cap gain taxes). The premium ATVI gave to shareholder are mainly going to IRS' pocket. You basically didn't make too much $$ as you wanted.
Thank you very much again MrPrena. Very insightful and helpful. Much appreciated.


Quote:
Originally Posted by MrPrena View Post
Sprint....
haha lost a lot on AAPL today...if it drops more --> time to buy?
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      09-03-2014, 03:06 PM   #2561
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AAPL could be entering a downtrend, however with its event this week, this could just be noise.
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      09-04-2014, 04:05 AM   #2562
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Quote:
Originally Posted by MrPrena View Post
I couldn't get in on a price I wanted, but bought AMD on Wed for under 3.80 across all my acct.
122mil shares traded on Thurs up 2.36% on a huge down day.
2.36% gain isn't much, but 122mil traded.... Something is up.

3.91 0.09(2.36%) Jul 31, 4:00PM EDT
Volume: 112,163,796
Avg Vol (3m): 28,437,200
Held AMD for about 35days, and ~11% is all I got...
I need to wait till OCT for this one to move.

http://finance.yahoo.com/q/op?s=AMD&m=2014-10
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      09-04-2014, 03:53 PM   #2563
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Quote:
Originally Posted by MrPrena View Post
Well, if beta was 1 and S&P500 gain was 5%, 8% gain on one specific stock is consider beating the market.

Well, if beta was 2 and S&P500 gain was 5%, 8% gain on one specific stock is not consider beating the market. You took 2x the risk than the index/indices market. Therefore you should have 2x more gain.

A lot more to it than that. For example: what if the R-Squared were .10?

Quote:
Originally Posted by jasonn View Post
gotcha,

I just looked at my stocks' betas, they are all below 1 except two which are 1.18 and 1.09. Those are also the only two in the red currently.
A perfect example of why a beta measurement, by itself, is of little to no significance to the educated investor.
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      09-04-2014, 03:57 PM   #2564
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Quote:
Originally Posted by RandomHero View Post
A lot more to it than that. For example: what if the R-Squared were .10?

A perfect example of why a beta measurement, by itself, is of little to no significance to the educated investor.
NOW, we are talking to real technical trader here.
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      09-11-2014, 02:58 PM   #2565
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Quote:
Originally Posted by MrPrena View Post
Sprint....
Sprint .....
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      09-11-2014, 10:48 PM   #2566
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Have you guys been taking up positions in MSFT? I've been giving you the heads-up for weeks now!
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      09-12-2014, 04:15 PM   #2567
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I knew AMD will see a dip, before pre-earning run up. Just that -2.9% today on no news kinda makes me unhappy. 4% gain in 1mo on AMD during historical bull market is just stupid. Even people who has no idea about stock invested in GPRO, TSLA, and FB made more than I did (comparing only to AMD) Still gonna hold till Mid OCT.

If there is no spike during OCT, AMG for AMD campaign is a bust.

Sprint was another free giveaway from the wall street (just like Twitter purchased before world cup this year).
Of course Iphone6 will support triband.
Of course Sprint will be agressive with pricing after they decided not to go with Acquiring TMUS.




Quote:
Originally Posted by MrPrena View Post
My wife wants a C63AMG. Thankfully she doesn't care if it is non blk ser.
We are calling the AMG campaign a.

AMD for AMG

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      09-12-2014, 04:24 PM   #2568
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Looking for SLV to have a strong flush to the $15s. I'd go long only on a sell-climax. SPX is in a short term downtrend.
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      09-15-2014, 02:15 PM   #2569
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UGH! Anyone else seeing heavy selling in their stocks? The fund managers are selling some of their high growth holdings and taking profits to raise capital for the impending Alibaba IPO on Friday. My Facebook shares have fallen 5% so far today!
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      09-15-2014, 06:09 PM   #2570
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UGH! Anyone else seeing heavy selling in their stocks? The fund managers are selling some of their high growth holdings and taking profits to raise capital for the impending Alibaba IPO on Friday. My Facebook shares have fallen 5% so far today!
I got hit hard with AMZN.

I'm going to pick up some FB when it hits 70/72.

Also Netflix although I haven't determined an entry point for that one yet.

LUV is singlehandly keeping my entire portfolio in the green
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      09-15-2014, 07:07 PM   #2571
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Tech got sold off pretty hard today. Might've been because of the alibaba ipo coming soon.
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      09-15-2014, 07:19 PM   #2572
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TSLA warning from ANALyst was a huge contribution to biotech/momentum stock's fall.
It was no brainer, but I think it will head up "little" higher. TOo many people on the sideline right now. Only momentum stock I've bought this year was Pandora and Twitter.

I am sticking with beat up stocks.

Just my opinion that people will do better on negative EPS stocks than a stock with extremely high P/E right now. People are looking for next TSLA which people DO NOT know about.
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      09-18-2014, 11:51 PM   #2573
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How does everyone feel about alibaba? I missed the boat on twitter and go pro. The hype surrounding alibaba seems to be even greater. I'm tempted to gamble a substantial amount on alibaba but I'd like to hear some thoughts first.
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      09-19-2014, 04:34 AM   #2574
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Quote:
Originally Posted by NemesisX View Post
How does everyone feel about alibaba? I missed the boat on twitter and go pro. The hype surrounding alibaba seems to be even greater. I'm tempted to gamble a substantial amount on alibaba but I'd like to hear some thoughts first.
320m shares will be available upon hitting the secondary market.
At least there are less probability that specialist/MM's hiking the damn price to 90/sr on open.

My wife is willing to only bet 200-500shares (depends on opening price upon hitting the 2nd mkt). I would rather bet on RAD at 5.00-5.10.
We are too heavy on other stocks as is.
Everytime I see "IBs, insides, and initial investors are selling, street buys" kinda makes it less attractive to IPO. BTW, i was all over IPOs during 1999-2000.
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