RE:RE:RE:RE:RE:Chart analysis on the bearish sideThank you very kindly for a very comprehensive answer MA.
I did buy HMMJ a couple of times but nothing beats the great feeling brought about by successfully trading your favourite stocks.
Thank you for sharing your knowledge.
quote=MartialArts
EI, that is a very, very good question. Is it possible to "invest" with big money and computerized hedge funds using computers to trade? Yes, but I feel that finding "buy, hold and forget" is getting harder especially in individual equities and especially in non-GAAP Canada where financial fraud is a serious unresolved problem.
If you self invest, you have to spent an incredible amount of time "self serving" your portfolio. Most people who are rich from non-market endeavors park their money with a financial firm that pays staff a salary with performance bonuses with a flat 1% fee. Nobody I know who is rich self-manage their portfolio. Too complex and they know they don't have the skillsets in that area.
But self-investing isn't easy. I often feel the markets is a giant chess game and I've seen others call it this as well. If you watch some "players" here, they sometimes put out some wild speculations but if they can back it up with reason why they speculate a particular way, it's often because they have seen the same action on other stocks. They have clued in to the "chess game" of a particular stock and are able to adapt to the "play". ACB is easy, it's incredible how they "played" the CMED acquisition for example. Very few people understand the incredible dynamics in play there. How many people have read every document on SEDAR for both ACB and CMED for example? It's complex stuff. I was talking to a friend who showed me the package he just received while he was staying "too much to read and understand". I gave him the 25 word executive summary. He's a "regular" self-investing type of person.
I'd love to find a discussion site that goes "deep" into the strategic analysis because there isn't much depth here and that's what's really required to "self-invest". I do share information via private messenging where people aren't afraid to open up. There are really good people here. Some very quiet, some very loud unfortunately.
ACB is a classic "growth by acquisition" so anyone highly invested here should research how these behave. One of the US short sellers calls this a "Valeant" and like Valeant, the growth can be spectacular. Can ACB reach $20, $30, $40? Absolutely. Check the dotcom valuations as a reference point. Most don't realize that Valeant had the highest market cap of any stock in Canada at one point. Higher than Royal Bank which is current #1. How? Via its impressive "growth by acquisition". It had the backing of billionaire Ackman in the US. That seasoned veterans was ripped off like other Valeant investors who figured the financials were sound. It was a "market darling" for years until the growth stopped. I see, withouth any doubt, Aurora doing the exact same thing IMHO. A great stock to own during the growth phase and also a great stock to trade.
So yes you can "invest", survive and do well despite active trading of all kind. Look at Apple, Microsoft, Amazon and other market leaders. Finding the next "Amazon" of this space should be the priority of any "investor". Look for a company that behaves like an Amazon and one that doesn't behave like a WorldCom unless you are on the ride for the growth phase only.
And if you made a bad call, switch horses. If all of this is too much, look for an ETF (low management cost). If I wanted to trade on non-steriods, I would simply be on ETFs. If you feel the future of the MJ sector is there, which I feel it is with international rec market and undervalued pharma potential, invest in the MJ ETF which is HMMJ in Canada. It spreads out your risks so one bad equity won't kill your portfolio. Sell the moment an "inverse" or "bear" MJ ETF emerges short term until the dust settles. That's one of the next sector event to watch out for.
So knowing that you are competing against trading machine and full time professional is half the battle really. And what is your best weapon to deal with machine trading, hedge funds and other "big money". Knowledge. And that requires time. Also know the sector. Investing in the MJ sector is as "speculative" as it gets. If I had to suggest to a novice on the best way to invest? It would be in a low fee ETF in a non-speculative sector.
The safest reward to risk one in Canada (assuming the economy does well) is XUI
The iShares XUI is the TSX 60 - the largest Canadian Companies. Trades like a stock but is more like a mutual fund with a basket of shares with a management fee of just 0.18% far better than any mutual funds.
https://www.blackrock.com/ca/individual/en/products/239832/ishares-sptsx-60-index-etf?nc=true&siteEntryPassthrough=true
And when the markets turn from bull to bear, switch to the inverse to make money on the way down with something like this https://www.horizonsetfs.com/etf/hix but only on a confirmed bear market and recession. Not the management fee is much higher and so are the risks. Short selling is best left for the professional traders.
Hope that helps.
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