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Anyone Else Getting Spanked?


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Rather than say, HECK...how good is that, I can now buy it at $30 and I

almost bought it at $35, they sit back and wait...many times clearly

stating they want to "see if it goes back up" before they buy it.

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Amusing and probably so true! Isn't this the main reason most small investors are consistently fleeced in the Stock Market, which is run by professionals who DO know qwhen to buy and sell?

If you have a busy carreer and family I see little time for proper stock market research. Best advice.

1. Funds with track record

2. Diversify

3. Save more than you think you need to. I save 18% of my annual salary per year.

My company stock made 23% average over the past 3 years and I still will only own their stock as 7% of my portfolio. I work for them but have no clue as to when the stock in Brussells stock exchange will make a negative correction.

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Guys...

The can of corn analogy is to just try to make an illustration. Don't build it into a bigger mystery than it is. It might not apply to your logic pattern and if not, you might not necessarily agree with it. I've personally dealt with MANY people over the years who DO follow the logic of it.

Example...(and this is based on true stories)

Joe Blow is looking at buying (enter SPECIFIC stock or mutual fund) and it is trading for $35/share

Market pulls back 300 points that day and the stock/fund has fallen to say $30 (funds are determined at end of day so stocks are easier to use for illustration).

I can not tell you HOW many times over the years I've had someone who was ALREADY wanting to purchase "X" at $35 decide to "wait & see" because it fell to $30.

Rather than say, HECK...how good is that, I can now buy it at $30 and I almost bought it at $35, they sit back and wait...many times clearly stating they want to "see if it goes back up" before they buy it.

Of course, if it goes back up again (let's say to $33) then they still missed most of "the sale"

We all know stocks go up & down and there is no 'guarantee' that any specific item is going to go UP (or down for that matter) after its purchased.

The very basic point the can of corn analogy is trying to point out is people will JUMP to buy something that is on sale yet if it is the very stock they are WANTING to buy going on sale, they will many times, pass on it.

(disclaimer: not everyone, not every time, not every situation blah blah blah... I've just seen it happen enough to become fascenated by their thought process)

There is no mystery to this at all. Without specific correct information most all of the world uses a simple formula to predict the future - the best predictor of future behavior is past behavior. This is the reason for keeping a list of the historical prices, charting them to see their direction, and performing moving averages and other analyses. Without additional information, when someone sees a price going down the simplest inference is that it

will continue to fall; and that if it is going up it will continue to

rise. This explains why folks will hold off buying a falling price and

hold off selling a rising price.

Stocks are balanced - you buy or sell

Cans of corn are single ended - you just buy... when and if you eat it is irrelevant to the buying

Now after the collapse of civilization when there becomes a trading market for cans of corn (and bullets, beer, gasoline, and women); that's different!

Disclosure: I have 11 cans of corn.

I see experts offering their opinions and predictions which they are obviously recommending you take; specific actions to buy and sell; but they always give you the fine print that states their input is for "information purposes only" and is "not financial advice to buy or sell" anything they push or denigrate... they sometimes explicitly state that past performance does not predict future performance. Example:

The content on this site is provided as general information only and

should not be taken as investment advice. All site content, including

advertisements, shall not be construed as a recommendation to buy or

sell any security or financial instrument, or to participate in any

particular trading or investment strategy. The ideas expressed on this

site are solely the opinions of the author(s) who may or may not have a

position in any company or advertiser referenced above. Any action that

you take as a result of information, analysis, or advertisement on this

site is ultimately your responsibility. Consult your investment adviser

before making any investment decisions.

It is logically impossible to offer a recommendation to buy or sell (future prediction) and also claim that it is not a recommendation and is not based on past information.

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OB, you're right, a QUICK FIX, that surely won't benefit the dollar in the long run, but the FED isn't concerned about dollar devaluation right now. BE LEARY and cautious.

Personally, I buy generic corn.....less risk![:D]

There is risk in buying any corn... I went to buy dog food yesterday for my 14 year old pup at the local Randalls.

It was closed because the heavy rains caused a roof collapse; one death, some injured.

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Fresh corn is cheap this time of year, 2 ears for .88 at Kroger, should go cheaper in a couple of weeks.

Shop around! A few miles south in Colleyville we have been getting it for 5/$1.00 (20 cents) for some time. ;-)

LOL Mas, like I'm going to drive all the way to Colleyville for a few more ears of corn, but yeah, I expect that price to get up here pretty soon.

Pauln, it is only because of lawyers (and their clients) that those disclaimers are necessary. Imagine a world with no lawsuits over the plaintiff's own bad judgement, and a country without the complicated tax laws the US has, and there would be lots of lawyers and accountants looking for another line of work (maybe this time it would be productive work).

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Right before the big drop I stuck 50% of my 401(k) in cash and divided the other 50% by putting 5% in each of 10 different fund families. As of close of business on Thursday I lost approximately 5% of my money. I didn't think that was too bad.

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