I have been reading the other thread (bumper yield on wall street) and it makes for some good read, but it is also not really helping a lot of nepalese that have little or no experience/knowledge about the market. I am reading up on all these proclamations by the threaders (and maybe they are telling the truth), but I can easily see the ramifications -- ever seen those auto commercials where they say 'do not try this at home"? This is one of those things.
Forget options, futures and currency swaps unless you know what you are doing. Heck, even stay away from individual securities if you can help it. for beginners, go after mutual funds. try cheap mutual fund houses such as Vanguard, Trowe and Fidelity. go to morningstar.com and look for the 4 and 5 stars; and then most important, create a well diversified mix--have proper controls in place so you dont have everything correlated to the market; go after index funds to minimize costs, and place your equity exposure in accordance to your age (for example, if you are 30 go after 30% in bonds and cash and the rest in stock exposure)
by the same token within the stk exposure break it down 50/50 between domestic and international-- choose an index fund copied around the wilshire 5000, and an international index fund chasing the msci (international index)---with fixed income (bonds) have 1/3rds in mmkt, an bond index fund, and a high yield.
there, that should do it. Dont forget to rebalance it every year though.

Jhyalincha -

Agreed. I also think it is a question of your priorities. My portfolio is heavy on mutual funds for many of the reasons you mentioned and one other reason : focus. If you are not actively trading and cannot devote a whole lot of time to manage your money, in my opinion, it often works out better if you let someone else do it. (Assuming they have credibility, yada yada and all the standard caveats and pros and cons)

But if you can devote the time and energy to managing your money yourself, I'd say why not? Many people pass through that stage of agrresive investement before they settle down for something more cautious. When your net investment is fairly small, as it might be when you are straight out of college, single, with a new job, no major responsibilities, you can afford to be more aggressive than if you have a large sum invested and have other priorities that demand more of your time. You need to decide what mode fits you.

But yes, anything you hear about others making money, whether it be on Sajha or on Yahoo or in a bar should always be questioned and double checked. I would hope most people who are thinking of putting their money to good use, will use their senses, (or their brokers/manager's) and do just that before they commit.

Thanks for sharing your thoughts and have a good one.

I disagree with jyalincha,
Yes your investment ideas are acceptable and does promise better than return on bonds or slightly better than the market. But i don't see how you could make significant $$$ without access to huge capital. Most people with some finance/econ background one knows gold prices will go higher and crude oil will be up mid-term to long term. But how would u make money without access to capital. Well if you are managing your own retirement than its a diff ball game.

Yes futures and forex are generally set aside for experts and wall street firms kept their knowledge inside; talenst switching from one house to another. But since 1999 things have changed forex no longer a game only of big banks and major corp. One could do it.

The only reason i recommend those is the availiablity of leverage. But yes it does take atleast a year or more of studying and econ/finance backround is definitely a big plus. The point is u need to be expert and but it is not impossible. People get scared and don't even give it a shot.

http://www.equitiesmagazine.com/pdfs/articles/06-winter/Beginners_Guide_To_Forex.pdf

I have to agree with Duke. For a person without much capital, futures or forex is the way to go. I prefer futures but if you have a system that works in forex more power to you. Leverage is a two edged sword. You can make a lot of money but lose your shirt as fast too.

First of all, people have to define their time frame and risk tolerance before they get in the market. It will be different for all people. I intend to start a new thread with my trading strategies after the new year (if people are interested here). I will like to know from users whether they want to know about short-term futures strategies or long-term stock strategies. I won't have time to do both but I will do one. With stocks the daily moves are not so big so you need a longer-term horizon to catch the big moves. With futures you want to catch a part of the daily move and not lose money. It will be a long-only strategy. I short frequently but I would not recommend it to people that are new to trading.

Emini,

If you come out with a thread solely descibing your trading strategies, I'd love to read and analyze it. I've been in this field since 2002 but everyday I feel like I learn something new (damn, when will learning ever cease??). Are you trading for a firm now? And are you into forex?

If you are a beginner e- mini is also a smart move !

First you gotta make a move on the basics of the stock market and then onto the basics of trading. Then you need to be clear about what direct access trading is, how to invest, technical analysis, etc etc all those. It really is quite a bit of learning. And takes some time. Heck, a lot of business students dont get those concepts clearly. then you gotta get into the basics of stocks, volume and liquidity. How to screen stocks, fundamental analysis, etc. That takes considerable amounts of time.

The next step would be to hit yahoo finance (and you should have by this time) and just follow the markets everyday like I've done since I was 16. It's never too late.

Then after you paper trade, follow different kinds of charts and patterns and news and world events. It's boring frankly. Its een more boring when yo have noone to teach you. I learnt everything about the stock market from the internet and from books I scoured through from libraries. Having a mentor definitely helps but it also makes you a bit lazy and over confident sometimes. So do it yourself!

Only when you've mastered the knowledge of trading stocks should you even consider futures. Heck, understanding emini futures are one thnig. Going through commission structures, making a schedule to trade, having the cash to trade, the control on emotions and greed are all a huge factor.

So I say start stocks. Mutual funds, learn abt them from your parents or online. Theyre the simplest investment vehicles. I think stocks are the way to go.

And don;t be afraid to lose money. You will. Everyone does. Youll lose it big a few times and wanna piss in your pants. But don't be discouraged.

"Life's either a daring adventure or nothing"- Hellen Keller

Everyone here is talking through their assess except Jhyalincha... I have not come across more moronic comments regarding investments than this:

"But i don't see how you could make significant $$$ without access to huge capital"

"But i don't see how you could make significant $$$ without access to huge capital"

Milliondollars, If you're into trading, you'd know that the above stmt by Duke is the reality in this biz. Lets hear about your trading experiences (if any)...If you don't have any then get your azz outta here and quit dissin' all the people trying to educate the others in this forum...Hey, call youself a millionturkishliras from the next time around, nincompoop!!

Samsara Son:
I could teach you a thing or two about investments any day... Who does not already know:
"But i don't see how you could make significant $$$ without access to huge capital"

We are talking about a few individual investors here with a few thousand dollars here... Any statements that involves "Significant $$$" or "Huge Capital" seems ridiculous to me...

You sound like a fresh grad... Stop pissing people like me off with your stupidity if you are looking for a job... Now wipe that sadness from your face, just a fatherly advice for you...

Hey Millionliras, in retrospect I know I'm old enough to be your DAD so get down to sucking my knee-caps. And you teach me about investments??? Didn't know that your degree from the Bronx school of Finance made you a player, damn schmuck. Get a real college degree before you even try to understand the basics of trading, smart ass.

"But i don't see how you could make significant $$$ without access to huge capital"

I'm on the trading side for a major investment bank and this statement is the fact here. Even if the forum members here have very little capital (as you said), you could make money by leveraging the little you have relentlessly (200:1 or in some cases 400:1 in the FX mkts). This way, you have "access to huge capital" that could help increase your gains exponentially. By the looks of it, it seems to me that you've never even traded before in your life at all as you know of no such minor details. My advice to you nani, is to go back to scool, get a job at one of the big boys and ONLY then talk about trading with me, fu(king loser!!

I'm done for the day...slow day in the FX Options side! Am out now and will continue the discussion tomorrow!

Man O' Man,
This thread was getting informative to beginners like myself...and all of a sudden, we Nepalis start showing off our BIG Gorkhey EGO and bickering....Stop it guys.....just enlighten us with your knowledge and expertise in the Stock Market, without fighting among urself.....Will you? Could You?

Please Don't hate me now...coz I am simply stating the obvious....

Samsara: God help the major investment bank that allows you to trade. From what I can read, I don't believe you would be allowed to do more than cleaning the trading floor. You may have overheard some traders talking about leveraging. Does your empty head even realize how risky your strategy would be to leverage 400:1 ? And who would satisfy the margin call the day after, your stupid bi.tch ? And the worst of all, you are advising the little guys with their lifetime savings of a few thousands here trying to invest for their retirement to leverage to death ? I would not be able to justify your advice unless you are on crack...

KnightCrawler,

I agree with you. Just as you said, I wanna learn too.

So please share your wisdom with fellow Neps who can try and get less risk averse as a society.


Big Guns,

Peace out and let the ego be parked at the parking lot. That is how we can make the Neps society not be that risky.


Cheers!

-B

dont want to make this a pissing contest, but here's my 2 cents:
if you are a savvy investor- and better yet if this is your line of work- go crazy on all the arbitrage opportunities the market throws at you-- if you have the time and the resources.
I have the resources, but unfortunately not the time since I only track some very select equities for my firm. So I mainly went with the strategy mentioned above, leaving very little play money. Thankfully it has worked out quite well. It started out small, but now looking back, the strategy has worked quite well
Moral of the story--we can all be Warren Buffets in the short term, but in the long run you have to be willing to commit a lot of time to this if you are looking for significant profits. If you do not have the time, or the knowledge/resources, stay away from exotica.
Compare this to a well diversified mutual fund portfolio I outlined earlier, and this portfolio has generated an average of 18% a year for the past 5 years ( I should know, I have it)- yes the data may be a bit faulty because it caught the market on its way up, but the law of averages will take precedence eventually.
I am sure we have some very talented people sharing their ideas on this thread, but lets not discount each other. Not everyone is the same, and the reason i started this thread is to make sure we did not have unknowing victims of glitzy returns.

Jhyalincha/ Duke/ Eminitrader/ Captain Haddock / TimeTraveller,


Great to see you guys pitch in with your comments/experiences.

Keep it up!

-B

Anyone for

LUV, HMC, ALU, PMCS.

aka

Southwest, Honda, Alcatel-lucent, P Sierra.


Let me know your opinions.

Thanks.

-B

just out of curiosity--how many of you still use the black scholes model while trading options? I thought it was the bomb back in grad school, now I wonder what all the fuss was about.

I am not a Finance Major guy...As a lay man..

How can I start trading stock?
What are risk factors?
What is return on investment?
and so on

Can anyone expalin ABC of stock? I really appreciate