Newbie question about my stock in Amazon...

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alex_686
Posts: 2473
Joined: Mon Feb 09, 2015 2:39 pm

Re: Newbie question about my stock in Amazon...

Post by alex_686 » Mon Jul 31, 2017 8:57 pm

sociologydude76 wrote:I just want to echo the awesome advice in this thread so far. And as mentioned above, I'm encouraged by the pleasant responses by a newbie question. That's a rarity on the internet!
Let me try to be a bit kinder than my cohorts. The are 3 kinds of investors.

There are the Boggleheads, who are passive investors. We believe in the efficient market hypothesis. We assume that fundamental economic forces will drive the stock market higher. We don't know if the stock market is over or undervalued and we kind of don't care. Over our holding period of 10 years we will reap large gains thanks to the fundamental forces, and that these gains will swamp the piddling overvalued / undervalued factors.

There are the Fundamentalists, who believe they can read the annual reports and divine the intrinsic value of the company, divorced of the popularity contest that is the market. If a company is undervalued they will buy. It may take a few years for the market to realize a company is undervalued but that is o.k., more time for them to buy the company. Some Boggleheads also dabble in this. These people have a time frame from 3 years to 10 years.

Then there are the Technical Analysis which peer into the market to divine if a company will become more or less popular. They have a time frame of less than a year. It is incredible hard to do consistently. Almost no Boggleheads do this or have the skills to do it. This is what you are trying to do.

As such you have kind of came to the wrong place. I would encourage you to research more about Passive Investing and Fundamental Investing (also called Value or Intrinsic Investing). These are areas where a individual investors can acquire skills and compete reasonably in the market.

Zeusy Zeus
Posts: 18
Joined: Sat Jun 24, 2017 6:46 pm

Re: Newbie question about my stock in Amazon...

Post by Zeusy Zeus » Sat Aug 12, 2017 6:59 pm

I mostly follow SeekingAlpha articles and I read the comments people write on there and base it off the mutual consensus of whether or not a company is worth what it's priced at. I'm still currently reading Bogleheads I'm about halfway just trying to find the time to finish it. The picture overall is clear to me passive investing trumps stressing over the market every day because quite frankly you're worry free, I get that. Only reason I was asking the question I was asking was like I mentioned my Roth is maxed out and I want to play around with stocks. I made some impulsive buys which I'm regretting such as Snap but atleast it wasn't much. Currently I'm in Marijuana stocks (curious to hear your opinion) and I don't buy stocks on impulse I research it thoroughly including using multiple websites for price analysis. I'm currently subscribed to a few newsletters, however not sure how good Motley and agora financial really is mainly seems like spam. Taking it one day at a time making this my hobby. I plan on taking some trading courses online and continue learning the markets before I jump into any heavy investing. I'm also contemplating index funds in my brokerage account. Really appreciate all the advice I have a lot of reading to do.

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