Why I invest in index trackers
Nov. 4th, 2018 02:26 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
mtbcOccasionally an investment stategy occurs to me and I wonder if it affords a means to beat the market. It never does. Fortunately, paper trading protects real money from my ideas: it is just a matter of plugging a different
Recently I wondered if stocks whose price has been wobbly but broadly stable are an opportunity for a quick profit. On average, it turns out: no, they aren't. I thought I would share an example of one of the reasons why.
If one had been watching the stock for RumbleOn1, the online marketplace for used motorcycles and the like, then on the morning of 24th ultimo one might have been tempted to buy. The price had stayed comfortably above $8 since the end of August and over October had wobbled very many times below $8.25 then above $8.40; on that morning it again dropped below $8.25.
Needless to say, that long position would have disappointed. Rather than yet again climbing by a few percent the stock fell: it now typically trades below $7. Toward the end of the month the company reported disappointing earnings and borrowed more to buy another vehicle trading website. Even given the ability to place stop loss orders this kind of event is not unusual enough to be worth the risk.
1NASDAQ ticker symbol RMBL
what to buy or sellfunction into my existing code and seeing what happens.
Recently I wondered if stocks whose price has been wobbly but broadly stable are an opportunity for a quick profit. On average, it turns out: no, they aren't. I thought I would share an example of one of the reasons why.
If one had been watching the stock for RumbleOn1, the online marketplace for used motorcycles and the like, then on the morning of 24th ultimo one might have been tempted to buy. The price had stayed comfortably above $8 since the end of August and over October had wobbled very many times below $8.25 then above $8.40; on that morning it again dropped below $8.25.
Needless to say, that long position would have disappointed. Rather than yet again climbing by a few percent the stock fell: it now typically trades below $7. Toward the end of the month the company reported disappointing earnings and borrowed more to buy another vehicle trading website. Even given the ability to place stop loss orders this kind of event is not unusual enough to be worth the risk.
1NASDAQ ticker symbol RMBL
