Trading the stockmarket (NO Referrals)

[sniffy]

I was playing with R and reading related material on the net for hours last night. It's all very interesting but I feel like I know nothing. No idea how to interpret the data really (saying that, I don't even know how to create datasets yet). I'm gonna *try* make it through those lecture slides though, hopefully it will be somewhat clearer then

Don't suppose you use MSN dangerstat?

 

[silversurfer]

buy on the rumour, sell on the news

but now they have all of HBOS to add value.

genius lol That might be true in five years, Im not sure people are bidding on lloyds now with the same clear view of the future

worth buying now for a long term investment then?

Its always worth buying for long term investment if its a good company. Thats buffets rough thinking but he has xray specs to see the worth of things


"autumn correction" is pencilled in for first trading day after labor day 2.35pm

Meh, I know this is smallfry but I've been given 2.35 shares in Walmart for free. Worth about $125 or so.

Do I wait for them to increase or just sell em for £75 now? Hmmm

buffet owns them along with tesco, he says you keep them forever

 

[sniffy]

I'm hoping you can point me in the right direction here dangerstat

I've created a dataframe with the following:

> price <- c(666,665,667,666,665,667,664)
> date <- c('27/08/09','27/08/09','27/08/09','27/08/09','27/08/09','27/08/09','27/08/09')
> time <- c('9:00','10:00','11:00','12:00','13:00','14:00','15:00')
> stockData <- data.frame(price, date, time)

Is it easy enough to just slip a new field into this thing? Is there any way to properly save this dataset so I can access it once I've closed down R (like you can access EuStockMarkets) or do I have to just save the work image to reuse it? Also is there a better way to do what I'm doing?

Really sorry for the dumb questions but I can't find any resources that doesn't assume previous R knowledge. It is quite overwhelming!

 

[dangerstat]

Hi Sniffy

Good to see your looking into this.

Lets start with an example, the following is a CSV export from Yahoo for Oracle:

http://ichart.finance.yahoo.com/table.csv?s=ORCL&a=02&b=2&c=1988&d=07&e=27&f=2009&g=d&ignore=.csv

Once you save this, as say, Orc.csv

You load it into R with

data <- read.table("Orc.csv", sep=",")

(edit you might need a skip=1 here too)

Then we want the logged returns so

Orc <- diff(log(data[,5]))


Don't worry about the dates right now, if you really want to know how to format the dates and make a .ts object for R I'll post during the weekend if that's okay. I'm having to learn ruby tonight :/

 

[sniffy]

Thanks a lot mate.

I'll have a bath then check it out. I really shouldn't be enjoying something so academic

 

[Vanilla]

genius lol That might be true in five years, Im not sure people are bidding on lloyds now with the same clear view of the future

I am

Holding them for a long time 3-5 years as circumstances dictate.

M-m-monster mortgage company.

 

[Kristoph]

Just went to sell the 2.35 shares I was given for free.

Seems like I'm getting even less every time I glance at them..

Transaction Details Plan Currency Payment Currency
Estimated Market Value Per Share USD 51.24 GBP 30.96
Estimated Total Market Value USD 120.77 GBP 72.97
Estimated Fees
Trading Fees USD 30.15 GBP 18.22
Foreign Currency Fee USD 15.00 GBP 9.06
Estimated Total Charges USD 45.15 GBP 27.28
Federal Tax Withheld USD 0.00
Estimated Net Proceeds USD 75.62 GBP 45.69

So that's £27 less than what I thought I'd be getting.

 

[sniffy]

OK I've done that. I now have a pretty histogram Now I need to learn how to interpret this data with R lol.

You have my condolences for having to learn Ruby

 

[dowie]

@ stiffy if you're getting into this seriously

taking outright directional punts is a very very hard way to make money - there are other ways.....

might be worth you taking a look into co-integration and have a go at implementing a simple pairs trading/mean reversion strategy

other stuff to look maybe look into - futures spreads - plenty of material out there on commodities, perhaps less of a good idea to look at bond futures or STIRS as a retail investor - maybe start looking at relationships between index futures - i.e. EuroStoxx vs another EUR denominated contract - i.e. Dax, AEX, CAC etc...

start learning about the major economic figures and how the effect the instruments you're trading, make sure you monitor related instruments too

basically you need to find an edge, if you don't have one then you'll just end up churning your account - no one is going to really help you too much with this unfortunately

few other points on stuff I'd avoid - taking info on trading forums at face value - there are a lot of people out there playing with spreadbetting accounts, retail fx accounts etc... a large portion of them use a whole bunch of pseudo scientific nonsense to make trading decisions - you'll see funny charts with all sorts of magic jesus indicators, funny subjective lines (if you draw enough lines on a chart you'll find trends/support/resistance anywhere), people who don't use indicators but look for subjective chart patterns - you will even find some people who use phases of the moon or astrology to trade (I'm not kidding here) - basically be careful what you buy into - it might be worth getting a technical analysis book and deciding for yourself whether you're interested in it (technical analysis book by Murphy is quite comprehensive) - be warned though a lot of this stuff is not really properly researched and may or may not be complete bunk.

 

[sniffy]

I am serious mate. I appreciate it's going to take many years to understand how it works but I definitely want to be in that position eventually.

Thanks for your suggestions. I'll start reading into them tonight/tomorrow.

 

[sniffy]

This is a strange topic to learn. I've learnt programming, some pretty savage maths and other nasty stuff. I can't say I've ever encountered a topic that encompasses so much. It's not particularly difficult but when you need to read through 5 web pages to understand 3 sentences, progress is amazingly slow.

I can appreciate that people who do truly understand this stuff have a very large financial incentive to keep quiet though

Edit

If anyone is remotely interested in the work that dangerstat carries out, PLEASE post your interest. I'm amazed people are investing thousands and don't seem even remotely interested in what's behind it.

 

[PanchoVilla]

Dangerstat, thank you for posting #304 - I've been skimming this thread and I'm now getting very interested as your process seems more empowering than relying on recommendations from others.

When I've got the time, I'm going to read through this thread again in case I've missed something.

Thanks Sniffy for referring to Dangerstat in your post, I would've missed it otherwise.

 

[morguk]

Hey guys Senior Noob here again. Just some questions about the possible Autumn correction.

I'm looking to invest into Lloyds. So when the Autumn correction hits, (estimated 7th of Sep?) am i looking to buy that day or wait out a few days?
I am unsure of when I should buy.
I don't want to buy in at Lloyds for 100p and then watch it go down another 15p or something. Then again as a long term investment, small increases/decreases shouldn't affect my investment much.

Just wondering what percentage Lloyds may drop in Sep, if at all.

Thank you.

 

[Vanilla]

All this talk of corrections is quite amusing.

I bought LLOY at 66 and watched it drop a bit. I also saw BARC and 100p and thought i'd missed the boat - almost 400p only a few months later

Just buy when you feel comfortable. Look at the long term - you'll never buy if you wait for so-called corrections or reports. At the time everyone was saying that there was a rights issue and it would drop further that LLOY was set for more trouble, etc. Nothing ever came of it.

I still got in and now i'm up about 60-65%. Same story with RBS.

 

[silversurfer]

The lloyds rights issue was always a good time to buy, the last one anyhow. It was done to reduce costs and debt, it was productive capital raising.

Lesson learned is to support any company which does its best to reinvest your money in the best way

Standard chartered also recently did another small share issue. The reason was to invest in assets available at this time. One mans downfall is another mans opportunity and they are set to buy rbs assets because that bloated beast was trying to become a world bank.
Chartered just specialises in asia, a growing market unlike the usa

Should you support a company taking action like that, hell yea especially if others worry and the price drops a bit. If the share price drops, it just got cheaper and many times thats a good thing quite simply

http://www.taloneight.com/secularmarket00xx.html

http://forums.moneysavingexpert.com/showthread.html?t=956257&page=12

 

[Vanilla]

The lloyds rights issue was always a good time to buy, the last one anyhow. It was done to reduce costs and debt, it was productive capital raising.

Lesson learned is to support any company which does its best to reinvest your money in the best way

Yes, the only issue with rights issues is that they tend to send the SP down, often to the same price as the rights issue!

I took the last rights issue, picked up about 2k worth of LLOY for 38p. That 2k has now become almost 6k

LLOY and RBS are pushing higher because there's rumours they are trying to pay back the government and get out of that scheme early. A good sign.

 

[silversurfer]

If you bought for 38p you would have had to been a holder already which means you did suffer devaluation previously.
To weigh one against the other I would want to withdraw the money I put in via the rights and realise the gains on it

The market price fell to like 60p though, anyone buying then would have done well similar to shareholders who appeared to get the greater bargain of 38p

 

[silversurfer]

Re: price devaluation by new shares issued, rbs is the worst culprit

http://www.iii.co.uk/investment/detail?code=cotn:RBS.L&display=fundamentals&it=le#row3

 

[PanchoVilla]

...
Lets start with an example, the following is a CSV export from Yahoo for Oracle:

http://ichart.finance.yahoo.com/table.csv?s=ORCL&a=02&b=2&c=1988&d=07&e=27&f=2009&g=d&ignore=.csv
...

I'm looking at the data and trying to figure out how to add 'Shares in Issue' to the table.

Don't understand what to make about shares in issue.

[a] can 'Shares in Issue' per day be downloaded as well?
how does 'Shares in Issue' affect the price?

 

[Hades]

If you bought for 38p you would have had to been a holder already which means you did suffer devaluation previously.
To weigh one against the other I would want to withdraw the money I put in via the rights and realise the gains on it

The market price fell to like 60p though, anyone buying then would have done well similar to shareholders who appeared to get the greater bargain of 38p

I had a small number of shares in LTSB at the time which I had left over from working from them (a handful left after selling a very large amount to buy a house). I took up my maximum entitlement as it was simply too good an offer to refuse. Knowing the company I'd put more money in now if I had it. Buying HBOS was a disaster but give it 3 or 4 years and they will be a very successful company once again. A very good long term buy in my opinion.

I now work for Barclays and I'd also put money into them (in fact I did ), but for a different reason - they are ruthless bar-stewards that are going to come out of this one of the strongest international financial companies.