Im thinking of buying some General Electric stock. Has anyone else made recent investments on companies they feel are undervalued? I think the markets have stablilzed for the time being...
I do not think it has hit bottom. It is still reacting to rumor and stupid analyst opinions. GDP, unemployment, and many, many other indices must stabilize and begin to show strength. Too many people are way too scared to get back in. Typically, I will buy with "mad money" but not now. Everyone is looking at past trends but failing to take into account that we have never before had this type of recession caused by credit abuse on a gargantuian scale. Even the Chinese are beginning to wonder if they should loan us any more money. If that dries up you better have every dime in cash. I don't know how they can possible expect consumers to start spending beyond their means again with only $13 extra each week, having just watched both their savings and home values shrink by 50%. The market, when it starts to go up may indeed go up fast but it will come back down twice as fast again. It is a reactionary market not based on fundamentals but emotions. GE? Nope, they have been in trouble for some time now. Think of things that people will always need, like health insurance and food (Wal-Mart). Problem is, from what I have observed, the gains this past week were made at the expense of what usually are good sectors. Instead of people buying up everything, they are simply moving things around. Another sign that it just is not over. Add to that the fact that they are just beginning to look at further regulation. When that kicks in, there is no way the market will even come close to what it was at before, at least not in several, i.e., 5 to 10) years. PLUS, because our government is going further and further into debt, we will have to work until the day we die just to survive when things to kick around and inflation jets sky high along with taxes. Now, if you are real young and have "mad money" lying around, sure, go ahead and invest because your down risk now is not nearly as bad as it was the end of last year. However, I still think it has further to go down, say DOW 5000 before things will kick back in. I'm staying out of stocks for the time being.
The best investment advice ever given was by Warren Buffet when he said, and I paraphrase, don't buy any stock if you can't stand to see it loose 50%. We are due for a relief rally, but the ultimate bottom may still be out there. Use stop limits, where you can, to protect your downside. GE just got downgraded to AA, if they get down graded to A, they will have to pay much more for the debt the use in their finance division, which has a large exposure to Eastern Europe, where the meltdown has been severe, and where liquidity will likely get worse.
I like Duc's idea. If you do buy GE, stick a stop limit or stop loss order in about $1 below your purchase price. GE has been trading like a bank stock for the last 6 months; and will continue to do so.
Ratings agencies would suggest otherwise... but it depends on your position. If you're planning on a short term sell personally I would wait until it falls below 8 again before I bought. But if you have a 5-10 year horizon, just about everything is undervalued right now, you just have to be patient
I took lots of nibbles of the bank and financial stocks around the time you posted this...and at the moment, i probably have scaled out of about 50% of the positions i bought into, and i have long term put options on all of it, as i was very anxious buying in back in march...more so than i have ever been, in trying to pick the bottom. I have made out very nicely, but i rue not buying a ton more...then again, in the environment at the time, it was the scariest market i have seen in a looooooooooong time, certainly while i have been working in the market, and that is going close to 15 years now. Better safe than sorry. thank goodness for options...i rarely ever take long term positions without option protection of some level..compulsively, as i learned a long time ago. trading and scalping on a daily basis is rather simple, but to be patient with long term investments, you have to be willing to take the risk of holding it, and for me, i am rarely without a hedge position. it has served me well over the years.
2nd qtr earnings will be telling. thinking banks will get pounded... gotta like commodities....inflation will go nuts next 3, 4 years
On GE I would have made 1000 dollars on the 2000 I was thinking of investing by now. There were riskier investments I also considered that would have been much more profitable. I feel like a tool for not taking my own advice. But at least I can brag about calling the end of the downturn on a large penis forum. BTW...as for the future....I have not a fucking clue anymore....which is why I don't throw my money in now. I simply knew that was going to be the bottom of the current downturn in March.
Not sure about anyone calling the bottom on this forum or any other, but it would be a unique investing claim - I can see it on the front page of Barron's now... it certainly would sell copies. You'd probably make more on the article than on the GE trade. Odds are the March low will be tested again, so don't despair, there are always be more buying opportunities.
Why didn't you buy, mang? Almost everyone in this thread said it was undervalued. You're doing exactly what I'm doing right now though. I picked up Apple in March and that's all I plan on holding until the holidays are over. I feel like everyone is just waiting and waiting for a pullback, private investors came in first, now hedge funds are buying every little dip and bringing prices right back, the bond market is shit, and commodities are far too risky...the decoupling of natural gas means something, I'm not sure what though. There's just too much shit going on right now, the only strategy I would consider is just sticking with large cap companies if I actually had enough money to be concerned about where I'm keeping it lol
Many people called the low, both here and in real life...I made an entire thread about 2009 economic predictions and if I remember correctly, it's spot on..maybe I should try to find it and send it in lol
I should have bought. I had too much going on...was being all lazy, and then when things came back strong I kept waiting for it to fall back. I have a feeling that Bank of America might be a good idea. Since they own a percentage of all mortgages after swallowing up countrywide, they will probably go way up in value. The question is when. They are worht less than half what they were before the recession...I guess my question is how the sustained unemployment will affect current mortgages. Maybe I'll look into some tech stocks. Apple or perhaps google. Don't know enough really.
