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Thread: hmmm, do you suppose we should pay attention to this development ?

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    Banned Melonie's Avatar
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    Default hmmm, do you suppose we should pay attention to this development ?

    (snip)"Insiders sold $8.4 billion in shares last month, according to data compiled from SEC filings by the Washington Service, a research firm that tracks such transactions. Buying was almost $133 million, for a sell-buy ratio of 63.18.

    That ratio surpassed a previous high of 62.76 reached in July 2005. The S&P 500 declined 2.2 percent from August through October 2005."(snip)


    I can't believe that these huge insider sales of stock shares were prompted by a need for cash to go Christmas shopping !

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    Featured Member Katherine's Avatar
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    Default Re: hmmm, do you suppose we should pay attention to this development ?

    Yeah, exactly, Mel... like those people all need those extra millions in cash. They already make how much? Our yearly salary in the space of a few days? Maybe a week? Aargh.

    This doesn't factor in for the rest of it, but here's a semi off topic side note.

    Well, I have a girlfriend who started working at google while it was a start up. As compensation for a low salary, she accepted stock. I know that she sold a couple thousand shares. But I know that she did cause she was buying a house (and she found one last week and it's scheduled to close next month!!) So happy for her.


    Doesn't them selling all of it lower the price of the stock?

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    Banned Melonie's Avatar
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    Default Re: hmmm, do you suppose we should pay attention to this development ?

    Doesn't them selling all of it lower the price of the stock?
    certainly does. However, what's arguably much more telling is that, knowing all that they know about their own companies and other companies, that they should choose this particular moment to start selling their shares. This carries a strong implication that 'inside knowledge' is pointing to the strong possibility that the value of that stock is going to decline significantly in the very near future !!!

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    Featured Member Katherine's Avatar
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    Default Re: hmmm, do you suppose we should pay attention to this development ?

    double whammy. Fun.

    Who wants to blow some money with me? Let's invest in stocks! :l .....

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    Default Re: hmmm, do you suppose we should pay attention to this development ?

    Quote Originally Posted by Katherine View Post
    double whammy. Fun.

    Who wants to blow some money with me? Let's invest in stocks! :l .....
    I wouldn't be quite so cynical. The stock market certainly fluctuates, but throughout its history it has given average returns of about 12% annually. With the magic of compounding interest, that can add up. My portfolio this year has yielded 18% in returns, so I'm beating the market average, but this has also been a very good year for the market. The general consensus among financial experts is that things will still be good next year but start to decline slightly.

    If the price of some stocks is depressed, it can be a good thing for bargain-hunting investors. During the market correction this summer when a lot of stocks dipped, I saw it as a great opportunity to snap up some great stocks at a lower price. Procter and Gamble (a great company to invest in for decades) saw their stock price dip to 52 a share this past June and I bought some. It's now trading at $64 a share, plus the stock has consistently paid out high dividends too.

    Just do a little research. There are always good companies out there to invest in. I'm a big fan of Motley Fool newsletters, Money Magazine and Smart Money magazine. They have good, common-sense advice for investors and Money is geared towards the "average Joe" investor to show real people how to build wealth through investment and sensible retirement planning.

    The smartest and richest investors tend to buy up individual shares, not to put all of their money in mutual funds.

    Although lower-risk investments like bonds are also good to add into the mix for diversification, of course.
    Last edited by NinaDaisy; 12-07-2006 at 10:13 PM.
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    Default Re: hmmm, do you suppose we should pay attention to this development ?

    Quote Originally Posted by NinaDaisy View Post
    The stock market certainly fluctuates, but throughout its history it has given average returns of about 12% annually.
    Quote Originally Posted by NinaDaisy View Post
    The smartest and richest investors tend to buy up individual shares, not to put all of their money in mutual funds.
    This is key. The smartest and richest investors have access to far more information than we, as the average investor do. You would need to commit hours a day running technical and fundamental analysis, studying trends and indicators. Those people are "connected". Insider information gets passed around every day. Those "best of the best" investors are the only ones who consistently beat the market.

    Most of us simply don't have time to make good investment decisions. Although I spend my days looking at the above, I STILL put my own money into mutual funds because I simply don't have enough time, and am too emotional, to pay such close attention to my money.

    I am sure that Melonie would disagree. But Mel also spends a lot of time following the markets, and she is very informed and intelligent in those regards.

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    Default Re: hmmm, do you suppose we should pay attention to this development ?

    Quote Originally Posted by Katrine View Post
    This is key. The smartest and richest investors have access to far more information than we, as the average investor do. You would need to commit hours a day running technical and fundamental analysis, studying trends and indicators. Those people are "connected". Insider information gets passed around every day. Those "best of the best" investors are the only ones who consistently beat the market.

    Most of us simply don't have time to make good investment decisions. Although I spend my days looking at the above, I STILL put my own money into mutual funds because I simply don't have enough time, and am too emotional, to pay such close attention to my money.

    I am sure that Melonie would disagree. But Mel also spends a lot of time following the markets, and she is very informed and intelligent in those regards.
    What I mean by "richest" wasn't so much people who are already rich, it's regular people who do well with investments. But yeah, people who are already loaded of course get the creme de la creme of investment advice. I'd love to do private banking, but you need at least a million to get in the door.

    There are just sooooo many individual stocks out there that it's next to impossible to know, for example, which small drug company will likely have their stock increase by 60% in a year.

    That's why I mentioned the magazines I did. They have a lot of good, common-sense advice that's pretty easy to follow. I do more of my own research beyond that to narrow down my options from what I read.

    Most of my stocks I plan on holding long term. Hey, it worked for Warren Buffett!
    "She has written so well, and marvellously well, that I was completely ashamed of myself as a writer...But this girl, who is to my knowledge very unpleasant and we might even say a high-grade bitch, can write rings around all of us who consider ourselves as writers"

    Ernest Hemingway on writer, aviation pioneer and horse trainer Beryl Markham


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    Default Re: hmmm, do you suppose we should pay attention to this development ?

    Private bankers won't help you with this! Private banking is more about sales than managing money. It is all very cynical.

    If you hunt out a few job descriptions online for the big wealth management / private banking firms, you won't see much listed or required about a successful track record investing money. They want top class sales people.

    I reckon all the selling is so they can pay off their big mortgages just before the housing bubble bursts.

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    Default Re: hmmm, do you suppose we should pay attention to this development ?

    This is key. The smartest and richest investors have access to far more information than we, as the average investor do.
    This was exactly my point about corporate 'insiders' selling their stock shares in their own companies at record levels this month. Who on earth would you expect to know more about those companies' future financial prospects than the CEO's, CFO's etc. that are actually running those companies on a daily basis ?

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    Default Re: hmmm, do you suppose we should pay attention to this development ?

    But you won't know until its too late!!

    "Have you ever been to American wedding? Where is the vodka, where's marinated herring?" - GB
    "And do the cats give a shit? No, they do not. Why? Because they're cats."-from The Onion

    Quote Originally Posted by Mia M
    If a cupcake was tossed at me... well, I'd only be upset if it missed my mouth

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