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Börsipäev 27. september

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  • Rev Shark:

    Being Bold Won't Make You Money on the Street
    9/27/2005 9:05 AM EDT

    "There is no sudden leap into the stratosphere. There is only advancing step by step, slowly and tortuously, up the pyramid towards your goals."

    -- Ben Stein

    As the recent hurricanes fade into the annals of ancient history and the market seeks out new driving forces, it is important that investors not attempt to look too far into the future. In an uncertain environment where the next catalyst is still unknown, the key to success is to focus on the small steps -- it is the little things that you do today that will set the stage for longer-term market success.

    There is always a temptation to make the dramatic, grandiose market prediction. The idea of establishing a major position in hopes that the market will eventually see things the same way you do holds great appeal. If you are correct and the future unfolds as your crystal ball predicts, it not only can be very profitable but it provides great emotional satisfaction to know that your predictive powers are so exceptional.

    But the key to market success isn't the big bold call. The key is slogging away day after day, advancing one trade at a time and building your capital. That is especially so in a market environment like we have now, which is uncertain and volatile. Making big market bets now is particularly perilous because even if you turn out to be correct, it is very easy to find ourself on the wrong side of the trade long enough to wash you out.

    As the economist Keynes once said, "The market can remain irrational for longer than you can remain solvent." And that is the reason why the big bet on the market is so dangerous. It isn't that your logic is incorrect or that your facts are wrong, but that the market simply does not act rationally for long periods of time. You might as well play a slot machine as to make predictions far into the future.

    Stick to what is on your screens and take care of the small things -- if you do so, it is surprising how well the future tends to turn out. If you are inclined to make bold market calls, go ahead and do so when you are talking with friends over a beer or writing a column that you hope people will read. Most everyone enjoys making bold market predictions but the true professionals know that the key to making money lies elsewhere.

    Markets are flat to start the day. Crude oil is down a bit, as is gold. The dollar continues to rally and is at a two-month high. Overseas markets were mostly down overnight. This is a market in search of a catalyst and likely to be volatile.

    Gary B. Smith:

  • Gapping Up

    Mad Money Mentions: COLY +11%, PEC +8.5%, JDSU +4%.... Other News: NAPS +9.4% (in sympathy with Openwave acquisiiton of Musiwave), LTXX +9% (Lehman upgrade), RNAI +13% (granted broad patent in UK), ULBI +7% (higher contract), GLGC +7% (announces agreement with Pfizer), PDC +5.5%, NFLX +4% (Bear Stearns upgrade), ELN +2.4% (submits supplemental license application for Tysabri), ANF +2.2% (CSFB upgrade), LEN +2% (reports AugQ), SNDK +1.1% (unveils new memory card, as expected).... Under $3: SIGA +37% (Army contract), APRS +13% (to be acquired).

    Gapping Down

    TASR -9% (SEC widens probe), ENDP -8.4% (secondary offering), MOVI -6.4% (suspends dividend), OMNI -6% (profit taking after large move), BSX -3% (Merrill downgrade), DNDN -2.9% (Cramer negative on it), TOT -1.9% (JP Morgan downgrade), NOK -1.6%, NEM -1.2%.
  • USA tarbijausaldus 86,6 punkti, oodati 95 punkti, näitaja kahe aasta madalaimal tasemel.

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