Dear Maurizio13,
I believe I have told you before that I have lost the thrill and
excitement of making a fool out of you.
And this is why.
1) These quote will mean nothing to you because you have ZERO
experience in trading stock and thats why you believe you have the
ability to time the market like Mr. AndrewPKyap in this forum.
Let me put you a challenge here. Instead of continuing with
your armchair critics stuns of reporting yesterdays news like
its your prediction, let me ask you. Do you think ML share price
will head north or south in 3 months time? ie. Oct 2008.
I really hope you will take this opportunity to prove to us that
you are as smart as what you said.
2) When I posted the quotes, I did 2 things
intentionally, first is to remove one of the quote
and 2nd I didnt show you the link. The reason is because,
I am wait for you to sprout more nonsense to
argue about timing the market.
I am not sure why you quoted George Soros, did he
teach you to time the market? Or are you trying to use BIG
NAME to repackage your bulllshit?
And BTW, dont twist words here, I am comparing gambling to
timing the market,
not gambling to investing in stocks. You should know
thats a whole lot of difference if you have the any experience
trading share on th xchange.
“I never have the faintest idea what the stock market is
going to do in the next six months, or the next year, or the next
two.”
http://www.fivecentnickel.com/2008/03/25/investment-insights-market-timing/
The pro's predicament. For market
timing to be an effective investment strategy, you have to be right
twice: once when you sell to exit the market, and again when you
buy to re-enter. Being correct on the first call is challenging,
but twice in a row is even more difficult. Although professional
market timers—those who offer informed buy/sell advice to their
clients—often claim success, decades of research have found little
theoretical or empirical evidence that active market timing
works. Indeed, a study that analyzed the five-year
performance of 25 experienced professional timers found
luck to be just as
important as the timers' skill in determining performance
results.1 And while market timers can reduce portfolio
volatility (simply by being out of the market for periods of time),
researchers have
found no evidence that they consistently boost
returns.
3) The FACTS of the matter is that Temasek acquisition into ML
is a marriage deal, whereby the ML INVITE
Temasek to take up a stake in the company. Hence please
dont confuse yourself with trading stocks through the xchange.
If Temasek refused to take up a stake in ML 6 months ago,
do you think Temasek will be given a chance to increase their stake
now? Since ML desperately need to raise fresh capital 6
months ago, if Temasek pass that opportunity, I am pretty sure some
other SWF would have taken up the stake. If that happen, can you
tell us, what is left for Temasek?
4) If you are wondering why I switch my nickname, its not
because I am banned, its because FireIce disable some feature in my
account to slow me down.
Whats new, she is your MAMA right?
1) Given the set of economic
circumstances in current US economy, I would say that Merrill
Lynch would be trading in the AVERAGE share price of around USD 27
to USD 20 for the month of October. Provided the US economy does
not promote aggressive monetary expansion to stimulate the economy
and inflation levels are maintained.
Now my question. Do you have the
guts to put your money where your mouth is and bet against
me?
2) Market timing is not for
everybody, it's definitely not for people like you, who have
insufficient knowledge and information. If your investment
philosophy is the same as Warren Buffett or George Soros, then I
guess you would have been a billionaire right now won't you. There
is a difference between timing the bottom of the market and
predicting the market (whether share prices will be
substantially lower) based on economic fundamentals. The same
person whom you quote, also made this prediction in 2007. It's not
possible to predict the exact location of the stock market exactly,
but it is possible to predict the general movement of the market
based on leading indicators. If what you said is true, then those
information that intelligent investors rely on would be redundant,
everybody should just be like you, grab any investment and hold it
forever. Geez! I think you qualify to be a portfolio manager now,
given that there is nothing to distinguish you and Warren Buffett.
You had basic
knowledge from your Marketing Degree course, so don't purport to be
be an expert in finance. So were you long or short in equities from
2007 to present?
Recessions can't be avoided forever. In
the last few days, Buffett told our Becky Quick that if
unemployment picks up significantly, the
"dominoes" will fall
and the U.S. economy will fall into recession in 2008.
He's not sure, however, that unemployment
will go up next year. In
fact, he's surprised that all the weakness we're seeing in housing
hasn't affected the jobs market ... yet. Here's what he
is sure about: "It is
the nature
of capitalism to periodically have
recessions. People
overshoot." (He told Becky she's young enough to expect to
see 6 or 7 or them.)
http://www.cnbc.com/id/22252384
The Payoff to Market
Timing
In a 1986 article, a group of
researchers1 raised the shackles of many an active portfolio
manager by estimating that as much as 93.6% of the variation in
quarterlyperformance at professionally managed portfolios could be
explained by the mix of stocks, bonds and cash at these portfolios.
In a different study in 1992, Shilling examined the effect on your
annual returns of being able to stay out of the market during bad
months. He concluded that an investor who would have missed the 50
weakest months of the market between 1946 and 1991 would have seen
his annual returns almost double from 11.2% to 19%. Ibbotson
examined the relative importance of asset allocation and security
selection of 94 balanced mutual funds and 58 pension funds, all of
which had to make both asset allocation and security selection
decisions.
Damodaran A., Investment
Philosophies, Wiley Finance
I
forgot, you are not into reading books to gain knowledge, I guess
this abstract would have been no consequence to you
too.
Finally, risk averse investors who
wait for the absolute bottom before they will invest often fail at
this strategy because timing it is just about
impossible.
Damodaran A. Investment
Philosophies, Wiley Finance.
I know this is mentally
challenging for you, but try to distinguish the
difference.
Fundamental
Indicators
You can try to time markets by
developing simple signals based upon macro
economic variables. In this
section, we will consider some of these signals – some old and some
new – that have been used by portfolio managers as market timing
tools. (e.g. short term interest rates, treasury bond rates,
business cycles, etc)
3) If
Temasek didn't take up the offer in Dec 2007, they can still
acquire shares from the open market (at much lower price) or
purchase the current share offer from Merrill Lynch now. If they
don't raise the required capital (Temasek had effectively shackled
itself to Merrill Lynch, they can't don't exercise the option to
purchase the shares, else they will lose more) assuming that no
investors are bullish about the prospects of Merrill Lynch, then
the shares will definitely drop further.