When I was 22, I wasn't even thinking about the market. It is true that the markets of the middle 1990s showed unusually small volatility, relative to historical norms. But anyone who has traded Nasdaq stocks between 1998 and 2003 has been trading up and down a historical bubble and its aftermath. This is the sense of my comment. 2003 was not unlike 1991 or 1995 in many ways. But 1999-2002 were unlike any of the other market years I've witnessed, and that includes 1987. I'm not old enough to have been trading during the 1972-74 market, which is probably the most comparable recent period to 2000-2002 in the Nasdaq. Before that, you have to go to 1929-1932, and that's an unpleasant time to think about. What was different this time was that the Nasdaq bubble, at least so far, has burst without killing the economy. But the Dow and S&P 500 did not bubble nearly as badly, which helped smooth the works, at least so far.
I am finding value increasingly difficult to find in this market - that was not the case in 2000. In 2000, most real economy stocks were bargains. A lot of reflation has occurred since then. But this market cycle may not end well when rates start going back up. Hard to say. None of this is easy.
Good luck to you.
I agree with you-I'm still having a hard time getting over the fact that I was able to trade stocks when I was 18 and witness the change to decimals. The whole world's changed, and I don't think I have seen a typical market. But then again, were the 90s typical? Maybe it's more likely that there is no typical market-people rarely are getting the direction right by market timing-I have tons of friends who think stuff is overvalued, and sure it looks that way, but you can be right about things being overvalued and still in the short term miss out on huge gains, thus being wrong about the market direction but correct about fair valuation. I liken the market's response and return to rational investment decisions in the short term to the return of corporate profitability improvement and business pickup following interest rate cuts: everything has this lag. It would be ideal if the market expected the great quarter and went up in expectation of it, and then traded sideways until the announcement. Here, however, it seems nothing can stop the bull. This is reason for concern, greater gains and people being happy and euphoria, but most I believe would rather see the sideways trade followed by gains to prevent large corrections and bubbles from becoming apparent after the first sign of problems. The market is so complicated, I believe it is part of both the study of psychology, mathematics, and finance, and that is what I love about it. Anyone thinking it's just bland and one-flavored probably hasn't taken enough time to educate himself and witness these things.
Just my rambling thoughts. But I'm only 22, what do I know?
Good luck to you - just a word of caution from an old gunslinger; I have different ideas about the market and my trading abilities now than I did when I had been investing for 4 years. In my opinion, you have yet to experience a "normal" market, but everyone has to find his/her own best strategy and comfortable level, and no one else can tell you what this is.
Good luck to you.
part of my 2003 gains came from lgnd. i made a 50% gain on the stock last year. the two stock that i have kept long term are eln and mlnm, both of which have gone up very well this past year. these three things have been going very well in the market, which is why i did so well.
for 2004, eln may double or triple due to resolution of sec and antegren results plus the alzehimers tests. mlnm will be closer to profitability and the p3 results are coming in mostly positive. i expect these two stocks to appreciate well if the market stays healty. the rest of my gains will be made on short term trades.
i've been in the market for only a short term, about 4 years. i got in just before the bubble burst.
i'm one of the lucky ones that didn't lose their life savings.
i used to be a long term holder of equities, then 2 years ago my porfolio turned into a falling knife. i liquidated all equities and started to rebuild my porfolio by trading in an out for the past year. i stopped being greedy and hope for the double-triple etc. and went for small gains of 0.5 to 2 point gains. this has worked well for me. for 2003, my porfolio value went up 185% which means i beat the nasdaq and dow. i hope to repeat this success for 2003
corrchess, i got clobbered by crxa, but thats just a memory now, as i have recovered all my losses
good luck to all!
I too am interested in that particular response.
I am also interested to see who is selling BIIB because of the poor payroll numbers. That would be completely silly. But I'm sure some will.