The 200 day MA is fine and dandy for a short term invesotr.
But for the truly intelligent long run investor you just have to look at the track record, the fundamentals and the value...
Buffet who is now edging on Bill Gates to be the richest man in America doesn't give a hoot about the 200 MA.
He bought stocks like Best Buy and Automatic Data Processing when way below the 200 MA only because they represented great companies and a compelling value.
This is Buffet style thinking that leads to gigantic profits over the long run.
Thanks for the additional information in the last two posts, helps round out the story in where we are now with ORI.
Why traders would want to tear their hair out over a boring-but-beautiful stock like this is beyond me. It makes you wonder whether we are putting all the brainpower of this country to the most productive use :)
I want to remind everyone about two things.
1.) After a split - - people/investors/hedge fund managers/profolio manager/whatever sell some stocks because this stock has gone up almost 100% in the recent past. They actually have sold a lot less than the last time it split so I think that is a good sign. Yes, that is how long I have owned some of this stock.
2.) I have met many of this management team. I trust them with my money. They are doing a really good job of managing this company. You know how I can tell. They are sitting on $9.6 BILLION in reserves. That is money they don't have to spend or make available to the insured because they did such a good job in the last 10 years of not having to pay claims. So do the math. If they have $9.6 BILLION and only 181.290 million in stock outstanding what is the company really worth. My math says at least $52.95 per share. Where is that on the moving average?
I hardly ever respond to the "Moving Average" controversy,but I checked the ORI avg. and found that ORI broke below the 200M.A. from oct.2002 to around may 1st 2003 then stayed north of the 50,100,and 200 M.A. todate.
I just never could rationalize this part of the investing business. I buy for value and stay until I think the stock is overvalued or management has blundered. I like this board,s posting and I'm staying long.
I see we need to call out the irony police. By TA you mean technical analysis? Yes, my TA was flawed in that I didn't give you any, I was kidding!
All right, I guess the stock is doomed at price X. Ignore that book value of nearly $20!
Congratulations on limiting your losses. The rest of us will try to make positive money on this stock. I promise to study Marketedge if you promise to learn the meaning of "average cost basis."
feelingmutual, why is the concept of Buy Low, Sell High so hard for people to understand?
we have broken support @ 25.24.The 200 day moving ave is 23.36, and rising.The 200 day is the drop-dead number where it is an indication the stock is doomed, should it break below 23.30.Your TA means nothing, because you need to go to Marketedge.com, and study the meaning of technical analysis.
You know, this is fascinating. If I understand the technical mumbo-jumbo correctly, you have determined that if ORI goes to $23.60, it's at risk of falling by half, to $11.80, complete with hyper-specific reasons concerning the behavior in the hitherto unknown future by mutual funds and other money managers.
Apparently you haven't noticed that ORI has a book value of $19.70. Oh, I'll ride this puppy down all right.
Here's MY technical analysis. In the next 10 days, ORI will do the following: I have no idea! But I'll make you a deal -- if it does go to $23.60, you go ahead and get out, and I'll come back to the board and raise ORI from Buy to Strong Buy.
I hesitate to respond to your rambling, but I will:If you feel good about your purchase of a stock,stay with it and ride it down, even if it breaks below the 200 day moving average, which means it could go down 50% further.A "sellstop" is a protective measure, either @ the 50-day moving ave(intermidiate investing, up to 1-year), or the 200 day moving average, for longer-term investing.A break below the 200- day indicates that mutualfunds are selling faster than other funds are buying and that the prospects, longterm for the Co look weaker than expected.At 25.00, we are below the 50-day, but above the 200-day, which is about 23.60.This break below the 50-day is a short-term distribution indicator.The 200-day is ultimate support.?s?
What is "sellstop"? I sure hope it means "stop selling," not stop-loss, which is the single dumbest concept in all of investing. If you buy a stock and feel the need to put a stop-loss on it, it means you don't know why bought the stock. Because if you did know via your research, then either a) you wouldn't buy the stock because it doesn't pass your tests, or b) you would buy more when it dropped, just like feelingmutual says.
I love lines like "hedge funds control this market." Of course hedge funds "control" the market -- they have more money than you or I do! Why worry about it? Again it's like feelingmutual says -- Buy low, sell high, why people make it more complicated than that I have no idea.
The great thing about a stock like ORI is you can look at their latest investor presentation and if you have some affinity for numbers and don't think that insurance is crashingly boring, they give you a very clear and balanced story to walk away with.
That's all for now!