No, when I say 'Type II', I mean credit over cash. Each 'Type' is a designation brokers use to code your account. Type I is cash, Type II is credit/margin, Type III is...?? (I forget) and so on... I just keep forward trading, or at least I did until everything came crashing down. It's really quite simple if you think about it. Your daily margin interest keeps getting larger and larger, because you never sell anything... LOL. You learn how to phenagle to get improvments in your margin account, like getting requirements lowered to stave off any calls, etc. Your inventory of positions gets to be HUGE overtime. Your c.g.'s are virtually nonexistant. GMCR would've been a perfect stock to do it, had you started like 10 or 12 years ago...that's why I can kind of sympathize with what Stiller went through...in essence, he might've kept borrowing and borrowing, and kept getting SMA, so kept unraveling his trade, until it all came crashing down. What you do actually requires intelligence...and a large yearly tax bill to Uncle Sammy. According to daytrading rules and reg's, at least the ones I remember from a day long gone, you can borrow up to 4X's your account value, as long as you have it all returned to your (risk) desk by 4 p.m.
Do you mean Level II? I use level 2 before but not as much now....
I daytrade one stock but swing trade multiple stocks, GMCR is a long term core plus swing trade to accumulate shares.
Daytrade is so quick, usually a round trip is within half hour. It is not risky.
Do you run any Type II? I used to momentum block trade many years ago, and it's great and very profitable for a very long time, but you eventually paint yourself into a corner... If you do run Type II, your risk desk must go nuts due to your (singular) stock concentration... I love focusing on one (or two) positions...it's the only way to trade.
You end up getting a higher and lower beta at the same time. Lower beta focusing on one or two positions, because you know the idiosyncrasies of it, but higher due to the risk of one.
Yeh, it takes a lot of effect doing DD...
I only trade stocks that I have sufficient knowledge. There's no way I can be as informative as the pros, but I try...
That's why I'm into daytrading. Daytrading is so quick that fundamentals do not make too much a difference. It's 80% technical and 20% fundamental. Also, when I daytrade, I only trade a single stock. In my case, MSFT. I have sufficient understanding of MSFT fundamentally and very well technically.
I knew, but I didn't know, about LVS back then when it was trading at that historic $2 and $3 level, if you know what I mean. I really wish I knew better, to have bought that baby back then, but I think I was pretty heavy into either the 'Ag's' (MOS, POT, CF, etc.) or maybe it was the publicly traded exchances like ICE, CBOT, etc.
A little before LVS fell so hard then recovered as it did, I was into MGM when there was word of the LBO by Kerkorkian...
See, the problem with all stocks in all sectors, if you're really going to know the position well, and do it right, you have to know all the 'angles' on it, the entire story about the position, not just buy it because it's suddenly popular and everyones buying it, or you're screwed...and that takes awhile.
Oh no, not gung ho....
Even with LVS, I started buying around 5, then around 4, 3, 2, under 2 and back up around 3....
Too bad I sold out most around $10, except a small 10% core which I saved. Overall I did very well there....
But I didn't bet my farm with LVS either, only a portion of my portfolio....
I'm a very cautious player. I play both offense and defense. Always keep lots of powder. Making sure no sweat.
I thought you were all gung ho on it...why do you want to tip toe into it now? And where's your farm...?? I like farm animals... And where's 'Crestwood' at? (I bet you forgot about him from a couple weeks ago) LOL
No, there not going to go bankrupt. GMCR is in a good nitch. Yes, it will take a while to dig out of this hole. Think back when SBUX was at the $50 dollar range and they dropped down to around $16, now look where there at. Whether they can maintain this pace is unknown under present market conition. A good barometer I use is MCD. I can remember when they were $12 a share back in 2001 and over the years the market has had some real bad times these guys have kept pretty steady. Now even there getting pounded. A few months back an analylsis mentioned they should be valued around the $73 range. I guess my point is that MCD, AAPL, CMG and lot of others are way over valued, I personally can't see how they can maintain there pace without a hugh correction. Once that correction starts it takes everybody with them like GMCR.
At the moment it's a bear's market and shortie would have you believe this company is about to be plowed under. Not so. GMCR has spent a great deal of money to improve there distribution performance, I wouldn't worrie to much about there patent problems, there's a lot of strings attached that allows them to maintain control till 2017, Just can't see where GMCR would leave themselves bare like that.
People did not stop driving nor flying before GM and AMR filed bankrupt. As a matter of fact, business laws allow them to keep planes in air and plants open while lawyers file the paper in courthouse...and to start selling new shares again in few months down the road targeting new and fresh investors. Why didn't they sell all American airways planes or auction all GM dealerships inventories.
The managements doesn't care because their overall interest is much more than little investors funds.
Market is rigged and some people steals the bulk money by moving the market up or down.
Wherever likes of Buffett invests, they often receives pre-warning before any major news that will hurt their money...it is always the little guys that gets screwed.