There is a very simple explanation why I don't own the stocks I recommend. The explanation is ethics and the law.
1 -- Since I left the corporate world in October, I now write full time not only Seeking Alpha but also 6 other publications. It would be a pump and dump scheme if I bought a stock, recommended it to my readers and sold it before I told them to sell it.
2 -- I have a family member who is employed by an investment bank. In order for me not to have a regulatory conflict with their employer's activities, their employer's compliance rules or even worse the SEC rules and regulations we limit ourselves to investing in ETFs and mutual funds in which we have no conflict.
If you watch CNBC and see the disclosure they run after each of their quests recommends or pans a stock what would you rather see:
1 - Disclosure - no conflict - no positions held,
or
2 -- I own it, my spouse owns it, my family owns it, fiduciary trusts I control own it and my employer is a market maker and underwriter in the offerings of this stock and my employer presently holds this stock in their trading accounts.
I'm not in conflict with my recommendations, I can't make money at your expense and anything I cover will not be a pump and dump on my part.
Maybe you'd like to take the recommendations of a brokerage firm who owns and controls mutual funds who invest in the stock and at the same time they are recommending it to you, they are doing an underwriting of the stock or even worse selling it short in their own trading accounts.
The best way not to violate the sprit or letter of "the Chinese wall" is to have no conflict whatsoever. I owe it to my readers not to double deal at their expense.
Rohan 1666 - I guess you just did read the article before you made the comments -- I didn't say to invest, what I said was you needed a certain about of knowledge about a stock before you invest.
I think there will be a housing shortage but not in homes but in places to live.
Lot's of people are losing jobs and their houses and are forced to relocate. I see a point where there will be vacant homes but not enough apartment units to rent.
I've been trying to sell a house in South Florida and I'm getting lots of offers but the banks are turning down the financing.
As banks get more stringent with their underwriting more people will be forced to rent
The house is properly priced and always passes inspection and appraisal but some of the lending requirements are stringent
Example: One lady, a teacher with 20 years experience in the north, took a job teaching. She had a good credit history.The bank said she had to be locally employed for 2 years to qualify. In an area like south Florida where people are moving into the area at a rate of 600 a day how can you expect someone to rent for 2 years locally before they can buy?
There are also over 600 condo projects n south Florida that are red-lined. No matter what your credit score the bank just won't float a mortgage in those projects.
Banks just don't want to loan -- ask any small business owner who has had his business over 5 years if he can get a loan.
I want to address your misconception - You are totally correct. You should not buy a stock JUST BECAUSE Wall Street Analysts recommend it. Consider this: I find a stock that I think is a real dog and I want to short it. Before I push the sell button I take one last look. Merrill Lynch, Wells Fargo and Goldman Sachs all upgrade the stock from neutral to strong buy and I see short sales have been coming down in the last month. We live in an auction stock market. Now we have 3 major brokerage firms with 30K to 40K brokers calling several million clients talking about the upgrade. At the same time the readers of Seeking Alpha, Barchart, MSN Money, Yahoo Finance and Google Finance and many, many readers of other on line sites all reading of the stock's upgrade by several major firms. Do you really believe that stock will continue to go down in the short run?
The inverse is also true: I want to go long a stock and 3 major firms downgrade to under perform and the same brokers and investing sites are spreading the news of the downgrade. Do you think it will go up in the short term?
Analysts recommendations are just 1 of several dozen indicators I use that collectively give me a picture of the overall investor community's optimism or pessimism about a stock. No one indictor tells me what to do, but collectively they will have me on the right side of the market
Transocean Vs. Noble: Battle Of The Deepwater Rigs [View article]
I do not buy because analysts say to but If I see something I want to buy and notice 25 brokerage have sell recommendation then I know there are 25,000 brokers calling their customers telling them to dump. I go with the flow and then put it on my watchlist till the sells bottom out
I Can't Get Serious About Sirius XM Radio [View article]
My motto is I'd rather be approximately right than precisely inaccurate. I am an investor not a speculator in penny stocks. Although I'm 64 that just means I'm only 64% of the way to my goal of 100. I seasoned not dead.
I invest in companies with proven track records that have predictable projections of double digit increases in both sales and earnings and are currently having upward momentum.
SIRI is not an investment, it's a speculation.
When I see 5 years of increase sales, earnings and prices I then consider that an investment. Although SIRI does have increased sales it has only been profitable for 2 years.
I can't buy everything and limit my personal portfolio to the 15 - 20 stocks that fit all my criteria.
Merck: My Favorite Dow 30 Stock [View article]
1 -- Since I left the corporate world in October, I now write full time not only Seeking Alpha but also 6 other publications. It would be a pump and dump scheme if I bought a stock, recommended it to my readers and sold it before I told them to sell it.
2 -- I have a family member who is employed by an investment bank. In order for me not to have a regulatory conflict with their employer's activities, their employer's compliance rules or even worse the SEC rules and regulations we limit ourselves to investing in ETFs and mutual funds in which we have no conflict.
If you watch CNBC and see the disclosure they run after each of their quests recommends or pans a stock what would you rather see:
1 - Disclosure - no conflict - no positions held,
or
2 -- I own it, my spouse owns it, my family owns it, fiduciary trusts I control own it and my employer is a market maker and underwriter in the offerings of this stock
and my employer presently holds this stock in their trading accounts.
I'm not in conflict with my recommendations, I can't make money at your expense and anything I cover will not be a pump and dump on my part.
Maybe you'd like to take the recommendations of a brokerage firm who owns and controls mutual funds who invest in the stock and at the same time they are recommending it to you, they are doing an underwriting of the stock or even worse selling it short in their own trading accounts.
The best way not to violate the sprit or letter of "the Chinese wall" is to have no conflict whatsoever. I owe it to my readers not to double deal at their expense.
Is Facebook An Investable Stock? [View article]
Where was I before?? http://bit.ly/RBwxve
Housing Shortage Coming [View article]
Lot's of people are losing jobs and their houses and are forced to relocate. I see a point where there will be vacant homes but not enough apartment units to rent.
I've been trying to sell a house in South Florida and I'm getting lots of offers but the banks are turning down the financing.
As banks get more stringent with their underwriting more people will be forced to rent
Markets Still in Upward Climb [View article]
1 - What is the economy doing -- I use the Conference Board Leading Economic Indicators, and
2 - What is the market doing -- as I did in the above article
If both are rising I buy
If they are in opposite directions I cull and stay in cash
If they are both going down, I'll short or buy short ETFs
Sounds simple but over time it works
Housing Shortage Coming [View article]
The house is properly priced and always passes inspection and appraisal but some of the lending requirements are stringent
Example: One lady, a teacher with 20 years experience in the north, took a job teaching. She had a good credit history.The bank said she had to be locally employed for 2 years to qualify. In an area like south Florida where people are moving into the area at a rate of 600 a day how can you expect someone to rent for 2 years locally before they can buy?
There are also over 600 condo projects n south Florida that are red-lined. No matter what your credit score the bank just won't float a mortgage in those projects.
Banks just don't want to loan -- ask any small business owner who has had his business over 5 years if he can get a loan.
Many of the are beach front
Herbalife: Have You Picked A Side? [View article]
Is Facebook An Investable Stock? [View article]
The inverse is also true: I want to go long a stock and 3 major firms downgrade to under perform and the same brokers and investing sites are spreading the news of the downgrade. Do you think it will go up in the short term?
Analysts recommendations are just 1 of several dozen indicators I use that collectively give me a picture of the overall investor community's optimism or pessimism about a stock.
No one indictor tells me what to do, but collectively they will have me on the right side of the market
Is Facebook An Investable Stock? [View article]
Pfizer Has A Pipeline Of Products [View article]
Transocean Vs. Noble: Battle Of The Deepwater Rigs [View article]
I Can't Get Serious About Sirius XM Radio [View article]
I invest in companies with proven track records that have predictable projections of double digit increases in both sales and earnings and are currently having upward momentum.
SIRI is not an investment, it's a speculation.
When I see 5 years of increase sales, earnings and prices I then consider that an investment. Although SIRI does have increased sales it has only been profitable for 2 years.
I can't buy everything and limit my personal portfolio to the 15 - 20 stocks that fit all my criteria.
SIRI is speculation not an investment.
I Can't Get Serious About Sirius XM Radio [View article]
I Can't Get Serious About Sirius XM Radio [View article]
It may be a nice company but not an investable stock
Chesapeake Energy Is Getting Cheaper [View article]
Transocean: Deep Rigs at a Deep Discount [View article]