why do you have to be prepared to lose it all? From everything I've read, airline stocks have always been a trade, never a long term hold.
Old Joke (source unknown): How can you have a million dollars??
Invest $10 million in airline stocks.
Nevertheless, I have almost doubled my money since last week, and will probably sell soon.
(and PS, I've watched (not bought) it come down from 90 to 3.75).
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by mdtony: You know how folks used to day trade internet stocks during the bubble days of two years ago? Well, I'm thinking that if you wanted to, you could trade airline stocks like that.
These days, commissions are low enough and there is enough volatility that you might be able to do it with a few thousand bucks. Let's say you bought UAL at under $4 a share and you used Brown, which charges you $5 a transaction. Well, if you sold it after it gained a buck a share, and you had 200 shares, you'd be looking at a nice $190 profit on a $800 investment. Not too shabby.
But you also have to be willing to lose it all.</font>
Re-read your last sentence. If you want to gamble, go to Vegas, bet on black, then close your eyes.
The movement today in UAL was a classic short squeeze. Short interest in UAL is/was an obscenely high number. Guess a few too many people are believing those Ch 11 rumours. Congrats to all who decided to roll the dice.
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by fallinasleep: Re-read your last sentence. If you want to gamble, go to Vegas, bet on black, then close your eyes.</font>
Oh, come on. Nobody's saying put your life's savings into this. I'm saying that if you've got a grand or two of play money sitting in a retirement account somewhere, then play with it like this. With the low commissions you see a lot of places now, you can do that.
You get to play Mr. Big Tycoon, Mr. Trader. You get to play the same game they play, although they do it with tens of millions of bucks and you do it with a couple of grand.
And if it works out, you take your winnings, and you smile. If not, well, it was play money, so don't sweat it.
Believe me, in the past few years, I have seen my portfolio shrink by a hell of a lot more than a grand or two.
Well, I just put my money where my mouth is. I got in at $6.30, and have a limit order of $9.10 in for the sale. If it pops due to the loan guarantees, I'm set. If not, well, if it goes to zero, no worries, since I've lost a lot more than this in the past couple of years.
By the way, Morningstar put a 0.09 price/cash flow ratio in and came up with a price of around $25. But they also said that the risk of bankruptcy makes them unwilling to give the stock a rating or a fair value.
[This message has been edited by mdtony (edited 07-30-2002).]
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Flying an aeroplane with only a single propeller to keep you in the air. Can you imagine that?
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by mdtony: You get to play Mr. Big Tycoon, Mr. Trader. You get to play the same game they play, although they do it with tens of millions of bucks and you do it with a couple of grand.</font>
Huh? I don't know of any tycoons who daytrade. Suckers daytrade. The rich guys (and girls) collect commissions, margin interest, and option premiums. Same story about selling picks and shovels to the gold miners.
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by pynchonesque:
Huh? I don't know of any tycoons who daytrade. Suckers daytrade. The rich guys (and girls) collect commissions, margin interest, and option premiums. Same story about selling picks and shovels to the gold miners.</font>
Only one other individual -- the famed Warren Buffett -- rivaled Soros as an investing wizard for the long stretch from the '60s through the '90s. Buffett's approach was dreadfully prosaic -- he lived in Omaha, Neb., of all places, bought stocks in a few supersolid companies (among them Coca-Cola, Disney, ABC and the Washington Post) and held onto them forever. Soros, in contrast, was the epitome of guts and glory. He was a short-term speculator who made terrifyingly huge bets on the directions of financial markets.
No wager was bigger than the time in September 1992 when he risked $10 billion -- billion with a B -- that the British pound would fall. His instinct was right: That night, while Soros slept in his apartment on New York's Fifth Avenue, he made $1 billion from the trade. Ultimately his profit reached almost $2 billion -- and earned him international notoriety.
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by pynchonesque: Huh? I don't know of any tycoons who daytrade. Suckers daytrade. The rich guys (and girls) collect commissions, margin interest, and option premiums. Same story about selling picks and shovels to the gold miners.</font>
Uh, you sure about that? You know those big block trades that go on all day long on the NYSE? They're buying and selling based upon computer programs that tell them to buy when it gets to a certain point and sell when it gets to a point just a few percentage points higher. They take advantage of market inefficiencies, and they play this game to the tune of hundreds of millions of dollars.
Most of them time, they lose a little bit on the transaction, but every now and then they hit a home run!
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Flying an aeroplane with only a single propeller to keep you in the air. Can you imagine that?
Program trading is arbitrage, based on spread between futures and cash markets. It is nothing like daytrading as most people do it.
Soros doesn't daytrade either. He makes large-scale macroeconomic bets that are also nothing like daytrading. Actually, made, not makes: he hasn't been actively running Quantum for a while now.
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by ozstamps: OUCH! Trading right now under $4. WHAT a roller coaster in past 5 days. </font>
Oz, I figure two things are coming up that will give the stock a pop. First is the ALPA vote on the concessions. If that goes through, expect a pretty good pop. Then the loan board will decide on whether or not UAL gets the loan. Rumors are that they will grant it to them. If that's the case, the stock will see a pop.
What happened over the past few days is understandable, if not something that makes me happy. The stock went down because economic conditions are not picking up as quickly as folks would like, and if the economy stays slow, so does business travel, which is what UAL makes its money on.
Goldman released some research on UAL, and they said that the bankruptcy fears are way overblown, even without the loans and the concessions. They said that UAL's burn rate would allow them to operate for 800 days if they didn't take out more loans on their assets. So they think that once folks realize this, they will bid the price of the stock up. They think this will happen in the last quarter of the year.
We'll see. But there is one thing that I completely agree with the folks at Goldman on. They've got a price target of $15 a share. If UAL gets there, you can be sure I'll sell at least half my stake.
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Flying an aeroplane with only a single propeller to keep you in the air. Can you imagine that?
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