Hi ladies,

question - if you researched the f$%^ out of stocks, commodities, currency etc and watched for say 6 months - would you ever get to a point where you would be able to predict with better than 90% certainty when a stock etc - was going to move ???

Once of the reasons I ask - is that, on one of the local TV shows - they have a very well known financial anaylyst come on every now and then and give his take on the economy etc.

He has literally gone on record as saying that he would invest in Aust currency, because he will gaurantee it's positive climb over next couple months.

Now I'm not into litigation and shit - but surely, coming out and giving guarantees such as that, could open doors of pain for himself and broadcaster ??

I know the asnwer but i'll ask the question - Is there ever a 100% gurantee when investing ?

Cheers
Si

There's never a guarantee.

If you look at actively managed funds and portfolios you'll see that well educated business guys can't consistently and significantly outperform index funds. If these guys can't do it how they then get on tv and proclaim they know with certainty what's going to happen? If they know with certainty how things will move they should be able to know which of their holdings will be winners and which will be losers, so why do they still pick losers?

There are statistical methods that can be applied to be able to hedge your bets. During the S&L crisis the banking industry also took a hit. There's a normal range in which the industry has historically performed. When the industry is 3-4 quartiles below the norm it's good bet that some will pull through but some won't. Since it's 3-4 quartiles below the norm you have the chance to make good money since you're buying so low and betting that the industry will return to its norm. If you scatter your money across stocks in that industry you'll have some that return to norm and others that die out. Hopefully the gains from the ones that return to the norm well outweigh the ones that die out and are a loss.

The silver bugs have been saying that silver is undervalued in comparison to gold and it's guaranteed to rise. There's a certain ratio that silver historically trades at compared to gold. With gold being so high some believe that means silver must come up.

Personally I think gold, silver, precious metals, is a bubble. My loose indicator of a bubble is when you're neighbors and co-workers talk about investing in X and making money with no real clue it means it's getting close to its popping point. I'm not saying it'll happen next week. All I believe is that PM's aren't a good investment. Also factor in that gold has been trading higher than platinum and the hierarchy of PM's is out of whack which I attribute to emotion. The only metals I "invest" in are lead and brass so that I can feed my guns.

Nope, no guarantee. I have lost quite a bit within the past few months. You can pay high priced advisers that will help you out though.

My loose indicator of a bubble is when you're neighbors and co-workers talk about investing in X and making money with no real clue it means it's getting close to its popping point. I'm not saying it'll happen next week.


That is 1 hilariously accurate comment - Love it!!!

I guess, what I was asking is with an amount of study, with an amount of waiting - would it be possible to get to a percentage approaching 90-100% of accuracy ?
I'm reasonably confident in some stocks that i "play" with on where they might go once various announcements are made - but it's only a educated guess, around maybe 50-60%...
I spose Term deposits are guranteed - but they are freakin boring...we can get 6% at moment on term deposits up to 12 months.

I'm very much with most people's opinion on Gold - surely it has to crash soon...there are so many under handed large firms in the markets - who knows what / who / how the price is continuing to rise.

I recall watching oil explode a few years back - and after the huge drop back down to $100us, it was made public that the entire "bubble" was down to a few various firms across the world...scary.

Cheers
Si.