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We have about $500 in our trading account that we're thinking about using to buy some Lehman Bros and AIG stocks while they are under-priced.
Anyone else considering taking a gamble on these stocks while the prices are so low?
I almost bought Delta stocks a few years back when they were at $0.25 a share but was talked out of it, this time though i think im gonna buy a few thousand Lehman Bros and take a risk of losing $200 or so on them and another $200 on AIG.
Regards,
Lee
I invest in models, that I make movies with.
So far, they have out performed Wall Street by about 50 to 1.
I think General Electric (GE) is a steal right now at $24 i don't think it has been this low in decades. not sure if it will go back up in the near future, but buy and hold it for 5-10 years and you will do very well with that stock at that price. It's too good of a company and well diversified, 50% of revenue comes from outside the US.
Lee,
For the love of God don't buy any of these stocks. I just lost about $80,000 on Lehman (after my bf who works for JP Morgan told me to buy the damn thing). AIG is going to get bailed out by the Feds real soon. NEVER EVER buy a stock in a company that is in Bankruptcy.
Don't buy stocks in companies that are at a low. Buy in companies that are at their peak. there is a reason they are at their peak. I wouldn't touch GE with a ten foot poll. I did buy some Apple today. :)Quote:
Originally Posted by markwolff
Fannie and Freddie are priced as if they went bankrupt in a receivership deal, which isn't the case. Being that it's a temporary conservatorship, the stocks SHOULD survive. If the $500 is worth losing, when the housing market is about to get good news (it will eventually but not yet), Fannie and Freddie may be a steal. They'll be the first stocks people buy at the first sight of good news.
Worst case, you lose 500 bucks.
And Apple may be bottoming out soon also, hopefully.
I really wouldn't touch Fannie or Freddie. Under the conditions that the Govt took them over and the priority that they give to common shares it's just not worth it at all. I don't see a turnaround for Fannie or Freddie any time soon at all.
Up $50 overnight on LEH :)
Regards,
Lee
I've never heard of buying companies at there peak, so you buy high sell low? Buffet or Sorros never told me that one!
I have allways looked for good companies, with good fundimentals, that have been beaten down by the overall market GE is a perfect one, lot's of upside, i think the stock is pretty near bottom now, look for it to move upwards, as a 5 year buy and hold, it will be a winner
Apple great company, but allmost fully valued, not alot of upside to that stock. Ipod sales are slowing, i phone sales are flat, lot's of new competition from RIM (blackberry) and HP. The stock market is a mess right now, i would not be putting too much money in there right now, but there are some great companies that are traiding at 10 year lows right now, that over time will go up. The time to buy a stock is when people are selling it, and the price is low, not when it's flying high at or near it's peak. The secret is you need to do your homework on what companies are down because they are poorly run companies, and the good ones like GE that are down because of overall market forces, ie a sell off. That's my lesson today, No charge this time!
Here's to hoping Barclays decides to buy the largest chunk of Lehmans assets - Its brokerage firm in the near future, after saying that talks were off over the weekend, it now appears Bob has his sites set back on aquiring that segment of Lehman Bros :thumbsup:
Regards,
Lee
No. Not at all.Quote:
Originally Posted by markwolff
I forget the name of a pretty famous trader that really embraced this strategy. Basically, it says if a stock is selling low then it is a damaged stock for a reason. Cash flow, management, poor marketing, bad products etc. So, does one really want to invest in a "damaged" company?
"Peak" is a somewhat subjective term. It could be a 52 week high. For some companies it may even be a 3 year high. Those companies that are trading at the level are GOOD companies. Otherwise, they wouldn't be trading at a high.
Look at Apple: I have bought Apple quite a few times at it's peak in the past 5 years only to have it go up and up. I have sold it and bought it again later at an even higher price that I sold it, only to have it go up again.
MANY companies that have traded at their "peak" have gone on to double and triple in stock price.
"Peak" is not the highest that a stock will ever get, it's just a measure of how it has done relative to a period of time in the past. Stocks that are trading at a peak tend to be good companies.
On the flip side, many look for damaged companies that they see a turnaround possible. That is risky. Companies that are damaged by various problems; mgmt, cash flow, poor product placement etc tend to have a harder times turning around.
The main risk in buying a company trading at it's peak is the market conditions can damage the companies stock, but the company is still a solid company. It's much easier for a good company to overcome a poor market than a damaged company to turn itself around.
My 2 c
Lee,Quote:
Originally Posted by Lee
If that happens the proceeds will most likely goto creditors vs shareholders.
I wouldn't touch AIG - they put their Canary Warf building in London England up for sale. All 5000 employees showed up for work to notices posted in the windows saying "you no longer have jobs, go home".
Actually, 2 buildings in Canary Wharf went up for sale this morning. Can't remember the other company but CHRIST.
I don't feel so sorry for the brokers, but the secretaries, janitorial staff etc. are all out of work too.
The Brit Govt is putting together a bail out, though, so they may just survive.
Mary
If that happens, the share prices will still go up though.Quote:
Originally Posted by abostonboy
All the American public will hear is 'Lehmans Bros bought by Barclays' and people will start buying shares again, thus raising the prices, which in turn will be the perfect time to sell :)
Never under-estimate the power of stupid people en mass ;)
Regards,
Lee
Looks like this Barclays deal might just be going forward...
http://www.reuters.com/article/innov...60856820080916
Regards,
Lee
Barclays is buying some of Lehmans assets to the tune of $2 Billion.
http://www.reuters.com/article/merge...46480120080916
This is going to be a great swing stock over the next couple of weeks now thanks to this :thumbsup:
Regards,
Lee
I bet the stock hits 25 cents and then takes a nose dive. :)
Its done that several times today already ;)Quote:
Originally Posted by abostonboy
This is a stock to hold on to for a couple of weeks.
Regards,
Lee
So if you stock market investors were to put say $5,000 investment units into an adult Producer/Studio (like me), to produce content,, how much cash would you expect to receive in 12 months - with or without monthly/quarterly dividends - to feel comparably satisfied?
I doubt anyone would be stupid enough to invest in a production studio unless it was their own $0.02Quote:
Originally Posted by nickbaer
But typically when we have invested in businesses before we look for an annual return of about 7%-15%
Regards,
Lee
It's down to 11 cents now. Do they stop trading it when it reaches zero?Quote:
Originally Posted by Lee
Im not worried, DAL went right down to $0.03 at one point, now look where it is at :)Quote:
Originally Posted by abostonboy
Regards,
Lee
Oh and BTW, Barclays is looking to aquire more of Lehmans assets now also :)
Regards,
Lee
Lee,
If Lehman's ever closes above 50 cents a share dinner and drinks are on me if you and Gary come to NYC. :)
Hugs,
Lloyd
Fannie up 57% today, Freddie 83% . ;) Would've been $500 well spent.Quote:
Originally Posted by abostonboy
So was some other not so cheap stocks. GM was up over 30%.Quote:
Originally Posted by SluggerJ
Penny stocks always have a high increase/decrease. Still doesn't make them good bets. All banking stocks were up. It would be safe to assume that many stocks will rise for the next few days until the market deals with the ban on short selling and then you should see some stability in the market.
Only if you sold today. :)Quote:
Originally Posted by SluggerJ
That's true with any stock. ;) Naturally if you like to play it safe, it's not a good time to get in.Quote:
Originally Posted by abostonboy
Like I said initially, "if it's worth losing...". $500 of spare money wouldn't have been a big loss and since I was reasonably confident that they would eventually go up, it was within my personal risk limits. It isn't for everyone, but I've done alright. :)
Well it looks like Barclays has decided to buy all but $20 billion worth of Lehman Bros according to news out today...
http://biz.yahoo.com/rb/080920/lehma...lays.html?.v=3
Would explain the two rallies this stock had yesterday at the start and end of trading :)
Lehman isnt out yet, in fact, this could still have the potential to make money if you bought in at the right price over the next week.
It also just goes to show that even if a company does file for bankruptcy protection, it doesnt mean that they are going to go bankrupt.
Regards,
Lee
That is true. However, from an investor standpoint what really matters is the share price and how much money goes to the common shareholder after all other liabilities are paid off. There is no indication that common shareholders in Lehman will get anything whatsoever. Many companies have come out of Chapter 11 and have had their common shares worth zero.Quote:
Originally Posted by Lee
I agree. I bought quite a few stocks this week, but I have a high tolerance for risk.Quote:
Originally Posted by SluggerJ
Right but if people are going to be buying these shares as speculators, it doesnt matter if any of the common shareholders get anything, by that time, i will have already sold the shares i do own for a profit to someone else ;)Quote:
Originally Posted by abostonboy
Regards,
Lee
That could be true. As I said, I feel Lehman's will peak at 50 cents a share.
LEH is going through a nice rally right now, its up 79% in the past couple of hours of trading.
I think it might be time to average out my shares :)
Regards,
Lee
If you paid less than 26 cents. Sure.
Got in for 14 cents ;)Quote:
Originally Posted by abostonboy
Regards,
Lee
Averaged down just in time LOL
Looks like LEH is starting to fall again, now have half the stock i initially had and made a tidy profit in the process of liquidating :)
Lets see where these free shares go price wise now.
Regards,
Lee
So AIG is now up to around $40 a share :)
Just a shame we cant touch our portfolio for another 3-6 months LOL
Regards,
Lee