Stockmarket Addiction Problem

[Babs_O]

Folks what are your or possible strategies for reducing stock addiction. e.g. Some people may not feel well or have a feeling of incompleteness till they see the daily stock trading report. Also even before the stock market closes some have started hunting for the daily report. Also some spend hours, days and weeks doing stock research / analysis and portfolio management. These addictiions can take their toll on work and relationships.

Please lets help each other, please share your advice on how to prevent (or reduce) a stockmarket addiction problem, while still making an above average to top quartile returns on personal and borrowed funds.

[samu43]

Originally Posted by Babs_O

Folks what are your or possible strategies for reducing stock addiction. e.g. Some people may not feel well or have a feeling of incompleteness till they see the daily stock trading report. Also even before the stock market closes some have started hunting for the daily report. Also some spend hours, days and weeks doing stock research / analysis and portfolio management. These addictiions can take their toll on work and relationships.

Please lets help each other, please share your advice on how to prevent (or reduce) a stockmarket addiction problem, while still making an above average to top quartile returns on personal and borrowed funds.

I feel you my brother- very good point! Of recent, when I’m tired of researching, I go on a reading quest of posts on this forum which never ceases… Kudos to you all

However, to mitigate the issues you rightly mentioned, my strategy is to allocate time per day – which must be somewhat spread out for the seriously addicted ones- e.g. 1 hr in the morning, at lunch time and in the evening. I think spreading the ‘allotted’ time is better because you are not totally out of touch- you want to see when those bears are coming!

I must say it’s very difficult as we virtually have access to the net all day [apart from the odd times – e.g. when Apache is in his farm ] but one needs to be prudent about this whilst increasing your time in other things– work, relationship, other activities, etc.

If we no take time, the recent and rampant bears wey just enter town fit injure person. This is my 2 cents sha…

[olusolakemmy]

Originally Posted by Babs_O

Folks what are your or possible strategies for reducing stock addiction. e.g. Some people may not feel well or have a feeling of incompleteness till they see the daily stock trading report. Also even before the stock market closes some have started hunting for the daily report. Also some spend hours, days and weeks doing stock research / analysis and portfolio management. These addictiions can take their toll on work and relationships.

Please lets help each other, please share your advice on how to prevent (or reduce) a stockmarket addiction problem, while still making an above average to top quartile returns on personal and borrowed funds.

the way things are now, the only vehicle of investment people know that can also make them keep their job at the same time is stock investment.
the irony is that the time requirement is enormous, except you want to be a passive investor or employ an analyst that just give you report daily!!!!1
anyway, i think diversification can reduce stock addiction.

it is like that because some people have all their money tied down in the market and so have no option

[Babs_O]

Samu43 and Olusolakemmy thanks for sharpening me further. Since it is clearer that stock investing is the only investment vehicle one can do while retaining ones job then a high interest in doing it well is a good one. I should only maintain some discipline in using time more efficiently. For me now I see it as spend max 15 mins during lunch break to glance at latest jist. And then spend 1 to 3 hours in the evening after work for research. (Now I have uninterrupted access to sweet internet as I have both generator and sinewave inverter, thus 3 hrs after work can be guaranteed uninterrupted if needed). I believe the evening research may reduce with time once my database / info net is improved and I get more skilled and efficient.

After all in the current bull market which may last another 2 to 10 years one can continuously make more than double annual paid employment income from capital appreciation on the stock market for the next 5 years if one is really skilled. Thus it is really worth the time.

One should just take it easy and have a proper balance of work and play by maintaining some discipline on time usage.

Thanks for sharing.

See what natty's portfolio returned.
SMN Investment Challenge 2008

What an inspiration.

[zainabusman]

Originally Posted by Babs_O

-----------------------------------------
After all in the current bull market which may last another 2 to 10 years one can continuously make more than double annual paid employment income from capital appreciation on the stock market for the next 5 years if one is really skilled. Thus it is really worth the time.

One should just take it easy and have a proper balance of work and play by maintaining some discipline on time usage.

Thanks for sharing.

I think we are now in a bear market. If u also examine the past history of the NSE, it is highly unlikely we would see the kind of return we had in 2007 in the next few years. For example in 1995 the market returned a fantastic 131% and 37% in 1996. However, for the next three years the market closed with a net loss for the year.

The best year since 1995 was 2007. So we should not expect 2008 to be as good as 2007. Infact from all indications it is not going to be.

So lets make sure we manage our expectations.

We need to be more disciplined with our time. Too much time spent on stocks usually results in unnecessary trading. However, this is the time when quality research pays off. So use ur time wisely.

[Babs_O]

Originally Posted by zainabusman

The best year since 1995 was 2007. So we should not expect 2008 to be as good as 2007. Infact from all indications it is not going to be.

So lets make sure we manage our expectations.

Real food for thought. 2007 Could have been boosted by margin loans amongst other sources. It may be pay back time and this may really impact growth in prices as people sell stocks to pay back loans. Now margin funding is being hammered by cbn, also manufacturing is being hammered by NEPA (PHCN) we may really have a mixed harvets this year.

[hispy99]

Originally Posted by zainabusman

I think we are now in a bear market. If u also examine the past history of the NSE, it is highly unlikely we would see the kind of return we had in 2007 in the next few years. For example in 1995 the market returned a fantastic 131% and 37% in 1996. However, for the next three years the market closed with a net loss for the year.

The best year since 1995 was 2007. So we should not expect 2008 to be as good as 2007. Infact from all indications it is not going to be.

So lets make sure we manage our expectations.

We need to be more disciplined with our time. Too much time spent on stocks usually results in unnecessary trading. However, this is the time when quality research pays off. So use ur time wisely.

Zainabusman,

Thanks for this piece....most people (including your humble self) have short memories or are new to the market and the only thing they have witnessed is a bull market. In the long run, the market goes up, but in between, it goes up and down. Expectations need to be reasonable regarding what can be achieved in the market

[knightofdelta]

Originally Posted by zainabusman

I think we are now in a bear market. If u also examine the past history of the NSE, it is highly unlikely we would see the kind of return we had in 2007 in the next few years. For example in 1995 the market returned a fantastic 131% and 37% in 1996. However, for the next three years the market closed with a net loss for the year.

The best year since 1995 was 2007. So we should not expect 2008 to be as good as 2007. Infact from all indications it is not going to be.

So lets make sure we manage our expectations.

We need to be more disciplined with our time. Too much time spent on stocks usually results in unnecessary trading. However, this is the time when quality research pays off. So use ur time wisely.

Thank you Ma. This is the 2nd best advice I have heard this year.

[knightofdelta]

Originally Posted by zainabusman

I think we are now in a bear market. If u also examine the past history of the NSE, it is highly unlikely we would see the kind of return we had in 2007 in the next few years. For example in 1995 the market returned a fantastic 131% and 37% in 1996. However, for the next three years the market closed with a net loss for the year.

The best year since 1995 was 2007. So we should not expect 2008 to be as good as 2007. Infact from all indications it is not going to be.

So lets make sure we manage our expectations.

We need to be more disciplined with our time. Too much time spent on stocks usually results in unnecessary trading. However, this is the time when quality research pays off. So use ur time wisely.

Thank you Ma. This is the 2nd best advice I have heard this year.

[arcade]

Originally Posted by zainabusman

I think we are now in a bear market. If u also examine the past history of the NSE, it is highly unlikely we would see the kind of return we had in 2007 in the next few years. For example in 1995 the market returned a fantastic 131% and 37% in 1996. However, for the next three years the market closed with a net loss for the year.

The best year since 1995 was 2007. So we should not expect 2008 to be as good as 2007. Infact from all indications it is not going to be.

So lets make sure we manage our expectations.

We need to be more disciplined with our time. Too much time spent on stocks usually results in unnecessary trading. However, this is the time when quality research pays off. So use ur time wisely.

To me it looks as if the bearish trend may continue for some time inspite of good results being declared here and there - margin trading, profit taking etc, etc. So I guess any new investment should be in value stocks that are trading around their sustainable prices(which I hope we can know by thorough analysis) so that the losses, if any, would be minimal.

One could also consider investing in real estate, mutual funds and enterprenurial pursuits of trusted friends to diversify our portfolio.

[Babs_O]

Zainabusman thanks for the insight on balancing expectations.

No matter the direction the market goes if one wants to play the market it pays to do it well and always try to return above the ASI (All Share Index). Going to the data I can lay my hand on I calculated 65% gain for 2007. And data for 2008 looks as follows:

'............(?)31Dec06......10Apr07......31Dec07. ......18Apr08
ASI............34,372..........44,643........56,86 3.........61,419
CAP.............4,537...........6,406.........11,8 43.........12,151

'................2007Q1........2008Q1..........200 7
ASI Gains........30%.............8% ...........65%
CAP Gains........41%...........19%............120%

One should always work to beat ASI gains and cut losses sharp sharp. If you can deploy margin well use it to build into PP's with a view on riding on the wave of the new listings and the resulting market capitalization gains. The skilled players will still smile as they work to the level of nearly operating like someone with insider information. That is where energies should be focused on and not wasted on idle highs and wishing for good returns. I can see this as a deduction from Zainabusman's contribution. Thanks.

[zainabusman]

Originally Posted by Babs_O

Zainabusman thanks for the insight on balancing expectations.

No matter the direction the market goes if one wants to play the market it pays to do it well and always try to return above the ASI (All Share Index). Going to the data I can lay my hand on I calculated 65% gain for 2007. And data for 2008 looks as follows:

'............(?)31Dec06......10Apr07......31Dec07. ......18Apr08
ASI............34,372..........44,643........56,86 3.........61,419
CAP.............4,537...........6,406.........11,8 43.........12,151

'................2007Q1........2008Q1..........200 7
ASI Gains........30%.............8% ...........65%
CAP Gains........41%...........19%............120%

Just a minor addendum. The opening ASI for 2007 was 33,189 and closed on Dec 31 as 57,990. This gives a gain of 74.7% in 2007. The ASI was at 56,863 on Dec 28. So 2007 was really good.

Thanks for ur insight. We surely need a lot more work this year if we intend to do better than the market.