Stock Market-Day Traders and Pump & Dump Are Back

W

WhatInThe

Well-known Member
Not that either really left the market but the pump and dump along with day traders are back. I see absolutely no rationale for some of the increases or declines. It's behaving like the pinksheets or OTC/over the counter market. It's probably still goes back to computerized trading which probably are programmed to keep the price trending up.
 

WhatInThe said:
Not that either really left the market but the pump and dump along with day traders are back. I see absolutely no rationale for some of the increases or declines. It's behaving like the pinksheets or OTC/over the counter market. It's probably still goes back to computerized trading which probably are programmed to keep the price trending up.
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I think a lot of reason for the increases and decreases is the programmed trading.

› Algorithmic trading is a method of executing orders using automated pre-programmed trading instructions accounting for variables such as time, price, and volume. This type of trading was developed to make use of the speed and data processing advantages that computers have over human traders.
 
Could mutual fund mangers. That is the downside of funds in that the managers in some, not all cases go for year end numbers to boost their careers. One needs to read the fine print when buying mutual funds.
 
90% of all daily trading is software driven by machines ....markets are moved by fear ,greed and perception OF THE FUTURE ...

markets are already looking a head ....prices were already based on how bad the markets thought things were ....unless things appear that were not already known markets tend to over do things .

It is like earnings and market gains are worlds a part .....there is no link between earnings and market gains
 
fmdog44 said:
Could mutual fund mangers. That is the downside of funds in that the managers in some, not all cases go for year end numbers to boost their careers. One needs to read the fine print when buying mutual funds.
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That is one reason I do not like mutual funds. I like to make my own decisions.
 
mathjak107 said:
90% of all daily trading is software driven by machines ....markets are moved by fear ,greed and perception OF THE FUTURE ...

markets are already looking a head ....prices were already based on how bad the markets thought things were ....unless things appear that were not already known markets tend to over do things .

It is like earnings and market gains are worlds a part .....there is no link between earnings and market gains
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markets and growth and corporate profits have never been linked .

as much as we think higher profits lead to higher stock prices it really does not work like that .

markets are based on greed ,fear and perception not the here and now .

gains and corporate profits don't flow together more often than not.

in the book a random walk down wall street 548 NYSE issues were tracked and analyzed over 5 year periods and the results were the performance had no relationship between the technical and fundamental signals and the actual stock performance ..

ned davis research took another look at the relationship and going as far back as 1927 they found when profits rose more than:

20% the s&p returned a mere 1.3% in gains

10 to 20% saw 5.8% in gains

(-10% to + 10% in profits saw a 9.3% jump in gains

(-10%) to (-25%) drop in profits saw 28.6% gains

(-25%) and lower saw a -28% drop in share price.
 
mathjak107 said:
90% of all daily trading is software driven by machines ....markets are moved by fear ,greed and perception OF THE FUTURE ...

markets are already looking a head ....prices were already based on how bad the markets thought things were ....unless things appear that were not already known markets tend to over do things .

It is like earnings and market gains are worlds a part .....there is no link between earnings and market gains
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"there is no link between earnings and market gains"

That does not make sense. When a companies earning come out and its above or lower than forecast it effects the price of their stock.
 
oldmontana said:
"there is no link between earnings and market gains"

That does not make sense. When a companies earning come out and its above or lower than forecast it effects the price of their stock.
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Who cares what you think ... where did i say earnings don’t effect the stock ? The biggest gains though Are not when earnings are the highest in study after study ...

..there was a load of research on this by the best minds in the business ...go show us your academic study .....the data clearly shows us market gains and earnings don’t flow together ..go read a random walk down Wall Street , one of the best known books ever written on the subject ....then tell me it makes no sense
 
mathjak107 said:
Who cares what you think ... where did is say earnings don’t effect the stock ? The biggest gains though. Are not when earnings are the highest

..there was a load of research on these by the best in the business ...go show us your academic study .....the data clearly shows us market gains and earnings don’t flow together ..go read a random walk down Wall Street , one of the best known books ever written on the subject ....then tell me it makes no sense
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"there is no link between earnings and market gains"

That does not make sense. When a companies earning come out and its above or lower than forecast it effects the price of their stock.

I suggest that you get in the real world and see what happens when a companies earnings comes out and its above or lower than forecast. That is very basic and if your beloved books do not indicate that burn your books and get in the real world and watch what happens to a companies stock when their earning come out. No need for a academic study.
 
oldmontana said:
"there is no link between earnings and market gains"

That does not make sense. When a companies earning come out and its above or lower than forecast it effects the price of their stock.

I suggest that you get in the real world and see what happens when a companies earnings comes out and its above or lower than forecast. That is very basic and if your beloved books do not indicate that burn your books and get in the real world and watch what happens to a companies stock when their earning come out. No need for a academic study.
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https://finance.zacks.com/quarterly-earnings-mean-stocks-3875.html

What Do Quarterly Earnings Mean for Stocks?


Stock prices are often extremely sensitive to quarterly earnings results. If a company surpasses the expectations of Wall Street analysts, investors are likely to celebrate the stock by purchasing shares. When results are disappointing, however, shares are likely to come under pressure and lose value. Company executives often attempt to prepare investors for forthcoming quarterly earnings results by offering some guidance to avoid major surprises. Analysts similarly offer earnings forecasts. Investors are often keen to compare actual results with estimates to gauge a company's performance.

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Anyone that owns stocks and watches the price of their stocks will see that the quarterly earnings will effect the stocks price.

That is basic and yet some do not know that.
 
oldmontana said:
https://finance.zacks.com/quarterly-earnings-mean-stocks-3875.html

What Do Quarterly Earnings Mean for Stocks?


Stock prices are often extremely sensitive to quarterly earnings results. If a company surpasses the expectations of Wall Street analysts, investors are likely to celebrate the stock by purchasing shares. When results are disappointing, however, shares are likely to come under pressure and lose value. Company executives often attempt to prepare investors for forthcoming quarterly earnings results by offering some guidance to avoid major surprises. Analysts similarly offer earnings forecasts. Investors are often keen to compare actual results with estimates to gauge a company's performance.

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Anyone that owns stocks and watches the price of their stocks will see that the quarterly earnings will effect the stocks price.

That is basic and yet some do not know that.
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that is not what i said ......which part of earning s and gains don't track together in proportion dont you get ..... the study is saying .... THE GREATER THE EARNINGS THE LESS THE STOCK TENDS TO MOVE UP because earning expectations are higher . ....the stocks have their biggest gains coming out of crappy times with crappy earnings ......the greater the earnings the less gains markets seem to show .....go look at the numbers instead of always shooting from the hip about things you don't understand ....read , learn .....


meeting or beating expectations is not the same thing as the stocks overall gains based on earnings over time . markets see their greatest gains when profits are in the minus 10 to minus 25% range ... why , BECAUSE EARNINGS EXPECTATIONS ARE SO LOW THEY ARE EASY TO BEAT ..... try to understand why that has nothing to do with what you are talking about .

in the book a random walk down wall street 548 NYSE issues were tracked and analyzed over 5 year periods and the results were the performance had no relationship between the technical and fundamental signals and the actual stock performance ..

ned davis research took another look at the relationship and going as far back as 1927 they found when profits rose more than:

20% the s&p returned a mere 1.3% in gains

10 to 20% saw 5.8% in gains

(-10% to + 10% in profits saw a 9.3% jump in gains

(-10%) to (-25%) drop in profits saw 28.6% gains

(-25%) and lower saw a -28% drop in share price.
 
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mathjak107 said:
that is not what i said ......which part of earning s and gains don't track together in proportion dont you get ..... the study is saying .... THE GREATER THE EARNINGS THE LESS THE STOCK TENDS TO MOVE UP because earning expectations are higher . ....the stocks have their biggest gains coming out of crappy times with crappy earnings ......the greater the earnings the less gains markets seem to show .....go look at the numbers instead of always shooting from the hip about things you don't understand ....read , learn .....


meeting or beating expectations is not the same thing as the stocks overall gains based on earnings over time . markets see their greatest gains when profits are in the minus 10 to minus 25% range ... why , BECAUSE EARNINGS EXPECTATIONS ARE SO LOW THEY ARE EASY TO BEAT ..... try to understand why that has nothing to do with what you are talking about .

in the book a random walk down wall street 548 NYSE issues were tracked and analyzed over 5 year periods and the results were the performance had no relationship between the technical and fundamental signals and the actual stock performance ..

ned davis research took another look at the relationship and going as far back as 1927 they found when profits rose more than:

20% the s&p returned a mere 1.3% in gains

10 to 20% saw 5.8% in gains

(-10% to + 10% in profits saw a 9.3% jump in gains

(-10%) to (-25%) drop in profits saw 28.6% gains

(-25%) and lower saw a -28% drop in share price.
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Your book ..Ned Davis..1927.

"that is not what i said ......which part of earning s and gains don't track together in proportion dont you get ..... the study is saying .... THE GREATER THE EARNINGS THE LESS THE STOCK TENDS TO MOVE UP"

Another statement that does not pass the smell test.

Believe in your book I will believe what really happens when a stock has good earnings..the stock goes up.
 
I'm looking one of the volume or high activity leaders MFA or MFA Financial Inc which is a finance company with little news yet it's been the most or one of the most traded stocks going up and down, up and down. Today it traded hands almost a quarter of million times at last check around 214,000 trades. Judging by the up and down rolling hill type chart it looks like the same people are buying and selling sometimes just taking a quarter to .50 cent profit. Then the cycle starts over again. This is high frequency trading. Wether it's all computers I don't know. Wether the same people are spreading out trades at lower prices to trend up then sell I don't know. Doesn't need a lot before a computer picks up a trend.
 
Now that many brokerage firms offer free trades, traders are more willing to take less profit and to trade smaller amounts.
I've exited my green positions and am waiting for things to hit bottom.
At least the market is interesting now.
 
for those who do want to learn ....

meeting or beating earnings is a stock market game . analysts and traders try to anticipate the next quarters earnings ... the worse the economy the lower expectations and estimates are ...the better the economy the higher expectations are for earnings ...

stocks tend to have very low earning expectations in recessions ... so it is not hard for companies to beat expectations once we start to come out of the recession ... stocks tend to soar early on coming out as earnings are easy to beat . but as profits grow , p/e's go up and earning expectations go higher and higher ...

so higher profits tend to produce lower over all returns while lower profits tend to see bigger gains as expectations are lower .

2019 saw markets hit new highs , earnings fell to 2014 levels on the s&p 500 in 2019 so valuations and market growth did not follow earnings....markets should have fallen based on earnings but p/e's rose as fear greed and perception propelled markets .

so if you look at the data you see there is no direct link to better profits create higher percentage gains ... stocks still go up but not nearly as much as we see when profits fall and expectations for earnings are lower .

the biggest market gains tend to be when we see (-10%) to (-25%) drop in profits which saw 28.6% gains in the market

the smallest market gains happen when earning expectations are high and are up 20% or more , the s&p returned a mere 1.3% in gains on average

so yes stocks go up when earnings are beat but there are times they go up greater based on earnings levels

https://www.aaii.com/investing-basics/article/earnings-estimates-and-their-impact-on-stock-prices
 
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mathjak107 said:
for those who do want to learn ....

meeting or beating earnings is a stock market game . analysts and traders try to anticipate the next quarters earnings ... the worse the economy the lower expectations and estimates are ...the better the economy the higher expectations are for earnings ...

stocks tend to have very low earning expectations in recessions ... so it is not hard for companies to beat expectations once we start to come out of the recession ... stocks tend to soar early on coming out as earnings are easy to beat . but as profits grow , p/e's go up and earning expectations go higher and higher ...

so higher profits tend to produce lower over all returns while lower profits tend to see bigger gains as expectations are lower .

2019 saw markets hit new highs , earnings fell to 2014 levels on the s&p 500 in 2019 so valuations and market growth did not follow earnings....markets should have fallen based on earnings but p/e's rose as fear greed and perception propelled markets .

so if you look at the data you see there is no direct link to better profits create higher percentage gains ... stocks still go up but not nearly as much as we see when profits fall and expectations for earnings are lower .

the biggest market gains tend to be when we see (-10%) to (-25%) drop in profits which saw 28.6% gains in the market

the smallest market gains happen when earning expectations are high and are up 20% or more , the s&p returned a mere 1.3% in gains on average

so yes stocks go up when earnings are beat but there are times they go up greater based on earnings levels

https://www.aaii.com/investing-basics/article/earnings-estimates-and-their-impact-on-stock-prices
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"so higher profits tend to produce lower over all returns while lower profits tend to see bigger gains as expectations are lower "

So buy the stocks with lower profits...interesting.
 
oldmontana said:
"so higher profits tend to produce lower over all returns while lower profits tend to see bigger gains as expectations are lower "

So buy the stocks with lower profits...interesting.
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if you didn't have a reading comprehension problem you would understand that is not what is being said at all ... but since you do seem to have issues understanding facts , data AND INTERPRETING WHAT IS BEING SHOWN , believe what you want ...others will LEARN from these academic studies
 


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