Conference nyoss1::market_investing

993.0. "STOCK TIPS" by MROA::SRINIVASAN () Sat Apr 13 1996 10:51

      
Over the years I have had some limited success over picking good stocks. 
I also had my own share of failures. I have picked a stock thinking it is 
likely to go up and in 3 years & it had not moved much ! I have swallowed my 
pride / cut my losses and moved on ! Do I talk about it ! Hell No !
Then every one will think I am a loser ;-(. 

One lesson I have learned over a period of time is NOT to give any advise on the
stock market - But to go alone on my gut feeling. Recently some of my colleagues
came to know about my success in buying SDRC stock at 4 and selling it at 31+.  
So they thought I am a hot shot in picking stocks. ( Which I am not ).
One guy in my neighborhood kept pestering for stock tip almost every day 
for stock tips. His exact words were - 
    
Let me know when another SDRC comes along !  I want to make a bundle like you!
My mutual fund is a waste . I cannot get rich with 15% return etc etc ! 
Normally I avoid telling about the stocks to those whom I think do not have the
stomach for the ups and downs of the stock market.  Finally I could not 
tolerate his pestering and I gave in. Now I realize I have made an error by 
giving the stock tip. He bought a whopping 100 shares at $10.The stock is 
down  25% since I gave the tip, I did learn my lesson on giving stock tip to
some one who cannot stand the ups and downs of the market ! This guy calls me 
every day asking me what is going on ( as if I am the investor relations person
for this stock ! ). 

Over the period of few weeks I received similar requests in the office, 
( particularly after I bought puts 65 and 60, when DEC stock was at 76 ! ).
Now I have learned one important lesson ! Stock market is NOT for every
one. If one is going to lose their sleep over a  one day swing in the market, 
and lost 300 bucks , then they should not enter the stock market. They should 
put the money in a CD or an fixed income fund and rest easy ! For some of 
these folks, I won't even suggest an index fund.

So here is the summary of lessons I have learned :

1.. Do not give the stock tip to some one whom you think do not have stomach to
to withstand the ups and downs of the market.

2. If you think that some one is going to buy 100 stocks using 100% of savings,
please stay away from him/her. This person will pester you for every one 
point swing in the downward directions.

3. Watch out for the ultimate researchers. This is the person who will make all
kinds of analysis, calculations, ask his friends, some medicating gurus in 
India etc etc. These guys will never make up their mind and also will not 
have the stomach to buy even a single stock. If he ever buys a stock after all
these research the stock will probably go down.

4. Never recommend an option to some one who has no experience on options. They 
will drive you crazy since probably they will not understand it easily and lose
all the money !

5. Watch out for panic sellers. So you recommend a stock and goes down in value 
by 10%. Panic seller generally don't understand that one cannot always pick 
the stock at the real bottom or the top. He/She will immediately sell it and 
blame it on you for his/her loses ( Privately if not publicly ).

6. Never forward your friends stock tips messages to any of your friends. 
    If you do so delete the forwards. Otherwise your friend will also 
    also will get junk mail 
    

7. If the person shares all his/her investments with their spouse _ it is 
a double whammy. You have just made 2 people lose sleep worrying about
the stock.. Make sure that his /her spouse and your spouse are not buddies. 
If so, you spouse will receive constant complaints.

8. Never mention about any investment club to this person. He/She will drive 
you crazy trying to get in, to do research to invest their $4000 portfolio 
in several diversified stocks in various sectors.

Finally if you still gave the stock tip to some one falls in to above 
mentioned category, here are things you should do !

1. Unlist your number !( Including the office number if possible :-)
2. Relocate if you can .
3. Find a new job and move and make sure not to leave a forward address. 


Hmm ! Full time brokers job is a tough one indeed !

Jay

                                                                    
      

    Wow.....
    
    That was SOME EXPERIENCE that you went through Jay.  I agree with a lot
    of the things you said and especially cause when anything involves
    money you get "ALL the DEBITS (and some more in margin-interest) and
    NONE OF THE CREDITS...". 
    
    Good Luck....
    
    Ken

    Boy - do I have the perfect match for you.
    
    I have a dear friend with a heart of gold who willingly shares all his
    "inside" "hot" stock info with me. He has enough money to play with and
    loves taking a gamble. His track record, as near as I can tell, is
    somewhere between lousy and zero. I have mastered the best imitation of
    a smiling deaf man you have ever seen. I could never afford his free
    help.  
    
    Funny how things are some times.......

From my local town newspaper, 4/11/96:

It takes real savvy to recognize a hot stock market tip when you hear one.  
Here is how I did it.

One summer day, on a seasonal excursion to my favorite -- and secret -- 
blueberry and raspberry patch, I noticed with dismay another berry picker 
approaching, pail in hand.  We stopped on opposite sides of a raspbery bush
and began to pick in silence. 

Well, nothing can keep me silent for long, and within the next 10 minutes we 
had exchanged much vital information.  I found out that he worked for a 
pharmaceutical company named "Neutro-something".  They were on the verge of a 
great discovery, and they tended to treat their stockholders well, 
particularly at annual stockholders' meetings, when their hospitality knew no 
bounds.  While I did not quite get the company's name, I learned that he lived 
nearby.  Buckets filled, we parted amicably.

Several months later, while idly scanning the newspaper, I saw it.  Lexington 
firm, "Interneuron", has made an important pharmaceutical discovery.

"That must be the firm the raspberry man told me about," I said to my husband. 
"Let's buy a few shares so we can go to the stockholders' meeting where they 
treat you so well."

Delighted with my sudden, unaccustomed interest in his stock purchases, he 
agreed; and we bought a few shares at $6 each.

Months went by, Interneuron rose to $11.   ("Sell?"  "Not yet.")  To $20.  
("Sell?"  "No, hold.  We haven't been to any of their meeetings yet.")  When 
it reached $30, I decided to call our benefactor to thank him for the tip.  I 
needed to consult the "snoopy" book at the Town Clerk's Office to find his 
name.  When I called, he remembered our raspberry bush encounter, but 
"Interneuron"?  No, that was not his firm.  The name had a "neuro" in it, to 
be sure, but ....

The latest Interneuron quote was 31 3/8.

See, it's easy to make money on the stock market if you know where and with 
whom to pick berries.