The Stock Market is Obviously Rigged

Buy VTSAX and hold for decades. You can thank me later.

Invest in companies you believe in. It’s quite simple. Buy them and hold them. Amazon, Starbucks...etc.

Study all you want.

But there are stocks that can’t miss and risky ones also.

As an account place holder I bought a little ATT. Nice 7% dividend but it will never move. Right now it is outperforming any debt that I have so it’s fine.

I bought Disney at 102. This was really easy. I mean, I didn’t think it would bounce back this quick and was prepared to go a couple of years with it. The biggest post pandemic issue they have really is the cruise industry in my opinion. They are over 140 now.

I recently bought a bunch of airline stocks. This is still a winner. Mark my word that a company like Delta will double. I have some American Airlines because it has a potential to triple.

Anyway, there is more to this.

Now is not the time to buy into stocks that are thriving on the pandemic line Amazon. That should be obvious.

It’s not complicated. You just have to understand what is going on.

The market also likes stability. A change to a Democrat president with a majority republican senate to balance that means that nothing crazy happens too quickly.

Add that to an announcement of a potential vaccine and the market goes nuts for stocks that will benefit from an opening economy.

It’s not at all rigged. You just have to understand it.

It's only rigged in that you are an amateur trying to day trade with professionals. It's like running in the same race as Kipchoge and complaining that he beat you because he is professional runner.

There's a lot to it, and there's a lot of truth to what you say. I've found some things work better than others, and try to stick to those with the bulk of my investments.

Playing a swing trade used to be a whole lot easier, and i suspect the introduction of algorithms has a lot to do with it getting tough to pull off,

These days, i find it's a bit easier to try to pick the winners in an particular industry, find a good entry point, and ride it out. Just buy those companies that you will feel comfortable holding through a downturn, should it happen.

I'd seriously be fairly conservative with the bulk of your investments and if you must, just get speculative with a little play money you could afford to lose.

Do you have to pay taxes on profits earned when you trade?

I've been trying daytrading like you now that I've been able to work at home over the last few months. I have my real portfolio in Fidelity where I mostly buy and hold and basically a gambling portfolio in Robinhood where I mostly trade options. Market manipulation absolutely goes on, but it's just one problem with modern day trading I think.

First of all, Robinhood is a crappy brokerage. You can count on it not working whenever you really want to exit a position. The funny part was yesterday morning, when the vaccine was announced, all of the "real" brokerages weren't working while Robinhood was fine. If you're cynical, then you might interpret this as an example of market manipulation from the real players - crashing all of the main brokerages to prevent retail trading while the banks entered and exited positions - I'm not convinced it isn't. Anyway, the point is you should use a real brokerage if you don't want crappy fills on options if you're trying that and more reliable service.

Second, yes, retail traders like us are at a huge disadvantage compared to the real money. They just have more resources - they get news first, an army of quants, years of experience and of course much more capital. Of course you can still make money as retail, but you're going to need luck on your side if you try any aggressive strategy - most of mine have failed. Also, I think algo trading has made things more difficult. As soon as there's news on some company, the algos will pick it up and usually oversell or overbuy, which just makes it more difficult for you to enter positions when you want to and pick up gains.

HS question wrote:

Do you have to pay taxes on profits earned when you trade?

Yes, in cash accounts. On tax defered accounts you pay when you withdraw the money. So it's probably better to do your frequent trading in the tax defered accounts like IRAs.

Go to the bogleheads forum. Study up there.

The only way to consistently beat the market in this era is value investing. Value investing does not mean necessarily buying and holding for 30 years. Value investing may mean making moderate to more than moderate changes to one's portfolio quarterly, maybe significant changes (1 to 5) years.

Thirty-five plus years ago, we could feed our families on arbitrage trading, trading on price differences between N.Y.S.E. or American Stock Exchange and regional stock exchanges like Chicago Stock Exchange.

I got to your point #1 and see that you don't know what you're talking about so I'm not reading any further. Unless you're using a different definition than what the industry and SEC considers an insider, they aren't legally trading minutes after a pre-market press release.

80% of day traders lose money. It's not rigged. You played a game most people lose and you lost.

I've been wanting to buy stock, but never had the capital or the balls to do it. I have some free cash, but a tiny set of trading cojones.

Common sense says buy the big companies that are struggling because of COVID like Cruise Ships and Airlines.

I've seen the best stocks to buy are those you have a personal interest in (Disney, Starbucks, etc).

For someone who knows nothing, what's the safest move I can do to get my feet wet?

welp wrote:

I've been wanting to buy stock, but never had the capital or the balls to do it. I have some free cash, but a tiny set of trading cojones.

Common sense says buy the big companies that are struggling because of COVID like Cruise Ships and Airlines.

I've seen the best stocks to buy are those you have a personal interest in (Disney, Starbucks, etc).

For someone who knows nothing, what's the safest move I can do to get my feet wet?

ETFs like VOO which track indices aren’t bad. The market may experience some dips, but it’s basically guaranteed to go up in the long run.

In terms of individual companies, something like Delta is basically guaranteed to go up again once travel starts increasing, but you might be waiting a while. Tech is a bit overbought right now, but if you’re looking to buy and hold obviously AAPL, GOOG, AMZN, etc. are all safe bets.

welp wrote:

I've been wanting to buy stock, but never had the capital or the balls to do it. I have some free cash, but a tiny set of trading cojones.

Common sense says buy the big companies that are struggling because of COVID like Cruise Ships and Airlines.

I've seen the best stocks to buy are those you have a personal interest in (Disney, Starbucks, etc).

For someone who knows nothing, what's the safest move I can do to get my feet wet?

The common sense advice you've received is crap. Open a retirement account, invest in good growth stock mutual funds, and leave it aside for decades.

I think there's some truth to what you're saying and I sympathize with your position. Also as others have said, it's just hard to compete with the big guys at their game. So find a different game.

Your chances of success are better with longer time horizons. Maybe not as fun and exciting, but much lower risk.

The stock market is really supposed to be a place where you can make an investment in a company that you have studied and know by buying stocks and seeing it grow in the long term.

Anyone using it to play a game for short term gains and winds up losing money deserves what they get.

welp wrote:

I've been wanting to buy stock, but never had the capital or the balls to do it. I have some free cash, but a tiny set of trading cojones.

Common sense says buy the big companies that are struggling because of COVID like Cruise Ships and Airlines.

I've seen the best stocks to buy are those you have a personal interest in (Disney, Starbucks, etc).

For someone who knows nothing, what's the safest move I can do to get my feet wet?

Yes get the companies that have been pretty consistent and tanked because of Covid but aren't quite back yet. Once this is all done they will be back to normal or above. In March when this all happened I looked at some of the big companies in the Dow Jones Index that went down pretty huge but are otherwise consistent, like Nike, Microsoft, Visa, Walmart. Three of them have reached new all-time highs since then. Many others still have some recovery left in them to hit pre-covid levels, those are the ones I'd go for if you started today.

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