You really can't get adequate diversification buying single stocks if you only have a few thousand dollars to invest.
I would argue that you can. Many companies are like mutual funds in themselves. Take companies like Clorox, Procter & Gamble, Philip Morris, Coca Cola, Disney, G.E., IBM and AT&T.
The amount of diversification within these companies is staggering... plus, the majority of them have huge operations overseas, meaning you get the benefits of a foreign fund as well!
For instance, everyone knows Philip Morris makes cigarretes (which include Marlboro, Benson & Hedges, Virginia Slims, Merit, Parliament, L&M, Chesterfield, Lark and Basic to name a few), but did you also know that Philip Morris owns:
Coffees (Maxim, Maxwell House, Sanka, and various Starbucks brands)
Soft Drinks (Capri Sun, Country Time, Chrystal Lite, Kool-Aid and Tang)
Post Cereals
Condiments & Sauces (such as Bull's Eye Barbecue and Miracle Whip)
Altoids, Jell-O, Shake N' Bake, Minute Rice, Toblerone, Stove Top Stuffing, Loius Rich Meat, Claussen pickles
Oscar Mayer
Kraft Foods
Numerous cheeses (Philadelphia, Velveeta, Cracker Barrel, Di Giorno)
Pizza (Di Giorno's, Tombstone and Jack's)
Oh, and they also own some beers you might know (Miller brewing company, Foster's, Molson, Red Dog, Icehouse, Mickey's, Olde English, Meister Brau, Leinenkugals, Celis, Shipyard, Sharps and Magnum)
Have i made my point? because I could go on...
Plus, with individual stocks, you do not have to pay the year to year fees, on top of year to year capital gains taxes.
1) If you are one of the lucky few who get in on the IPO, you would really be doing yourself a disservice to dump it on the first day since the immediate money you could make is far less than the potential return 10 years down the road if it takes off. Imagine how you will feel in 10 years if the value is 10x what you paid tomorrow and you sold it on the first day for a 20% gain.
Selling initially does not prevent you from buying the shares back in the near future when the volume has settled down. If you believe RHAT to be a good long term investment, by all means, by the shares back and profit with them over the long haul. However, over the past two decades, the average annual return of even the successful IPO's has only been 5%. This is pretty dismal, especially considering how wonderfully the overall market had performed during that span of time.
2) If anyone really cares about success of this IPO, 'flipping' is not how you help. Buying the shares and watching the price and then buying some more later is good. Dumping your stock the day you buy it does not contribute to the stability of the stock. RedHat and E-Trade want the stock to appreciate in value gradually over time, not swing windly up then crash to the floor.
What slashdot readers decide to do with their shares is going to have absolutely no effect on the stability of RHAT's opening. The majority of the recepients at the offering price are institutional investors and high net worth individuals who do not give a damn about RHAT's mission satement.
3) Instability in the market for open-source company IPO's will not help the compaines like VA that will go public in the future. If RedHat looks like a nightmare, the terms for future IPO could be less favorable.
Once again, this is simply what has happened to virtually Every IPO that has come out over the past 3 years. There is nothing wrong with a slashdot reader/linux supporter in trying to make some money on a market swing. If you believe in the company, buy your shares back once it settles down (or even better, more).
Except for that rare breed of first wave internet stocks, buying and holding IPO's is a way to lose money. No matter how great the idea behind the company is.
Trying to "outguess" the market has repeatedly and repeatedly been shown to be a losing game.
Investing in quality companies over the long haul has repeatedly been shown to be a winning strategy, and the best possible way of staying well ahaed of inflation.
Over the long term, a company's share price is directly related to that company's performance. Because, as stated above, afterall... these are shares of the actual company that you own!
Short selling!? Did someone mention selling short? I certainly hope not.
I would venture that RHAT is more than a run-of-the-mill decent IPO however. Here is a recent clipping:
More and more IPOs are being postponed or cut in size and terms amid the recent downturn in the broad market and investor hesitation toward Internet and technology IPOs. But analysts have been enthusiastic about Red Hat. "Red Hat seems to be the hottest deal, given the Linux revolution," said Steven Tuen, an analyst at IPO Value Monitor. International Data Corp. said Linux was the fastest-growing operating system for servers in 1998. Linux has made progress in the corporate computing world, making major inroads in the Web server and e-mail server markets, displacing Microsoft Corp.'s Windows NT. Red Hat sells packaged versions of Red Hat Linux on CD-ROM discs. ((--Wall Street Desk (212) 859-1730)) REUTERS --- Rtr 14:56 08-10-99
Yes, this is true. But, when is the next time that you can honestly see yourself getting in on an IPO with as much publicity and chance of springing quickly as Redhat? The average investor never gets a chance like this... and while E-Trade and various other internet brokers out there will put some IPO shares in a lottery pool, even if you do luckily get one, there is a high probability that it will be a dud.
There are over 40 IPO's slated to come out this week alone. There were 30 last week. Many analysts have ventured that this huge slur of initial and public offerings is partly to blame for the recent poor performance of internet (which leads to tech, which leads to the rest of the market) stocks.
I think this is a bad time for Redhat to be coming out... they are going to be (unfairly) grouped with all the countless "dot" coms that are coming, and I am afraid it may fair poorly.
Well, both movies started out stating the ending. We knew at least one person surviced SPR, and we knew that the kids were never heard from again in BWP. Did you really ever think they "might make it"?
BWP scared me... but only because I let my imagination run. The idea of going off to war really scares the shit out of me though. I was damn scared in 1990 when the Gulf War was starting, and the idea that I might be drafted.
But yeah... they really have nothing to do with each other. I just wanted to comment on how another movie affected its watchers to even more of an extent than BWP.
While people did leave the BWP mostly quietly (even the large group i went with did not say a word until we had gotten well outside), I have never seen a movie effect people the way Saving Private Ryan did.
People left that movie like they were walking out of a funeral. Many were crying.
That was impressive, and moving. And, that was definitely a big budget film.
Nto sure what my point is, but I guess I am saying that big budget films are not necesarily "unmoving" (except when it comes to Titanic.
Of the sites you mentioned above, only porn and gambling sites actually profit. Yahoo barely does, and Ebay, Amazon.com, Buy.com and all the others have never come close to making a profit.
But, they do make money (as in revenues). In that line, Egreetings makes money and Zeronet make money... more when they gave their services away for free, than when they were charging.
I am not talking about an advertising circular, I am talking about things like Music Revue and other magazines that have full-time employees, profit and give their mahazines away for free. There is a lot of content, but a shit load of advertisements. I see no similarities to a billboard (an online, or a roadside)!?
Slashdot Mirror
You really can't get
adequate diversification buying single stocks if you only have a few thousand dollars to invest.
I would argue that you can. Many companies are like mutual funds in themselves. Take companies like Clorox, Procter & Gamble, Philip Morris, Coca Cola, Disney, G.E., IBM and AT&T.
The amount of diversification within these companies is staggering... plus, the majority of them have huge operations overseas, meaning you get the benefits of a foreign fund as well!
For instance, everyone knows Philip Morris makes cigarretes (which include Marlboro, Benson & Hedges, Virginia Slims, Merit, Parliament, L&M, Chesterfield, Lark and Basic to name a few), but did you also know that Philip Morris owns:
Coffees (Maxim, Maxwell House, Sanka, and various Starbucks brands)
Soft Drinks (Capri Sun, Country Time, Chrystal Lite, Kool-Aid and Tang)
Post Cereals
Condiments & Sauces (such as Bull's Eye Barbecue and Miracle Whip)
Altoids, Jell-O, Shake N' Bake, Minute Rice, Toblerone, Stove Top Stuffing, Loius Rich Meat,
Claussen pickles
Oscar Mayer
Kraft Foods
Numerous cheeses (Philadelphia, Velveeta, Cracker Barrel, Di Giorno)
Pizza (Di Giorno's, Tombstone and Jack's)
Oh, and they also own some beers you might know (Miller brewing company, Foster's, Molson, Red Dog, Icehouse, Mickey's, Olde English, Meister Brau, Leinenkugals, Celis, Shipyard, Sharps and Magnum)
Have i made my point? because I could go on...
Plus, with individual stocks, you do not have to pay the year to year fees, on top of year to year capital gains taxes.
1) If you are one of the lucky few who get in on the IPO, you would really be doing yourself a disservice to
dump it on the first day since the immediate money you could make is far less than the potential return 10
years down the road if it takes off. Imagine how you will feel in 10 years if the value is 10x what you paid
tomorrow and you sold it on the first day for a 20% gain.
Selling initially does not prevent you from buying the shares back in the near future when the volume has settled down. If you believe RHAT to be a good long term investment, by all means, by the shares back and profit with them over the long haul.
However, over the past two decades, the average annual return of even the successful IPO's has only been 5%. This is pretty dismal, especially considering how wonderfully the overall market had performed during that span of time.
2) If anyone really cares about success of this IPO, 'flipping' is not how you help. Buying the shares and
watching the price and then buying some more later is good. Dumping your stock the day you buy it does
not contribute to the stability of the stock. RedHat and E-Trade want the stock to appreciate in value
gradually over time, not swing windly up then crash to the floor.
What slashdot readers decide to do with their shares is going to have absolutely no effect on the stability of RHAT's opening. The majority of the recepients at the offering price are institutional investors and high net worth individuals who do not give a damn about RHAT's mission satement.
3) Instability in the market for open-source company IPO's will not help the compaines like VA that will go
public in the future. If RedHat looks like a nightmare, the terms for future IPO could be less favorable.
Once again, this is simply what has happened to virtually Every IPO that has come out over the past 3 years. There is nothing wrong with a slashdot reader/linux supporter in trying to make some money on a market swing. If you believe in the company, buy your shares back once it settles down (or even better, more).
Except for that rare breed of first wave internet stocks, buying and holding IPO's is a way to lose money. No matter how great the idea behind the company is.
Great reply.
Trying to "outguess" the market has repeatedly and repeatedly been shown to be a losing game.
Investing in quality companies over the long haul has repeatedly been shown to be a winning strategy, and the best possible way of staying well ahaed of inflation.
Over the long term, a company's share price is directly related to that company's performance. Because, as stated above, afterall... these are shares of the actual company that you own!
Short selling!?
Did someone mention selling short? I certainly hope not.
I would venture that RHAT is more than a run-of-the-mill decent IPO however. Here is a recent clipping:
More and more IPOs are being postponed or cut in size and
terms amid the recent downturn in the broad market and investor
hesitation toward Internet and technology IPOs. But analysts
have been enthusiastic about Red Hat.
"Red Hat seems to be the hottest deal, given the Linux
revolution," said Steven Tuen, an analyst at IPO Value Monitor.
International Data Corp. said Linux was the fastest-growing
operating system for servers in 1998. Linux has made progress
in the corporate computing world, making major inroads in the
Web server and e-mail server markets, displacing Microsoft
Corp.'s Windows NT.
Red Hat sells packaged versions of Red Hat Linux
on CD-ROM discs.
((--Wall Street Desk (212) 859-1730))
REUTERS --- Rtr 14:56 08-10-99
Here is a quick list that i found.
COMPANY SIZE(MLN) RANGE UNDERWRITER TRADEDATE
InterWorld 3.0 15 Invemed PRICED
U S Interactive 4.615 10 Lehman PRICED
Braun Consulting 4 7 DLJ PRICED
Hotjobs.com 3.0 8 1 DB Alex PRICED
Garden.com 4.1 11-13 Hambrecht Aug11
Mortgage.com 7.5 10-12 CSFB Aug11
NETsilicon 5.0 8-10 CIBC Aug11
Red Hat 6.0 12-14 Goldman Aug11
Women.com 3.75 10-12 MorganSt Aug11
NetScout Systems 4.0 14-16 DB Alex Aug12
Blockbuster 31.0 16-18 Salomon Aug11
IXNet 7.5 18-20 Salomon Aug11
Quest Software 4.4 12-14 BancBoston Aug12
FirstAmerica Auto 7.84 12-14 Merrill Aug12
Bamboo.com 5.0 10-12 Prudential Aug12
Active Software 4.0 10-12 Goldman Aug13
LookSmart 12 11-12 Goldman Aug13
Tunes.com 4.0 13-15 Salomon Aug13
Medscape 5.4 11-13 DLJ Aug13
Luminant 12.6 11-13 DB Alex Aug13
Alliance Resource 8.97 19-21 Salmon Aug13
Rockford Corp. 3.4 11-13 DainRaucher wkAug9
US Interactive 5.2 10-12 Lehman eawkAug9
ftd.com 5.5 13-15 Bear eamidwkAug9
AverStar 4.0 7-9 Bear midltwkAug6
Cortelco Systems 3.12 10-12 JPMorgan ltwkAug9
Opensite Tech 3.68 10-12 Hambrecht ltwkAug9
Interactive Intelligence 2.67 11-13 Merrill midAug
Greatfood.com 2.5 10.5-13.5 WRHambrecht midAug
Lionbridge Tech 4.0 12-14 Prudential midAug
Loislaw.com $75max Prudential midAug
Headhunter.net TBA FirstUnion midAug
Riva Bancshares 3.0 10-12 CIBC wkAug16
Healthgate Data 4.6 10-12 SGCowen wkAug16
Airgate $100max DLJ wkAug16
Webstakes.com 3.575 13-15 Bear wkAug16
MyPoints.com 5.0 10-12 BancBoston wkAug16
Imagex.com 4.0 12-14 Volpe wkAug16
Duraswitch 3.0 8-9 Cruttenden wkAug16
NovaMed DLJ Aug17
Netro Corp 5.0 7-9 Merrill Aug19
LaBranche 11.5 15-17 Salomon Aug19
Therma-Wave 3.3 10-12 BancofAmerica Aug
Gen Trak TBA 10 Barron Aug
Daleen Tech $57 BancBoston Aug
Jore 3.8 9-11 DADavidson Aug
Tunes.com 4.0 13-15 Salomon Aug
PurchasePro.com 4.0 11-13 Prudential ltAug
Ecollege.com TBA BancofAmer Aug/Sept
E2Net.com $173max DB Alex eaSept
Cybergold 4.0 9-11 SG Cowen Sept
Nelson Comms TBA SGCowen Sept
PCQuote.com 5.8 12-14 Prudential Sept
ITXC 5.4 13-15 Lehman Sept
Williams Comms $750max Lehman Sept
Yesmail.com 3.4 11-13 DB Alex midSept
Oratec $48.9 Merrill wkSep20
Advanstar 14.0 12.5-16.5 Merrill wkSep20
Predictive Systems $52nax BancBoston Sep23
Planet.Rx $69mln Goldman wkSep27
Charter Comm $3.45bln Goldman wkSep27
Spinnaker $125max CSFB wkSep27
United Parcel $3bln MorganSt Nov
Yes, this is true. But, when is the next time that you can honestly see yourself getting in on an IPO with as much publicity and chance of springing quickly as Redhat?
The average investor never gets a chance like this... and while E-Trade and various other internet brokers out there will put some IPO shares in a lottery pool, even if you do luckily get one, there is a high probability that it will be a dud.
I would sell mine initially.
I like how the ticker symbol (RHAT) sounds out to be "Rat".
:)
Great marketing
There are over 40 IPO's slated to come out this week alone. There were 30 last week. Many analysts have ventured that this huge slur of initial and public offerings is partly to blame for the recent poor performance of internet (which leads to tech, which leads to the rest of the market) stocks.
I think this is a bad time for Redhat to be coming out... they are going to be (unfairly) grouped with all the countless "dot" coms that are coming, and I am afraid it may fair poorly.
Ha!
so did 129 others...
new results = 44,700 midgets vs. 474,930 giants.
Nope... I did not put the quotes on it. :)
Damn, and here I was all excited because there were so many like-minded individuals as me
Midgits fall very short of the Giants' large presence:
Giants: 474,930
Midgits: 129
I did a search on Alta Vista for "I like to maim and kill puppies and kittens".
The search yielded me 1,258,080 sites.
Quite sinister.
Well, both movies started out stating the ending.
We knew at least one person surviced SPR, and we knew that the kids were never heard from again in BWP. Did you really ever think they "might make it"?
BWP scared me... but only because I let my imagination run. The idea of going off to war really scares the shit out of me though. I was damn scared in 1990 when the Gulf War was starting, and the idea that I might be drafted.
But yeah... they really have nothing to do with each other. I just wanted to comment on how another movie affected its watchers to even more of an extent than BWP.
Then that should cover at least 3 sequels.
can't wait!!!
...... Josh is still OUT there!!!
Off topic here...
While people did leave the BWP mostly quietly (even the large group i went with did not say a word until we had gotten well outside), I have never seen a movie effect people the way Saving Private Ryan did.
People left that movie like they were walking out of a funeral. Many were crying.
That was impressive, and moving. And, that was definitely a big budget film.
Nto sure what my point is, but I guess I am saying that big budget films are not necesarily "unmoving" (except when it comes to Titanic.
You are 15?
*Sigh*
Those wacky kids these days!
I would suggest a Hogshead of Whiskey.
The fun will never end!
... Or just stay home and huff Scotch Guard.
Most squa's do not understand my glowing sense of humor and good-natured sarcasm.
"I play sports"
Maybe this will help all of you who wrote in earlier complaining about your lack of a dating life.
The Slashdot Bash will be HUGE with the chicks I bet!
You have to make sure that you carry the football at all times.
Pretend that you are like the one kid from the Program.
Walk around wearing Zubas as well.
Very important.
I have found the best way to pick up chicks is to walk around with a football.
It does not matter if you are 5'5 and 90 pounds... chicks DIG this!!!
Mention that you "Play Sports" too.
Of the sites you mentioned above, only porn and gambling sites actually profit. Yahoo barely does, and Ebay, Amazon.com, Buy.com and all the others have never come close to making a profit.
But, they do make money (as in revenues). In that line, Egreetings makes money and Zeronet make money... more when they gave their services away for free, than when they were charging.
I am not talking about an advertising circular, I am talking about things like Music Revue and other magazines that have full-time employees, profit and give their mahazines away for free. There is a lot of content, but a shit load of advertisements. I see no similarities to a billboard (an online, or a roadside)!?