Passing the six million dollar mark!

Passing the six million dollar mark!
I hope my stockmarket skills exceed those of my handling graphics online.
I will say this though. Becoming "virtually rich" has been surprisingly easy. Getting this kind of success into
the real world is going to take a bit more doing, I am sure. Will be back later. This monster has eaten up way too much of my time. I got a dog to walk and bathe.
Later.

Your move 

The Virtual Thousandaire

January 2, 2005

Hey there!
Thanks for hanging in there with me. I realize that some of the material I present on this site is rather dry and somewhat disorganized. I am going to take a different tack today and give you a rundown of what I was looking for when I got involved with the virtual stock exchange (http://www.virtualstockexchange.com/) way back in April of 2004.
Some time ago I picked up a book by Robert Lichello titled “How To Make $1,000,000.00 In The Stock Market Automatically”. I really liked some of the concepts I read and started thinking about what kind of portfolio I could build in the future.
In the 1990’s I worked at a number of electronics companies. One of which gave me the opportunity to contribute to a 401(k) retirement program. I came to realize how limited my knowledge in investing was as I was only having limited success with my 401(k).
A friend of mine that I had met at work was really jazzed about a guy named Wade Cook who had published some books on investing and ran a very expensive set of seminars on the subject, none of which I had ever attended as I just did not have five thousand dollars to spend learning about how to make a million dollars on whatever I had left over after that. Does this sound somewhat familiar?
What I did, instead, was subscribe to Mr. Cook’s free cassette tape series, which I would listen to daily in my car on my way to and from work. Of course, every one of those tapes turned out to be a commercial for his expensive stock market seminars. Some of them, however, turned out to actually be somewhat informative. Wade’s problem is that he made a lot of his stuff up as he went along, often borrowing on ideas he got from stockbrokers he knew. There was nothing wrong with that, of course. Some of his concepts seemed rather sound. I learned a little bit about betting on stock split companies, paper trading - testing your strategies by making imaginary stockmarket trades, part of what the virtual stock exchange is about - and something he called “rolling stocks”; now known as channeling stocks - stocks that trade within a narrow price range so you can buy low, sell high (www.channelingstocks.com, not affiliated with anyone but themselves).
I tempered the information I heard on those tapes with what I heard on Wall Street Week with Louis Rukeyser, a program on a PBS TV channel. One night, a long time ago, Mr. Rukheyser fielded a question about stock split companies from a listener who had heard that they would be a sure thing. Lou reminded the audience that there really are no sure things in the stock market and nothing can really replace studying market fundamentals. I would later find out how right he was. That TV show no longer exists in its old format. Louis Rukheyser left, and Wall Street Week got corporate funding from Fortune magazine. I find them mildly entertaining now, but I try to catch Louis Rukheyser’s Wall Street whenever I can because really do miss Mr. Rukheyser.
Another group that I followed at the time was the Motley Fool, who are still around and doing rather well, thank you. Managed by the Gardner bothers, they survived by maintaining a longer-range view of the stock market, and were able to change with the times.
Which is what concerned me about Wade Cook and his ilk. Wade did not survive the nineties or the new century as well as I had expected him to. I was, and still am to some small extent, a fan of his ideas. Those tapes I listened to were largely responsible for at that, even though I fear I may have been buying into a kind of brainwashing over time. It wasn’t long before the times soon came to turn against him. As I mentioned before, Wade Cook's organization ran a very expensive set of seminars, and after that a bulletin board service, and later a website that would charge people thousands of dollars to participate in. Wade collected critics, especially where he would mix his investment advice with a kind of right wing Mormonic/religious zealotry. In fact, it did not take long before people began to come forward with horror stories of landslide losses in their investments, particularly where it involved playing with options.
I have never played with options as I have found that the capital requirements impossibly high.
You can, of course, paper trade any market strategy wish. You can get a lot of information about issues from your online broker – etrade.com for instance, though there are others or you can just surf over to quotes.com. What the devil is a “virtual portfolio” good for if you can’t really retire on it?
One answer might be its use as a performance model for your future investment vehicle.
Let me explain by example: I started out nine months ago with a fantasy portfolio of one million dollars ($1,000,000.00) and by making certain decisions I was able to build it up to a little over 5.2 million dollars ($5,215,472.84 at last count).
Of course neither myself, nor most of my readership have a million dollars to throw around for an investment portfolio, but if you can divide by ten (or in the case of a typical starter portfolio divide by one hundred) you can take the examples made earlier in the year and apply them to a portfolio worth anywhere between $100,000.00 to $10,000.00.
You could be well on your way to an early retirement, one would think.
Or not.
To get the performance I had these last few months I did a number of trades in succession, buying and selling sometimes on a daily basis. I didn’t day trade, but I didn’t buy and hold either.
When you are starting an investment program with an itty-bitty 401(k) program or a small fund you can start on http://www.sharebuilder.com/ you probably can’t afford to make those kinds of rapid fire trades. What you might really need is a solid portfolio of strong issues that will make sense in today’s screwed up economic market.
That’s why I refer to the Motley Fool and Lous Rukeyser and the other Wall Street Week - with Fortune, even though they probably may not appreciate the plugs I am giving them. The point I am trying to make is this - in my humble opinion- when you are starting a portfolio by committing, say, $200.00 a month (one hundred dollars deposited into your sharebuilder account every two week pay period - if you are so lucky to be employed in todays jobmarket - you don’t want to squander those precious funds on issues that may not hold their value in 2 to 5 years time because they fell apart or went out of style.
Buy and hold may not be entirely on the mend, but I wouldn’t call it “dead” either.
That’s about it. I gave you a bunch of information that you might useful. I hope I haven’t bored you to tears. I also hope that I didn’t misrepresent myself or the fine people and organizations I have quoted in this piece.
If it turns out I have, just remember this:
HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS,SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADETHAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSESSIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARPDIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND ACTUALRESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THEIMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE,THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCERESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.
Any links provided to other server sites are offered as a matter ofconvenience and in no way are meant to imply that the author endorses, sponsors, promotes or is affiliated with the owners of orparticipants in those sites, or endorses any information containedon those sites, unless expressly stated. However, Frank Austad may receive compensation from the server sites which are provided through links.

So there!

January 1, 2005

Hello again. Here is another display of my success at this avocation of mine. What you see here is another cut and paste fragment from my latest portfolio in the Virtual Stock Exchange.

Total Equity 5,215,472.84 Total Return 421.55%
Cash 878,445.34 Today's Return -0.27%
Margin 0 This Week's Return 0.29%
Interest Earned 39,864.49 This Month's Return 5.35%


Symbol Quantity Curr Price Curr Value Gain/Loss % Chg % Equity
PLCM 5000 23.32 116,600.00 24,370.05 26.46% 2.24%
CELG 8000 26.52 212,160.00 97,570.05 85.20% 4.07%
MRVL 10000 35.47 354,700.00 92,770.05 35.43% 6.80%
ANPI 10000 18.41 184,100.00 2,370.05 1.32% 3.53%
STMP 10000 15.84 158,400.00 24,970.05 18.74% 3.04%
PNY 5000 23.24 116,200.00 61,045.05 110.79% 2.23%
SYMC 4000 25.76 103,040.00 43,380.05 72.80% 1.98%
WERN 10000 22.64 226,400.00 14,670.05 6.94% 4.34%
JBL 1000 25.58 25,580.00 1,350.05 5.70% 0.49%
FINL 8000 18.30 146,400.00 80,870.05 123.51% 2.81%
AVN 10000 3.41 34,100.00 4,570.05 15.59% 0.65%
ETM 5000 35.89 179,450.00 27,920.05 18.45% 3.44%
AGE 1000 43.21 43,210.00 8,510.05 24.63% 0.83%
AGE 1000 43.21 43,210.00 7,180.05 20.03% 0.83%
PLCM 10000 23.32 233,200.00 28,170.05 13.76% 4.47%
CAKE 6250 32.47 202,937.50 71,713.11 54.68% 3.89%
ETM 1000 35.89 35,890.00 720.05 2.13% 0.69%
AGE 5000 43.21 216,050.00 24,620.05 12.88% 4.14%
UCI 1000 33.90 33,900.00 -119.95 -0.26% 0.65%
NCR 1000 69.23 69,230.00 9,400.05 15.77% 1.33%
O 1000 50.58 50,580.00 500.05 1.06% 0.97%
SHFL 1000 47.10 47,100.00 5,960.05 14.57% 0.90%
WWW 1000 31.42 31,420.00 -499.95 1.47% 0.60%
FLIR 1000 63.79 63,790.00 4,360.05 7.39% 1.22%
MTH 100 112.70 11,270.00 354.05 3.53% 0.22%
JOYG 1000 43.43 43,430.00 2,040.05 5.00% 0.83%
SYMC 6000 25.76 154,560.00 3,630.05 2.43% 2.96%
MTH 1000 112.70 112,700.00 460.05 0.44% 2.16%
EV 1000 52.15 52,150.00 420.05 0.87% 1.00%
SKT 10000 26.46 264,600.00 3,470.05 1.34% 5.07%
SBIT 1000 37.50 37,500.00 610.05 1.74% 0.72%
CLF 1000 103.86 103,860.00 -3,079.95 -2.85% 1.99%
CRDN 1000 57.21 57,210.00 -489.95 -0.80% 1.10%
CRDN 10000 57.21 572,100.00 -5,439.95 -0.94% 10.97%

Total long positions: $4,337,027.50


Just think nine short months ago I started out with a blank slate and $1,000,000.00 to spend on any security or issue I wished.