“Mad Money” Show Recap - Market Speculation
Jim had a great show today, and recapping his shows is now definately a part of my daily routine for Stock Trading 101.
Today’s theme for the show really was on stock market speculation. With the investing world so big, there are tons of people speculating on this or that predicting the next big hit. Jim tells us though that these hard core speculators don’t always know what the heck they are doing. His stock example was Finisar (FNSR) which apparently has lost 25% of its value because of speculation.
His tips for speculating properly:
- Don’t speculate with borrowed money. That makes simple sense, if we are trading on margin and have all of our money on a looser, then we are in more trouble than just loosing our cash.
- Only speculate with funds you are willing to loose. This to me means that I should walk into the play knowing I may get bit and loose badly. I can’t expect to win everytime. Jim also told us to stop speculating after you turn 54 years old.
- Never have more than 20% of your entire portfolio in a speculative stock play.
He ended with a couple other quick tips and his bottom line was, “Know what you are doing so you don’t speculate when you mean to invest.” That’s simple enough, thanks Jim.
Alright, part of the show included a speculative list of 10 stocks which our stock guru Jim Cramer has in his sites. The list goes something like this (no particular order):
- Ciena (CIEN)
- Conexant Systems (CNXT)
- EuroZinc Mining (EZM)
- Transmeridian Exploration (TMY)
- Crystallex International (KRY)
- Finisiar (FNSR)
- JDSU (JDSU)
- Rentech (TRK)
- Ivanhoe Energy (IVAN), and
- Northgate Minerals (NXG)
He also had a list of hot speculative stocks that are apparently ready to shoot to the moon: Garmin (GRMN) who had a 67% increase in 1st quarter earnings, Trimble Navigation (TRMB), Navteq (NVT), and MapInfo (MAPS). This is a big jump in stocks posted since yesterday’s show, but never-the-less Jim had alot to talk about today.
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