ESRwannabe
Full time employment: Posting here.
- Joined
- Mar 19, 2010
- Messages
- 889
That sounds more like value investing than day trading to me.
When I played with individual stocks, I would discount my expected future value (typically conservatively estimated future EPS along with a conservative future PE ratio) by a desired rate of return (15% in a low inflation environment) and would buy companies I felt were relatively safe (good established business and not highly leveraged -watch those balance sheets). I did well and beat the market over the next 2 years on almost all my purchases but was not disciplined at selling my winners and rode a few down losing some of my gains. I then made myself a rule to sell half when it doubled if I still liked the stock. -Then I felt I missed out as they kept rising but at least I didn't ride them down! I only own one stock at this time and am liquidating it for living expenses first. I've "proven" my analysis to work well but don't have any false security that would be able to beat the market consistently over a longer period and would have long periods in cash when I couldn't find anything I liked that was undervalued.
Maybe 2020 to 2022 was an exceptional time for finding mispriced stocks, with the two large crashes and the giant rally in between them.