Which is the worst investment?

[Veritas_et_Aequitas]

Poll question: Which is the worst investment?

My finance class is having a stock picking contest and the winner gets some extra credit. I have my fantasy portfolio picked out, but my friends and family have questioned some of the riskier stocks I'm picking. So, I'm just curious what everyone thinks my worst pick was.

[Fleshdancer]

1. I think it's a tie between BoA and GM

I ended up voting for GM though because they've already started threatening the govt for more money.

[Veritas_et_Aequitas]

2. That's what I think, too,

and even though I think BoA should tank, I don't think Geigner has the stones to let it crash and burn.

[Fleshdancer]

5. true, plus I think the executive culture at BoA is easier to change

They've made some real boneheaded decisions lately, but I think they'll do whatever it takes to change their current situation if enough pressure is applied. GM on the other hand seems to be set in their ways.

[marketcrazy1]

7. you are trying to win this contest right??

these are some pretty ballsy picks! GM is toast, even if they dont BK every dollar of bailout money costs them equity so long term they are finished. short term they could bounce on a cash infusion that does NOT result in GOV takeover. BAC is risky but will likely bounce pretty good IF turbo timmy goes ahead with the taxpayer bailout. ford will likely be flat in the short to medium term as they ask for more credit. Exxon mobile did great on high oil but first quarter earnings are going to suck unless oil spikes. I am sure these are not your entire portfolio. BAC believe it or not is probably your best pick ( as a percentage gainer, short term ) as it is almost a given that turbo timmy will bailout the banks..... GL with your contest!! hope you nail it!!

[Veritas_et_Aequitas]

9. Yeah, I know GM is a major risk, and I'm not putting a lot into it.

And I agree with you that BAC will probably recover.

No, it's not my entire portfolio. There are the sketchier ones. I spread out over 35 stocks and am mainly invested in technology, construction and mining with some entertainment, retail, mining, and oil/energy for support.

[flvegan]

3. Depends. Is this a short term hold or a long term hold?

IOW, this "stock picking contest" has what turnaround for the stock(s) that are picked? Is it just for today? A week? The semester?

[Veritas_et_Aequitas]

8. The contest runs from tomorrow until the first week in May

so it's just the semester. I'm taking a long position with most of my stocks. My portfolio has 35 stocks in it divided over entertainment, technology, construction, oil&gas, alternative energy, mining, and retail and I may add a couple of mutual funds if I can find any that might perform adequately.

[flvegan]

11. 3 months? Tough call from the four.

I think Exxon is a safe call, as is Ford. I like GM stock right now at $2.50, but I don't know about a short term like 3 months. I'd have to go with BAC (Bank of America). The whole finance sector is in such a mess, I'd not put a dime there. Flip side of that is, the bigger the mess, the bigger the potential loss or gain. I don't think BoA will go down in flames, but I don't think it's going to fare well over the first two quarters.

[marketcrazy1]

14. will you be allowed to trade these picks??

IOW, buy or sell as they advance or decline over the contest time line? or is it strictly buy and hold?

[Veritas_et_Aequitas]

15. Trading is allowable over the contest life.

Buying on margin is allowed as well, although I'm a bit too gun shy for that. At least in this market.

[marketcrazy1]

19. well if you can trade these

you could do pretty good on financials/home builder/construction in the short term on treasury actions. pick your exit points ( price/percentage appreciation ) and take your profits when they hit. dont get greedy!!! remember it`s not what you leave on the table ( paper profits ) but what you take off ( bankable cash ) that counts!! -- hogs get fat, PIGS get slaughtered! dont be a pig!! LOL!!!!

[blue_onyx]

4. I went with BoA

If I had money I would buy GM stock.

[Tierra_y_Libertad]

6. Our brilliant politicians seem to think all of them are hot products..with our money.

[Veritas_et_Aequitas]

10. Why do you think I decided to risk on them?

;)

[Tierra_y_Libertad]

12. You weren't offered any choices that had a chance of making money?

It's the only plausible reason I can come up with.

[Veritas_et_Aequitas]

13. No, but I doubt any of these will tank outright because there will be too much uproar.

My other picks are more stable or have a chance of taking off some after 3 months when the stimulus should kick in.

[Tierra_y_Libertad]

16. So, why did you pick them?

Is the point to make money? Not lose money? Or, go bankrupt?

As for me, I moved all of our investments to Money Market Mutual Funds about 8 months ago when the handwriting on the wall started flashing "Shitstorm Approaching" in neon.

[Veritas_et_Aequitas]

18. Because they're risks that might pay off.

I have 31 other stocks that are doing more than balancing them out. And of the four, I think the only one that has the real potential to blow up in my face is GM, especially since it's facing bankruptcy. However, I remember in the last recession that bankruptcy actually helped the price of some stocks, and I'm hoping that will happen with GM (it's cold and callous, I know).

Ford will probably hold steady. Maybe it will get a boost from the stimulus.

Geigner will not let Bank of America fail, and depending on how it uses the rest of its TARP it might actually do better.

ExxonMobil will probably hold steady until April (when it will start to climb) unless oil spikes, in which case I'm screwed.

[TahitiNut]

17. Unless BofA and GM go through bankruptcy, they're probably the MOST underpriced right now.

A great deal depends on how well we recover from today's economic woes. If the recovery is decent, then I'd say ExxonMobil is the WORST investment (since it's selling at a premium right now, based on our oil addiction) and GM is probably the BEST investment.

The problem isn't as much one of 'best vs. worst' but one of CONFIDENCE in ANY investment. If I were confident enough to invest at all, I'd probably go GM.

[Veritas_et_Aequitas]

20. ExxonMobil? Really?

I know it's price is still high, but I was looking for a somewhat reliable oil stock for my portfolio. The price might still climb come April or May.

[TahitiNut]

21. Your OP didn't say the hold was until April or May. Sorry. I assumed long-term.

Whenever I hear "investment" I think long-term, not casino-style. I have a strong bias regarding stock and the manner in which its traded these days. (But that's not the subject of the thread.)

In terms of a short-term buy, I don't know that there's any reliable basis to project April/May price levels. The fluctuations between now and then are bound to be all 'Greater Fool' reactivity to the news of the day and not the more fundamental trends/events in either the company or the economy's health.

Again, however, from a sheer volatility perspective (and the associated upside potential), ExxonMobil is an anchor, not an 'opportunity.' You're (necessarily) throwing the dice on 'News Of The Day' so auto/bank is most likely to include the biggest upside mover (if only because they're HUGELY down), not petro.

That's all. :shrug:

[Romulox]

22. How can you pick "the best investment" when several of these co's are on the PUBLIC DOLE?

You'd be better off picking who has the best lobbyists.

:crazy: