Not really. It’s pretty cumbersome buying stocks everyday at the open and selling them again steht e close. Unless you ha w a machine doing that for you and exceptionally low transaction costs it is not something worth bothering.
I usually buy at the market close, if not putting in a limit order, and hold for several quarters. In up trending markets it seemed buying at the open might be a better average. Thank you for your response and all your articles. Back in January, I believe, your views on Net Intangibles brought me to sell APPS @ ~ $55 and preserve a big profit. :)
1/ Perhaps I misremember, but I recall that you wrote earlier about research showing that sector momentum is caused by flows and price moves in individual stocks are caused by HF analysts spotting mispricing.
2/ Robert Armstrong (in today‘s FT) points to research showing that trading volumes matter: high-volume stocks exhibit short term momentum and low-volume stocks show short term reversals.
I stand corrected: you were the first to spot this!
And you‘re right, in that the diffusion of new ideas does appear to follow a more or less predictable path: researcher —> SSRN —> a newsletter —-> the general press
Based on this, am I better off buying stocks at the open?
Buy n hold will do even better
Not really. It’s pretty cumbersome buying stocks everyday at the open and selling them again steht e close. Unless you ha w a machine doing that for you and exceptionally low transaction costs it is not something worth bothering.
I usually buy at the market close, if not putting in a limit order, and hold for several quarters. In up trending markets it seemed buying at the open might be a better average. Thank you for your response and all your articles. Back in January, I believe, your views on Net Intangibles brought me to sell APPS @ ~ $55 and preserve a big profit. :)
Thanks for this, Joachim. Three related thoughts:
1/ Perhaps I misremember, but I recall that you wrote earlier about research showing that sector momentum is caused by flows and price moves in individual stocks are caused by HF analysts spotting mispricing.
2/ Robert Armstrong (in today‘s FT) points to research showing that trading volumes matter: high-volume stocks exhibit short term momentum and low-volume stocks show short term reversals.
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3150525
3/ Another paper via Armstrong: value is mean reverting, growth trends
https://verdadcap.com/archive/trend-following-in-growth-and-value
Yes, the volume thing is something that was in the Versand newsletter yesterday, so today it is in the FT. I wrote a out that a year ago: https://klementoninvesting.substack.com/p/short-term-reversal-or-short-term
I stand corrected: you were the first to spot this!
And you‘re right, in that the diffusion of new ideas does appear to follow a more or less predictable path: researcher —> SSRN —> a newsletter —-> the general press
And here is something related to the night effect; https://www.nightshares.com/