Analysts, Downgrades and Bull$hit

Hey folks,

You know, I haven't been doing this for a long time. I first started trading and investing in March of '05. Although this classifies me as a newbie trader, it has no negative effect on me as a guy who pays attention to the details. I am talking about the way that Analysts and brokerage firms maliciously manipulate stocks with out-of-the-blue and perfectly timed upgrades and downgrades just for the sole purpose of accumulating and dumping shares. I have noticed this many times and it disgusts me each and every time. Now I will admit, there are a few times when an analyst or brokerage firm issues an accurate and well deserved buy or sell recommendation. But still, these accurate thumbs up or thumbs down, are way too far and between and without a doubt, drowned out by the sea of falsified recommendations fueled by nothing more than their big clients greed and failure to grab a stock early enough.

Need an example? Take a look at UARM.

Or how about PLXS? PLXS has been downgraded 3 times. Yes, 3 times since November, by 3 different Brokerages! And still, despite these downgrades and sell recommendations, the stock has reacted quite well. Its funny how the brokerages were yelling sell and yet buying 6000+ share blocks of the stock. Gimme a break! They are not the ones negatively impacted by these malicious sell comments. Its the unsuspecting, inexperienced investor/trader that becomes the sucker that sells his stock in fear of losing money. Its the average trader/investor that ends up getting the loss, while the institutions snap up his or her shares on a discount! Gee, thanks alot!

The best advice that I can give to new investors or traders, is to pay attention when researching a stock. Take note of earnings, and quarter results. Because some stocks are cyclical, their earnings will vary from quarter to quarter. For instance, if a stock typically has a slow 4th quarter, year after year, then it may be a good idea to sell before the 4th quarter results and buy back later. Now if the stock has had some significant revenue increasing changes or hot new product that can positively affect that usually lack luster quarter, then by all means hold onto it.

All I am saying is, you should be in charge of your own buy/sell recommendations. You shouldn't allow someone else to make or influence your decisions. These analysts are not looking out for your best interests. They are looking for their firms best interests. So do your on R+D and always make an entry/exit plan or strategy for every trade or investment. This can help you stay focused and eliminate some of the emotional stress that can often cripple new investors and traders.