Your Daily Bit of Wall Street Wit & Wisdom

Stockbroker tie

Detail from my father’s stockbroker tie

“Remember, your goal is to trade well, not to trade often.”
— Alexander Elder

I concur with Dr. Elder.  My father, Paul Sarnoff, was fond of saying in his Brooklynese, “Sometimes da bulls gotta get fed and sometimes da bears gotta get fed.  But da brokers eat wheddah da market goes up or down.”

Accentuate That

When I first went west, in the early-1980s, people made a big deal of my New York accent.

I shook my head, “What accent?”

One morning, after I’d been in Idaho for a while, I was on the phone with my dad and asked him about my brother Mitch being in New York City, down from his home in Rhode Island.  What I heard, kinda shocked me, “He met ya muddah fer lunch at some jernt uptown.”

I was taken aback, “muddah,” “jernt,” what an accent!

I guess there’ll always be a little New Yorker in me.

For thirty years now, our approach at Options Hotline is that the only ones sure to profit from doing a lot of trades are the brokers.

Any way you say it, we strive for quality over quantity.

This week’s action should reveal some valuable information about the market’s intended primary direction.

I hope you enjoyed my little story.

Best regards,

Steve

Your Daily Bit of Wall Street Wit & Wisdom

Cartoon from the Wall Street Journal

Cartoon by Bo Brown, h/t Wall Street Journal

No, I don’t have a crystal ball. Run from anyone who tells you they know what the markets will do.

Yes, back in another century, I did start out drawing my Japanese candlestick charts by hand.  It was a good way to develop a feel for the price movement of stocks and commodities.

Besides the hand-drawn charts, something else jumped out at me from this vintage cartoon.

Note the absence of women in this snapshot of a bygone era.

Some things have changed for the better, but there is still much work to be done in regards to closing the gender wage gap.

Best regards,

Steve

Wednesday’s Bit of Wall Street Wit & Wisdom

The Sub Treasury Building (now Federal Hall National Memorial) and the statue of George Washington, opposite the Stock Exchange in New York in October, 1929.

by Steven Sarnoff

Selling is setting the tone to start the year in pre-market trading.  Because of the holiday-abbreviated week, today feels like a Monday.  Following, you’ll get two for Tuesday on a Wednesday!

This bit of simple wisdom may be among the most difficult for traders to learn:

“Markets are never wrong; opinions are.”

— Jesse L. Livermore

As a chartist and technician, I am particularly fond of this Japanese adage:

“The chart is never wrong; only the analysis.”

Two bits of personal trivia:

My first job on Wall Street was as a runner (messenger) in the early-1980s and I used to eat lunch on the steps of Federal Hall.

My father, Paul Sarnoff, authored a biography titled, Jesse Livermore Speculator-King, published in 1967.

As Options Hotline begins its 30th year of publication, we’ll continue to tune out the noise and use our charts to focus on what the market is telling us.

Best regards,

Steve

 

Your Daily Bit of Wall Street Wit & Wisdom


Kristen Visbal’s Fearless Girl facing the New York Stock Exchange

by Steven Sarnoff

Happy New Year!

In my last Options Hotline social media (facebook, twitter, linkedin) post of 2018, I shared with readers the important idea that traders must not confuse Simple with Easy. Having done that, it sparked a notion that in this new year you might enjoy and benefit from a bit of wit and wisdom to start your trading day.

Even though the market is closed today, let’s go with:

“I will tell you my secret if you wish. It is this: I never buy at the bottom and I always sell too soon.”

— Baron Rothschild

Let me know what you think.

Wishing you good health and good fortune in 2019!

Steve

Animal Spirits In The Stock Market

h/t NatGeo

by Steven Sarnoff

Note: The chart within is updated from my original article, which appeared November 21st on other media platforms.

When I was young my father would enjoy telling me a fable, “The Scorpion and The Frog.” With Financial Talking Heads debating whether stocks are still in a bull market or now a bear, I hearken back to that tale.

Continue reading

Value, What A Concept!

value

by Steven Sarnoff

Just a week after running over Ford, Tesla today overtook General Motors for the number one spot among US automakers for market value based on stock market capitalization.  Tesla’s drive higher has sparked renewed debate about the concept of value.

Differing opinions make markets. The financial media features many Wall Street analysts flouting Tesla’s share price rise, calling the stock clearly overvalued. Elon Musk, Tesla’s chief executive officer, couldn’t resist schadenfreude by trolling and throwing shade at short sellers with his, “Stormy weather in Shortville…” tweet.

Continue reading

The Role Of Luck

tumblingdice

by Steven Sarnoff

When people find out what I do for a living, they invariably ask what I think the market is going to do.  I politely tell them that if I knew what the market was going to do, I wouldn’t have to work.  If you ever encounter someone who claims to know what the market is going to do, zip your wallet.

In option trading and in life, luck plays a featured role.  We are practitioners of uncertainty. Somewhere back in the mid-1990’s I recall seeing Alec Baldwin interviewed on the show, Inside the Actor’s Studio. He was asked to describe what acting was like to him.  Baldwin answered that it was like repeatedly banging your head against a door and then, it’s all up to luck. Continue reading

My 9/11 Story

freedom_tower

by Steven Sarnoff

On Sunday, September 9, 2001 I told thousands of people to bet that American Airlines was going down.

And on this solemn day of remembrance, marking the 15th anniversary of the terror attacks, I recall my personal story from that tragic time to give you a smile as we move forward in life…

You know what happened on the ensuing Tuesday.  I really felt like a New Yorker that day.  Back in the eighties I worked in the World Trade Center, amid the open outcry bedlam of the gold and silver trading pits. Flashing forward, we had taken a family trip to NYC and brought our two wide-eyed young kids to the top of the Twin Towers in April of that fateful year.

When trading resumed I started receiving emails like “Dear Mr. Sarnoff, I made $250,000 in one day on your American Airlines recommendation, but my account in the Cayman Islands has been frozen by the government.  What should I do?  Please advise.  Many thanks,…”  You may picture me pushing my chair back from my desk and throwing my arms skyward in the international signal of surrender!

Then I saw Dan Rather on television reporting about how the terrorists were suspected of using the options market to profit from the 9/11 attacks.  I imagined my subscribers getting grilled by the FBI and testifying, “Sarnoff told me to do it!”  So I waited for my phone to ring. Continue reading