Money Forum World

Amado · Joined: 08 Nov 2007 Posts: 2098

I have been losing lots on shipping stocks over the past week, but today I took by far the biggest hit. I invested in the stock DRYS yesterday and today it dropped 22 points on me. am I supposed to just pull out or stay in there? I dont really have anymore money to invest and could either pull out and take big losses of about $40,000 or can be purchase 300 more shares of the stock and expect it to go up to cut my losses and maybe make a profit . The stock is said to be very overvalued, but I never projected it to take that big of a hit in that short of a time.

Jonathan · Joined: 08 Nov 2007 Posts: 2155

General consensus at conference says shipping rates have to come down..
check here: shipping.capitallink.com/
As far as the investment goes, its so hard to but these shippers have been very unstable up also as down.I surely could give it some more days/weeks to re coup some of your losses.buy those not many more shares only if you see an upswing.

Chris Black · Joined: 08 Nov 2007 Posts: 2207

Jebediab is correct. But dont sell now.. Jim Cramer says that the shipping fees may drop shortly, but will go up longer term. there's &amp, will be a shortage of the real dry ships for some significant time which will give these shippers pricing power.

That said, &amp, I dont mean to dump on the questioner, but you really should have seen this one coming.

The dry shippers have had a big, fast rally. If you're early to such a rally, great. Then a sudden drop cuts into your profits, but losses are typically evaded.

If you're late to such a rally &amp, you chase it, Watch out. If you chase it with big money, then you're a fool. Hot money investors need any silly excuse to sell and take profits, cause they got in early.

If you have to chase a rally, invest small, so you may be able to double down after a big drop, without committing a big fraction of your investable cash.

Jared Chang · Joined: 08 Nov 2007 Posts: 2086

Jim Cramer wouldnt know a ship if one ran aground in front of his beach house dont you people understand that hes an entertainer, not a financier? DRYS and the other members of the BDSX Index fell because the Baltic Freight Index, which measures voyage charter rates for dry bulk ships, fell by 1% yesterday and another 2% today. And investors who dont understand the business and its history are freaking out. The bottom line is, if you dont know why you bought the stock, you may want to sell it now.