Links for Friday the 13th

Posted by: Ben Steverman on June 13, 2008

To start the weekend, here are some intriguing blog posts on the stock market and investing:

1. Bespoke Investment Group notes that, on average, the stock market performs no more poorly on Friday the 13th than any other day of the year. So disregard those rumors of a “Jason Effect.”

2. Jeffrey Miller, on the blog “Dash of Insight,” put together a page of his best blog posts. His goal is to provide some good resources for individual investors, and there is some good stuff there, including advice on how to avoid big mistakes, and how and when to listen to experts.

3. How much extra return to small-cap stocks provide, in exchange for the higher risk associated with smaller companies? How should value investors play the micro end of the market? James Picerno at the Capital Spectator has some interesting thoughts and reporting on a new effort to find undervalued micro-cap stocks.

4. Tim Sykes has an interesting post on TradingMarkets on the benefits of using limit orders rather than market orders. Eddy Elfenbein at Crossing Wall Street offers his thoughts, as someone who uses market orders.

It’s a classic debate among investors and traders, and I’d just add that some recent academic research seems to side with the market order crowd. As I noted late last year, the problem is that limit orders turn “stale,” especially when news breaks or sentiment shifts. Sykes probably uses limit orders in a way that limits this danger, but at least some evidence suggests many amateur investors use them incorrectly.

Reader Comments

Paul Blake

June 14, 2008 7:01 AM

I lost a lot of money last week due to the B&B share collapse. I have decided to go short on my Boral portfolio due to my technicals pointing to Boral Share collapse and I dont wish to get burned twice in a row. I suggest every one revalue their portfolios just in case.

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About

Bloomberg Businessweek’s Ben Steverman focuses on the latest moves in financial markets and emerging trends in stocks, bonds, and funds, always with an eye toward giving readers a better understanding of the sometimes confusing and often chaotic world of money. Standard & Poor’s senior index analyst Howard Silverblatt will also provide his take on companies’ finances and the markets. Voted one of the “Top 100 Finance Blogs” in 2007.

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