Please talk me out of buying ship stocks like $DAC

I haven’t purchased a single ship stock in over a decade (and for good reason) but dayrates on the small container companies are climbing. Companies like Danaos ($DAC) are up almost 30% for the month. Hell, even a few American companies like Matson ($MATX) is soaring to new highs.

What could possibly go wrong?

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Your job is in shipping. You are already overweight ships. Look for something diverse.

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DAC doesn’t look that bad really. The 50 day simple moving average shows the price moving up & the 200 day SMA looks like it finished its leveling out phase to start climbing too. The RSI (Relative Strength Index) that shows if a stock is overbought, neutral or oversold is kind of high for me but the Earnings Per Share is really good at $6.24 per share. It opened Friday at $10.80 & the after hour close was $12.00 so some suave investors probably made 10% in 1 day. $12.00 is too close to its 52 week high of $12.43 for me & I wouldn’t buy in unless it was under $11.01 & then put a sell order for plus 10% whatever I paid for it. 10% in a few days is better that what most mutual funds will pay you in a year.

As CoastalTrader said & others agreed with, you are already heavily longterm’ed invested in the maritime industry & any further investments should probably be for short term gains & it looks like DAC can provide that if you want to risk it.

https://www.marketwatch.com/investing/stock/dac

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I could not disagree more with this sentiment. I believe in doubling down on what you know.

Maybe if I was young but not now with shipping being at the lowest levels in a lifetime. Shipping can’t go lower because it’s essential and because a little thing called physics prevents drones and space craft and tesla trucks from taking over.

I’m very bullish on ships (at least in the long term).

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As a suggestion, why not look into industrial suppliers like tire manufacturers, paints, glues and lubricants, heavy machinery suppliers not necessarily directly related to shipping?

I’m not a financial whiz, but I think you can make the same argument about passenger planes. People will start flying again.

I know the feeling. The oil business, however, cured me of it. I know that my returns suffered some because of over-confidence. I do believe that taking a flyer once in a while is good for the soul though.

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@john look at NPR’s Planet Money podcast and see how their experience buying Hornbeck Bonds went. It was pretty funny to listen to since they knew nothing about the industry, but still worth a listen.

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I heard that podcast! Who knew the bond market could be such a laugh? …Becky.

Well somebody’s reading this forum! :flushed:

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First thing, if there’s an investing app easier & more intuitive than Robinhood I haven’t found it.

I’m seeing it’s up to $13.25. It looks like my order for 91 shares at $11.01 will take a while to fill, maybe never. Yahoo Finance Community members say this shipping company is slowly being bought up by an asset management company called Cerebrus/Promontoria. Depending how much & how fast they are buying, this stock might stay up for a while.

OK now it’s making me nervous:

This bump is mostly due to coronavirus optimism viz the Moderna (regular refrigerator) vaccine.

Although the market is generally over-valued, IMO, there is one lesson to remember from the Great Recession: the more downtrodden stocks bounce back harder and faster because they have so much more ground to make up.

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I went for American airlines, 800 shares. The pandemic hurt airline stocks the most, and they will be one of the last ones to recover, but they will…particularly with the low oil prices. I’m not day trading, I’ll keep these for a little while. As a bonus, the government will always insulate the airlines through bailouts. The same cannot be said for shipping.

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TRAITOR!! :wink:

Never buy individual company stocks no matter the industry.

Why the hell not?

Since 2004 my entire IRA portfolio has consisted of one one stock: aapl

(And it’s done rather well thanks)

Because you’ll almost definitely perform worse than the market as a whole is you only own one company.

Nonsense.

Do you know how many crappy stocks are in the s&p500? Do you know how many get delisted every year (only after they loose most of their value)?

Why hold shitty stocks. It’s easy and comfortable to own an index fund but it makes zero sense if you map it out logically.

Not according to the credible academic research on the topic.