Stock Market 2020
Tesla?, Penny stocks?
Every time I hear a person (or financial article) tells a story about a stock that went up 50%-100% (or more), I always see 2 things come out of it:
1) Those who invest in those stocks more often wind up lose money than make money.
2) While those who look for another or similar stock that can generate 50%-100% (or more) the next time around, [albeit a penny stock that can go up&down 50-100% in a hour, a day], rarely gets lucky again; in the long run.
So the only things going for me are my investments to never bet against Technology or the Market (exchanges) overall: TQQQ & SPXL
Of course something like VTSAX is where most people should allocate most of their funds and just let it ride for decades.
But nothing wrong with playing with fun money.
You invest in those etf’s IF you want to make average market returns with an average market risk. You can’t do above average there. However, in other assets, you can get above average returns for more risk or lower returns for less risk.
I’m for lower risk right now.
Google hedging with options. Many common investors don't even know this is an option. Or short selling a stock plus puts... Putting your investment into a company that is failing and investing in the downward swing :)
Best of luck to you strangerdanger
team, I don't think so. We use the Atlassian suite at my employer. But will probably pivot from all of its offerings except for JIRA and Wiki.
Thanks Jacqui, that's what I thought. My issues is the time, effort, costs, and complexity. Sure, if you own a single higher risk stock, can be a safety net, but by the same token, can rob you of profits if your original stock pick is correct. Since all puts are time-based, these hedges put a self-imposed timer on all of your actions.
If you own a wide portfolio; it's a heck of a lot of work to lower profits IF you picked the right stocks. If I put the same effort in my original selection, isn't that better? It is to me, but each to his own.
Case in point: at the crash at the end of 2018, I dove in buying shares in a diverse set of over 30 stocks. First, I had the marbles to go all in during a crash. I was nervous for a few months. Within a quarter or so, I was setting stop limits at 10% on many, others to follow within the next quarter. That was my safety net: assured profit at about 10%, or slightly less. Now I could sleep well. Meanwhile, I choose stocks with 3% or higher dividends. My portfolio was safe, it took little effort to secure the assets, and I was making over 4% off the entire portfolio as it just rolled along without buying or selling anything. That took my 10% assured profit to over 14% guaranteed, in only a few months.
A year later, all was sold, unlike Frank's value going up 40% over three years of holding; my CASH was up over 30%, in my pocket, in my checkbook....and my only hold was Kraft/Heinz which not only suffered a bad quarter, but an SEC investigation which may still be ongoing. Like Frank, I may need to milk that profit for a few years as I wait to repeat the process but the cash is in my pocket or invested in much lower risk assets. That's a huge difference, I took the profit.
Yeah, a hedge could have helped, but with dividends, only 1 out of 30 buys being a dog, I'll take that risk over the cost of the hedge, a risk also. I even doubled down on the dog n the trough to be able to mitigate the loss by 50% because I believe that they will come back. After a year, I think I am in for a long haul. At least it's me and Warren Buffet.
So, buy low, sell high
But with dividends that exceed CD interest rates, 3% or higher
Copy experts like Warren Buffer or great 401-fund managers
Set stop limits when profiting for safety net
If most have the limits set, sleep well.
Now, within that I usually buy one or two "flyers," as in high rise potential and not paying dividends. On those I should probably use your hedge since more often than not, they do not succeed. It's just that, when they do...….
Again, thanks for the explanation.
Chinese Amazon. Already huge. Finally China is becoming modern. This could go up 10 fold in the next 10.years.
Earnings come out next week. Typically it crushes expectations and that should happen again I assume.
An 8 for 1 split had already been approved and will be implemented in the next few months...meaning if you buy 100 shares now, you will have 800 in June. Then the price wiall be low again, encouraging more investment. A very positive sign of a strong company. Plus they have like 40 Billion in cash sitting around.
China, now? While internet might boom Alibaba when no one wants to go out, and their current Q will probably be great; don't think next Q will be as sunny. Might want to pause until that effect is seen. Could get a deal.
My overall problem in Chinese companies is there is no Chinese SEC or formal bookkeeping checks akin to the scrutiny we have in the US. Thus, I might invest what I call "Atlantic City" money as in what I might lose if I went on a three-day gamble, but never a big nut. Worked last time as I rose and fell for reasons seemingly beyond revenues and costs. Never had a stock valued at "-" before :>)
China? Gambling? Try Macau exposure. Wynn, Sands in a few weeks. Might be good using as I call it, my "Monopoly" money.
When the taxi drivers start giving you stock tips, it's time to get out. Old maxim highlighting a barometer for overvalued stock market.
GDDY beat revenue, thus the chart. But they missed earnings, apparently no problem. Neither is a 100 point PE Ratio, go figure, overinflated internet stock with and easy-to-understand, easier-to-copy business model.
So did you buy, sell, or hold? I don't have any and don't follow the crowd very often. Raymond James was a major promoter of this rise; I dumped them as Fund Managers in 2018 because their "model" did not have a decent exit plan. By the end of 2018, I was proven right. Lemmings. It's a speculative, chaotic market right now -----> gonna see spikes and crashes for awhile. While not making big bucks right now, I am seeking shelter for a bit. So I'm just a lurker right now, how about you? Did you buy, sell, hold, or just watch, like me?
SD re: your "You invest in those etf’s IF you want to make average market returns with an average market risk. You can’t do above average there. However, in other assets, you can get above average returns for more risk or lower returns for less risk."
You're half right speaking of AVERAGE etfs making AVERAGE market returns -
But half missed (agreeing I did not elaborate or go into details on my TQQQ & SPXL) that you CAN get ABOVE AVERAGE MARKET returns from LEVERAGED ETFs, while providing *LOWER RISK* than (most individual or small basket of) STOCKS.
Like these: [3xs]
Something worth to add, along looking into Jacqui's "'Hedging with options" investment plan. Thanks and Best of luck to all
Oh come on, there are etfs and there are leveraged etfs. These have very different definitions. Like playing black on the roulette table or playing a black number and saying both are defined as playing black.
I would recommend etfs to almost anyone. I would never recommend leveraged etfs to average investors, train more and get more experience first.
Especially in an overvalued, inconsistent market like today. However, this will be a good day for me; the gimme shelter man. Could even trigger some stop limits today.
Leverged ETFs will amplify the gains and losses. If you are not comfortable, for instance, with options (who would be, its gambling), then don't invest in leveraged ETFs.
It’s really risk. Given the entire market and every investment is not a sure thing, each investment is a gamble, each with a different risk factor. Even FDIC backed CDs carry risk making the safest of investments a gamble.
Some “gambles” like covered calls reduce risk; thus the lower payback, some like leveraged efts increase risk, thus the “amplified” payouts.
And yeah, better know what you’re doing for these gymnastics. Fun to talk about though.
I originally bought GDDY a few years ago around the $26 mark and sold it at $64. Then I just pulled a swing trade buying it again around $64. Plus sold puts in the downward swing..
I just don't what to engage with you for you seem to know it all on every topic brought up on this site.. Can't even have a convo with you for you already know it all.. I gather google is your friend..
Not engaging is OK by me. No, I do not know it all. Yes, I do understand technically what you are doing; I do not need google for most of this, you're not quite that advanced yet... Not sure why you need a teachable moment from me, but I do not take the same speculative risks that you do. You seem to leverage or hedge most of your investments. I am simpler and less speculative. Down boring probably to you. I am glad all your maneuvers seem to be working so well. If I was you, I would continue since it seems to be working. Just the mere fact you bought recently at 64 is a sweet move, much less recently, much less to make it a profitable swing sale, so a great move.
So, how do you value these stocks to make these higher speculative investments? How did you pick the $64 target? I mean, did you just pick off the stock at 64 on a hot day at the perfect moment, did you have an order in place already, and what made you pick 64 ----- especially given you just sold at 64? I have been searching for a targeting model, formula, valuation model, and google ain't gonna help with that. If you don't want to continue, that's OK, makes sense to me. No one else wants to tell this deep dark secret either.
I was thinking the same thin Jacqui
Where do you all do your trading? Is there a website? Do you employ stock brokers for yourselves and do everything via phone call/emails?
Yes to all. I have used everything from brokers I can call to financial websites to roll-my-own to professional money managers doing everything.
I dropped the managers and the brokers and just use Fidelity’s website mostly right now. I get a lot of human support there, if needed, but they are support, not making picks. Seems to be the new trend to provide human support for process and definitions, but not selections.
I also still have some certificates and buy some funds direct from the fund managers like Threadneedle, Alliance Bernstein and the like. Some of these are weird things like preferred offerings. These are real long term things that I don’t change much.
Hang on to your hats, gonna be a bumpy ride today. I may be selling and buying at the same time. Maybe even the same companies over two days — you never know ;-)
I should add that the services I dropped, like personal managers, I may pick up again. I just tend to rotate when the spirit moves me. They all can be good, it depends, at least in my case.
Not really... my “unrealized” gains have been chopped, but I didn’t sell anything off. Actually bought like $18K more and will keep doing so. I’ve got a couple decades before I need to cash out.
Buy on the way up, not on the way down. Already out, will wait later for a good time. Stocks bought yesterday are already down a record amount. Tomorrow is another day to have trading halted. Some time in a few months is the time to see where we're at.
GC; I’d say that’s an “it depends.” You can make more money day trading on the roller coaster if you have the guts and some luck. Did 30% that way around 2009 but was pissed, thus motivated.
This time I’m with you for a number of reasons and looking for the far side of the trough if we make it there. China will be a good barometer in that they are 2 months ahead of us. Amazingly we just hit my equities targets based on my 2018 purchases that did me so well.
Still making money now but not much but which was the plan to begin with. A lot of fixed assets. My bond funds that skyrocketed have gone a bit south but with dividends still holding head above water. That liquidity / QE thing was unanticipated.
Don’t have much equities now, most auto sold at a nice profit with trailing limits. And the ones remaining are blue chip with 5% dividends —- maybe 10% now, ouch.
Check out Pure Biosciences (PURE). I've had it for a while and has not done what I expected. Basically they make non toxic disinfectants that kill everything from Ebola to flu to Coronavirus. It also kills food bourn illnesses like salmonella so is used to spray on food like chickens, produce, etc. Well, long story short, it's the only thing I have making money right now for obvious reasons. It was just added to the list of things that kill COVID-19.
US COVID cases top 50,000 yet the Dow recorded its biggest point gain ever. Something is out of sync here...
^ Today’s gains are due to the expected signing of the stimulus bill.
Next potential for the market to drop will be Thursday after the job numbers come out.
"US COVID cases top 50,000 yet the Dow recorded its biggest point gain ever. Something is out of sync here..."
It's because of the stimulus package.
At BEST, it’s a roller coaster on a downward trend still. Stimulus is one thing, not working is another. Lots on investors just maximizing on the ups and downs. Day Traders time.
This will take some time, probably years to recover. Taking my time to get back in. Although my OLN is hanging in.
The market has certainly not bottomed out yet. The next wave will come when forecasts for GDP come out and earnings from Q1 are released. It could be a bloodbath. Do your research and tread carefully.
Sounds good - thank's for the info
but trying to look up when we'll know, this site is saying the GDP #s don't come out until April 29th for an 'advanced estimate' with a final on May 28th?
I gots to jump in sometime earlier than that....even if I take a little bath then;
since my gut says something has to make this world better prior those dates.
Lol since IDK, so GL !
Right now we are in the making a tsunami of bad news economy wise. It is a viscous cycle when mass numbers are out of work, they buy less, pay less, and on and on and on. This is why the government is pushing all of the aid, if our economic machine stops it could take a decade or more to rebound...
Now China is going back to work but the rest of world has not only stopped ordering, they are trying to cancel existing orders and delay payments on goods received but not paid for...….gonna need some real deep pockets to survive this one.
Anybody have stock in condoms?? If there really is a shortage those sales are gonna sky rocket quick.
Not sure what you mean on that last one ijay?
I agree it could take 10 years to come back, especially to an over valued, overheated market like we had. Plus the world will be under extreme debt with us as the queen of the pigs. We already banked 1T this year under the great tax cut, now over 2T on top of that. If we survive our current status which is far worse than where we were in 2008, I do think we will come back faster than The Great Depression or our more recent Great Recession. But right now, we are in deeper than we have ever been before. Way deeper. China may be our saving grace.
Today, mixed market in futures, trying to figure out which way to go before the bell. Roller coaster continues. Bonds are back due to stimulus/QE. Yippee for me! For now. Maybe. Sigh.
It might not take 10 years, it could take much less -- even a year or two. We don't know yet if the job disruptions are permanent or just temporary.
Regarding China, they currently rely on foreign trade so they will ship goods.
I first thought he meant to say 10 months, not 10 years --- However, even your a year or two is missing the biggest decider, the election in November !!! :) or :(
If Biden wins, I'd add 4 years to your 1 or 2 (and not knowing if he'd seek to be reelected or even if another republican wins after Biden's first term), I doubt he/she'd bring 'making america more great or better' after Biden, where then I'd have to agree it most likely take 8-10 years to get back to a similar Bull market run (defined with another booming economy).
Since remember, all/any policy from a Democrat is NOT to bring in Business/Capitalism/$, it is always to GIVE more Regulations/Socialism/Free$ (that never solves or motivates them to work hard or work harder to overcome their own hardships) --- that hardly boosts firms to move higher, create jobs, motivate people spend, move a class up on their own, etc.
Not being political about who's on watch or how we have so far fought this war as a nation (not), but if you review the facts as to who has brought us out of these things over the years, I think the facts dispute your theory. Think of it as supply side and demand side to take party politics out of it. Note that we are now setting many records and not good ones. We are economically following a demand side playbook not invented here injecting supply side mechanics into it.... Just saying. However...I will note that perhaps the safest route is split govt between Congress and the President, don't matter which is which. That's what history says. Now, it may just be luck, timing, but.....here's the tale of the tape.....and why: https://www.thebalance.com/democrats-vs-republicans-which-is-better-for-the-economy-4771839
The Balance rates Least Biased, High factual basis by media bias, fact checker....
That said: historically iJay is correct in the decade theory based on recessions/depression. The Great Recession taking 7 years or so to really feel good is our latest example. That said: this is different. While a recession was warranted, was expected, this is not a normal recession. Will that change things? Who knows.
The Great Depression lasted ten years but we didn't have the financial tools nor skills that we have today. The Great Recession (2008) technically lasted for 18 months, but wouldn't most of us say it felt like 7 years or more..... Thus IMO, Ijay could be correct.
In the end, IMO, as a monetarist, it's all about money. As I have said many times before, at the simplest level, recession is just a lack of money and inflation is just an excess of money. Without enough money, we don't buy --- recession. With too much money, we are willing to pay more: inflation. By money, I mean that which we can not measure. And that's the rub. IOW, the Fed can only approximate the true money supply using M1 and M2 and does not even count M3. Also, they don't print money anymore to inject into the system, many digital forms are used, each of which has a different money multiplier attached to it. So while my monetarist definition is simple, application is beyond extremely complex. Thus, end-ith or start-ith the lesson :>)
That said, tyvm Mr. President for the QE; my tanking bonds, are still tanking but given dividends, probably breaking even as of yesterday. TY TY.
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