Don't Noonan
Footballguy
feels like capitulation today
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Stock Thread (22 Viewers)
- Thread starter St. Louis Bob
- Start date
siffoin
Footballguy
Times like these are difficult. And I think the answer always comes back to: Do you really have a plan? What is that plan? Are you following that plan? And what are the reasons or situations for you need to make modifications to that plan. THIS is what this thread should be all about!
Most people can get away without having a plan in place for most of the time. Why? Because most of the time the market is going up. And it's especially easy in a wildly bull market- dare I say the most bullish market that will be in the rest of your lifetime. They attribute the gains in their portfolio to their own mastery of the market. When the market turns against them they seek answers as to the who, why or what. Not looking inward to the real answer: lack of a thought thru plan. A plan allows a person to navigate in any type of market condition. And from experience (shared experience) one can learn then modify from the lessons learned.
Humpback asking the question: How much of this bull market gains do we give back? To me this is a great question to ask and deserves conversation with arguments about buying or selling $XYZ at certain levels. Someone gloating "Look at me, I'm the person making money today": on a down day, in a down week, in a down month, in a down quarter, in a down year to me re-affirms the reasons to just stay away from this thread altogether.
I'm not picking on anyone here. But if you go re-read the thread it wasn't long ago comments were: "I'm in it for the long haul"; "If $XZY drops to $____, I'm all in"... Perhaps now is that opportunity you so hoped for...but where is the conviction...was that really THE plan? What's changed?
I'm certainly not without my investing/trading flaws. However, in this particular market I feel I've been navigating according to plan with pretty good skill - especially on the LT time frame (mostly good - as I did think we'd have a decent bounce back towards $SPY $280 at the low on Dec 10th- which was dead wrong- so ST time frame was definitely off).
To me the questions that need to be answered is:
As always - as the year closes I would wish everyone (well most everyone) good luck in all your investing decisions.
* (Sand's politics and football team fandom are terrible and to me you should completely ignore his nonsense and character weakness in these areas )
**( Sand you know I'm just giving you shiz here...it's not uncommon for me to find myself in your neck of the woods and I think...Oh I should call Sand up and have a beer).
Most people can get away without having a plan in place for most of the time. Why? Because most of the time the market is going up. And it's especially easy in a wildly bull market- dare I say the most bullish market that will be in the rest of your lifetime. They attribute the gains in their portfolio to their own mastery of the market. When the market turns against them they seek answers as to the who, why or what. Not looking inward to the real answer: lack of a thought thru plan. A plan allows a person to navigate in any type of market condition. And from experience (shared experience) one can learn then modify from the lessons learned.
Humpback asking the question: How much of this bull market gains do we give back? To me this is a great question to ask and deserves conversation with arguments about buying or selling $XYZ at certain levels. Someone gloating "Look at me, I'm the person making money today": on a down day, in a down week, in a down month, in a down quarter, in a down year to me re-affirms the reasons to just stay away from this thread altogether.
I'm not picking on anyone here. But if you go re-read the thread it wasn't long ago comments were: "I'm in it for the long haul"; "If $XZY drops to $____, I'm all in"... Perhaps now is that opportunity you so hoped for...but where is the conviction...was that really THE plan? What's changed?
I'm certainly not without my investing/trading flaws. However, in this particular market I feel I've been navigating according to plan with pretty good skill - especially on the LT time frame (mostly good - as I did think we'd have a decent bounce back towards $SPY $280 at the low on Dec 10th- which was dead wrong- so ST time frame was definitely off).
To me the questions that need to be answered is:
- How do you determine Risk V Reward? (This is the #1 first step- if you don't define risk from the beginning your f'd- whether that be today or sometime in the future. Leave risk undefined and you're f'd- oh and if you think trailing stop losses are the answer - they aren't - TSL's are terrible in a down trending market. Once you decide to put on a TSL in a down market... just sell it instead, because the TSL is going to get hit 9/10x - )
- What is the trend of the market (bull or bear) (this is a question to ask every day, week and month)? (this is technical analysis - reading a chart - and it's not hard - hell a child could look at a chart and determine if price is generally moving up or down - no fancy indicators needed.)
- How to define value? (this is fundamental analysis - what are the best methods backed by hard historical data )
- Trend:Value can then determine what to buy and when to buy (or sell). I have said this for years here: Use Fundamental Analysis to tell you what to buy (or sell) and Technical Analysis to tell you when to buy (or sell) it. If you aren't doing this...you f'n up.
- How to properly allocate a portfolio and how and when to make changes to that allocation? (honestly this is where I feel I was most weak a number of years ago and people like Sand gave a lot of information which I've applied towards a level of Mastery and that has served me quite well in the past year. Am I perfect? NOPE - but he and perhaps other people have a level of expertise and we should ask and learn from him/them - and then explore, back test, etc)* (**)
- Future Forecasting: Basically what MIGHT the opportunities of the future be? What are potential stumbling blocks? How does one take measured risk, and how is that risk defined within a time frame that extends years perhaps decades? I'm a big believer in trying to hit home runs and that some small portion of your overall investing portfolio be allocated to just that. Ideally I want to risk $1 and make $10+. That's a risky proposition and Future Forecastings' role is to minimize that level of risk.
- Tools: There's long stock, short stock, options, futures, forex, cryptocurrency...and just like anything else there is a time and place to use each of these and reasoning behind them. Sure you might need a "hammer" to build your financial house but a hammer alone will build a house with inherent weakness and flaws. What are the strategic methods for deploying these tools to maximize reward and minimize risk? People here are resident experts on certain tools - perhaps they could serve us all by sharing that.
As always - as the year closes I would wish everyone (well most everyone) good luck in all your investing decisions.
* (Sand's politics and football team fandom are terrible and to me you should completely ignore his nonsense and character weakness in these areas )
**( Sand you know I'm just giving you shiz here...it's not uncommon for me to find myself in your neck of the woods and I think...Oh I should call Sand up and have a beer).
fantasycurse42
Footballguy Jr.
I could see a bounce since technically we are oversold, but anything meaningful will be sold, imo.
Trump threatening a shutdown without his wall money too. To me, he’s getting frustrated and is going to start saying “#### it, I don’t care anymore!”
That can be scary.
Capitulation probably needed but at this point, anyone selling is going to be buying back in higher or swearing off the market completely.
Don't Noonan
Footballguy
I always tell people if you sell in a panic like today, what will be the trigger for you to buy again? 5% gain, 10% gain, etc. Most likely with no plan they will still be sitting in cash and miss the bounce.
culdeus
Footballguy
You are using two metrics here. One is absolute dollar figures, and the other is %. You can't at the same time say an absolute dollar figure is the metric and then lampoon a %. And his point isn't the rich are not winning, it is that on a % of total wealth basis the poorer have much more and are losing more.Yes I did. I actually watched his segment on it last night too. While that might be true, the super wealthy are losing A LOT more money than anyone here right now, I don’t consider that winning
Furthermore, markets move fast, tides turn quick. They’ll have to pay penalties for early redemptions if they decide the time is right to get back in, reducing the yield further.
The wealth gap will shrink in a bear market, it doesn’t take an economist to run simple numbers like that.
Also, the highest CD I’m seeing for a 2 year right now is 2.8%. Based on the spreads between the 2/5 T Bills, I’d imagine there isn’t much of a premium on 5 anyways.
Lastly, almost nobody wins in a bear market, so it’s foolish to say the rich are winning.
It's the same argument about Bill gates picking up a penny, it's not particularly helpful at times like these but here we are.
culdeus
Footballguy
fantasycurse42
Footballguy Jr.
My whole point is this guy is an idiot.
His whole premise here is to get people fired up, for whatever reason.
Regardless, this isn’t really relevant to what we do with our money.
fantasycurse42
Footballguy Jr.
I don’t think Trump is leaving, and if he does, I’d think he goes down in a hellfire blaze.
I have no idea where Pence stands on anything. Isn’t he a super conservative? Honestly, outside of trade/tariffs, I try to not let politics muddy up my investing.
I have no idea where Pence stands on anything. Isn’t he a super conservative? Honestly, outside of trade/tariffs, I try to not let politics muddy up my investing.
I would say "no" but who knows. Gotta wonder how many Republicans are simply going with it because Trump is the President.
Who's to say today is a panic? If you would have told them that in any of the numerous prior "panics" we've had over the last ~2 months they would have saved a ton of money so far.
I also think it's a mistake to assume we get a sharp bounce once the bleeding finally stops. We did for all these years because we had the Fed put to fall back on, but that's gone now.
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St. Louis Bob
Footballguy
St. Louis Bob
Footballguy
Sand
Footballguy
Yep. Right now I'll hit 30 days tomorrow and will tax loss harvest again - out of QQQ and DIA and back into IVV. No way anyone should sell permanently with this sharp a drop. These things usually overreact and bounce (if you're gonna sell permanently this thing will most likely bounce at some point). I believe that the algos have really magnified these moves up and down. Maybe I'm just
. Obviously the question is after a bounce (hopefully) - is it a rubber ball or a dead cat?This market is particularly frustrating when you look at asset classes:
- Domestic stocks - down
- Foreign stocks - way down
- Emerging markets - way down
- Real estate - down
- Long bonds - down
- Commodities - down, particularly oil
- Gold - flat
Ok. Now you can rag on my politics all day long, but throwing water on my Saints is way over the line, bub.
You're welcome to ring me up anytime.
fantasycurse42
Footballguy Jr.
This
Powell changed the game, Fed no longer has the markets back. I think it’s going to take months for the market to fully digest this.
Simplest analogy is steroids, market has been hitting the weights on juice for a decade, going to be a major adjustment that takes time getting off the sauce.
Regarding capitulation, first off, when we really capitulate, it won’t be like today, it’ll be a soul crushing day that sees the major indexes fall at least 5% during the day. Not comparing now to 2008, just using it as the last real bear market as an example. One could’ve said we capitulated when BS went under, then when Lehman went under, but it didn’t really happen until over a year after BS and 6 months after LB.
fantasycurse42
Footballguy Jr.
And watching the Nasdaq tick by tick right now is pretty crazy. Looks like a war to me with the bears trying to close it in bear market territory.
It’s been over a decade since they pushed this index into a bear market close. It didn’t make it that low in early 2016, right?
It’s been over a decade since they pushed this index into a bear market close. It didn’t make it that low in early 2016, right?
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St. Louis Bob
Footballguy
Happy Holiday's and my best to all of you.
SLB
SLB
Shula-holic
Footballguy
Got my entire 2018 401k and match to put in still for the year. Feel like now it’s trying to catch a falling knife. I have to put it in at some point but every day the pricing gets a little better
dickey moe
Fingerpicker
fantasycurse42
Footballguy Jr.
Bulls defended the close, not a “bear market” for the Nasdaq as of now.
ETA:
To officially be in a “bear market” by the definition, the Nasdaq is only 21 points away. DJIA is about 1,200 points away, and the S&P is about 112 points away.
Russell 2000 is already there, down 23%
ETA:
To officially be in a “bear market” by the definition, the Nasdaq is only 21 points away. DJIA is about 1,200 points away, and the S&P is about 112 points away.
Russell 2000 is already there, down 23%
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I agree that these things usually overreact and bounce, but I don't think we are anywhere near the point of overreaction yet. I also agree that algos have magnified the moves, but as you said, that applies to upside we had as well. I think another factor that magnifies the moves is debt and monetary policy- both provided huge booms on the upside, very likely to exasperate the current decline.Yep. Right now I'll hit 30 days tomorrow and will tax loss harvest again - out of QQQ and DIA and back into IVV. No way anyone should sell permanently with this sharp a drop. These things usually overreact and bounce (if you're gonna sell permanently this thing will most likely bounce at some point). I believe that the algos have really magnified these moves up and down. Maybe I'm just
This market is particularly frustrating when you look at asset classes:
So, yeah, the plan is to keep earning money and throw it into the market. And try not to puke when reviewing my portfolio. Stick with a middle of the road equity exposure, even though personally my 10% foreign and my energy exposure has made my YTD performance relatively lackluster. I'm still beating my benchmark by .3%, but that's a pyrrhic victory at the moment.
- Domestic stocks - down
- Foreign stocks - way down
- Emerging markets - way down
- Real estate - down
- Long bonds - down
- Commodities - down, particularly oil
- Gold - flat
Ok. Now you can rag on my politics all day long, but throwing water on my Saints is way over the line, bub.
You're welcome to ring me up anytime.
Don't Noonan
Footballguy
Market expectations are way down entering 2019 compared to the start of 2018. Sure, the Fed is not going to be easing anytime soon but if Powell suddenly decides no further increases are needed instead of 2 the market will jump. Further, if U.S. and China come to a trade agreement that will be another big catalyst. I don't blame anyone for staying on the sidelines but for long term investors it is a mistake.
St. Louis Bob
Footballguy
Remember when I lost all that money in TVIX? 
Of course moving mostly out of stocks is 7-8x of a return than those losses but it would have been a really Merry Christmas if I would have timed it better.
Of course moving mostly out of stocks is 7-8x of a return than those losses but it would have been a really Merry Christmas if I would have timed it better.
Brony
Footballguy
I've been looking at the patterns of the most recent year vs. the crash of 2008. Here are the 2 side by side with 2018 normalized by 60% to give a better visualization.
https://imgur.com/a/oNUV7OO
Not saying that this will follow the same pattern, but it is interesting how the 2 compare.
https://imgur.com/a/oNUV7OO
Not saying that this will follow the same pattern, but it is interesting how the 2 compare.
Don't Noonan
Footballguy
Market expectations are way down entering 2019 compared to the start of 2018. Sure, the Fed is not going to be easing anytime soon but if Powell suddenly decides no further increases are needed instead of 2 the market will jump. Further, if U.S. and China come to a trade agreement that will be another big catalyst. I don't blame anyone for staying on the sidelines but for long term investors it is a mistake.
This is totally different. Don't try and compare the 2. The 2008 crash was epic yet quite obvious when you give out 125% loans to people who can't afford 1/4 the actual loan. When a house valued at 35000 goes for 100k, bad things are gonna happen. When people quit their real jobs and start flipping houses, bad things are gonna happen.
As far as capitulation, there doesn't even have to be capitulation. This can continue to drain towards 2100-2200 with a dead cat bounce that fools some and takes more of their $. Then we can start back up with every selloff during that rally making people scared to buy until we are back up 10% or more higher than we are now.
The Elliott Wave trader room says that this goes back to S&P 2900 or so at sometime in 2019 in a months long rally. However the main analysts all seem to not be at all interested in going long until at least 2350. Lastly, I want to remind you that once this a-wave completes, I will be looking for a multi-month b-wave rally to take us back up over 2800, and it can even take us up to the 3011 region.
skycriesmary
Climbing up the Walls
I hear ya. I'm down a total of about 10k from all of my bets to the downside this year. I sold those bets in May/June. I didn't have the stones to hold, but I'd be up nicely now if I would have. Enjoy your holidays, GB.Remember when I lost all that money in TVIX?
Of course moving mostly out of stocks is 7-8x of a return than those losses but it would have been a really Merry Christmas if I would have timed it better.
Market expectations are down for good reason, that doesn't mean that they won't continue to go lower and/or miss those lowered expectations. Not only will the Fed not be easing anytime soon but he made it clear that they will continue tightening for the foreseeable future. It isn't about an extra .25 or two, that's next to meaningless, it's about the $50 billion per month of liquidity it's pulling out that is a bigger issue. Again, when they were adding liquidity it fueled the upside, now that they are removing it it's going to have the opposite effect.
What if we don't come to a trade agreement, or, as seems more likely, there aren't any meaningful concessions? Even if they do actually get a deal that is more favorable for the US, if it takes several months to happen, at the rate we're going the market could very well end up much lower than it is now when all is said and done.
Most of the potential positive catalysts seem more likely to be just stopping the pain that they've already caused more than an actual net positive.
Warrior
Footballguy
Seems like cherry-picking. Go back twice that far and see if they look even remotely similar.
I do as well, but the thing that's in the back of my mind is how likely it is for the Dem's to pretty much have carte blanche after the next election. For all of Trump's warts, and they are numerous, he has been pro business and pro market (at least in the short term). How is the market going to react if/when the next POTUS/Congress raises taxes (on businesses, the wealthy, capital gains), increases regulations, etc.? It wouldn't shock me to see them not only undue his policies but shift to the other extreme and go beyond where things were before.
Sand
Footballguy
The difference was that for one we had the US govt. stepping in to keep the entire system from locking up. Right now we have a booming economy with record low unemployment. That doesn't mean valuation wise we can't see a downturn like now, but I'm not scrambling like I was back then. Now I'm just holding tight.
GoBirds
Footballguy
I think the market needs to check this box so we’ve had our “bear market “ I wouldn’t be surprised to see a good bounce back after but think we need to hit this threshold.
GoBirds
Footballguy
fantasycurse42
Footballguy Jr.
IMO, we don’t see a floor until the data starts becoming painfully obvious that the Fed has to reverse course.
On another note, this is of concern to me. This is the one talking head I like to listen to. I’ve mentioned him before, Gundlach is my favorite.
https://www.cnbc.com/2018/12/17/gundlach-says-passive-investing-has-reached-mania-status.html
On another note, this is of concern to me. This is the one talking head I like to listen to. I’ve mentioned him before, Gundlach is my favorite.
https://www.cnbc.com/2018/12/17/gundlach-says-passive-investing-has-reached-mania-status.html
fantasycurse42
Footballguy Jr.
GoBirds
Footballguy
This is interesting as the herd is all heavy in the direction of index funds and it does seem like a mania but if these funds do tank as they own individual stocks won't these individual stocks tank as well? I don't see a contrarian solution besides get out of stocks altogether?
fantasycurse42
Footballguy Jr.
To add to this, the data is still pretty solid across the board. Sure, when GDP is over 4% like the high watermark earlier this year, it’s hard to replicate all that data, but just because it’s lower, doesn’t mean it’s bad.
At an FFR of 2.5%, I really don’t think Powell sees that as restrictive, so forecasting two more hikes isn’t madness. Bottom line, I don’t think we’re close to the Fed stepping in to save the day and the guy has all but telegraphed that.
With that being said, I’m putting together a bunch of tickers over the next week that I will start slowly scaling into for long term buy/holds. Some are dividend plays, others are growth, and some safety plays. I’ll post them and my thoughts behind them. Love to hear what tickers you guys like/dislike too.
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fantasycurse42
Footballguy Jr.
Everyone has been herded into it, he isn’t wrong about that. This guy is influential enough that Vanguard actually issued a response to his statement.
I don’t think we’ve seen a real panic yet, curious what happens if there is a real unwind with all of these funds.
fantasycurse42
Footballguy Jr.
Sand
Footballguy
As noted I nibbled on a bit of BX Friday (too soon, but still IMO a solid play). Other than that just holding and TLHing.
Ran into a good article this morning - 2018 is the worst market on record. Pretty brutal year, all told.
fantasycurse42
Footballguy Jr.
STWD is a dividend play I’m interested in. Still need to do more DD, but the balance sheet looks solid, and we would need a 2008 like event to put their dividend at risk.
Just did a better job saying nothing is on auto-pilot, they are listening to the markets, always looking at the data and will re-assess, etc.
ETA- here's a link, I'm sure the full video will be up soon.
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fantasycurse42
Footballguy Jr.
Feels like today is a dead cat to me.
Selling the pop when they resolve the government shut down.
Selling the pop when they resolve the government shut down.
siffoin
Footballguy
It's a 2 part question. So you may have answered the question of "What to Buy." The other part is "When to Buy It". If your answer is "now"...I would respond "show your work."
