Investments Trade Log

Ask your investment, budget, and other money related questions here
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Lemur
Posts: 902
Joined: Sun Jun 12, 2016 1:40 am

Re: Investments Trade Log

Post by Lemur »

@ertyu

Going the chicken route myself. Fear my dumb luck streak would end. With IV being as high as it is and with so much money being pumped in now, the risk/reward ratio is not there anymore. Selling cash covered puts on some long positions you don't mind getting assigned is where it is at because you can collect a fatter premium and "buy the dip" for the long haul. After further drops in the market, I may consider getting into some LEAP calls for the rebound. That rebound may not begin this year IMO. We still haven't seen the job reports or the full effect of the virus just yet.

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Dream of Freedom
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Location: Nebraska, US

Re: Investments Trade Log

Post by Dream of Freedom »

Bought BRG @5.38, IRT @7.80, and PSTL @12.44. Just adding to long term positions. There are some interesting deals available right now.

Seppia
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Re: Investments Trade Log

Post by Seppia »

From the latest Howard Marks memo

"What do we know? Not much other than the fact that asset prices are well down, asset holders’ ability to hold coolly is evaporating, and motivated selling is picking up. I’ll sum up my views simply – since there’s nothing sophisticated to say:
 “The bottom” is the day before the recovery begins. Thus it’s absolutely impossible to know when the bottom has been reached . . . ever. Oaktree explicitly rejects the notion of waiting for the bottom; we buy when we can access value cheap.
 Even though there’s no way to say the bottom is at hand, the conditions that make bargains available certainly are materializing.
 Given the price drops and selling we’ve seen so far, I believe this is a good time to invest, although of course it may prove not have been the best time.
 No one can argue that you should spend all your money today . . . but equally, no one can argue that you shouldn’t spend any.
 The more you want to garner potential gains and don’t mind mark-to-market losses, the more you should invest here. On the other hand, the more you care about protecting against interim markdowns and are able to live with missing opportunities for profit, the less you should invest.
But is there really an argument for not investing at all? In my opinion, the fact that we’re not necessarily at “the bottom” isn’t such an argument."

slowtraveler
Posts: 757
Joined: Sun Jan 11, 2015 10:06 pm

Re: Investments Trade Log

Post by slowtraveler »

Bought in 2 portfolios. Most of my assets are split between us and international index, I went nearly all in Friday.

About 15% of my assets are in individual stocks divided into GOOG(6%), DEO (4%), DIS (3%), and RDSB(2%). Most of my positions were bought Friday and are up so far. Buying top shelf blue chips at a fair price. Was thinking about ALK or LUV but decided against it. I wouldn't feel comfortable.

Seppia
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Re: Investments Trade Log

Post by Seppia »

Lol 6 trillion stimulus package.
This feels like stocks could either skyrocket or lose another 50%

ertyu
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Re: Investments Trade Log

Post by ertyu »

skyrocket maybe not, but a good old dead cat, why not.

Seppia
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Re: Investments Trade Log

Post by Seppia »

Markets are forward looking, so it's not impossible that if they anticipate both the USA and Europe will go full-japan from now on, stocks all of a sudden become more attractive.
I'm not saying it's likely (I'm in the camp "nobody knows"), but it's a possibility.

Meanwhile, it seems like the gold market is breaking up, with huge demand spike for physical gold.
I'm thinking If maybe this can have weird effects on gold etfs? Anybody smarter than me have an opinion?

There was a first page article on yesterday's FT

Traders have reported a growing shortage of gold bars, as the coronavirus out- break disrupts supply and stokes demand, with one business comparing the frenzied buying of the metal with the consumer rush for toilet roll.
Retail investors in Europe and the US have snapped up gold and silver bars and coins over the past two weeks in an effort to protect their money from the collapse in global stock prices and many currencies.
But Europe’s biggest gold refineries have struggled to keep up because of the region’s shutdown. Valcambi, Pamp and Argor-Heraeus are in the Swiss region of Ticino, near the border with Italy. Local authorities announced in recent days that production in the area was to be temporarily halted.
The gold price hit a seven-year high on March 9 of more than $1,700 a troy ounce as the deepening economic impact of the coronavirus pandemic sent investors scurrying for haven assets. But gold has since been swept up in the selling frenzy, with some inves- tors needing to offload their holdings to free up cash, pushing the price down to about $1,530 yesterday.
Most of the selling has been in gold futures or exchange traded funds backed by the metal. During the same period, retail demand for physical gold bars has surged.
Retailers have reported delays of up to 15 days on shipments. Markus Krall, chief executive of German precious metals retailer Degussa, said it was struggling to meet customer appetite for gold bars and coins and had turned to the wholesale markets. Demand is run-
ning at up to five times the normal daily amount, he said, adding: “We are being creative to find new sources but what is driving it all are the measures by authorities to stop coronavirus. This is so unpredictable.”
Rob Halliday-Stein, founder and managing director of UK-based Bullion- byPost, said the situation was unprece- dented. “Basically, we’re selling as soon as we get stock on location in secure vaults — but we’re restricted to what we can get hold of. It’s a bit like toilet roll.”
While London’s gold vaults are full of gold bars, they are 400-ounce sized bars traded by large banks, not the smaller ones that retail customers buy, which tend to be 1kg (35 ounces) or lighter.
“I don’t think you will find a kilobar presently in Europe and the US for love nor money,” said veteran gold trader Ross Norman. “It’s quite extraordinary"

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jennypenny
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Re: Investments Trade Log

Post by jennypenny »

I'm watching the gold market closely because I made a really big bet on gold (for me). I suspect demand will surge even further when China and other Asian countries come back online since retail sales account for 50% of gold demand during normal times.

Does anyone think the stimulus is going to work? Wrt the market, I mean. I wonder if the market will slump again once people realize that we aren't getting back to normal for a few months at least. I fear the next stimulus package will include lowering the age for medicare/SSI and a loosening of bankruptcy rules.

Seppia
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Re: Investments Trade Log

Post by Seppia »

I think they are firing their bullets way too soon. The USA has just barely started to feel some economic damage now.
It seems inevitable that something additional will be needed further on.

I personally think the Fed lost an opportunity to raise more when times were good, now at zero but without much room to go further.
Plus there was the genius move of exploding the deficit after a 9 year amazing run of the economy, in order to provide some much needed* tax cuts to corporations that were already racking in all time high profits.

This puts you in a worse position than you could have been.
Europe is this bad place already, but our more stringent labor laws and much better welfare state should help soften the blow for what we hope will be a relatively short lived halt.

I think this will be much, much worse in the USA, where people have historically lower savings rates compared to Europe, take on more debt, and can lose their jobs overnight resulting in zero income and no health insurance, with no safety net.
$1200 one-shot is not going to cut it.

Fun fact: there are 205 million working age americans. If they spent the $6 trillion only putting cash in the pockets of these 205M, they could pay them a $1200/month salary for two years

*sarcasm

Lucky C
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Re: Investments Trade Log

Post by Lucky C »

As good as yesterday's rally was, US stock futures are now negative despite the stimulus passing.

Here's a nice snapshot that shows that despite yesterday's rally the S&P500 did not even exceed Thursday's (intraday) highs.
https://www.advisorperspectives.com/dsh ... -9-4-rally

Something I find is lacking in the commentary of this decline is talk of the baby boomers who want to retire soon, who may start getting laid off in large numbers and who might feel they wouldn't have time to make up for big losses in their 401k. Same for those who recently retired near all time highs and might fear having to go back to work, and possibly not being able to find a job anymore. That would create headwinds for a quick V-shaped stock recovery, right? I've seen talk of the "elites" getting out of the market early and retail investors (mostly young people?) buying all the way down, but what are typical boomers doing? Just sitting passively like they're told to do, rebalancing into stocks, or are they panic selling yet?

IlliniDave
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Re: Investments Trade Log

Post by IlliniDave »

I'm the tail, tail end of the boomers and I'm buying into the decline, but only very modestly. Boomers who hold appreciably investment portfolios probably aren't doing all that much different than other cohorts. They should already be (like me) lowering, or have already lowered, their equity exposure coming to the cusp of retirement or beyond. I know some boomers who sold everything they had left a week after the first reports came out of Wuhan (hat's off to them, I thought they were being rash at the time). I know some who are buying into the decline. I know others who are just squeezing their eyes shut to help them endure. But the largest cohort I know among boomers really doesn't have much in the way of an equity portfolio at all to be worried about. Bigger fish to fry for a lot of people.

IlliniDave
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Re: Investments Trade Log

Post by IlliniDave »

jennypenny wrote:
Wed Mar 25, 2020 5:11 am
I'm watching the gold market closely because I made a really big bet on gold (for me). I suspect demand will surge even further when China and other Asian countries come back online since retail sales account for 50% of gold demand during normal times.

Does anyone think the stimulus is going to work? Wrt the market, I mean. I wonder if the market will slump again once people realize that we aren't getting back to normal for a few months at least. I fear the next stimulus package will include lowering the age for medicare/SSI and a loosening of bankruptcy rules.
It'll go through the roof if the "digital dollar" survived the late add-ons in the stimulus negotiations (gold, that is). Unless they outlaw owning gold/precious metals and similar commodities too.

Not knowing the details of the stimulus yet, and exactly what you mean by "work". The gov't isn't much good at fixing things beyong one or two narrow swim lanes. Some of the things I've heard discussed will probably help a little. I like the tax holiday ideas for their simplicity, but those don't come with additional federal power so I'm sure they are out. The problem with 1,000s of pages of new laws is there will so may hoops and red tape barriers that the flow of money will not begin to trickle after it's too late. And there were lots of things rumored to be in draft versions from the House that are potentially long-term economy killers. I'm afraid so much of that will have made the final cut that we might look back at the stimulus as being more deeply damaging to the economy than the pandemic.

George the original one
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Re: Investments Trade Log

Post by George the original one »

I'm in line with Seppia as far as the stimulus affecting markets and lost Fed opportunities. The stimulus is mainly letting investors who felt trapped get out of bad positions in a late timeframe.

Market will slump again. Traders are paid to trade, not sit still and play it safe, so the real question is who's money are they playing with? The stimulus buys maybe one week of joy, but since new COVID cases aren't slowing down overall, the truth will sink in again.

Mass travel, tourism, lodging, live entertainment, and dine-in restaurants are not going to survive unless they have deep pockets or can re-imagine their business. Vaccine or COVID burning out on its own are the only two options for this year. A treatment that keeps patients out of hospital beds (or at least off ventilators) will kickstart the economy because then we can risk catching it.

I suspect millennials are going to be hardest hit. Still paying off that student loan, no trust in the stock market, and now paying off a medical bill while their house just plummeted in value.

ertyu
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Re: Investments Trade Log

Post by ertyu »

millenials don't have houses, it's all in toast + avocado

me and other millenials i speak with are hoping for property prices collapse cause we'll finally be able to afford our own place

George the original one
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Re: Investments Trade Log

Post by George the original one »

Note that the rally is not particularly wide-based nor strong (strong in the context of "we're saved"), being very concentrated on the DOW 30 and some of the S&P 500.

ertyu
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Re: Investments Trade Log

Post by ertyu »

whoever's pumping it is gonna dump it

IlliniDave
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Re: Investments Trade Log

Post by IlliniDave »

George the original one wrote:
Wed Mar 25, 2020 12:52 pm
Note that the rally is not particularly wide-based nor strong (strong in the context of "we're saved"), being very concentrated on the DOW 30 and some of the S&P 500.
I think the main response was yesterday (~+10% or so) and the response was pretty solid across the board, at least in terms of Morningstar style boxes. Today just added a little to that, with small value being the standout, but I'm pretty certain it took the most, and biggest, kicks in the teeth.

I agree though that it's a temporary thing most likely. My guess is generally down until late summer/early fall.

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Bankai
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Re: Investments Trade Log

Post by Bankai »

Singapore GDP -10.6% in Q1 and they didn't even have a lockdown. It's going to be brutal for the West - Q2 GDP the worst on record? What's the chance the stock market bottomed?

Lucky C
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Re: Investments Trade Log

Post by Lucky C »

Bankai wrote:
Wed Mar 25, 2020 9:10 pm
What's the chance the stock market bottomed?
We've had about a 13% bounce from the current S&P 500 bottom. How would we do in past bear markets if we called the bottom after the first 13% rally?

1929: bear market (-20% from peak) started 10/28/29, 13% bounce only 3 days later on 10/31/29, bear market bottom 6/1/32
1957: bear start 10/21/57, bottom 10/22/57, up 13% on 5/9/58
1962: bear start 5/28/62, bottom 6/26/62, up 13% on 8/20/62
1966: bear start 8/29/66, bottom 10/7/66, up 13% on 12/12/66
1970: bear start 1/29/70, bottom 5/26/70, up 13% on 6/3/70
1973: bear start 11/26/73, bottom 10/3/74, up 13% on 10/11/74
1982: bear start 2/22/82, bottom 8/12/82, up 13% on 8/23/82
1987: bear start 10/19/87, 13% bounce 10/21/87, bottom 12/4/87
2001: bear start 3/12/01, 13% bounce 4/19/01, bottom 10/9/02
2008: bear start 7/9/08, 13% bounce on 10/31/08, bottom 3/9/09

A 13% gain was a bull trap in 1929, 1987, 2001, and 2008, so the three worst bear markets in US history and the 1987 crash with the worst daily losses in history (but otherwise a mild bear market). You would eventually lose 82%, 13%, 38%, and 43% (respectively) at the bottom if you bought into those bear markets after the first 13% gain. A 13% gain came after the bottom in the other 6 bear markets.

So based on historical occurrences, 60% of the the time a rally of this magnitude came after the bottom, which sounds like decent odds. On the other hand, this top was most in line with the 1929 and 2000 peaks in terms of high valuations, suggesting a more prolonged bear market with multiple legs down and rallies mixed in. One might also compare the credit risks of this scenario with those of 1929 and 2008. There doesn't seem to be much similarity between this bear market and one of the milder ones.

Finally, with the record steep selloff, extremely high volatility, and unprecedented stimulus measures, one would expect some random but meaningless extremely good days mixed in with the extremely bad days we've been having, compared to previous bear markets which were (so far) all milder than this one. This 13% rally may only be "equivalent" to an inconsequential 5%-10% rally in a more historically normal bear market.

Edit: there was also another bear market within the Great Depression starting in 1937, but since the S&P had not recovered from 1929-1932 to make new highs (new highs in price were not until 1954!) my lazy spreadsheet does not flag it as another new bear market. Its peak is 3/11/37 at about 41% down from the 1929 peak and bottoms exactly 5 years later, 3/11/42, -57% from the 1937 peak! In those 5 years there were big rallies > 13%.
Last edited by Lucky C on Thu Mar 26, 2020 10:23 am, edited 1 time in total.

CS
Posts: 660
Joined: Sat Dec 29, 2012 10:24 pm

Re: Investments Trade Log

Post by CS »

@lucky C
Thanks for the data on rallies - that was interesting to see.

Not really an investment, but my treasury direct reinvestment went through and I made 9 cents on 4k! Lol, I logged in half expecting to see it negative. In 2018 I was getting about six and half bucks every four weeks for 4k. This zero percent interest is not motivating. (Yes, I know it's more complicated with inflation and all that... I'm talking psychological reactions.)

@Bankai
Apropo no professional experience, I can't imagine this is the bottom.
Last edited by CS on Thu Mar 26, 2020 8:40 am, edited 1 time in total.

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