Investments Trade Log

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Bankai
Posts: 816
Joined: Fri Jul 25, 2014 5:28 am

Re: Investments Trade Log

Post by Bankai »

Mister Imperceptible wrote:
Wed Apr 29, 2020 1:08 pm
Are we in a new era where 5 companies control everything? Or is this a bear market rally?
I wouldn' say that 5 companies control everything. Rather, investors are still oblivious to the economic reality - we're heading for the sharpest & deepest recession on records in the UK (records go 3 centuries back); the rest of the world is probably not in much better shape. The idea is that the internet stocks are immune to the meltdown & equities are still better than cash, however:

- Google & Facebook generate the majority of revenue from ads - struggling companies looking for cost cuts and savings will start from marketing budget;
- Apple model is based on selling the same item in new packaging but many of the usual customers are either unemployed or about to be, or quite afraid to be so unlikely to upgrade an item that doesn't need upgrading
- Amazon should do well while physical stores are shut, but ultimately the same consumer squeeze is going to hit them
- Netflix will do well. That's 1 out of 5

Bear markets are long and this looks like just the beginning. V-shaped recovery is not coming for the rescue.

Having said all of that, I actually opened a few long positions over the last couple of weeks but with tight stops and only using a small %age of NW so the total risk is small.
Last edited by Bankai on Wed Apr 29, 2020 2:11 pm, edited 1 time in total.

Mister Imperceptible
Posts: 1296
Joined: Fri Nov 10, 2017 4:18 pm

Re: Investments Trade Log

Post by Mister Imperceptible »

@Bankai

Thanks for adding nuance. What is being overlooked by most is that AMZN and NFLX already have price-to-earnings over 100. I suppose that could go over 200 since everyone already agreed the current number does not matter.

I think this has been a great opportunity for the big money to get out slowly. If you have billions it is hard to sell all at once. Need a sustained bear market rally so that stocks can be offloaded methodically to the public pension funds (bag holders), before the next leg lower.

Watching the Jerome Powell press conference now and he is saying the same thing. “There was nothing wrong with the economy whatsoever, greatest labor market ever, this is entirely attributable to an exogenous event.”

COVID-19 is the best scapegoat they could have ever asked for.

Powell: “The government debt is a longstanding concern but now is not the time to address it.”

Never let a good crisis go to waste.

Lucky C
Posts: 561
Joined: Sat Apr 16, 2016 6:09 am

Re: Investments Trade Log

Post by Lucky C »

Prior to COVID-19, we were on the path toward a recession beginning in the first half of 2020 anyway, based on the yield curve inversion, a year of flat-to-rising weekly unemployment claims, slower earnings growth, and a YoY contraction in manufacturing (with services slowing too).

COVID-19 health impacts might come in waves, but on the other hand the impact could certainly be V-shaped looking at the optimistic news that has come out lately. Regardless, COVID-19 caused a deliberate/known recession on top of our economic trajectory that was already heading toward recession. Like hitting the brakes when you're about to crash your car. Now we might be trying to accelerate again but the crash may be unavoidable.
If we do crash then everyone's going to blame it on hitting the brakes.

Lucky C
Posts: 561
Joined: Sat Apr 16, 2016 6:09 am

Re: Investments Trade Log

Post by Lucky C »

Cool, S&P500 total return is still positive over the past year.

slowtraveler
Posts: 880
Joined: Sun Jan 11, 2015 10:06 pm

Re: Investments Trade Log

Post by slowtraveler »

My direct, equal weight investment is beating the S&P by a percentage point or so. It is definitely more volatile.

Top performers are not the tech giants but they are doing well.

guitarplayer
Posts: 80
Joined: Thu Feb 27, 2020 6:43 pm

Re: Investments Trade Log

Post by guitarplayer »

Wow reading this thread for the past two months really makes me want to buy some shares/be more active, only I don't know how! Again, probably better to stick to my (very simple) plan for now until I learn more stuff.

Thanks all for disclosing your thought processes, lots of material to learn from.

Seppia
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Joined: Tue Aug 30, 2016 9:34 am
Location: Italy

Re: Investments Trade Log

Post by Seppia »

Interesting that Buffet did zero buying during this pullback.

classical_Liberal
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Joined: Sun Mar 20, 2016 6:05 am

Re: Investments Trade Log

Post by classical_Liberal »

@seppia
I thought that too, but remember how quickly everything happened? It's not like BH can just place a 20 billion limit order and click accept, like we can. These things take time at the levels of money he's dealing with.

thedollar
Posts: 149
Joined: Tue Feb 21, 2017 4:07 am

Re: Investments Trade Log

Post by thedollar »

@seppia

Yes. He only sold (airlines).

I guess if you look at the financial crisis the down trend lasted a little over a year. Guess he thought more was to come (and it might still).

Jason
Posts: 2765
Joined: Mon Jan 30, 2017 8:37 am

Re: Investments Trade Log

Post by Jason »

Seems like anything related to sea or air is getting killed. I have a small holding in SPCE and was happy to read they had their first successful air test only to find out the next day major investors are flocking out of it. Now that Buffet is completely out of airlines I'm thinking my foray into BA is just a lost cause.

elegant
Posts: 101
Joined: Sat Apr 13, 2013 2:19 pm
Location: Land of Milk and Honey

Re: Investments Trade Log

Post by elegant »

Took advantage of the recent downturn to start investing in individual dividend paying stocks for the first time in my investing career (started in 2013). After years of extreme Boglehead indoctrination It almost feels like picking up smoking or some other bad habit. However I feel it is more of a (hopefully prudent) exercise in risk management. I don't plan to sell my (accumulating) index funds but I will divert new cash to dividend stocks. So far I initiated positions in GD, ADM, CAH, TD, PM, UPS and STAG.

Mister Imperceptible
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Joined: Fri Nov 10, 2017 4:18 pm

Re: Investments Trade Log

Post by Mister Imperceptible »

Trimmed GDXJ OTM calls by 5% as miners trade at top of range. Used proceeds to buy more SPY OTM puts with VIX at 30 and SPY trading around 61.8% Fibonacci retracement.

GDXJ calls expire Jan 2021 and SPY puts expire Dec 2021 so this also reduces theta bleed. Open interest on GDXJ 2022 calls is much lower and spreads are wider. I prefer to trade deeper and more liquid markets.

Adamski
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Joined: Wed May 29, 2019 8:35 am

Re: Investments Trade Log

Post by Adamski »

US stocks lot more resilient than rest of the world. S&P 500 1 year down 1% compared to UK FTSE 100 down 19%. Recent experience has confirmed my view that best not to be country bias as need large US exposure through a US or Global tracker.

Lucky C
Posts: 561
Joined: Sat Apr 16, 2016 6:09 am

Re: Investments Trade Log

Post by Lucky C »

More like US P/E multiple expansion has been more resilient than the rest of the world recently :)
A bit like if you said in 2008 that emerging markets are more resilient than the US (followed by emerging markets crashing harder than the US and 12 years of EM underperformance, so far).

There's also the concentration into large cap stocks, and even more so into popular tech stocks. On the other end of this divergent market, small caps have been doing worse than international stocks. Over the past year, S&P500 does beat the international and emerging market indices, but international and emerging markets beat the Russell 2000.

Sorry if I sound too negative. I just see a lot of warning signs.

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Lemur
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Re: Investments Trade Log

Post by Lemur »

Go figure as soon as I buy a SPY put the market rallies back up lol....I bought a PUT for June 30 $260 at $7.70. Trying to sell at $8.00 for some quick turnaround if the market tanks. A small hedge.

I sold PUTS on AMD, SQ and will not be assigned; I made a quick premium for this week but did note had I just owned the shares, I would've been up more. There is the downside of my strategy.

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C40
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Joined: Thu Feb 17, 2011 4:30 am

Re: Investments Trade Log

Post by C40 »

Does anyone know of a good alternative to Value Line Reports? I'm not looking for something to use instead of them, but rather something to use for companies that Value Line does not make these reports for. I'm struggling with research on REITS in particular, as they don't make reports for many of the REITs. I've actually been struggling with this for years :?

The important things I'm looking at are yearly history of per-share values for things like FFO, Dividends, NAV (going back 10 or 15 years), and current values for Sales, book value (though NAV would be great), debt...

I've been looking at websites and some reports from other analysis companies and have not yet found anything showing these. If I can find a source for these that is easy to look through, I can do my research much faster (and usually see back more years) than looking at the companies financial reports. [or.... is the reality that I just need to get used to finding and digging through financial reports?]

Here is an example of the Value Line Report
Image

If anyone wants to use the Value Line reports, a subscription is expensive, but you can get access through membership at some libraries. If your library does not have access, it's often possible to get a card at other libraries without actually living in that area.

George the original one
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Location: Wettest corner of Orygun

Re: Investments Trade Log

Post by George the original one »

C40 wrote:
Thu May 14, 2020 8:38 pm
Does anyone know of a good alternative to Value Line Reports?
Value Line is certainly good quality. Ameritrade accounts offer free reports and they used to carry Value Line or very similar, but I haven't checked in a few years what is on offer these days.

arcyallen
Posts: 88
Joined: Sat Jan 20, 2018 11:20 am

Re: Investments Trade Log

Post by arcyallen »

Seppia wrote:
Tue May 05, 2020 1:43 am
Interesting that Buffet did zero buying during this pullback.
Well, he DID buy some airline stock...right before he sold it. I'm a huge Buffet fan and I'm very intrigued by his non-buying. I mean, there's NOTHING that's a good value to him for years now? Even today? That tells me he thinks there will be something still down the road. I'm still shocked the market is this high still. I think it's a good time to own BRK as it's underperformed for a long time, and you know he'll be picking up some deals by the end of all of this. If you can hold a contrarian view I think these all point to a resurgence in value investing.

Seppia
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Location: Italy

Re: Investments Trade Log

Post by Seppia »

it's also interesting that more and more "has Buffet lost his touch?" articles are popping up, which is usually a great sign.
https://www.marketwatch.com/story/heres ... 2020-05-12

jacob you did buy some BRK correct?

jacob
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Re: Investments Trade Log

Post by jacob »

Yup, a painful experience---if only I had waited a month to pull the trigger. I'm still accumulating though. The only thing that bothered me was Buffett's lack of interest in buybacks given his previously stated position. The shares are the cheapest they've been in the last 30 years based on intrinsic value, but now his argument is that they're no cheaper than the market on a relative basis. I don't know what to make of that beyond maybe he's expecting to be able to use the cash later in the year as the rest of the market drops more than BRK.

I guess he must be holding off for the big one. It was to be expected there would be a break from the "new era" guys. It's getting less and less fun to be a value investor these days when large cap tech momentum has ruled the world for 10+ years. (In contrast, value did well in 2000-2010, while large cap tech momentum was shite). Unfortunately having big guys rotate out does provide some downward pressure on the share price for the time being.

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