Investments Trade Log

Ask your investment, budget, and other money related questions here
Seppia
Posts: 1415
Joined: Tue Aug 30, 2016 9:34 am
Location: Italy

Re: Investments Trade Log

Post by Seppia »

Today we will see if the president of the most important democracy on the planet tear gassing peaceful protesters so that he can pose for a picture is bullish.

ertyu
Posts: 909
Joined: Sun Nov 13, 2016 2:31 am

Re: Investments Trade Log

Post by ertyu »

of course it is. as long as the growth rate of QE exceeds the decline in earnings, stonks go up. money printer go brrr. Trump is an idiot, but he is an useful idiot because he's easy to manipulate and eager to please. They want him reelected, thus they want the stock market up. Something like tear gassing peaceful protesters would only be the occasion for extra stimulus. The market will not be allowed to drop meaningfully and consistently.

Mister Imperceptible
Posts: 1289
Joined: Fri Nov 10, 2017 4:18 pm

Re: Investments Trade Log

Post by Mister Imperceptible »

We saw the stock market move up faster in April when unemployment was increasing at a faster rate. With these tiny unemployment increases of 2 million per week the stock market has been losing momentum. We need to see the unemployment rate pick up again so the market can go higher.

Very bullish.

bigato
Posts: 2769
Joined: Sat Mar 05, 2011 12:43 pm
Location: Brazil

Re: Investments Trade Log

Post by bigato »

Between losses in gold* and gains in stocks, my networth is mostly keeping even since my last change in allocation. That was main goal, to weather this crisis keeping my capital, so I guess that the portfolio is working as intended so far.

* Brazilian Real is regaining some value against the dollar, and gold is priced in dollar

jacob
Site Admin
Posts: 12393
Joined: Fri Jun 28, 2013 8:38 pm
Location: USA, Zone 5b, Koppen Dfa, Elev. 620ft, Walkscore 73
Contact:

Re: Investments Trade Log

Post by jacob »

Newest US jobs report.

Labor market added 2.5 million jobs (payrolls) in May vs an expected loss of -8.3 million jobs.
Unemployment rate fell to 13% instead of an estimated 20%.

Freedom_2018
Posts: 438
Joined: Sat Dec 18, 2010 12:10 am

Re: Investments Trade Log

Post by Freedom_2018 »

The Coronavirus scare in the news was a good investment opportunity.

Also travel in the US (with common sense precautions) was great as most National Forest trails etc were mostly empty and quiet.

anesde
Posts: 149
Joined: Wed Jan 09, 2019 8:32 am

Re: Investments Trade Log

Post by anesde »

Selling off a bit of generic mutual funds into this rally. Jobs report is better than expected but I find it hard to believe we don’t have another leg down in the next 6 months that will pose for better entry points. Especially with the volatility of an election year.

Seppia
Posts: 1415
Joined: Tue Aug 30, 2016 9:34 am
Location: Italy

Re: Investments Trade Log

Post by Seppia »

Mister Imperceptible wrote:
Sat Apr 25, 2020 12:47 am
Deepest drawdown 12Feb2020: -48%

6 month return as of 25Apr2020: +252%

Largest single day gain on 16Mar2020: +83%
If you don't mind, I'd be curious to know how much you gave back, and what your performance is since the very beginning (your "Alea iacta est" moment).

I'm asking because of all the outcomes that I could think of, this hyper-sharp recovery was the one I expected the least, and my instinctive fear for unpredictable stuff is the main reason why I never go all-in on one strategy.

Mister Imperceptible
Posts: 1289
Joined: Fri Nov 10, 2017 4:18 pm

Re: Investments Trade Log

Post by Mister Imperceptible »

Now +177% from 25Oct2019 and -21% from 25Apr2020.

Had I remained just long gold without keeping and adding offsetting positions from 16Mar2020 I would be up about 360% right now. But then again if I was only long gold from 25Oct 2019 I would only be up around 100% instead of 177%.

If you asked me in mid-March if I thought the SP500 would regain 3000 I would say no, but it does not shock me.

The market chopped mostly sideways from mid-April to mid-May until the Jerome Powell appearance on 60 Minutes. Since then the market has moved up another 11.5% in 2 weeks. That’s the power of narrative, of “forward guidance,” of the Fed publicly announcing their backstopping of markets.

I think this is can run a few more months, maybe even to all-time highs. This last leg has been retail-driven; since the shutdown a lot of new accounts on Robinhood (Millenials) and money from gambling markets has moved over without any sports. I know the white collar workers my age or younger do not think economic recessions or depressions exist, and since the system is working for them (so far) they are easily convinced of the narrative. Add in algorithmic trading (buying begets buying) and now people convinced the Fed is invincible and QE knows no limit throwing in the towel, and I can see how this can go to all-time highs. But the only net buying of stocks in the last 11 years- corporate buybacks- is gone. So whenever this leg exhausts itself, I would think we would have another sustained sell off, unless and until the Fed pumps in a few more trillions. We had a 10% sell off In January 2018 with “Volmageddon,” a 20% sell off Sep-Dec 2018 with the Fed raising rates and QT, and a 35% sell off this year with the virus shutdown. Every sell off is bigger and bigger and requires even greater amounts of stimulus. And I think the job numbers from May were completely massaged and do not represent reality.

In all, this is one last leg where the smart money pumps, dumps to Pollyannas, and lets the bottom fall out. I suppose they could try to enforce bailouts of zombie companies to infinity but in the end it might be easier to just cash out and buy back at lower prices. I think all-time high stock markets with Main Street suffering becomes a political problem and eventually corporate tax rates will go up, so a sell-off will happen before the election because enough money is not going to wait to see what the outcome is.

My timing sucks and I have to endure these gut checks so that is why I buy put options with expiry dates 2 years out.

Seppia
Posts: 1415
Joined: Tue Aug 30, 2016 9:34 am
Location: Italy

Re: Investments Trade Log

Post by Seppia »

Thanks MI for the post
As usual most of the stuff you say makes a ton of sense for me, but I would never have the b*lls to follow you 100%.
I guess I'll just slowly keep raising my cash % on new savings

User avatar
Lemur
Posts: 596
Joined: Sun Jun 12, 2016 1:40 am

Re: Investments Trade Log

Post by Lemur »

This recovery has been shocking to say the least. I have 3 stocks past the contract price on my covered calls that expire mid June and I had originally set them at +20-25% of spot price... KO, WFC, and GE.

Mister Imperceptible
Posts: 1289
Joined: Fri Nov 10, 2017 4:18 pm

Re: Investments Trade Log

Post by Mister Imperceptible »

Raising cash is certainly one way to do it.

In reading about the Permanent Portfolio and asset allocation, I learned that the bulk of portfolio returns are generated over time from asset allocation and anti-correlation rather than individual security selection (going all in early on individual tech stocks that eventually became mega caps notwithstanding). And in reading Taleb and the writings by other hedge fund managers I recognized the importance of positive convexity.

I understand the idea that the QE pump means buying stocks and bonds means you have implicit and now explicit government support, but it has not just been a zero-sum transfer of wealth from investors to savers. (If by investors we mean analysts and savers we mean those who view index funds as high yield savings accounts.) It destroys productivity and creates zombie companies and social problems. Trump and Bernie Sanders and AOC would have been unimaginable as political figures 20 years ago, and they are symptoms of the latent negative convexity in the system. Stocks and bonds at these levels are huge negative convexity bets, and in the long run so is cash.

All I am trying to do with my portfolio is assemble anti-correlated positive convexity bets. Timing is hard. Position sizing is important.

Seppia
Posts: 1415
Joined: Tue Aug 30, 2016 9:34 am
Location: Italy

Re: Investments Trade Log

Post by Seppia »

Mister Imperceptible wrote:
Sat Jun 06, 2020 6:00 pm
and in the long run so is cash.
Yes obviously. My reasoning is that
1- cash is the asset that can be converted into something else the fastest
2- in a zero inflation (or even deflationary) environment such as the one we are/have been in for a few years, holding cash carries little penalty.
In normal times I would buy bonds, but since I’d use them for “safety” and not for speculation, I just can’t bring myself to lend money to Germany for 10 years to get back less money than I started with.

I am looking to add more inflation hedge (namely real estate) in the short term.


Seppia
Posts: 1415
Joined: Tue Aug 30, 2016 9:34 am
Location: Italy

Re: Investments Trade Log

Post by Seppia »

I love Sven. Would like to see his results.

giskard
Posts: 116
Joined: Sat Apr 30, 2016 12:07 pm

Re: Investments Trade Log

Post by giskard »

Mister Imperceptible wrote:
Fri Jun 05, 2020 2:51 pm
But the only net buying of stocks in the last 11 years- corporate buybacks- is gone. So whenever this leg exhausts itself, I would think we would have another sustained sell off, unless and until the Fed pumps in a few more trillions.
Perhaps corporate buybacks are gone but also consider that pension funds and other large institutions must have a real yield on their assets. Are they going to buy bonds without a positive real yield after inflation? I don't think so. The fed is going to be increasingly the only bidder in the treasury market and this forces everyone else into stocks. The fed has discussed doing yield curve control, so bond rates are not going be going up. How does the stock market not keep inflating in this situation?

All time highs by July? And at this point, I don't think central banks will allow equity markets to fall all that far because it would cause a deflationary spiral and that would be hard to recover from in this weakened business environment.

Also agree the numbers were not accurate on the jobs report, I'm afraid it will cause the senate to not act aggressively enough with the much needed fiscal stimulus and end making the fed feel the need to do more monetary stimulus.

A lot of my limit orders got hit last week on various precious metals miners and etfs! I have over 100k in the long precious metals trade now, mostly just long outright but also selling puts and buying some jan 2021 and jan 2022 calls. Still selling puts on various SAAS tech companies and haven't got an assignment in a while (*crosses fingers*).
Last edited by giskard on Mon Jun 08, 2020 8:03 pm, edited 1 time in total.

Jason
Posts: 2753
Joined: Mon Jan 30, 2017 8:37 am

Re: Investments Trade Log

Post by Jason »

Best of Stocks, Worst of Stocks Update:

BA is now down a "respectable" 31% from buy point after bottoming (hopefully) 200%.
DIS is now down 3% from buy point after bottoming (hopefully) 33%.
ZM is up approx. 200% from buy points.
TWIL is up approx. 100% from buy points.

DOW representing reopening, NASDAQ representing lockdown seem to be doing awkward dance with continuity/discontinuity issues until people become more confident that they can Zoom video themselves scoffing down cake for breakfast from Carnival cruise ships without Croatian teenagers drawing huge dongs going in and out of their pie holes. From what I can tell, Silicon Valley went from technological innovation to infrastructure while the world got tired of ordering their food on line and decided to go out and just steal it. People bring up the economy vs. stock market dichotomy but it seems obvious to me when I'm watching a bunch of people who can't got to work using high speed internet in order to post videos taken on their IPHONES to their Facebook accounts chanting about wanting justice. I want justice too but demanding it in this world seems like a big ol waste of time. Especially during a pandemic. Especially when there are SAS stocks to buy. The world teeters towards mayhem and the NASDAQ closes at all time high. 2020. Who would have thunk.

Mister Imperceptible
Posts: 1289
Joined: Fri Nov 10, 2017 4:18 pm

Re: Investments Trade Log

Post by Mister Imperceptible »

The pension funds have to redeem for those retiring and they do not have enough new inflows from current workers. Same problem with SS, fewer and fewer workers supporting benefit recipients.

The juxtaposition is interesting.

After Lehman collapsed in October 2008 the market was down 40 or 50% from the all time highs and ground only about 10% lower before bottoming. No one thought QE would work and was afraid of systemic collapse, and the surprise was to the upside.

Now we have huge reductions of economic activity with no hope of returning to previous trendline growth yet are 5% from ATH because everyone is Pavlovian trained that QE never fails. I am not saying the stock market cannot go up, but I am doubting its ability to keep up with inflation, and there will be huge air pockets along the way. This rally has traded with low volume.

Since January 2018 the SP500 has traded above and below the 2700-2800 range, but has not gone very far, up about 10%. But the Fed’s balance sheet has gone from around $4T to over $7T. The last 2009-2018 saw stocks beating inflation, and now we are seeing stocks lose ground to inflation.
Jason wrote:
Thu Feb 13, 2020 12:24 pm
There was a vignette in a Warren Buffet biography where he was getting divorced and he needed money. So he goes into his room for a day, does some international money exchanges and gets his nut. I guess Charlie was there and he walks out of the room and says (I paraphrase) 'this is too fucking easy." From October till now, I have often thought of that story. Its' not over till the fat lady sings, but damn, this has been too fucking easy.
Jason looking in the mirror and seeing Warren Buffett back in February also proved itself to be a contrarian indicator. The euphoria is back, and no one has learned anything.

Jason
Posts: 2753
Joined: Mon Jan 30, 2017 8:37 am

Re: Investments Trade Log

Post by Jason »

(MI)

I ate those words shortly thereafter and I'm assuming I'll eat them again. It will be interesting to see how Buffet's "panic" airline sell-off pans off being that he has "lost" billions since dumping them.

Mister Imperceptible
Posts: 1289
Joined: Fri Nov 10, 2017 4:18 pm

Re: Investments Trade Log

Post by Mister Imperceptible »

Hertz up 112% today after filing for bankruptcy.

https://seekingalpha.com/news/3581266-b ... -for-hertz

Several energy companies that have filed for bankruptcy have seen huge stock price gains.

https://seekingalpha.com/article/435265 ... eeze-rally

Short squeezing- this is why I buy put options. I do not understand why people expose themselves to unlimited losses. The kids buying these stocks on Robinhood have no clue, and the Fed and the hedge funds and the algos know how to push a short squeeze higher.

Up is down, down is up.

Post Reply