Markets Dropping. Who's buying?

larry · Post by **larry** » Thu Nov 15, 2012 4:30 am

Markets are down even more today.
Anyone putting in limit orders for stocks on their watchlist?
I added some CSX the other day to lower my cost basis, but have been holding my cash waiting for more of a discount down the road.
Thoughts from the many experienced investors here?

FI Fighter · Post by **FI Fighter** » Thu Nov 15, 2012 4:37 am

I wouldn't say I'm experienced, but I'm definitely watching the markets with much interest.
NSC is another railroad that is really beat up right now. MCD, VOD, KMI, CVX, and AAPL are some other ones that are looking attractive.
For long term investors, this may be a good time to add some shares. I'm short on cash atm, so will have to wait until my next paycheck.

Post by **jacob** » Thu Nov 15, 2012 4:39 am

Yeah, I am.
No idea how long this fiscal cliff story (similar story as last year and the year before) is going to last or if it's the end of the beginning or the beginning of the end, but I'm loading up on basic materials.

George the original one · Thu Nov 15, 2012 5:01 am

Selling off financials and buying oil/pipelines. Due to dealing with a funeral (mom), I was slow to sell this week.
Broad mix that's hitting good prices: WPZ, MCD, INTC, OHI, NSH, MSFT, AVA, KMP, LMT, LTC.

pooablo · Post by **pooablo** » Thu Nov 15, 2012 5:05 am

I didn't notice the drop but I presume that's because I have been away on vacation and my portfolio is pretty well-diversified.

Dragline · Post by **Dragline** » Thu Nov 15, 2012 5:37 am

I bought some MCD last week (as part of a PP tranche with EDV and IAU). But I still think this could get worse before it gets better. Will probably wait until near the end of the year. I am guessing that the popular meme will be "sell everything for tax reasons", which usually happens 10 days before Christmas.
The fact that there is a countdown clock on Marketwatch to the fiscal cliff makes me even more confident that this is just like the Y2K non-event. But there are more histrionics to come before then. Especially as we approach the apocalypse of my ancestors (Mayan) on 12-21-2012. Oooooh -- scary stuff!

FrugalZen · Post by **FrugalZen** » Thu Nov 15, 2012 6:55 am

Have a preference for very low expense (Vanguard) mutual index funds and Tax Exempt Muni Bond Funds (Fidelity).
Have watched the market for stocks go down and the market for bonds go up....right now I'm probably a bit ahead as the bond funds are ratcheting up.
As a point of interest when 2008 happened my mutual funds lost 45% of their value....and I did the same thing then that I have done for the previous two times we have sunk into a recession....NOTHING...I am in for the long haul and unlike many others I know who locked in losses by selling in 2009 and buying again in 2010 when the market had gone up 15-20% I know that EVENTUALLY the market will recover. Even at the current drop this week in the Market my values are 15% over what they were before the 2008 collapse.
Patience and an Iron Stomach....or for some a lifetime supply of Maalox may be required.
P.S. Out of curiousity I follow one of Jacobs earlier picks SafeBulkers, SB...it went up almost 9% today after losing almost 30% in the last two weeks.

secretwealth · Post by **secretwealth** » Thu Nov 15, 2012 7:38 am

This market dip triggered my limit orders for EAD and PHK. I am thinking of buying some more AGNC, TICC and BKCC if they go down further.
I expect this market dip to go a bit further--the fiscal cliff hysteria needs to play out a bit more. Then we'll get back up to previous levels.

GandK · Post by **GandK** » Thu Nov 15, 2012 12:10 pm

I haven't bought yet, but I have a buy order that will be triggered soon if the market continues falling.

jennypenny · Post by **jennypenny** » Thu Nov 15, 2012 12:19 pm

Not yet.

Chad · Post by **Chad** » Thu Nov 15, 2012 6:05 pm

Not yet. I'm more on Dragline's timeline.

FrugalZen · Post by **FrugalZen** » Thu Nov 15, 2012 7:00 pm

And of now....11:57 AM...since yesterday..SafeBulkers has collapsed by 31% to $3.44 a share.

Phayen · Post by **Phayen** » Thu Nov 15, 2012 8:45 pm

I bought another chunk yesterday as prices are starting to meet my entry prices. Wish I had more cash on hand if things keep going south.

44deagle · Post by **44deagle** » Thu Nov 15, 2012 11:46 pm

Just bought some OXY. Kinda hoping for the market to come down more to buy back in.

larry · Post by **larry** » Fri Nov 16, 2012 12:16 am

Great responses here.
Yeah, watching NSC, may initiate a position soon. Higher yield than CSX, but slower dividend growth. I think the railroads can do well if and when energy costs go up again, since they are much more efficient at moving freight for the amount of energy used.
Also, looking to add more KMI, MCD, ADM. All three are trading below my cost basis and would be good to add on any further weakness.
On a macro level, I don't know where things are headed, I think there may be more sell offs ahead with these three issues in sight.
1. "Fiscal Cliff"

2. European Drama

3. Israel Tension
It's always hard for me to keep some cash on hand for future opportunities, versus going ahead and buying the stocks that already look like good values.

Post by **jacob** » Fri Nov 16, 2012 1:59 am

Many hold SB just for the dividend and they cut the dividend to preserve cash to protect loan covenants (asset value of the ships follow the rates) and to pick up cheap ships from other companies which are less financially strong. The dry shipping market is in a funk until the [mainly Asian] economies turn around. Some companies will likely fold and the cash preservation move was to prepare to take advantage of it. The dividend was not cut due to lack of income. The payout rate is 50% and earnings and revenue are both up yoy despite the sector trouble. Also keep in mind that insider ownership is 60%. These are not guys looking to pad their resumes or get out with bonuses. As far as I'm concerned, the dividend cut was sad but made sense. Meanwhile, book value is $5 and nothing has changed in the economy. The only issue is that their main customer Daiichi has some issues but if they fall away SB can get spot prices which is where many other shippers are. This is Mr Market offering a bargain. I might buy some more.
(In case anyone is blindly copying my picks, this is just a small position for me. Shipping has an extremely stiff supply/demand curve resulting in stock prices going from $10 to $100 over business cycle of 11 years or so. I feel comfortable buying at the low end, e.g. 50% downside vs 1000% upside. Patience grasshoppers

)

DividendGuy · Post by **DividendGuy** » Fri Nov 16, 2012 3:25 am

I recently bought 20 shares of MCD, 20 shares of NSC and 50 shares of VOD.
I'm about tapped out, but I could stretch another purchase if I see something particularly attractive. Wouldn't mind more MCD and PM at current prices. MO has had quite a drop, and many industrials are favorable right now. INTC is also very cheap.

m741 · Post by **m741** » Fri Nov 16, 2012 6:34 am

Bought some GE today, INTC+KO a week ago. Bargains are finally starting to appear and I'm getting ready to unload more from my currently 50% cash position.

jennypenny · Post by **jennypenny** » Fri Nov 16, 2012 1:38 pm

@Toska--Can't you have your "ordinary" retirement plan initially invested in some sort of stable value fund, and then move it when the timing is right? We have all of our recurring contributions (401K/IRA) dumped into retirement trust/stable value funds, and then I move the money into other funds when I'm ready. This way I avoid ill-timed purchases just because the market is acting twitchy on the 15th or 30th.

George the original one · Fri Nov 16, 2012 5:44 pm

Bought ARLP today. Solid & reputable player in coal (unlike many others), so 8% yield and consistent dividend growth is worthwhile.
For those of you who would like to own your oil well, take a look at MVO. It is currently selling at a ridiculously low price. Resource royalty trusts, like MVO (& BPT, CRT, PBT, etc.) are best held in IRA or Roth IRA to avoid extra paperwork.