Investments Trade Log

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jacob
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Re: Investments Trade Log

Post by jacob » Wed Oct 10, 2018 4:02 pm

Investors are discovering a new world where interest rates exist/are larger than 0.
Something people under 32 have not ever experienced in their professional careers.

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cmonkey
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Re: Investments Trade Log

Post by cmonkey » Wed Oct 10, 2018 4:08 pm

October slide is happening because yields are rising (slightly) again. Give it a week or two and they'll forget. All the better for me, I would be buying some Fidelity CDs but I have no interest in boosting my taxable income at this point.

Seppia
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Re: Investments Trade Log

Post by Seppia » Wed Oct 10, 2018 4:38 pm

I'm happy to see that my individual stocks are performing significantly better than my indexes.
In today's environment, I'm also happy I own 0% USA indexes and 0% bonds (the one asset I wouldn't buy under any circumstance today thinking about the long term)
Europe and emerging seem priced somewhat fairly, so if they keep getting cheaper that's only good news: I have to stay disciplined and not buy too much too soon.

If you are a stock investor and panic / go all cash for a blip this small you should really reevaluate your asset allocation because you're likely to just hurt yourself.

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Bankai
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Re: Investments Trade Log

Post by Bankai » Wed Oct 10, 2018 5:08 pm

@ Seppia - when sentiment changes, high growth, high PE small caps go down like a rock. With these kinds of stocks, it's usually better to sell first and then ask questions, i.e. you can always re-enter when the dust settles and outlook improves. On Tue morning I was not expecting to sell anything, by today I was taken out of 5 of my 10 positions after they hit stops. No panic selling involved, just 'natural' change in asset allocation in reaction to market conditions.

Obviously, different rules apply to indexes, big caps etc.

Seppia
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Re: Investments Trade Log

Post by Seppia » Wed Oct 10, 2018 5:21 pm

Sorry bankai for the misunderstanding, I wasn't referring to your investing strategy in particular.
I remember we discussed this and you have a very different approach than I have: I'm not questioning your moves, just the rather curious fact that a bunch of index investors who are in theory in "for the long run" are already re-thinking their supposedly immovable asset allocation after a very trivial drop
My circle of friends and the media are already full of such people.
It puzzles me every time

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Bankai
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Re: Investments Trade Log

Post by Bankai » Wed Oct 10, 2018 5:29 pm

Yeah, I'm wondering if a 'total oblivion' strategy might paradoxically be optimal for index investors. I.e. since we know that investor is her own greatest enemy, the strategy of not checking any financial news and deliberately losing the password to her brokerage account might prevent her from shooting her own foot.

Seppia
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Re: Investments Trade Log

Post by Seppia » Wed Oct 10, 2018 5:37 pm

I agree.
Usually the best managers of 401ks are dead people and those who forgot about their 401ks existence.

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Re: Investments Trade Log

Post by jacob » Thu Oct 11, 2018 10:19 am

My stock screen has only showed 16 viables (out of a universe of 3500+ traded stocks) for months, but yesterday the count went to 17 and this morning there were 20.

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Re: Investments Trade Log

Post by RealPerson » Thu Oct 11, 2018 10:43 am

jacob wrote:
Thu Oct 11, 2018 10:19 am
My stock screen has only showed 16 viables (out of a universe of 3500+ traded stocks) for months, but yesterday the count went to 17 and this morning there were 20.
Which website have you found the best for screening stocks?

jacob
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Re: Investments Trade Log

Post by jacob » Thu Oct 11, 2018 10:50 am

Whatever one I have (broker) ... I haven't gone out of my way to look for a "best" one since I just use it to generate a starting list for further research.

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Re: Investments Trade Log

Post by thedollar » Sat Oct 13, 2018 5:39 am

jacob wrote:
Thu Oct 11, 2018 10:19 am
My stock screen has only showed 16 viables (out of a universe of 3500+ traded stocks) for months, but yesterday the count went to 17 and this morning there were 20.
What are your criterias?

slowtraveler
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Re: Investments Trade Log

Post by slowtraveler » Sat Oct 13, 2018 5:59 am

Very curious as well.

jacob
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Re: Investments Trade Log

Post by jacob » Sat Oct 13, 2018 7:52 am

IIRC, it's low debt (under industry average or just under 30%), high ROE, a dividend over 2%, and a rating that's 4/5 or better. It's pretty hard to have all those at the same time. Right now, it's mostly revealing auto-part retailers, chip makers, and a few mining companies which is not concordant with my "other" understanding of where the economy is... so I continue to invest in cash.

thedollar
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Re: Investments Trade Log

Post by thedollar » Sun Oct 14, 2018 1:31 am

Interesting. What would the 2% dividend achieve? You might miss out on good stocks delivering value purely through capital gains.

Do you hold a significant share of cash out of total allocation or simply investing new money coming in in cash?

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Re: Investments Trade Log

Post by jacob » Sun Oct 14, 2018 7:50 am

Value can be faked. Dividends and cash can not [as easily]. I'm increasing my allocation of "can't be faked".

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Re: Investments Trade Log

Post by jacob » Tue Oct 16, 2018 5:36 pm

Some data points for the price-sensitive investors among you:

Federal deficit for 2018 increased 17% to $779B (highest in 6 years).
CBO forecasts $981B in 2019 and >$1000B in 2020.

Interest payments on debt in 2018 increased 24% to $325B

Corporate tax receipts fell 31% (as corporate tax drops by ~1/3 from 35% to 21%)
Tax withholding on individuals increased 1%
=> Overall receipts were flat.

GDP grew so tax receipts fell from 17.2% of GDP to 16.5% of GDP.

Moody's foresees 2018 GDP growth ending at 2.9% for 2018, 2.8% for 2019, and 0.9% for 2020.

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Bankai
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Re: Investments Trade Log

Post by Bankai » Wed Oct 17, 2018 1:54 am

Wait, aren't 'good times' the time to reduce/eliminate deficit and prepare for 'the rainy day', i.e next recession?

oldbeyond
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Re: Investments Trade Log

Post by oldbeyond » Sat Oct 20, 2018 8:01 am

Big picture, nothing was solved after 08/09. Crisis was averted, but we're still in all the predicaments we found us in then(households/governments indebted, eurozone a mess, low growth, high inequality, asset bubbles). Some things are marginally bettter, sure, and the doomsday predictions proved to be false. But no issue is really taken care of.

Currently all assets in my AA(global large cap, global small cap, domestic mid cap, emerging markets equity, precious metals(mostly gold)) are below their 200DMA in my local currency. Interesting to see wether I'll be all cash come rebalancing date.

Seppia
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Re: Investments Trade Log

Post by Seppia » Sat Oct 20, 2018 11:00 am

I'm fairly pessimisting about the next decade, but to say that "nothing was solved" seems a tad strong.
The USA has the lowest unemployment rate in years (decades?), banks have much less leverage, and the S&P has experienced a 200+% rally from the lows in 2009.
The next cisis will definitely not look like the past one (they never do).
The euro zone is a mess for multiple reasons, but I'm fairly confident in saying that the austerity measures played a major role: this to say that I believe without zirp the world would be in a worse place than it is now.

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Re: Investments Trade Log

Post by jennypenny » Mon Oct 22, 2018 7:33 am

Volatility Lessons, recent article by Fama and French (PDF)

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