It's never the same.Originally Posted by Montello
Someone who lies about the little things will lie about the big things too.
"Well they would say that ... wouldn't they!"
Are you still short on these positions?
S&P now back to mid August 19 & Nasdaq Nov 19,when it appeared the only thing the markets seemed concerned about was Trumps trade war with China and now...
If the P/E's were already quite high when the S&P 500 was at 3000 then what the hell will happen to P/E when large companies start reporting disastrous quarterly results (which we know they will with the current lock down situation)?
Valuations will be so stretched that surely this bizarre rally will have to "burst".
Reading your post took me immediately here:
Raffe, I assume you are implying the opportunity to short stocks rather than investing in them?
I have been reviewing a few companies that I believe will be significantly impacted by the Coronavirus but have held up fairly well since the markets dropped but will fall when the economic impacts of the virus are understood.
I understand spread betting allows me to trade against companies, however, being a complete novice I’m inclined to give it a miss but feel like it could be a missed opportunity. Is there a low risk position to take when spread betting?
Easier to take the risk if you are already a multi-millionaire trader, have done significant due diligence (as per the big short) and be mostly trading other peoples money.
But, recommending someone (for example) should take their £50k life savings, or £300k pension fund and short it on the stock market based on the elephant in the room requires someone to be very, very brave indeed.
I think anyone is really concerned about capital loss they should convert more of their funds into deposits until CV dies down.
Not that I disagree the stock market is mad at the moment.
I agree. You know what you know and are trading - sincerely, all the best to you.
I have a full time job and my investing is a secondary activity - passive funds are best for me. I am hoping things recover in the next 10 years which is a gamble but a sensible one, I feel.
You’re talking historically, this is brand new unknown territory.
'Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money."
have a go if you feel you can
Totally agree, I may not get rich quick, but also won't lose my shirt in a nanosecond. All the best.
I don’t have the expertise for complex investment vehicles so limit myself to products I can fully understand which boils down to the buying and selling if funds, trusts and occasionally individual shares.
The majority of time I buy and hold, plus the occasional switch.
Only 3 times in 30 years have I sold some funds because I don’t like the outlook and this is the third time.
I have never been sitting with so much cash out of the market. I don’t understand this current rally but I’m happy to miss out on some of it as I suspect the risk of upside loss is far less worrying than the potential downside.
I’m figuring in 2-4 weeks we will have a much better view of how this is going to play out.
Seems like a battle between stimulus and fundamentals to me.
Last edited by Montello; 18th April 2020 at 09:49.
I switched some short futures positions into put options. Should have done with all of them, but unfortunately didn't.
In principal, there is no real difference in terms of risk between being long or short, at least not when it comes to the broad market. For single stocks, one could argue that you can lose no more than the capital invested when buying long while short can in theory mean you lose more than the nominal.
Important to understand that I am not advising anyone to do buy nor short any financial instruments, financial advice can never been responsibly given without knowing more about your financial goals, your cashflow situation and your risk tolerance profile.
Fear of missing out on an opportunity is never a good reason to invest, neither buying nor shorting. It was what brought retail investors in droves to past irrational bullmarkets, whether the dot.com bubble of 2000, the Bitcoin-mania of 2017 or Dutch tulips in 1637. Many investors won nice amounts in those bull markets, mistook their lucky gains for proficiency and in the end went under with 'all-in' or even leveraged mega-positions when the market reversed. Always do your own due diligence and if you don't understand how the market works, what the risks are or why you want to invest in the first place (bullish internet/newspaper articles don't count as sensible reason), simply stay away. This is the best advice I can give you.
Such a recommendation would not be brave but irresponsible.
I agree with you that f your investments give you sleepless night, your portfolio is probably too risky. Reduce risk, sleep better.
True. Makes your suggestion even more speculative.
I can only tell you from my experience as fund manager, CEO of a fund management company and director of funds that most active fund managers are charlatans.
i do agree in normal conditions raffe but i would imagine this must be shooting fish in a barrel for active managers? like S&P 500 has airlines, restaurant chains, etc which will all be hugely impacted. underweighting or selling those could be a once in a lifetime opportunity for active management to outperform, surely?
Alpha is measured over much longer periods of time, a three week bet is not alpha.
Someone who lies about the little things will lie about the big things too.
I done another quick trade this week but didnt bother in the early part of the week as the markets didnt feel right, the trade I went though with nearly went wrong on me but I could have also had 2 bites of the cherry had I stuck to my plan.
I bought into a share at 4.15pm Wednesday to leave overnight as I was confident they would go up first thing Thursday morning, plan was to sell once I hit £300/£400 profit, they did go up as planned and I got to £450 profit by 8.30am... but I didnt sell (Idiot!), I felt they would go on for another 10p rise but they didnt and fell all the way back to less than my buy in price- gutted..
Luckily the next morning (Friday) they shot up and I sold at £500 profit, but if I held on like the day before it would have been £900 profit.. Lessons learned, I was gutted about letting £450 go especially as it was my plan to sell and I could have bought back in that evening for less than my original buy in price and doubled up profit next day..
Its not for everyone as it is a bit dangerous but so far I'm doing okay, I base my share buying on a FTSE 100 blue chip company, if they take a big hit then hopefully the worst is I have to hang on until more prosperous days..
sure, i understand that, but i think there hasn't been a market in our lifetime where such a sharp separation between winners and losers ought to become apparent over the coming months, if fund managers are doing their job properly (big if, i agree). when i go back in, im tempted to break the habit of a lifetime and pay for active
How did that work after 9/11?
Someone who lies about the little things will lie about the big things too.
huh, i don't know- guessing not so well. perhaps i'm just falling for the hype. might stick with the vanguard then..
Last edited by robinsongreen68; 18th April 2020 at 22:19.
I got most of my sipp into cash before the drop, i have a little in a fund that has improved to be only* be 9% down, tempted to cash that in also then just sit back, wait and watch ... I don’t care about timing a comeback more avoiding a further steep drop.
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I stuck my little toe in the water a few days ago...and will likely regret it. I just feel 'antsy' sitting on the sideline for an extended period. I guess if I place even a tiny bet, I'm a "player" again!
I’m holding more cash in my portfolio than ever but also took a small step back into the market.I stuck my little toe in the water a few days ago...and will likely regret it. I just feel 'antsy' sitting on the sideline for an extended period. I guess if I place even a tiny bet, I'm a "player" again!
It goes against all my thoughts about the fundamentals of the businesses but there are other factors to consider. I still think the markets are over valued ... but in these times of zero interest rates what are money managers to do?
Even as recently as the 2007 crash rates were 5%. So you could bail out of the markets and still get 5% on your capital. I’d take that right now. As I’m sure many others would.
But imagine you are a pension fund manager with a trillion dollars under management and a load of defined benefit pensions expecting their monthly pension payments. Where do you put your money when cash and equivalents pay zero or negative?
I’m coming to the conclusion that the fundamentals of business are not driving the markets but the needs of investors scratching around for some sort of return.
Last edited by Montello; 19th April 2020 at 12:00.
Pension money managers only care about real returns and the likelihood of incurring a loss. That's why they are the ones buying government bonds with negative interst rates.
Other investors (mainly private individuals) are the ones who are chasing asset classes around in search of a return. At the same time they have to engage in riskier investments than ever before to achieve those returns.
This will not have a happy ending.
All pension funds need growth too; agreed they are typically more conservative than other investors but they can’t just sit on cash and equivalents and continue to meet their obligations. All pension funds will hold equities.
I just hope my fund manager isn't on meth
Not much to ask
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That made me laugh.
Just one simple criteria.
Given the current markets maybe that would help.
Probably the best investment advice on this thread.
Banks will do just fine. Or maybe not.
Its all Crystal Ball guess work at the moment
For Me the dangers are if this Lock down is lifted too soon with a resurgence of people becoming infected this i believe will again spook the markets.
However the longer the lock down is in force the more damage will be done to the economy and again the Markets will suffer.(stating the bleeding obvious)
Trump is going to have a big say on direction of the Markets and being the loose cannon that he is its anyone's guess what could happen.
We are a long way from being out of the woods yet IMO those hoping for some Normality (whatever that means) in a couple of weeks could be in for a few surprises
Another Market correction/crash is inevitable...its probably more of a question of when.
As ever far more questions than answers...
Last edited by SteveM112; 20th April 2020 at 08:28.
That is very telling. You can understand why Banks do not really want to give out loans at this moment in time.
We could see some market movements this week (ie down) - oil has plunged (WTI is $15) as people finally realise that despite the OPEC agreement, there is so much supply in the marketplace. Netflix has a great market cap than ExxonMobil. Let that sink in.
We are also seeing markets realise that the easing of restrictions and 'restarting' the economy in May is becoming a distant idea. This has been my view the primary reason of this buoyant market. It will correct.
On a 2 year horizon, WTI would be a ‘buy’ from $15 a barrel, may not have bottomed out but that isn’t a long term price point
Do your own research etc
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Now $14 pb
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$11.40...wow, there will be forced cuts to production as no storage capacity, incredible times we live in!
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That is super low, how do you buy oil? through an ETF scheme?
I bought into CRUD.L earlier, which is an ETC issued by WisdomTree. This will be a longer term position for me.
Okay, I have a lot to learn before I would think about investing but even so, $12 a barrel seems ridiculously low, I quite fancy buying 100 barrels worth and leave it for the long term??
Same ETC I took also, I’m tempted to go big in my SIPP as I’m 18 years from accessing it so can take the longer term view!
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Certainly getting itchy trigger finger here
The tankers may be the better short term bet, contango is pushing up freight costs and massively increasing profitability for tanker companies (tankers with relatively low book value create huge profitability just as storage). Share prices are already up so that ship.......no I can't be that cheesy
Certainly getting itchy trigger finger hereThe tankers may be the better short term bet, contango is pushing up freight costs and massively increasing profitability for tanker companies (tankers with relatively low book value create huge profitability just as storage). Share prices are already up so that ship.......no I can't be that cheesy
Before you are getting carried away with the prospect: anyone looked into and understands the issue of carrying such a position forward?
Read this and then decide if you want to buy oil.
This is today's data:
Last edited by Raffe; 20th April 2020 at 15:47. Reason: added embedded link
I am not saying buy oil, more I took a punt on the storage of oil via tankers (after reading some stuff last week that has been in public domain for a while actually) and it may be a better punt then oil short term.
Agree, much smarter.
If you buy cash oil, the price of the front month oil contract could double and you'd probably still lose money on the trade.
I can’t think of anything more difficult to forecast than oil. Well I probably can but oil will be right up there.
With the major producers playing silly power games just seems a wild market.
I expect oil will not be $40+ until YE (Brent). We do expect demand to reach 2019 levels until 2022.
looks like it could go to zero for the May future contract!!!!!!!
That would be a first (I believe).
In any case, no reason to buy. I would expect anyone buying on this level to lose money for the foreseeable future.
[QUOTE=Raffe;5391260]That would be a first (I believe).
In any case, no reason to buy. I would expect anyone buying on this level to lose money for the foreseeable future.[/QUOT
A lot of jobs in the industry to go as well.
I seriously hope that people on this thread don’t start making financial decisions (well gambles really) based on the current situation we’re in. There’s a lot of frustration, boredom and uncertainty at the moment. Especially if it’s something you don’t understand or haven’t experience in.
A good time to fill the tank of heating oil in your garden up.
.....and possibly even get a few used 3000L tanks and fill them up too.
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