Stock scream room

Discussion of the Stock portion of the Permanent Portfolio

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dualstow
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Re: Stock scream room

Post by dualstow » Tue Aug 27, 2019 9:10 pm

O0 O0
RIP Marcello Gandini
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Re: Stock scream room

Post by Smith1776 » Sat Aug 31, 2019 6:06 pm

*Sigh*

Guys, ever the tinkerer I am: 100% of the stock portion of my PP is now officially value tilted via:

BMO MSCI Canada Value Index ETF - https://www.bmo.com/gam/ca/advisor/prod ... file%2FZVC

and

Vanguard Global Value Factor ETF - https://www.vanguardcanada.ca/individua ... /?overview

I'm so lucky I'm almost entirely non-taxable... :o
I still find the James Rickards portfolio fascinating.
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Re: Stock scream room

Post by pmward » Sun Sep 01, 2019 3:12 pm

I just have such a hard time getting behind value these days. I just don't think it's possible for it to shine until the financial repression is finally over. Value is tilted too hard to financials, and financials struggle as long as interest rates are held artificially low or negative. I think the day will come, likely a few years from now, when the central banks finally fully paint themselves into a corner and everything blows up in their faces. When that day comes, this will be the time I'll be looking to heavily skew towards value. I think value coming back goes along with Ray Dalio's "Paradigm Shift" that he is predicting in the next decade. Until that point in time, I think it's too early; I just don't think it's possible for value to outperform with such a large allocation to financials in an artificially low/negative interest rate environment.
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Re: Stock scream room

Post by ochotona » Sun Sep 01, 2019 5:18 pm

I am watching the relative momentum of growth and momentum ETFs. When value wakes up, we will know.

Value vs. Growth performance tracker
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Re: Stock scream room

Post by ochotona » Mon Sep 02, 2019 6:20 pm

And this image.

FSLSX is an old Fidelity value mutual fund, FDGRX is an old Fidelity growth mutual fund.

I'd say the worm is ready to turn, but who knows?
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Re: Stock scream room

Post by pmward » Tue Sep 10, 2019 1:47 pm

Very interesting to see small caps going up to test resistance at top of the downtrend channel line the last couple of days, while large caps, bonds, and gold are all floundering. I think that if small caps break out into a new uptrend, that it is very bullish for new highs in stocks (small caps especially have a lot of potential upside in a new stock rally) and a bearish sign for the defensives that have up until now been leading. Will be interesting to see if we get a new uptrend in small caps, and how that resolves in the other assets. Small caps are what I'm watching very closely right now, as the main reason I've been so down on stocks in general lately is that I look to small caps as the canary in the coal mine for stocks, and they've been floundering in a downtrend. But a fresh break out in the small caps would completely change my short to medium term views. Also, value is looking to be perking up vs growth short term. Maybe we are getting some early signals that the "worm is turning" as Ocho likes to say? I'm still a bit resistant to this and require further validation and follow through to buy in, but my curiosity is piqued.
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Re: Stock scream room

Post by ochotona » Tue Sep 10, 2019 2:51 pm

pmward wrote:
Tue Sep 10, 2019 1:47 pm
"worm is turning" as Ocho likes to say? I'm still a bit resistant to this and require further validation and follow through to buy in, but my curiosity is piqued.
This ex-SLB employee is watching the same dynamic play out with SLB, and RSP...
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Re: Stock scream room

Post by pmward » Tue Sep 10, 2019 3:16 pm

ochotona wrote:
Tue Sep 10, 2019 2:51 pm
pmward wrote:
Tue Sep 10, 2019 1:47 pm
"worm is turning" as Ocho likes to say? I'm still a bit resistant to this and require further validation and follow through to buy in, but my curiosity is piqued.
This ex-SLB employee is watching the same dynamic play out with SLB, and RSP...
IJS closed less than 1% from the channel line. We have to break above and hold above that for me to really consider this scenario. We could still reject once again at the trend line, and continue on as we have been. But momentum on the daily chart macd is currently +1.1 which is the highest it's been since that sharp rally that came off of the December lows, and it's still increasing. So we have high and increasing momentum going into this channel line test. We have also had very high volume on each of the big up days in the last week. This alone is making me start to wonder what the markets know that we don't? Seeing large capitol flows out of defensives and into small caps, and small cap value specifically, is interesting and is making me start to question the assumptions I've been operating under for the last year. I just can't see a scenario where small caps can break out, yet we hit a recession and/or sharp stock selloff in the short to medium term. Is the market starting to doubt the recession theory? Is the "smart money" starting to position themselves for a stock rally? Is the economy currently stronger than we think it is? Do we have some upside surprises waiting in the wings? Are growth names finally going to rotate out of favor with all the legal heat big name tech is taking right now? Can a value rotation lead the market for at least one more leg higher? I've got so many questions starting to stir. This last year and a half has been the trickiest and most unpredictable markets I've ever seen.
Last edited by pmward on Tue Sep 10, 2019 3:24 pm, edited 1 time in total.
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Re: Stock scream room

Post by ochotona » Tue Sep 10, 2019 3:23 pm

pmward wrote:
Tue Sep 10, 2019 3:16 pm
I just can't see a scenario where small caps can break out, yet we hit a recession and/or sharp stock selloff in the short to medium term. Is the market starting to doubt the recession theory? Is the "smart money" starting to position themselves for a stock rally? Is the economy currently stronger than we think it is? Do we have some upside surprises waiting in the wings? Are growth names finally going to rotate out of favor with all the legal heat big name tech is taking right now? I've got so many questions starting to stir.
I wonder if it's just the usual "if it bleeds it leads" financial press overselling a dramatic recession story to sell ads. The FRED real-time (but lagged by a month) recession indicator says... no recession yet! Oil is kinda OK, unemployment hasn't turned up yet, maybe we do get a end of year rally. Wonder what the FED does this month!
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Re: Stock scream room

Post by Cortopassi » Tue Sep 10, 2019 4:01 pm

3 1/2 months left in the year. PP was up 17.5% a couple days ago. Up 15.3% today (yes I am looking daily)

Weird sense in my stomach that someone is going to pull something out of their a** and that 15.3% is going to be in the sub 5% range by Dec 31st. Gold back at $1200. Crap like that.

But I also don't see how we can't join the global race to zero/negative rates and how TLT and gold wouldn't be the beneficiaries.

(This always happens to me when I see my portfolio return go down a percent or two)
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Re: Stock scream room

Post by pmward » Tue Sep 10, 2019 4:16 pm

I went out searching for if anyone else in the people I follow are seeing any of the things I'm beginning to notice this week. This video here looked at a bunch of really informative and in depth charts that also do look bullish for stocks in the near term, it's worth a watch if you like that kind of thing (Ocho this would mean you, haha): https://www.youtube.com/watch?v=4VCuBikV9vg

I'm definitely not sure what is going to happen, but I'm starting to doubt the Q4 stock selloff narrative that I have felt so sure of for months now. If this happens, I think we may see a healthy retracement in gold and bonds, but not to bring the PP down to 5% or anything that extreme. Moreover, I would see that as a buying opportunity more than anything. I use the term "healthy retracement" very intentionally here. My long term view has still not budged any, it's just the short to medium term narrative that I'm starting to doubt. I'm starting to question if the timeline I was operating off of might have been a bit too early.
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Re: Stock scream room

Post by Smith1776 » Tue Sep 10, 2019 7:15 pm

I still find the James Rickards portfolio fascinating.
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Re: Stock scream room

Post by drumminj » Tue Sep 10, 2019 8:36 pm

pmward wrote:
Tue Sep 10, 2019 4:16 pm
I'm starting to question if the timeline I was operating off of might have been a bit too early.
...and this is why we are in the pp - it's not about timing the market and shifting out of allocations. That talk belongs in the variable portfolio sub-forum!!
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Re: Stock scream room

Post by pmward » Tue Sep 10, 2019 8:38 pm

drumminj wrote:
Tue Sep 10, 2019 8:36 pm
pmward wrote:
Tue Sep 10, 2019 4:16 pm
I'm starting to question if the timeline I was operating off of might have been a bit too early.
...and this is why we are in the pp - it's not about timing the market and shifting out of allocations. That talk belongs in the variable portfolio sub-forum!!
This is a talk about stocks, so why would it not fit in the thread that is used... for stocks???
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Re: Stock scream room

Post by ochotona » Tue Sep 10, 2019 8:49 pm

We're just venting
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Re: Stock scream room

Post by dualstow » Wed Sep 11, 2019 9:18 am

drumminj wrote:
Tue Sep 10, 2019 8:36 pm
pmward wrote:
Tue Sep 10, 2019 4:16 pm
I'm starting to question if the timeline I was operating off of might have been a bit too early.
...and this is why we are in the pp - it's not about timing the market and shifting out of allocations. That talk belongs in the variable portfolio sub-forum!!
That’s how I felt about all the gold trade talk a year or two ago. I gave up. O0

I wouldn’t care except that it must be strange for someone new to the forum who hasn’t read any of Harry’s books to see all the fast-paced, momentumy, technical chatter. I mean, he’s got a chapter on how how technical stuff is mumbo jumbo.
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Re: Stock scream room

Post by pmward » Wed Sep 11, 2019 9:30 am

dualstow wrote:
Wed Sep 11, 2019 9:18 am
drumminj wrote:
Tue Sep 10, 2019 8:36 pm
pmward wrote:
Tue Sep 10, 2019 4:16 pm
I'm starting to question if the timeline I was operating off of might have been a bit too early.
...and this is why we are in the pp - it's not about timing the market and shifting out of allocations. That talk belongs in the variable portfolio sub-forum!!
That’s how I felt about all the gold trade talk a year or two ago. I gave up. O0

I wouldn’t care except that it must be strange for someone new to the forum who hasn’t read any of Harry’s books to see all the fast-paced, momentumy, technical chatter. I mean, he’s got a chapter on how how technical stuff is mumbo jumbo.
He has a chapter on the technical indicators he believed weren't mumbo jumbo and actually used extensively and successfully in his younger speculating years. He didn't believe all technical stuff was "mumbo jumbo". I highly encourage you to re-read "When the best laid plans..." again. 90% of the posts in this forum are about future speculation. There's simply no way to get rid of this, unless you stop going to investing forums. The gold scream room got to me last year as well, but that wasn't constructive. It was just one disgruntled person coming into the room a couple times a week basically saying "gold sucks, the PP sucks, my 70/30 is great, I have 6 million dollars and you all are poor fools" over and over again.

On this forum we have some people that love buy and hold with no VP, we have some people that love fundamental analysis, we have some people that love technical analysis, we have some people that love quantitative analysis, we have some people that love macro analysis. I think that these views are all valuable and constructive. I see no reason for anyone to poo poo the views that they don't subscribe to, especially since Harry was adamant that most people should have a VP. I also believe that due to normal human psychology most humans are better off having a VP. If all we allowed in here were discussions directly about the PP, there would be no discussion, and nobody would be here.
Last edited by pmward on Wed Sep 11, 2019 9:44 am, edited 1 time in total.
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Re: Stock scream room

Post by dualstow » Wed Sep 11, 2019 9:43 am

I’ve got it in my lap. Ok, he saw something in support and resistance — I think you and I talked about it the last time I said “mumbo jumbo” — but isn’t that totally obviated by rebalancing bands?
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Re: Stock scream room

Post by pmward » Wed Sep 11, 2019 9:49 am

dualstow wrote:
Wed Sep 11, 2019 9:43 am
I’ve got it in my lap. Ok, he saw something in support and resistance — I think you and I talked about it the last time I said “mumbo jumbo” — but isn’t that totally obviated by rebalancing bands?
FWIW, I agree with most of what Harry said on technicals, especially considering the demographic he was writing for. But no, rebalance bands are not a replacement for support and resistance. Both are used for two completely separate ends. I do agree that in the PP people are best sticking to rebalance bands. But in the VP any number of strategies are fair game. Support and resistance aka technical strategies are great. Momentum strategies are great. Buy and hold strategies are great. Quant strategies are great. I think these all are valuable. It really depends on the person and what their constitution and goals are. Personally, I know in my constitution I need a VP so I feel that I have some control. Having the VP to chase gains is a psychological tool that helps me to hold my PP and stick to the rules without modification.
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Re: Stock scream room

Post by dualstow » Wed Sep 11, 2019 9:51 am

pmward wrote:
Wed Sep 11, 2019 9:30 am
On this forum we have ...
I think that these views are all valuable and constructive. I see no reason for anyone to poo poo the views that they don't subscribe to, especially since Harry was adamant that most people should have a VP. I also believe that due to normal human psychology most humans are better off having a VP. If all we allowed in here were discussions directly about the PP, there would be no discussion, and nobody would be here.
I don’t recall anyone saying you couldn’t talk about it. drumminj said all that technical talk really belonged in the vp section. I was saying I felt the same way about previous talk in the gold section - someone was bragging about buying and selling all the time, which just doesn’t have anything to do with the permanent porftolio, but would be fine in the vp section.

None of it is verboten, though. And I agree that there isn’t much to talk about with respect to the workings of the portfolio itself. That’s the beauty of it. New people want to know how cash is dealt with or how to buy bonds at a certain brokerage firm and after that it practically runs itself. Thank Zod for the lounge section.
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Re: Stock scream room

Post by dualstow » Wed Sep 11, 2019 9:53 am

Re: quants - probably half the stocks I’ve mentioned in the vp section were chosen by a family member’s quant newsletter. I don’t normally partake, but I press the appropriate buttons for him per the newsletter and he seems happy.
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Re: Stock scream room

Post by dualstow » Wed Sep 11, 2019 10:07 am

If I could criticize Harry a little bit, I wish that he had stated clearly that the average investor just doesn't have the aptitude to benefit from technical analysis. Well, maybe that was not his opinion. Perhaps you're smart enough to do it, pm. You obviously have a background in it. But, only a few analysts can be..

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head and shoulders above the rest?
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Re: Stock scream room

Post by pmward » Wed Sep 11, 2019 10:35 am

dualstow wrote:
Wed Sep 11, 2019 10:07 am
If I could criticize Harry a little bit, I wish that he had stated clearly that the average investor just doesn't have the aptitude to benefit from technical analysis. Well, maybe that was not his opinion. Perhaps you're smart enough to do it, pm. You obviously have a background in it. But, only a few analysts can be..

Code: Select all

Dr Evil, pinky in corner of mouth
head and shoulders above the rest?
I totally agree that the average person shouldn't dabble in technical analysis, as the amount of knowledge you need to gain is very large. The quote you posted from Harry earlier is true, that most people want that one technical indicator that is magic, and it simply doesn't exist. In technical analysis you have to use multiple indicators, and at any given time you're always going to have mixed signals. It's incredibly rare to have the stars align and see a perfect setup with no contrary indicators. These perfect setups tend to happen more on the longer term charts than the short term charts, like the recent gold breakout. I was pounding the table here for gold for months before it finally broke out. These longer term setups are indeed harder to time though, it was like "ok, be patient, gold is going to breakout like wildfire, but it could happen anytime between now and 2 years from now" haha. Everyone here on this forum had given up on it, and I kept pounding the table and saying it was the most beautiful long term setup I've ever seen. But in the short to medium term, there's almost always some bull and bearish indications on any chart, and if one is going to bet one does have to use some discretion and intuition here, along with the most important piece which is a proper risk management strategy. With a proper risk management strategy you can make more losing calls than winning calls, yet on the whole still make bank. Risk management strategies in trading are very similar to those employed by professional gamblers.

If the average Joe wants to leverage some sort of market timing strategy in their VP, I think that the quant momentum strategies that a few members here employ are much easier to understand and implement then a technical analysis system. Anybody could implement these in the VP and provided they stick to the rules over the long haul they will be successful. I do not trade like I used to, as it was too time consuming, as such I tend to focus more on the long term charts these days. But I still do love to think and discuss about what could happen next. When the stars do align and I see those perfect charts that signal a major macro shift, like gold, I want to make sure my VP is on the right side of the trade.

Recently, I had traded some of my VP small caps for REIT's. When I made that shift small caps were technically looking dead as a doornail. No sooner did I make that shift than small caps started screaming bullish signals left and right. Thankfully I do have a risk management plan in place in case small caps do break out to hedge my bet. It's unfortunate though, and deserves some "scream room" love, haha. So far small cap resistance is holding though, we poked a bit above the channel line this morning only to sell back down below. I'm definitely watching small caps very intently right now. One thing I've said here many times is that I look to small caps as the canary in the coal mine for stocks. If small caps do indeed break out and hold, stocks are heading to new all time highs in a fresh stock bull rally over the coming months. It makes no sense to me right not from a fundamental perspective, but the tape doesn't lie, and I have to go with what the tape is telling me.
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Re: Stock scream room

Post by boglerdude » Wed Sep 11, 2019 11:35 pm

Technical analysis is sperglords jerking off. Pattern seeking feels good. Fine. Its a hobby, and "I need a VP so I feel that I have some control" is a legit reason. Lets not lose perspective tho, if you want to "outsmart" the markets (composed of players like Jim Simons et al): front run or insider trade.

Edit1: Well, money does seem to slosh around between asset classes, so there might be something to be said for "market timing" by buying something beat up. Still, its gambling and shouldnt be thought of as more clever than studying real science

Edit2: A current debate https://old.reddit.com/r/investing/comm ... le_for_an/
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Re: Stock scream room

Post by pmward » Thu Sep 12, 2019 10:56 am

boglerdude wrote:
Wed Sep 11, 2019 11:35 pm
Technical analysis is sperglords jerking off. Pattern seeking feels good. Fine. Its a hobby, and "I need a VP so I feel that I have some control" is a legit reason. Lets not lose perspective tho, if you want to "outsmart" the markets (composed of players like Jim Simons et al): front run or insider trade.

Edit1: Well, money does seem to slosh around between asset classes, so there might be something to be said for "market timing" by buying something beat up. Still, its gambling and shouldnt be thought of as more clever than studying real science
Your views are very limited, subjective, and uneducated. You do not have the knowledge or experience on technical analysis to pass any kind of judgment. It's ok if you say "it's not for me, and I'm not interested". But it's not ok to insult something you have absolutely no real knowledge of. That being said, I don't feel like getting into yet another debate on technical analysis. I've had too many of those already on different forums over the years, and just don't have the patience to go through it again. Just like any other strategy: Those that get it, get it. Those that don't, don't. I have no interest in trying to convert those in the "don't" subset into the subset of those that "get it". However, I will point out that having a closed mind on any subject is nothing more than a self imposed limitation.
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