Gyroscopic Investing

Gotta love the stock market. Does well for weeks, then it suddenly shits its pants for no apparent reason.

Tortoise wrote: ↑Thu Jun 11, 2020 2:52 pm Gotta love the stock market. Does well for weeks, then it suddenly shits its pants for no apparent reason.

Seems to be partly fears of the 2nd wave of corona and partly Powell's gloomy outlook.
What I'm not sure of was the reason the market rose so fast in the first place. :-) Wishful thinking, I guess.

dualstow wrote: ↑Thu Jun 11, 2020 2:54 pm

Tortoise wrote: ↑Thu Jun 11, 2020 2:52 pm Gotta love the stock market. Does well for weeks, then it suddenly shits its pants for no apparent reason.

Seems to be partly fears of the 2nd wave of corona and partly Powell's gloomy outlook.
What I'm not sure of was the reason the market rose so fast in the first place. :-) Wishful thinking, I guess.

The market performs the BEST when things are REALLY bad, but speculation is that things will be less bad going forward. At the same time, there have been a lot of shorts that have been burned over and over again, who have been just itching to try to drop the market. It wasn't the news that caused the spike or the selloff, the news was simply the excuse for people to finally do what they have already been wanting to do. It was a lot of pent up aggression. 48% single day spike in the VIX goes to show how extreme that pent up emotion was.

I'm gonna go out on a limb here and opine that the bear market rally may finally be loosing steam as Wall Street has been getting a reality check on how bad things are, and are likely to remain for some time.

Ad Orientem wrote: ↑Thu Jun 11, 2020 3:25 pm I'm gonna go out on a limb here and opine that the bear market rally may finally be l(o)sing steam as Wall Street has been getting a reality check on how bad things are, and are likely to remain for some time.

Just yesterday, so many voices were saying 'hey, maybe it's going to be a V-shaped recovery after all."

I would like to ascribe the plunge to rational thought, even belated, suddenly arrived rational thought, but...why start (being rational) now?

dualstow wrote: ↑Thu Jun 11, 2020 3:40 pm but...why start (being rational) now?

Exactly this!! The stock market is never rational. We could turn around and be up 5% tomorrow. Then again we could also be down another 5% tomorrow. Either way the media will try to spin it after the fact to force it into some picture they want to paint, just like last week they were painting the bullish picture and this week they are painting the bearish picture.

From my perspective we are seeing Wall Street manipulating increased volatility to drive profits. Returns must be made and for insiders and professionals that is aided by increased volatility. The fact that market touched on January highs when the future prosperity of the world is hanging by a tenuous thread and suffering from historically high unemployment says to me that this is past the realm of irrational...there is gamesmanship going on.

doodle wrote: ↑Sun Jun 14, 2020 12:05 am From my perspective we are seeing Wall Street manipulating increased volatility to drive profits. Returns must be made and for insiders and professionals that is aided by increased volatility. The fact that market touched on January highs when the future prosperity of the world is hanging by a tenuous thread and suffering from historically high unemployment says to me that this is past the realm of irrational...there is gamesmanship going on.

Unemployment has actually been flat for over a month now. The increase in weekly initial claims has been made up for by the decrease in recurring claims (i.e. the people going back to work are making up for new job losses). In other words, for the moment, unemployment has peaked. If you look back at recessions in history, the stock market bottoms and starts going up usually a few weeks before the unemployment peak. It did the same here. This is nothing different than any other recession. The only difference is the speed it happened in. But from a historical standpoint, it's not irrational, it is following the same playbook it always has. In June 09 you probably would have said the same thing you are saying now and look how wrong you would have been. The market is forward looking, not backward or even present looking. If you are looking backwards, or even in the present, you are always going to be disconnected from the market. The market historically performs BEST when things are really bad, but looking slightly less bad going forward. If you wait for past looking economic data (that lags by 3-6 months) to catch up in order to feel safe you will always miss the boat. The stock market is the tail that wags the dog. When CEO's start seeing their stock price going back up, their confidence increases and they start to slow layoffs and even start hiring again.

pmward wrote: ↑Sun Jun 14, 2020 8:48 am The stock market is the tail that wags the dog.

Wondering how the appearances of new GI forum members and more forum hits relates to the stock market ..
Can recall Xan mentioned the hits increased during the worst market days in Feb/Mar. But guess if being any sort of indicator, sadly GI forum would be quite laggine one (for Boglers)

PS. I am not a new GI forum member, I am here since 1st Jan 2020 hahahaha

Stocks up on Russell changes, though the changes will happen June 29th.

dualstow wrote: ↑Tue Jun 16, 2020 1:08 pm Stocks up on Russell changes, though the changes will happen June 29th.

What changes? You mean the yearly reconstitution?

pmward wrote: ↑Tue Jun 16, 2020 3:48 pm

dualstow wrote: ↑Tue Jun 16, 2020 1:08 pm Stocks up on Russell changes, though the changes will happen June 29th.

What changes? You mean the yearly reconstitution?

Yes, although I didn’t know that’s what it was called until you mentioned it.

dualstow wrote: ↑Tue Jun 16, 2020 5:12 pm

pmward wrote: ↑Tue Jun 16, 2020 3:48 pm

dualstow wrote: ↑Tue Jun 16, 2020 1:08 pm Stocks up on Russell changes, though the changes will happen June 29th.

What changes? You mean the yearly reconstitution?

Yes, although I didn’t know that’s what it was called until you mentioned it.

Ah, yeah they do that every year. Not a big deal. It's a poor time to hold any Russell based funds though, because people front run the reconstitution and that forces the index fund providers to have to basically pay to rebalance. I read somewhere that this costed the average Russell fund something like 1% every year vs the index. Russell indexes were made to be indexes not funds, haha.

NASDAQ is at an all-time high.

So it looks like this is now the price for buying in to the 2021 and beyond economy ....the 2020 show is cancelled ....all tickets today are priced for next years shows

mathjak107 wrote: ↑Mon Jul 06, 2020 1:57 pm So it looks like this is now the price for buying in to the 2021 and beyond economy ....the 2020 show is cancelled ....all tickets today are priced for next years shows

Just to be clear you are NOT talking about "music" shows but making some form of analogy and referring to the pricing going on in the financial markets?

Vinny

Yep ...the stock market has pretty much closed the books on 2020 ....the prices we are at now get us in for the 2021 and beyond show

Rebalanced out of an International Growth fund that has risen 25%+ YTD (top holdings include Alibaba, Tesla and Amazon - 11.4% in North America). Felt like the wrong move so hopefully its the right one

There was basically no point to getting out of the market before the crash. (I didn’t).
Amazing recovery. I’ve been trimming my vp, though.

dualstow wrote: ↑Fri Jul 10, 2020 4:18 pm There was basically no point to getting out of the market before the crash. (I didn’t).
Amazing recovery. I’ve been trimming my vp, though.

Seems logical to trim some gains on shares purchased during the decline (no tax implications). I convinced myself to at least rebalance to the more aggressive 80/20 stock allocation and not all the way back to 70/30.

buddtholomew wrote: ↑Fri Jul 10, 2020 4:22 pm

dualstow wrote: ↑Fri Jul 10, 2020 4:18 pm There was basically no point to getting out of the market before the crash. (I didn’t).
Amazing recovery. I’ve been trimming my vp, though.

Seems logical to trim some gains on shares purchased during the decline (no tax implications). I convinced myself to at least rebalance to the more aggressive 80/20 stock allocation and not all the way back to 70/30.

Oh yeah, trimming is often sensible. And I have to admit I was envious of Ocho when I learned that he did more than trim at just the right time. Envious no longer.

dualstow wrote: ↑Fri Jul 10, 2020 6:57 pm

buddtholomew wrote: ↑Fri Jul 10, 2020 4:22 pm

dualstow wrote: ↑Fri Jul 10, 2020 4:18 pm There was basically no point to getting out of the market before the crash. (I didn’t).
Amazing recovery. I’ve been trimming my vp, though.

Seems logical to trim some gains on shares purchased during the decline (no tax implications). I convinced myself to at least rebalance to the more aggressive 80/20 stock allocation and not all the way back to 70/30.

Oh yeah, trimming is often sensible. And I have to admit I was envious of Ocho when I learned that he did more than trim at just the right time. Envious no longer.

Where is that guy? I hope he didn't get COVIDed.

Ocho started posting less frequently even before coronavirus hit. I hope it’s not my fault. I know he wasn’t happy with some of my posts about immigration and ICE happenings.

Last time I saw him here, he was threatening to quit his job since some of his coworkers were refusing to wear masks. So maybe he’s been busy with that.

dualstow wrote: ↑Sat Jul 11, 2020 1:30 pm Ocho started posting less frequently even before coronavirus hit. I hope it’s not my fault. I know he wasn’t happy with some of my posts about immigration and ICE happenings.

I put him on ignore quite awhile ago. He wouldn't discuss issues without irrelevancies due to TDS.