Investing / Holding / Selling / Rebalancing

[Shareguy]

So based on Basils post of average beer market decline of 31 percent.  The NZX benchmark index is down 18 percent for the first 6 months till end of June 2022 (According to BD). If Basils projections come tru we have indeed a long way to go.

At the end of the day none of us know for sure what's going to happen.  I agree caution is indeed warranted, especially for investors with a short term perspective.

[Ithaka]

From WSJ

You Can't Predict When Bear Markets End. So Don't Try.
Investors are better off controlling what they can control
JASON ZWEIG · Jul 9, 2022


Part of what makes bear markets so unbearable is that nobody—and I mean nobody—knows when or how they will end.
That doesn't stop everyone on Wall Street from flogging measures, hunches and folklore purporting to foretell when stocks will finally stop falling.
However, intelligent investors don't bother trying to predict the unpredictable; they focus on controlling the controllable. That's the psychological key to surviving this—and any—bear market, no matter how long it lasts.
To see clearly why it's so important to get your priorities straight, let's look quickly at three beliefs about when bear markets end.
Ask any market veteran when stocks will start to recover, and you're likely to hear something like this: Bear markets don't end until individual investors throw in the towel, fear hits new heights or stocks finally get cheap again.
Taking each in turn, here's why they're myths.
Retail investors have to capitulate. Financial professionals love to argue that bear markets hit bottom when individual investors give up on stocks in a crescendo or "capitulation" of panic selling.
Only trouble is, that isn't what happened in 1932, 1974, 1982 or 2002, among many examples. Bear markets sometimes end in a selling frenzy, but they often end in an indifferent stupor.
Fear has to spike. Many professionals contend that the Cboe Volatility Index, or VIX, is "too low" right now, says Nicholas Colas, cofounder of DataTrek Research, an investment newsletter in New York.
The VIX, commonly called Wall Street's "fear gauge," spiked to then-record highs in October 2008, during the global financial crisis— but stocks still fell more than 19% before the bear market finally ended in March 2009.
"When markets are trying to reprice their expectations of the future, they only nibble away at that truth," says Mr. Colas. No single indicator like the VIX can capture the moment when those expectations are about to shift.
Stocks have to get a lot cheaper. Many investors believe bear markets end only after formerly overvalued stocks finally become bargains again.
It just isn't so.
In March 2009, in the pit of the global financial crisis, stocks traded at more than 13 times their longer-term earnings, adjusted for inflation, according to data from Yale University finance professor Robert Shiller. That was only about 20% cheaper than the average all the way back to 1881.
Although stocks didn't seem like a statistical bargain at the time, they went on to gain roughly 15% annually over the next decade.
All this shows the folly of trying to figure out when stocks have hit bottom.

[Retread]

Unwilling/unable to sell current holdings and no other cash on hand. Sold down 50 percent 8 to 10 months ago but used that up

[Basil]

So based on Basils post of average beer market decline of 31 percent.  The NZX benchmark index is down 18 percent for the first 6 months till end of June 2022 (According to BD). If Basils projections come tru we have indeed a long way to go.

At the end of the day none of us know for sure what's going to happen.  I agree caution is indeed warranted, especially for investors with a short term perspective.

Problem is after last weeks Bear market rally which took the index up 3.9% we're "only" down about 14% year to date, (I acknowledge for many it will feel worse than that), so even if this is only an average Bear market (down 31%) we're not half way there and if its a lot worse than average, say 42%, we're only one third way there, which is a pretty disconcerting thought.

Implications are very different for say someone in their 60's or 70's who has done well over the years, (it may be best to stay highly defensive and protect your capital base), compared to someone say in their 20's or 30's who might want to keep dollar cost averaging into this market.

[Left Field]

Interesting discussion folks.

Another confusing factor is that we often measure bottoms/tops/ bear/bullmarkets based on indexes such as S&P, NZX, VIX etc.

I note the VIX is currently around 24.5 so actually down 37% on its 12 month high of 38.94 possibly indicating 'oversold.'

Re Basil's above comment that based on the NZX "we are one third (down)" to an average bear market decline of 31%. Not quite accurate IMO. NZX last high was September 2021 at around 13259. The recent low of 10589 around 13 June is some 21% down on the high. Maybe a 10% decline yet to come??

On top of the above, individual stocks can show quite different signals from the indexes by either out performing or underperforming the indexes and I tend to base my investing decisions primarily on individual stock signals. I use the indexes for overview comparison points only.

That said, while it is encouraging that some individual shares inching above their 30day MA, they have yet to reach 'golden cross' territory. So still time for caution...

 

[lorraina]

I buy shares in businesses.
Should they perform as I expect, I either hold onto them [buy more] or sell on results.
At present time I am waiting for August result season.
I am expecting a lot of solid results with increased divies.

[Left Field]

I buy shares in businesses.
Should they perform as I expect, I either hold onto them [buy more] or sell on results.
At present time I am waiting for August result season.
I am expecting a lot of solid results with increased divies.

Well said.

Reminds me of something that wise poster Percy once said; (you may be familiar with him/her Lorraina?)
To paraphrase;
"Buying/selling share in between market updates is......speculation.
Buying/selling shares based on market updates is........investment."

[lorraina]

Wise words.?
Sounds familiar....
Pleased you have a better memory than me...lol

[Left Field]

Best day on Wall Street for 3 weeks as earnings season excitement approaches.

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Encouraging. (however re picture/table inclusion rigmarole on this site... it ain't easy.... just saying)

[Left Field]

At last! My portfolio feeling the love recently..... up 13% in the last 2 weeks. Nice feeling but will it hold?

Everyone watching USA earnings season for a guide.

This from Reuters....

Meta and Alphabet are set to post their earnings next week, along with mega-cap peers, including Apple Inc (AAPL.O), Microsoft Corp (MSFT.O) and Amazon.com Inc (AMZN.O).

With 106 of the S&P 500 companies having reported earnings through Friday morning, 75.5% have topped analyst expectations.

Encouraging.

[SmallSteps]

Hopefully encouraging.  Not holding my breath though !
My portfolio *almost* back to where it was at the start of this drop.

[Left Field]

Wall Street back on track, heading to the first positive month in ages.

Has the market bottomed?

Time will tell.

[winner (n)]

The book JUST KEEP BUYING still selling like hot cakes

[Cod]

Wall Street back on track, heading to the first positive month in ages.
Has the market bottomed?
Time will tell.

An argument could be made that the US market got what it wanted from the Fed. Powell did not push back on market projections for interest rates looking out 6-12 months. Not exactly a pivot, but not as harsh as he has been in the last couple of months.

[Left Field]

An argument could be made that the US market got what it wanted from the Fed. Powell did not push back on market projections for interest rates looking out 6-12 months. Not exactly a pivot, but not as harsh as he has been in the last couple of months.

Also helping was the Fed's prediction that a 'soft landing' was more likely than the 'R' word.

I hope they are right!