OT: Stock and Investment Talk
- Thread starter RU-05
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I'm staying away for now, possible huge upside, but maybe not.
Could be a 2nd wave of covid recovery stocks down the road?
I bought at $20 and sold at 29+ last week. Should have held another week as it’s at 37 today
Ya, we talked about it a couple weeks ago, think I sold for basically no gain as I was looking to reallocate.
It's at $37 now, I have a bid in for $34. See if that happens.
I'm not sure how true or typical this is but I feel companies that are getting bought up tend to run upwards for days or longer after the announcement.
I saw this interview, and the possibility of Milton selling stock is concerning, but the other investors staying in until at least April makes me think the stock won't tank before then.
It all hinges on the GM deal, we know they are still in talks. Will it fall apart? Maybe. Could it happen? Given they are still in talks, of course.
If the deal goes through the stock jumps(and I'm sure Milton would sell some at this point) if it doesn't it tanks.
That's the short term play in a nut shell.
We have a modest amount of REITS via my wife's old TIAA-CREF account, probably only 1%'ish of our overall investments. Over the past decade or so it has returned 7-8% (about the same as a high yield bond fund).
Overall, I'm meh about it.
Question to everyone:
How are you planning for retirement? I mean, how into the numbers and forecasts are you getting? Also, what is your POV? Some folks have a clear plan of what they want from retirement and try to save the money for it. While some just save as much as possible and figure out later what type of retirement they can afford.
We are more the latter than the former. We are planning for two homes, one definitely in Stone Harbor NJ, but the details depend on our savings over the next 12-15 years.
How are you planning for retirement? I mean, how into the numbers and forecasts are you getting? Also, what is your POV? Some folks have a clear plan of what they want from retirement and try to save the money for it. While some just save as much as possible and figure out later what type of retirement they can afford.
We are more the latter than the former. We are planning for two homes, one definitely in Stone Harbor NJ, but the details depend on our savings over the next 12-15 years.
Me, usually, but these days I can get better yields on out of favor industrials with potential for upside. Hell, the Dogs of the Dow yields 4.5%.
I think my only REITs left are MNR & DLR. I dumped the offices & malls back in March. I plan to pick up SPG again if it gets below $80. They've been digging through the bargain bin with their cash and setting themselves up nicely for a recovery. Meanwhile you get paid 8% just to hold it.
IMHO the bias will be up until the Georgia run-offs are run, with the expectation the Senate will remain Republican. I'm not so sure. So I picked a few well out of the money SPY put with February expirations. Not as cheap as I hoped, 'cause a few others are thinking similarly. Because it if the Senate goes Democrat look out below.
Great days for the Tech stocks finally the rotation is coming back. I feel better with the market with Jeremy Siegel saying will have a good 2021.
2020 was an outstanding year for those that took advantage of the artificial buying opportunity. As long as the R's hold the Senate, 2021 will be good as well.
My friend's wife who works for Slack was very pleased! My little 200 shares provided me with a nice %'age gain but no real significance.
As you know, there are many considerations related to retirement planning. Below are some links that I think are helpful. There are many more but try to stay clear of ones trying to sell you something.
There is no one “right” way, in my opinion. Some steps I’ve tried to take in a general sense include: save early and diligently; maximize any qualified plans available to you;avoid high fee advisors, you can probably do it yourself; write a written investment plan that specifies your goals and what to do or not to do; think about asset allocation and what works at different ages; think about asset location and what investments should go into what accounts; avoid behavioral finance pitfalls; try to decide what you want out of retirement, as you mention; create a spreadsheet or use some online calculator such as firecalc or iorp to help you test various scenarios and assumptions; be aware of “sequence of return risks” for when you retire; consider traditional and Roth IRAs depending on your situation; think about the pros and cons of taking social security at various ages; prepare the appropriate documents early and be prepared for when one of you predecease the other; and lots more. Each of these is a topic worthy of considerable thought and actions. Educate yourself on all these topics and personal finance in general. Good luck!
Retirement planning
News and in-depth features about tax, accounting, auditing, and other business topics. Published by the American Institute of CPAs
www.journalofaccountancy.com
The Journal of Retirement
Kitces.com - Advancing Knowledge in Financial Planning
Home of the Nerd's Eye View financial planning industry blog and The Kitces Report newsletter for IMCA and CFP CE credits, published by Michael Kitces.
www.kitces.com
Edit> I was remiss in not pointing out a very important consideration: estimating expenses in retirement and using that to estimate your needed portfolio size. Some pre-retirement expenses will likely/hopefully disappear (mortgage, commute and work related expenses, social security contribution, helping kids with college costs, etc. Some expenses may increase such as medical insurance, discretionary travel/hobby’s, etc. You can then use that to assess how prepared you are financially. Many feel you need about 25x your annual expenses, net of social security, defined benefit if applicable, and other income streams. Personally, I think that is the low end but it is highly individual and dependent on what you want to do in retirement.
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Why would a Democrat controlled Congress be bad for stocks? Not trying to get political here, just genuinely curious.
One item to consider for 2020 performance, and to think about regarding future performance of risk markets, is the government’s rampant intervention in the spring. Sure, the Fed dropped interest rates to zero, but that in and of itself would not cause risk premiums to collapse as they did. Yes, some contraction would occur, but not the snap back that we witnessed. What drove the snap back? I’ll call it Mnuchin’s bazooka. When the government stated they would purchase all sorts of corporate bones, including high yield ETFs, the market for risk assets rallied meaningfully. No surprise, it opened the floodgates for all sorts of sectors to raise money, from airlines to cruise companies, to sure up liquidity (incidentally, that debt still resides in those companies balance sheets, making recoveries in their shares a bit more problematic). You didn’t want to be out of the market when Mnuchin would announce a SPV for S&P500 ETFs. if they’d buy HY, why not?
In an earlier post, I mentioned how risk premiums were fair right now across markets on a relative basis, but absolute valuation metrics were near all time extremes. In a very real sense, that’s the government’s intervention (or convincing threat of intervention) at work. It’s not capitalism. The government absolutely swept in to save many businesses, and holders of risk assets benefitted.
We have socialized risk to a greater extent today than ever before. To me, that’s the story of 2020 markets.
In an earlier post, I mentioned how risk premiums were fair right now across markets on a relative basis, but absolute valuation metrics were near all time extremes. In a very real sense, that’s the government’s intervention (or convincing threat of intervention) at work. It’s not capitalism. The government absolutely swept in to save many businesses, and holders of risk assets benefitted.
We have socialized risk to a greater extent today than ever before. To me, that’s the story of 2020 markets.
Tax hikes, and possibly significant ones at both the corporate and individual levels, is the most obvious. Increased regulations as well. And if it turns out the AOC/Sanders/Warren faction of the party wields an outsized influence that will happen on steroids, though the narrow majorities they look to have makes that less likely.
Corporate tax rate hikes combined with more restrictive regulatory policy. Personal tax rate increases for the top income brackets to a lesser extent.
Thank you
Thank you and also @Frida's Boss. Personally, I think Biden and the Democrats would repeal Trump's 2017 tax cut at first. Then they probably wouldn't do anything for two years until the mid terms and see if they still have control of Congress.
However, I feel market valuations for certain companies are due for a correction regardless of tax hikes or not.
Thank you and also @Frida's Boss. Personally, I think Biden and the Democrats would repeal Trump's 2017 tax cut at first. Then they probably wouldn't do anything for two years until the mid terms and see if they still have control of Congress.
However, I feel market valuations for certain companies are due for a correction regardless of tax hikes or not.
I don’t disagree with your view on certain companies valuations, but an increase in corporate taxes will make businesses less valuable overnight, and share prices will adjust.
I wonder if anyone ever tracked how stocks have performed under Republican or Democratic presidents.
The market doesn’t really like D or R presidents. The market excels when the legislative and executive branches are controlled by different parties. If a Rep pres like now and a Dem congress market does well. Dem pres. and a Rep congress market does well. Market likes steady no big changes. If on party controls both changes are on the horizon. That is why the Georgia run off is super important that Rep remain in control of senate with a Dem Pres. if the Georgia run off leads to dem control market will go down. If Rep wins we see more gains for another year.
This is spot on. Also, let’s be realistic: this is not your father’s DEM party. The far left faction will lean heavily on Biden, and the policies will ultimately hurt financial markets.
+1
The markets need a R Senate. If it becomes 50-50, at least we have Joe Manchin to block the wild stuff from the Dems. Also, the Dem majority in the House took a huge hit. The R's flipped 14 seats and cut the Dem majority to 6 seats at most (may go as low as 4 seats). That's a historically tiny majority. They may not be able to pass anything too nutty.
We shall see. I'm optimistic about 2021.....market and Senate! :)
If anything history has shown that political leaders have very little to do with the stock market. But feel free to speculate wildly.
I had a very meh day today, up .3%. Maybe I was due after having a very good run since early Sept(which really got rolling after the election), or maybe this was a sign some of those stocks that have carried me for the past 3 weeks have dried up.
There was a poster here who pointed out prior to the election that the market likes gridlock, and sure enough when it looked like(still unsure of course) the Senate would remain red the market took off. This was new to me, and something I found pretty interesting.
Now there are certainly sectors in the market that would really like a full blue wave, EV related stocks, renewables and weed stocks for instance, while stocks like oil and the banks, because of regulation, would really struggle.
At least this is something I think I've learned over the past couple months.
Like I said, I was doing very well the past 3 months, significantly better then the majors, so I might need to adjust, but I'm not going to index investing anytime soon.
Over the long run, you are going to lose money (just like the vast majority of professional managers).
Over the long run, those who held more than 10% exposure to Apple have outperformed whatever index they were measured against, regardless of the makeup of the rest of their portfolio.
About 95% of professional managers can't beat the S&P 500 over time. Which means, unless a disproportionate amount of that 5% post on this board, most here are FOS.
:)
The passive segment of the asset management industry has done a great job of convincing everyone that active management is suboptimal, and I’d say the vast majority of people should abstain from trying to actively manage their own holdings.
However, there are several issues with the blanket assumption that no one, or very few, can outperform the market because the vast majority of professional managers fail to do so. Those issues pertain to the constraints faced by professional managers that are not necessarily faced by those managing smaller amounts of money.
Before delving into those issues, however, it should be said that if you are unable to value a company and understand its financial statements (including the footnotes), you shouldn’t invest in individual stocks. Better to devote time to other areas of life and enjoy the average returns offered by indexing.
Those who can assess valuation, however, and are “blessed” with having a smaller amount of money to invest have some powerful advantages over professional managers. First, the universe of available investments is far, far larger. Most professional managers have a limited universe of investable securities because they cannot deploy enough capital in smaller issues without severely damaging the liquidity of that stock, but more importantly, they can’t deploy enough money to make it worth their while. The larger number of informed investors looking at a finite universe of stocks will make it relatively more efficient than a group of stocks that are not pored over by professional analysts. Hunt where there are game and where relatively few expert hunters are able to go.
Second, professional fund managers generally must adhere to diversification rules forcing them to invest in far more stocks than necessary or desirable to achieve a prudent level of risk mitigation. That means they must make far more decisions, and more decisions equals fewer good decisions. In essence, investing can be like poker. Most of the time, do nothing, until a high probability hand drops in your lap. Then, you must take advantage and not simply invest 2% of your funds. Professional fund managers (and I’m speaking mostly of mutual funds, but also larger hedge funds) can’t do that.
Third, volatility kills asset management businesses. Large moves down can lead to withdrawals, which equals less AUM to earn management fees upon. The reality is outperformance over longer periods necessarily means larger price volatility, since a portfolio with fewer but higher conviction investments tends to move more than a more diverse portfolio that looks like an index. If you want a result that is better than average, you must do something that is different than the averages. In my view, this requires an unusual amount of emotional stability and is probably the greatest reason why many individual investors are unable to outperform.
Summed up, an investor with a comparatively small amount of capital without the demands of the asset management business has access to a broader array of investments and does not have to make as many correct decisions, which are basically predictions about the future, to do better than average. This assumes this person can assess a business and value it conservatively. Following those tools can take a small pool of money and make it large, where you would start to face the constraints borne by larger fund managers. But by then, you’d be rich, so who cares?
