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Markets still falling like whoa

Llano Estacado

By Llano Estacado
in Business and Markets

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Eastwood
Eastwood

That's why I'm out. There is no end game, IMO. This has to be fixed outside of the market and I got too nervous about what that entails for retail investors. They will always be last on the list, if o

Rusty Shackelford
Rusty Shackelford
Eastwood
Eastwood

I'm not a financial advisor. This is not financial advise. I don't work in finance. I do not have a degree in finance. Actually, I have a BA and I'm bad at math past Cal I. I won't apologize for the l

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Blotto

Blotto 24,018

Posted
Posted
2 minutes ago, Rip76 said:

Sorry I’ve been busy today.  WTF is this all about?

I'd like to think it was  a modicum of common sense making its way into the markets, but its likely more just trading algorithms making bank for the big dogs. Wouldnt shock me to see a complete reversal tomorrow. 

 

 

 

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SDG

SDG 3,336

Posted
Posted
On 6/5/2020 at 2:30 PM, SDG said:

Set your trailing stops and enjoy the ride.  

Captured most my upside and am now all cash and a little gold.  I’ll probably sit on the sideline for a couple months as I move the funds to a new broker.   

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washparkhorn

washparkhorn 9,973

Posted
Posted
1 minute ago, ChiTownDoc said:

Shit - we probably need 4-5 more days of this for the market to truly line up with the real world economy.  But BRRRRT will come out and all will be 'well' again...

Agree - but remember the foundational defense to this contraction has been the financial system. The theory is the real economy will bounce back quicker if the market's asset bubble remains inflated. If we had been forced to rebuild the financial markets, the damage would have been  greater and the recovery would have been much slower. 

Word of a robust fiscal response from Congress will spark the market. Until then, brrrrt by the Fed keeps the spice flowing. 

 

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ChiTownDoc

ChiTownDoc 21,345

Posted
Posted
Just now, washparkhorn said:

Agree - but remember the foundational defense to this contraction has been the financial system. The theory is the real economy will bounce back quicker if the market's asset bubble remains inflated. If we had been forced to rebuild the financial markets, the damage would have been  greater and the recovery would have been much slower. 

Word of a robust fiscal response from Congress will spark the market. Until then, brrrrt by the Fed keeps the spice flowing. 

 

The truth lies in the middle, as always.  Yes, you don't want everything smoldering...but you sure as shit don't need fucking markets at all time highs right as unemployment is at all time highs.  This is serious WTF territory. 

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BevoSwag

BevoSwag 272

Posted
Posted
On 6/9/2020 at 7:52 AM, LTtxfan said:

 

Yesterday Up $45.... now down $30 premarket

Chesapeake Energy Corporation (CHK)

NYSE - NYSE Delayed Price. Currency in USD
Add to watchlist
 
69.92+45.12 (+181.94%)
At close: June 8 4:00PM EDT

37.95 -30.40 (-44.48%)
Pre-Market: 8:50AM EDT

This is caused by these 12 year old geniuses with dad's computer 

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Beau Vine

Beau Vine 55,864

Posted
Posted
On 6/6/2020 at 12:25 AM, closetohumping said:

I'm in the software industry, I've done virtual meetings for the last 8 years I'm not sure if Zoom is any different than it's competitors, but hey good for them

"When your name becomes a verb, that means you're gonna be huge." -- Beau Vine

I said that for years, and that's why I forced myself to buy ZM when its PE ratio was 1800.

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Beau Vine

Beau Vine 55,864

Posted
Posted
On 6/9/2020 at 7:45 AM, B00M said:

Targeted retirement funds are dogshit anyway so no ragrets. High management fees for mediocre returns. 

What in the fuck are you talking about?  Before pandemic I had about 90% of my retirement money in VTTVX (Vanguard 2025 retirement), and the fees are 0.13%.

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ChiTownDoc

ChiTownDoc 21,345

Posted
Posted
3 hours ago, Dbeasy said:


Can’t trust a thing those dirtbags ever say. They only say it after they’ve moved their $100M+ clients into or out of stocks.

This is true - but they aren't exactly moving their people the right direction either.  They hit and miss, just like everyone here. 

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closetohumping

closetohumping 17,817

Posted
Posted
52 minutes ago, Beau Vine said:

"When your name becomes a verb, that means you're gonna be huge." -- Beau Vine

I said that for years, and that's why I forced myself to buy ZM when its PE ratio was 1800.

Apparently they gave all US direct hires 450 stocks yesterday.  Why?  Well because I don’t work there. 

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B00M

B00M 6,734

Posted
Posted (edited)
7 hours ago, Beau Vine said:

What in the fuck are you talking about?  Before pandemic I had about 90% of my retirement money in VTTVX (Vanguard 2025 retirement), and the fees are 0.13%.

Why are you so fucking aggressive grandpa? Vanguard funds are pretty much the cheapest non index funds out there. That fund with its 0.13% expenses is 70% cheaper than its average competitors. Those of us that don't have company based deals with vanguard have to pay ~$75 per transaction fees to buy most vanguard funds which is enough to push my cheap ass to equal or better performing index funds. A similar fidelity target fund is like 0.75% while an index fund is more like 0.02%. 

Edited by B00M
Fuck, man.
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TwiceHorn

TwiceHorn 32,078

Posted
Posted
58 minutes ago, B00M said:

Lastly here's what the fuck I'm talking about. Compare the fucking performance to a got damn index fund. Cheaper AND better:

https://www.fidelity.com/fund-screener/compare.shtml#!&fIds=FXAIX%2CVTTVX&tab=mf

You realize, of course, that a target fund set four years out is a lot less risky than SP500?

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Fudge Nuggets

Fudge Nuggets 19,455

Posted
Posted
1 hour ago, B00M said:

Lastly here's what the fuck I'm talking about. Compare the fucking performance to a got damn index fund. Cheaper AND better:

https://www.fidelity.com/fund-screener/compare.shtml#!&fIds=FXAIX%2CVTTVX&tab=mf

When I switched companies I put about equal amounts in a regular index fund and one of those target retirement funds.  Five years later I realized my index fund was up serious bank and the target fund was down about 2%.  Cut that bitch right then.

Who knows, maybe those funds do alright if you're putting money into a < 10 year target, but I doubt it.  Then again, if they adjust risk based on age then they were probably in a lot of cash going into this year so would have held up nicely.  Who the fuck knows?

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B00M

B00M 6,734

Posted
Posted
7 hours ago, TwiceHorn said:

You realize, of course, that a target fund set four years out is a lot less risky than SP500?

Yes but the original conversation was about a 35 year old.

Here's fidelity's 2050 fund vs an SP500 index

https://www.fidelity.com/fund-screener/compare.shtml#!&fIds=FXAIX%2CFFFHX&tab=mf

And vanguard's 2050 target fund... Results are the same...

https://www.fidelity.com/fund-screener/compare.shtml#!&fIds=FXAIX%2CVFIFX&tab=mf

 

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Beau Vine

Beau Vine 55,864

Posted
Posted
12 hours ago, TwiceHorn said:

You realize, of course, that a target fund set four years out is a lot less risky than SP500?

No, I don't think he does.  Because he just compared returns on a  100% stock fund to a 60-40 stock-bond fund and acted like he dropped the mic.

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Beau Vine

Beau Vine 55,864

Posted
Posted
4 hours ago, B00M said:

Yes but the original conversation was about a 35 year old.

Here's fidelity's 2050 fund vs an SP500 index

https://www.fidelity.com/fund-screener/compare.shtml#!&fIds=FXAIX%2CFFFHX&tab=mf

And vanguard's 2050 target fund... Results are the same...

https://www.fidelity.com/fund-screener/compare.shtml#!&fIds=FXAIX%2CVFIFX&tab=mf

 

What you've just showed is that domestic equities have outperformed foreign equities over the last decade.  Congrats.

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Tailgate

Tailgate 3,075

Posted
Posted (edited)

Long term....loooong term.

 

https://www.cnbc.com/2020/06/12/jpmorgan-says-stocks-will-climb-nearly-50percent-as-investors-flee-low-returns-in-bonds-and-cash.html

 

JPMorgan says stocks will climb nearly 50% as investors flee low returns in bonds and cash

 

Investors are still largely sitting on the sidelines after the market’s epic rebound, but the low returns in bonds and cash have left them with no alternatives but to embrace risk assets again, according to JPMorgan. The firm sees a nearly 50% rise in stocks over the long term due to this shift.

“Our most holistic of our equity position metrics, which compares the size of the equity universe to the size of the bond and cash universe, implies 47% upside for equities from here assuming the implied equity allocation of non-bank investors globally rises from 40% currently to the post Lehman period high of 49%,”  Nikolaos Panigirtzoglou, a managing director at JPMorgan, said in a note on Friday.

JPMorgan looked at the allocation of non-bank investors, including households, corporations, pension funds and insurance companies. Their exposure to equities through Thursday was just 40%, which is below historical averages and at the low end of the period post the financial crisis, JPMorgan said.

It’s a supply and demand argument, the firm said. When investors go back to the levels that they owned stocks in 2018, global equities will climb nearly 50% from current levels, the bank estimated. 

The strategist said the 49% equity allocation level is likely to be revisited “over the coming years given the structurally favorable backdrop of high liquidity and low interest rates.”

Bonds have become increasingly less attractive for yield-hunting investors as the benchmark 10-year Treasury yield dropped to 0.7% from about 2% at the beginning of this year. Prices move inversely to yields and therefore theoretically don’t have much more room to rise.

Meanwhile, Thursday’s brutal sell-off cleared some of the froth in the market, creating a more healthy environment, according to JPMorgan. 

“With some of previous pockets of overextension clearing, we believe that an overall favorable equity positioning backdrop will re-assert itself rejuvenating the equity bull market,” said Panigirtzoglou. “We still see plenty of upside for equities over the medium to longer term.”

After a historic rebound from the coronavirus bottom, the S&P 500dropped nearly 6% on Thursday alone, suffering its worst day since March. The market rebounded on Friday, making back almost half of the losses as of morning trading.

Not only is the market less overvalued after this week’s correction, longer-term drivers for further upside are still in place, JPMorgan said. 

 “A still low overall equity positioning backdrop; a rapid healing of funding markets; a structural change in the liquidity and interest rate environment; and a rapid economic recovery driven by steady lockdown relaxation,” Panigirtzoglou said.

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B00M

B00M 6,734

Posted
Posted
5 hours ago, Beau Vine said:

What you've just showed is that domestic equities have outperformed foreign equities over the last decade.  Congrats.

Just one example of many index funds that outperform the target funds. But i do think the US market is better equipped to weather covid than most of the world, so i definitely don't have 30+% in foreign equities like a 35 year old's target retirement fund would.

Besides, these target funds with ~0.10+% fees are just small collections of index funds (like 3-5 total funds) that individually have ~0.01% fees. With 5 extra minutes of research, one could just buy the same funds and reduce their fees by an order of magnitude. Then they actually have the ability to dump or reduce their % in underperforming foreign funds rather than just accept the 40% missed gains over a decade.

 

 

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52-80

52-80 19,377

Posted
Posted
13 hours ago, B00M said:

Just one example of many index funds that outperform the target funds.

 

 

index fund was expected to outperform target funds last decade, because last decade was a historic bull run for the s&p.  target funds are about risk management, because the sooner youre retiring, the less you want to be exposed to a big drawdown. 

 

if you think of target date as roughly increasing bond exposure as time closes, you'll see corresponding increase in sharpe and sortino...which is what those investors expect

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