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What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 10:50 am
by LiveSimple
What does the portfolio one day movement tells you ?

I think I have seen here, to answer the question, can I buy this car, the answer is, yes if your your portfolio, moves to that amount in a day both positive and negative.

What are the other guidelines for a one day portfolio movement that we can hear or use.

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 11:00 am
by ResearchMed
One day portfolio movement is simply noise.
it "tells us" nothing.

There could be (and has been) a big blip up or down, and we wouldn't "do anything" based upon that.

RM

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 11:09 am
by livesoft
Mostly it tells one that one's portfolio fluctuates in value even when one is not looking.

Specific one day movements tell one about market capitulation and psychology of other investors. if there is a big blip down, then I am definitely doing something.

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 11:27 am
by NoblesvilleIN
On up days, my wife holds out her hand and says "show me the money" or "it's not in MY bank account yet, is it?".

On down days, she fires me.

I can't win. :)

Our account can, has, and I assume will continue to fluctuate greatly on some days, less on others. Once you get close to "enough", large dollar (but small percentage) changes are normal.

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 11:37 am
by TN_Boy
LiveSimple wrote:
Wed Oct 09, 2019 10:50 am
What does the portfolio one day movement tells you ?

I think I have seen here, to answer the question, can I buy this car, the answer is, yes if your your portfolio, moves to that amount in a day both positive and negative.

What are the other guidelines for a one day portfolio movement that we can hear or use.
Perhaps you have misinterpreted a prior post?

The portfolio one day movement doesn't tell you anything you didn't already know. If you have a large enough portfolio, then yes, the daily movement might equal the cost of a car. But that means either your portfolio is really big, or it is big and pretty aggressive (high equity), or it is big and the market made a huge move.

The portfolio change depends not just on size, but also stock/bond ratio. On a big stock market move, an $1M 80/20 portfolio would have about the same change as a $2M 40/60 portfolio.

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 4:05 pm
by RadAudit
Depending on the direction and size, it's the difference between one after dinner drink and two.

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 4:32 pm
by chevca
I would have to watch one day movements before it could really tell me anything. :happy

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 4:36 pm
by rkhusky
If the market drops 10% in one day and your portfolio drops 20%, that will tell you something.

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 4:42 pm
by jebmke
This is an interesting question. For most of our investing years, most of our assets were invested in a pension and profit sharing pool that only reported valuations on December 31. So for most of the year we had no idea what our holdings were worth. So I never developed a habit of looking frequently. You could sort of guess - everyone knew things weren't great in October of 1987 but ....

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 4:42 pm
by retiringwhen
I got sick of following organized sports that don't involve pointy objects a long time ago.

Watching the stock market is my spectator sport these days. So one day movement tells me whether I am bored or excited...

More seriously, I frankly think daily movement is all noise, but like a lot of noise we pretend there is a signal in it.

Mandelbrot and others believe(d) there is signal but it is very very faint. Finding it requires $20M worth of computer equipment and 12 PhD's in Physics.

And no, I am not talking Factors.

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 4:49 pm
by goingup
LiveSimple wrote:
Wed Oct 09, 2019 10:50 am
What are the other guidelines for a one day portfolio movement that we can hear or use.
Never heard of guidelines based on one-day portfolio movement. I suppose I'd say if you're watching one day of movement and drawing any conclusions, you will later be proven wrong about your conclusions!

Re: What does the portfolio one day movement tells you ?

Posted: Wed Oct 09, 2019 6:33 pm
by LiveSimple
Great thoughts appreciate all your inputs....