U.S. stocks in freefall

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FillorKill
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Re: U.S. stocks in freefall

Post by FillorKill » Mon Aug 24, 2015 11:44 am

Uncle Pennybags wrote:If you bought S&P 500 at 9:30 AM this morning you would be up 5.5% at this point in time.

I did. I am. Such an unusual experience. I'm more familiar with this: Buy VWO/VSS/VEU, they drop, I TLH. I must have done something wrong this time and may have even ruined this flash crash for everyone. Sorry about that. Won't happen again.

JW-Retired
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Re: U.S. stocks in freefall

Post by JW-Retired » Mon Aug 24, 2015 11:50 am

Oh bother! it's bouncing back up. Missed the dip buying again.
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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Mon Aug 24, 2015 11:51 am

Uncle Pennybags wrote:If you bought S&P 500 at 9:30 AM this morning you would be up 5.5% at this point in time.

HongKonger wrote:Yup - I placed a buy order for VTI on Friday night for what I thought was a silly price. Caught the opening drop. I'm happy.
FillorKill wrote:I did. I am. Such an unusual experience. I'm more familiar with this: Buy VWO/VSS/VEU, they drop, I TLH. I must have done something wrong this time and may have even ruined this flash crash for everyone. Sorry about that. Won't happen again.
I hold regular funds and get the end of the day price. I don't think too much about investing, it hurts my head and is counter productive. Remember someone sold what you bought.

A true Boglehead investor isn't even aware of the monthly ups and downs. I watch because it is better than Soap Operas.

knowsnothing
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Re: U.S. stocks in freefall

Post by knowsnothing » Mon Aug 24, 2015 11:57 am

ginmqi wrote:[

Happy camper checking in. I see another happy dude/dudette a few posts above as well.
:sharebeer


I wouldn't mind a nice prolonged downturn. :beer

Crow Hunter
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Re: U.S. stocks in freefall

Post by Crow Hunter » Mon Aug 24, 2015 11:58 am

Uncle Pennybags wrote:
Uncle Pennybags wrote:If you bought S&P 500 at 9:30 AM this morning you would be up 5.5% at this point in time.

HongKonger wrote:Yup - I placed a buy order for VTI on Friday night for what I thought was a silly price. Caught the opening drop. I'm happy.
FillorKill wrote:I did. I am. Such an unusual experience. I'm more familiar with this: Buy VWO/VSS/VEU, they drop, I TLH. I must have done something wrong this time and may have even ruined this flash crash for everyone. Sorry about that. Won't happen again.
I hold regular funds and get the end of the day price. I don't think too much about investing, it hurts my head and is counter productive. Remember someone sold what you bought.

A true Boglehead investor isn't even aware of the monthly ups and downs. I watch because it is better than Soap Operas.


Maybe you should watch Chinese Soap Operas. I hear they are very interesting, or so a little bird told me.

:D

Bracket
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Re: U.S. stocks in freefall

Post by Bracket » Mon Aug 24, 2015 12:00 pm

beammeupscotty wrote:
Bracket wrote:Wow IJS is roaring back up. (Up 10% since I bought) I guess I should have bought more.


Did it really briefly trade at $78.41? Wow. Good catch.

Image



Yeah I bought at 87, it fell more,
And now it's at 108. Dumb luck mostly.

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sperry8
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Re: U.S. stocks in freefall

Post by sperry8 » Mon Aug 24, 2015 12:01 pm

FillorKill wrote:
Uncle Pennybags wrote:If you bought S&P 500 at 9:30 AM this morning you would be up 5.5% at this point in time.

I did. I am. Such an unusual experience. I'm more familiar with this: Buy VWO/VSS/VEU, they drop, I TLH. I must have done something wrong this time and may have even ruined this flash crash for everyone. Sorry about that. Won't happen again.


Re TLH, how long do we have to wait to TLH? That is, if I bought VWO a week ago, can I TLH today? I know I cannot re-buy the same or similar fund for 30 days to make it count. But wasn't sure if I also have to hold for 30 days as well.
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Re: U.S. stocks in freefall

Post by gkaplan » Mon Aug 24, 2015 12:02 pm

tyler_cracker wrote:
HomerJ wrote:You've been posting this for the past 3 years... Pretty much every thread you have posted has been doom and gloom.

But I'm glad you're happy that you're right for once. Still doesn't make you an expert predictor, and it still doesn't make it easy to predict "downdrafts"


:thumbsup


:thumbsup :thumbsup
Gordon

FillorKill
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Re: U.S. stocks in freefall

Post by FillorKill » Mon Aug 24, 2015 12:08 pm

sperry8 wrote:if I bought VWO a week ago, can I TLH today? I know I cannot re-buy the same or similar fund for 30 days to make it count. But wasn't sure if I also have to hold for 30 days as well.
Yes, no holding period requirement. You can TLH a bad am buy in the pm.

autonomy
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Re: U.S. stocks in freefall

Post by autonomy » Mon Aug 24, 2015 12:23 pm

Has anyone seen any dead cats bounce through here? 8-)

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backpacker
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Re: U.S. stocks in freefall

Post by backpacker » Mon Aug 24, 2015 12:37 pm

TomatoTomahto wrote:
HomerJ wrote:
Browser wrote:Anybody who didn't know this stock market downdraft was coming just hasn't been paying attention.


You've been posting doom and gloom posts for the past 3 years...

But I'm glad you're happy that you're right for once. Still doesn't make you an expert predictor, and it still doesn't make it easy to predict "downdrafts"


Funny, I've got a broken clock that's right twice a day, but a slightly slow clock that's hardly ever right.


I never thought about that. A slow clock is right less often than a broken clock. And a clock that runs backwards is right more often than a broken clock. In fact, the faster a clock runs backwards, the more often its right!

And now the analogy has officially been taken too far. :D

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Re: U.S. stocks in freefall

Post by HongKonger » Mon Aug 24, 2015 12:55 pm

Uncle Pennybags wrote: I hold regular funds and get the end of the day price. I don't think too much about investing, it hurts my head and is counter productive. Remember someone sold what you bought.

A true Boglehead investor isn't even aware of the monthly ups and downs. I watch because it is better than Soap Operas.


Not everyone has access to 'regular funds' by which I assume you mean mutual funds. ETFs are regular funds to quite a lot of people these days.

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Re: U.S. stocks in freefall

Post by dbCooperAir » Mon Aug 24, 2015 1:04 pm

Flipped the news on today and I thought the world was ending, as it turned out the stock market took a hit, who would have guessed!

Image

Image
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Re: U.S. stocks in freefall

Post by grettman » Mon Aug 24, 2015 1:29 pm

autonomy wrote:Has anyone seen any dead cats bounce through here? 8-)


I did. I tried to save it but a falling knife went into its back. :shock:

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Re: U.S. stocks in freefall

Post by jarda » Mon Aug 24, 2015 1:44 pm

FillorKill wrote:
sperry8 wrote:if I bought VWO a week ago, can I TLH today? I know I cannot re-buy the same or similar fund for 30 days to make it count. But wasn't sure if I also have to hold for 30 days as well.
Yes, no holding period requirement. You can TLH a bad am buy in the pm.

Are you sure about that? I always thought this will trigger a wash sale. As per investopedia (http://www.investopedia.com/terms/w/washsalerule.asp):

The rule defines a wash sale as one that occurs when an individual sells or trades a security at a loss, and within 30 days before or after this sale, buys a “substantially identical” stock or security.

My understanding is you need to wait 30 days if you want to avoid wash sale.

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Re: U.S. stocks in freefall

Post by Hunky-dory » Mon Aug 24, 2015 1:50 pm

Speaking of soap operas, what are predictions for final close? My guess is down 2.92%.

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Re: U.S. stocks in freefall

Post by Tanelorn » Mon Aug 24, 2015 2:05 pm

Hunky-dory wrote:Speaking of soap operas, what are predictions for final close? My guess is down 2.92%.

I'll take the under on -4% (worse).

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Re: U.S. stocks in freefall

Post by new2bogle » Mon Aug 24, 2015 2:10 pm

I'm always so tempted to buy individual stocks at times like these. Like C or AAPL or something! But I never know what.

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Re: U.S. stocks in freefall

Post by packet » Mon Aug 24, 2015 2:17 pm

jarda wrote:
FillorKill wrote:
sperry8 wrote:if I bought VWO a week ago, can I TLH today? I know I cannot re-buy the same or similar fund for 30 days to make it count. But wasn't sure if I also have to hold for 30 days as well.
Yes, no holding period requirement. You can TLH a bad am buy in the pm.

Are you sure about that? I always thought this will trigger a wash sale. As per investopedia (http://www.investopedia.com/terms/w/washsalerule.asp):

The rule defines a wash sale as one that occurs when an individual sells or trades a security at a loss, and within 30 days before or after this sale, buys a “substantially identical” stock or security.

My understanding is you need to wait 30 days if you want to avoid wash sale.

I believe the before/after this sale is referring to making this TLH sale AND purchasing a "substantially identical" investment +/-30 days.
Thus, if sperry8 hasn't purchased a "substantially identical" investment in the last 30 days (and refrains from doing so in the next 30 days), they are in the clear, no holding period. This is across all accounts and includes reinvested dividends.

Just my current understanding... as always, I could certainly be wrong.

:beerCheers,
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Re: U.S. stocks in freefall

Post by Crow Hunter » Mon Aug 24, 2015 2:18 pm

jarda wrote:
FillorKill wrote:
sperry8 wrote:if I bought VWO a week ago, can I TLH today? I know I cannot re-buy the same or similar fund for 30 days to make it count. But wasn't sure if I also have to hold for 30 days as well.
Yes, no holding period requirement. You can TLH a bad am buy in the pm.

Are you sure about that? I always thought this will trigger a wash sale. As per investopedia (http://www.investopedia.com/terms/w/washsalerule.asp):

The rule defines a wash sale as one that occurs when an individual sells or trades a security at a loss, and within 30 days before or after this sale, buys a “substantially identical” stock or security.

My understanding is you need to wait 30 days if you want to avoid wash sale.


That only applies if you purchase and KEEP a substantially identical fund/tax lot in the previous 30 days or 30 days after as "replacement shares" for the ones you sold.

If you bought ETF X 15 days ago and then this morning at 9:00 am bought ETF X again and sold it this afternoon at 2:00 pm, but kept the tax lot you purchased 15 days ago, then yes, you would trigger a wash sale as they would be considered "replacement shares".

If, however, you sold both tax lots, you would not.

Remember the key is replacement shares. They aren't replacement for anything if you don't keep them.

http://fairmark.com/capgain/wash/wsreplac.htm

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Re: U.S. stocks in freefall

Post by Thebigc » Mon Aug 24, 2015 2:34 pm

Hunky-dory wrote:Speaking of soap operas, what are predictions for final close? My guess is down 2.92%.


Someone shoots the Dow, and the S&P is actually alive and taking a shower.

Dow and S&P

Dow -4.

S&P - 4.5%

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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Mon Aug 24, 2015 2:43 pm

autonomy wrote:Has anyone seen any dead cats bounce through here? 8-)
No cats but I wouldn't walk under any windows on Wall Street about 4:10 PM EDT. :twisted:

UADM wrote: Market timing isn't common, but it is absolutely possible.
Make a post with your predictions and I'll follow you. I wouldn't give you a penny for your thoughts though. Traders without inside information are suckers.

S&P 500 buy 9:30 sell at 1:10 make 6.3%, how did I do?

SpideyIndexer
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Re: U.S. stocks in freefall

Post by SpideyIndexer » Mon Aug 24, 2015 2:55 pm

Any comments on the big dip in IJS? I know small caps are more volatile than large or TSM, but 25% down for the first hour or two seems as lot.

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Re: U.S. stocks in freefall

Post by jarda » Mon Aug 24, 2015 2:56 pm

Crow Hunter wrote:
That only applies if you purchase and KEEP a substantially identical fund/tax lot in the previous 30 days or 30 days after as "replacement shares" for the ones you sold.



Ok, I stand corrected.

Thebigc
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Re: U.S. stocks in freefall

Post by Thebigc » Mon Aug 24, 2015 3:13 pm

SpideyIndexer wrote:Any comments on the big dip in IJS? I know small caps are more volatile than large or TSM, but 25% down for the first hour or two seems as lot.


No nothing specific on IJS but some are saying small caps are finding a bottom or found one, but then everyone is waiting to see what happens in China. Though we should not expect another crazy morning, more downside coming though. September could be like August, they are calling it a very weird day and nobody knows what to make of it yet. No answers, I mean apple was down 13% up a couple percent and now down a couple percent.

So small caps may have bottomed, though we are suppose to go lower. We could go down another 10 percent through the year, who knows. Basically we just sat through an entire 1 year market cycle in a day, and it'e weird. I just watch for Kelly Evans, I'm shallow like that.

EM's looking really bad because of currency issues and that may drag us down some more. IJS is not the only thing that too that big auto drop but that has to do with heavy weeked sell orders that went through at the open.

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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Mon Aug 24, 2015 3:49 pm

UADM wrote:According to you, I am a sucker. Yet, my business has flourished,
Your "business"? You are not the sucker. :wink:

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parsi1
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Re: U.S. stocks in freefall

Post by parsi1 » Mon Aug 24, 2015 3:50 pm

I was shoe shopping on Amazon this morning, so I didn’t notice the 1000 point drop in the market or the deep discount on ETFs or stocks.
Well I need to pay more attention next time.

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Re: U.S. stocks in freefall

Post by Leeraar » Mon Aug 24, 2015 3:52 pm

Browser wrote:
TomatoTomahto wrote:
2Birds1Stone wrote:As a newer investor who dumped his entire net worth into a 80/20 portfolio over the past few months this definitely doesn't feel very good -_-
If it always felt good, everyone would be doing it. The reason you generally make money at this is that there's always the small nagging fear that it will be global and long-lasting. You can't do much about it except lock in the losses, so relax.

On the other hand, this could get a lot worse. My theory: if you're likely to bail if stocks go down by 25% or more (be honest) then I'd go ahead and bail right now rather than later. Your equity bet was too large and now you know it. Reset.

This is very bad advice. Disregard it.

L.
You can get what you want, or you can just get old. (Billy Joel, "Vienna")

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Re: U.S. stocks in freefall

Post by CantPassAgain » Mon Aug 24, 2015 3:59 pm

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livesoft
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Re: U.S. stocks in freefall

Post by livesoft » Mon Aug 24, 2015 4:01 pm

SpideyIndexer wrote:Any comments on the big dip in IJS? I know small caps are more volatile than large or TSM, but 25% down for the first hour or two seems as lot.

There are a few possibilities, but here are just two of them:

1. Margin calls for folks who bought IJS on margin. Their brokers just sold their IJS to meet the margin call.
2. Folks who had active stop-loss orders in place. Once the activated, the shares were just sold.

Both of the above could probably have created the early 10 minutes of market activity.
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autonomy
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Re: U.S. stocks in freefall

Post by autonomy » Mon Aug 24, 2015 4:09 pm

Tanelorn wrote:
Hunky-dory wrote:Speaking of soap operas, what are predictions for final close? My guess is down 2.92%.

I'll take the under on -4% (worse).


Winner, winner, chicken dinner!

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TomatoTomahto
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Re: U.S. stocks in freefall

Post by TomatoTomahto » Mon Aug 24, 2015 4:38 pm

Funny, when I say that I'm dumb as a sack of hammers and lost the equivalent of a Tesla or two over the past couple of days, nobody disbelieves me. :oops:

I guess the likelihood that I'm lying is greater if my narrative has me as the super-hero. But, even if I were, it wouldn't be right to rub it in when some people, especially new investors, are feeling a bit queasy. That wouldn't be super-hero behavior at all, would it?

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TomatoTomahto
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Re: U.S. stocks in freefall

Post by TomatoTomahto » Mon Aug 24, 2015 4:47 pm

UADM, for the record, it doesn't matter to me whether you're telling the truth or not. Truly.

If you have something to contribute other than war stories, or how you're more clever than others here, I'm all ears.

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Re: U.S. stocks in freefall

Post by scone » Mon Aug 24, 2015 4:52 pm

Wowie zowie, I can't even tell you guys how relieved I feel. I didn't even know I was getting worried about how high the market had risen, and then it just sat there, doing nothing, for months! That was uncomfortable. I had no idea that "sideways markets" could make me so tense. Not fun. I have to think about this and "process my emotions," as the shrinks say.

However, now that we've had some definite break, I'm sipping prosecco and totally relaxed. FYI: add a couple of blackberries and a tiny squeeze of lemon to each glass. I'm calling that a Correction Cordial. :D

And, FWIW, I bought a little today. Emerging markets, small cap value, small cap international. I might do it again, just because I can... :happy
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ot1138
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Re: U.S. stocks in freefall

Post by ot1138 » Mon Aug 24, 2015 4:58 pm

I'm a little upset I didn't sell a couple of weeks ago when I thought about it. But I usually like to take action slowly.

Today, I didn't. I placed a buy order and purchased another $30k of a low-cost S&P 500 index fund at the close. Why?

Several years ago, I conducted a study on 10-year US equity returns and found that they were very predictable, much more so than most people think (this has been corroborated by independent academic studies). My model suggests that today is the best buying opportunity we've had since June 2013. That's not to say it can't turn into a better buying opportunity :-)

It actually shifted the market upwards into the 30% decile bracket in terms of 10-year returns. To state that a different way, 10 year returns for the past two years have historically been predicted at 3.7%, with a range of 2.0%-5.8%. About in line with what everyone thinks they will be.

The recent correction has shifted us to predicted 5.8%a return, with a range of 2.7%-9.9%.

Intuitively, buying corrections has been a profitable strategy in the past, if you are willing to ignore short-term noise and think in terms of the next decade.

I'm ready to follow up with another $200k I had parked on the sidelines for just this scenario... hopefully we will go down a little more :-)

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backpacker
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Re: U.S. stocks in freefall

Post by backpacker » Mon Aug 24, 2015 4:59 pm

livesoft wrote:
UADM wrote:
livesoft wrote:I believe UADM, but so what? Why carry on this pissing match on a public forum. Just let it go.


You are right of course. I just think it is silly to say "impossible." It is semi insulting, since I do that very thing for a living. I saw no harm in pointing out that though it is unlikely, it is indeed done.

Yep, I see no harm in pointing it out, too, but it only needs to be pointed out once.


Betting on sporting events is generally not a good way to make money. That said, there are a few especially talented professional gamblers who are able to make money hand over fist, at least for awhile. The problem for most of us is that this kind of success requires (a) a full time commitment and (b) finding a persistent edge. Most of us have other things to do, so we can't gamble full time. And even if we could, a persistent edge is very hard to find.

I have no doubt that there are professional traders who have, at least for awhile, found a persistent edge and reliably beaten the market. The problem is that the world is full of shmucks who think they can time the market by watching a few hours of CNBC and reading a couple articles on the internet. Finding a persistent edge is not that easy. It requires at least a full time commitment. Even then, there's no guarantee of finding it. Those who think they've found an edge are often just usually lucky.

So UADM may have indeed found an edge. That he/she trades full-time increases my credence that this is the case. On the other hand, you only have to get lucky once or twice to beat the market over the course of ten years. Even when you know your entire trade history and the thought process behind it, it can be hard to distinguish skill from dumb luck.
Last edited by backpacker on Mon Aug 24, 2015 5:00 pm, edited 1 time in total.

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Re: U.S. stocks in freefall

Post by jadd806 » Mon Aug 24, 2015 5:00 pm

TomatoTomahto wrote:UADM, for the record, it doesn't matter to me whether you're telling the truth or not. Truly.

If you have something to contribute other than war stories, or how you're more clever than others here, I'm all ears.


I'm not quite sure of the reasoning behind coming to a forum specifically populated by index investors and posting about one's (true or false) stock picking skills. I don't go into Forex forums and tell them about the Boglehead philosophy and my portfolio of indices.

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Re: U.S. stocks in freefall

Post by tennisplyr » Mon Aug 24, 2015 5:10 pm

It's kinda sad that this post produced one of the longest threads I've seen. The way I look at it is that i haven't lost a nickel......I haven't executed a sale.
Those who move forward with a happy spirit will find that things always work out.

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ofcmetz
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Re: U.S. stocks in freefall

Post by ofcmetz » Mon Aug 24, 2015 5:18 pm

tennisplyr wrote:It's kinda sad that this post produced one of the longest threads I've seen. The way I look at it is that i haven't lost a nickel......I haven't executed a sale.


I don't see it this way, but if it helps you to think of it this way then that's fine. I see my equities as being worth their quoted values each day, but since I expect them to be worth many times this by the time I plan on selling then then a drop today doesn't bother me as much. There are scenarios where I might need to sell equities much sooner than expected, so their value today does mean something to me.
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blueblock
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Re: U.S. stocks in freefall

Post by blueblock » Mon Aug 24, 2015 5:51 pm

You know, I just have to say that I knew a day trader who talked exactly like this, giving seemingly detailed explanations about his successful exploits. He was a fun guy, a family man with three young kids. He was also a prepper, with a basement full of supplies and ammunition, and a gun safe, in which he also stored his gold. A man's man.

Until he took his own life, and it turned out he'd never been successful at day trading, but was just riding down the proceeds of a fire insurance windfall. And the gold was, of course, gone.

So please pardon my skepticism.

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HomerJ
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Re: U.S. stocks in freefall

Post by HomerJ » Mon Aug 24, 2015 6:02 pm

UADM wrote:This year made things clear and easy. We broke to new all time highs. So, we rebounded from absurd lows and now broke new records. And why? Look around. Do things look rosy in the economic and worldly environment?


The U.S. stock market has been breaking all time highs since 2013.

2013 and 2014 had possible government shut-downs, Greece crisis, EU problems, etc, etc., etc.

Google 2013 and financial crisis. Google 2014 and financial crisis. Google 2015 and financial crisis (and look for dates BEFORE last month).

But last month was when you decided to go to 100% cash? Because just last month was when it became clear and easy?

100% cash may be a big deal to you, but it is a very common state for me. I am usually between 25-50% in. For a day or two, on occasion, I will go all in, and then quickly go out again. I rarely stay in anything for more than a few weeks.


Ah, so you're in 100% cash lots of times...

There's a huge difference between these two statements:

"Oh I saw this coming and went 100% cash last month. It was clear and easy to see a correction was coming".
"Oh, I'm in 100% cash 15 times a year. Looks like I was right to get out last month and might be able to take advantage now."

I wouldn't have as much of a problem with the second statement.

I'd glad you and your dad and really good at trading... I think (and you know) there's a lot more to trading successfully than getting out when "We've hit new highs, and there are bad things happening in parts of the world", and it's dangerous to make people think that it is "clear and easy" to predict a correction.
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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Mon Aug 24, 2015 6:09 pm

livesoft wrote:I believe UADM, but so what? Why carry on this pissing match on a public forum. Just let it go.
Why? If we didn't speak up some may actually believe some guy on the internet can market time and may also believe an "adviser" can market time. We are doing a public service.

toto238
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Re: U.S. stocks in freefall

Post by toto238 » Mon Aug 24, 2015 6:10 pm

UADM wrote:
ofcmetz wrote:
tennisplyr wrote:It's kinda sad that this post produced one of the longest threads I've seen. The way I look at it is that i haven't lost a nickel......I haven't executed a sale.


I don't see it this way, but if it helps you to think of it this way then that's fine. I see my equities as being worth their quoted values each day, but since I expect them to be worth many times this by the time I plan on selling then then a drop today doesn't bother me as much. There are scenarios where I might need to sell equities much sooner than expected, so their value today does mean something to me.


Agreed. As I said in another thread, if you kept your lucent stock from 2000, that went from 100 to near nothing, you could still claim you haven't lost anything because you haven't sold. You are only worth what the stocks are worth at that very moment. You could have hope about making it back, but that doesn't mean you haven't lost.


I feel like talking about an individual stock and talking about a stock market are a little different. Investing in an individual stock, when it goes down 99% it's basically gone and never coming back. It very well could go completely to zero, and you could still claim you hadn't lost anything since you still have 1,000 worthless shares.

But when investing in the "market portfolio" you're investing the stock market as a whole. Not one individual stock. Especially if you're diversified across different countries, your portfolio doesn't really go to zero. A scenario in which the stock market as a whole goes to zero is a scenario so dire that there likely is no investment option that would survive that. In case of apocalypse, no stock, bond or commodity is likely to retain value.

The Market Portfolio has these special characteristics that make it different from simply investing in a stock or even small group of stocks.

Basically someone hoping for Lucent to go back to its previous value is betting on something that's extremely unlikely. Someone hoping for the stock market to recover is betting on something that's extremely likely to happen. And it will likely happen well within a reasonable time period, assuming you balanced your stocks with bonds in a reasonable allocation.

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HomerJ
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Re: U.S. stocks in freefall

Post by HomerJ » Mon Aug 24, 2015 6:11 pm

This thread is a very ironic place to state that the correction we're experiencing was easy to see. You can go back through the thread and see dozens and dozens of days where the stock market dropped, this thread got resurrected by worried people thinking "Oh, no! <insert financial crisis here> is going to cause a huge crash!"

And then the market continued upwards.

UADM
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Re: U.S. stocks in freefall

Post by UADM » Mon Aug 24, 2015 6:20 pm

HomerJ wrote:
UADM wrote:This year made things clear and easy. We broke to new all time highs. So, we rebounded from absurd lows and now broke new records. And why? Look around. Do things look rosy in the economic and worldly environment?


The U.S. stock market has been breaking all time highs since 2013.

2013 and 2014 had possible government shut-downs, Greece crisis, EU problems, etc, etc., etc.

Google 2013 and financial crisis. Google 2014 and financial crisis. Google 2015 and financial crisis (and look for dates BEFORE last month).

But last month was when you decided to go to 100% cash? Because just last month was when it became clear and easy?

100% cash may be a big deal to you, but it is a very common state for me. I am usually between 25-50% in. For a day or two, on occasion, I will go all in, and then quickly go out again. I rarely stay in anything for more than a few weeks.


Ah, so you're in 100% cash lots of times...

There's a huge difference between these two statements:

"Oh I saw this coming and went 100% cash last month. It was clear and easy to see a correction was coming".
"Oh, I'm in 100% cash 15 times a year. Looks like I might be able to take advantage a little now."

I wouldn't have as much of a problem with the second statement.

I'd glad you and your dad and really good at trading... I think (and you know) there's a lot more to trading successfully than getting out when "We've hit new highs, and there are bad things happening in parts of the world", and it's dangerous to make people think that it is "clear and easy" to predict a correction.


I am embarrassed to say this, but you are right. I did not realize that 13.8k was the all time high previously. Oops.

2013 and 2014 never had real possibility of government shutdown. That was political theater.

Google 2014 and financial crisis? I honestly have no idea what you are referring to.

And no, as I said, I hit a high in May and lost a good amount back. After making it back, I decided that I was happy where I was and wanted to wait for a correction... one that seemed relatively imminent.

Actually, I am in 100% cash much more than 15 times a year. The difference this time is that I literally didn't trade from the last few days of June until this past monday(last week) and then immediately got out and walked away again. In other words, I expected trouble for a while now and got out again when I didn't like how things worked.

"I think (and you know) there's a lot more to trading successfully than getting out when "We've hit new highs, and there are bad things happening in parts of the world", and it's dangerous to make people think that it is "clear and easy" to predict a correction."- Absolutely. Those are just part of it of course. Additionally, I should clarify "clear and easy." For ME, who does this every day, it seemed inevitable that we'd have to have a serious pullback. It had just gotten preposterous already how much we've gone up and for how long. Additionally, trading has gotten a LOT harder since October of 2014, and it became like fighting an uphill battle. Clear and easy was in reference to how I felt... not how everyone else should necessarily feel.

Sorry if it came across as something that should be obvious to everyone. That wasn't the intention. I do this everyday. No one who has a real job should have felt the same way necessarily.

Thebigc
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Re: U.S. stocks in freefall

Post by Thebigc » Mon Aug 24, 2015 6:21 pm

jstash wrote:Did anybody see what happened to VOE near the open? Down about 25% then a quick recovery? Another flash crash or what?


There is some very strange trade action being noticed in ETF's at the open today and it looks like it will be looked into. Lots of 20+% drops. It was also seen very quickly in stocks like GE and Apple. Literaly 90 second windows in some cases. HFT's may be to blame. Will see.

Oh sorry was this on topic or is this still the market timing thread?

UADM
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Re: U.S. stocks in freefall

Post by UADM » Mon Aug 24, 2015 6:22 pm

HomerJ wrote:This thread is a very ironic place to state that the correction we're experiencing was easy to see. You can go back through the thread and see dozens and dozens of days where the stock market dropped, this thread got resurrected by worried people thinking "Oh, no! <insert financial crisis here> is going to cause a huge crash!"

And then the market continued upwards.


I'm pretty sure that that is not irony.

I can't speak for what other people have said.

I also cannot assure you or have ever made the claim that this will continue into a real correction. I have no idea. Like you said, and I have suggested, this could all bounce back tomorrow and be over. As I have now said many times in many threads over the past months, people learned the wrong thing from 2008. Look at what you wrote. "And then the market continued upwards." This is what people have learned to expect. That every drop will be followed with a bounce soon after. There is no fear anymore. That is another indication that things had been a bit stretched.

We've pulled back nearly 2k from the high now.

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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Mon Aug 24, 2015 6:32 pm

Thebigc wrote:There is some very strange trade action being noticed ...
That is why I'm satisfied with the average, I can't compete with professional market manipulators.

UADM
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Re: U.S. stocks in freefall

Post by UADM » Mon Aug 24, 2015 6:36 pm

toto238 wrote:
UADM wrote:
ofcmetz wrote:
tennisplyr wrote:It's kinda sad that this post produced one of the longest threads I've seen. The way I look at it is that i haven't lost a nickel......I haven't executed a sale.


I don't see it this way, but if it helps you to think of it this way then that's fine. I see my equities as being worth their quoted values each day, but since I expect them to be worth many times this by the time I plan on selling then then a drop today doesn't bother me as much. There are scenarios where I might need to sell equities much sooner than expected, so their value today does mean something to me.


Agreed. As I said in another thread, if you kept your lucent stock from 2000, that went from 100 to near nothing, you could still claim you haven't lost anything because you haven't sold. You are only worth what the stocks are worth at that very moment. You could have hope about making it back, but that doesn't mean you haven't lost.


I feel like talking about an individual stock and talking about a stock market are a little different. Investing in an individual stock, when it goes down 99% it's basically gone and never coming back. It very well could go completely to zero, and you could still claim you hadn't lost anything since you still have 1,000 worthless shares.

But when investing in the "market portfolio" you're investing the stock market as a whole. Not one individual stock. Especially if you're diversified across different countries, your portfolio doesn't really go to zero. A scenario in which the stock market as a whole goes to zero is a scenario so dire that there likely is no investment option that would survive that. In case of apocalypse, no stock, bond or commodity is likely to retain value.

The Market Portfolio has these special characteristics that make it different from simply investing in a stock or even small group of stocks.

Basically someone hoping for Lucent to go back to its previous value is betting on something that's extremely unlikely. Someone hoping for the stock market to recover is betting on something that's extremely likely to happen. And it will likely happen well within a reasonable time period, assuming you balanced your stocks with bonds in a reasonable allocation.



You are absolutely correct. I didn't even think of that. I am so used to my own methods that I projected. Then yes, as long as the market goes up, you can make it back. My only comment then is that we went from 6.6k to 18.4k. We are at 15.8 or so. Previous high(as I just learned it seems!) was 13.8 or so. We started at 6.6k. Is a retest of the high and breaking up above more likely or is it more likely to retrace our last steps? At 17.5k, I'd say(and di think) down. Here it is more difficult to predict. I still think down might be more likely, but as everyone keeps saying, this market always seems to bounce back after any correction. I'm still a bit timid right now.

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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Mon Aug 24, 2015 7:05 pm

I knew the title would someday be true but why now? This is worse than when Bentley was exposed to Ebola.

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