U.S. stocks in freefall

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nedsaid
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Re: U.S. stocks in freefall

Post by nedsaid » Wed Aug 17, 2016 2:00 am

backpacker wrote:Because I like winning things, I wanted to point out that I bet browser a Starbuck's Tall way back last September that the S&P 500 would reach a new high before it fell by 40%.

Browser wrote:
backpacker wrote:
Browser wrote:Typical bear market behavior. Large moves down and up, high volatility, and the trend is down. My hunch is that we'll look back in a few months and see it as the point where the risk showed up. And we'll say "why didn't we see it -- it was so obvious!" :oops:


Ah, an actual prediction! Shall we say six months? I'll add a reminder to my schedule and we can check to see if you were right. :happy

I'm happy to put a Starbuck's Tall on the line. Shall we meet there in 6 months. 8-)


Well, to be fair to Browser, it's a little unclear what the final bet was.

viewtopic.php?p=2609324#p2609324
viewtopic.php?p=2609408#p2609408

In any case, we've hit a new high since then. Good news for everyone.* :beer

*Well, expect for that guy from the 100% short thread.


Backpacker is back! One of my favorite posters. Good to see you post again!
A fool and his money are good for business.

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backpacker
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Re: U.S. stocks in freefall

Post by backpacker » Wed Aug 17, 2016 7:42 am

nedsaid wrote:
backpacker wrote:Because I like winning things, I wanted to point out that I bet browser a Starbuck's Tall way back last September that the S&P 500 would reach a new high before it fell by 40%.


Backpacker is back!


Well, I had a coffee to claim. :D

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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Wed Aug 17, 2016 9:10 pm

TheTimeLord wrote:.. there is also a basic reality that something isn't finished dropping until it stops going down.
Catch the falling knife? One never knows what tomorrow will bring. Dollar cost averaging to maintain an asset allocation takes guessing and worry out of the picture. I'm not getting rich quick but I'm not going broke ether.

backpacker wrote:Because I like winning things, I wanted to point out that I bet browser a Starbuck's Tall way back last September that the S&P 500 would reach a new high before it fell by 40%.

Thank you for making me look. Back in September my dollar cost averaging to maintain an asset allocation is working. :moneybag
Uncle Pennybags wrote:My "entitlements" go into a checking account then I distribute them at my pleasure. My pleasure dictates I buy stocks; especially REITs now paying over 4%. :greedy

boglerdude
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Re: U.S. stocks in freefall

Post by boglerdude » Fri Aug 19, 2016 2:41 am

Those of you following the markets in fall 2008, did you watch the S&P EPS tank before the sell off?

Or was the data delayed. I'm wondering how PE could have gotten so high.

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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Fri Aug 19, 2016 4:56 am

boglerdude wrote:Those of you following the markets in fall 2008, did you watch the S&P EPS tank before the sell off?

Or was the data delayed. I'm wondering how PE could have gotten so high.

Image

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ray.james
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Re: U.S. stocks in freefall

Post by ray.james » Fri Aug 19, 2016 1:09 pm

boglerdude wrote:Those of you following the markets in fall 2008, did you watch the S&P EPS tank before the sell off?

Or was the data delayed. I'm wondering how PE could have gotten so high.


https://www.quandl.com/data/MULTPL/SP500_EARNINGS_MONTH-S-P-500-Earnings-by-Month
Go to table view
When in doubt, http://www.bogleheads.org/forum/viewtopic.php?f=1&t=79939

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Toons
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Re: U.S. stocks in freefall

Post by Toons » Fri Aug 19, 2016 1:11 pm

The "Abyss" Of Opportunity :mrgreen:
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

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Taylor Larimore
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Misleading Graphs

Post by Taylor Larimore » Fri Aug 19, 2016 2:34 pm

ray.james wrote:
boglerdude wrote:Those of you following the markets in fall 2008, did you watch the S&P EPS tank before the sell off?

Or was the data delayed. I'm wondering how PE could have gotten so high.


https://www.quandl.com/data/MULTPL/SP500_EARNINGS_MONTH-S-P-500-Earnings-by-Month
Go to table view

Bogleheads:

The graph in the above table is misleading. For example; the stock market decline in the awful bear market of 1929-1933 (approx. -90%) appears to be much less than the decline of the bear market in 2008 (approx. -50%).


This logarithmic graph shows the relative difference in returns:

http://ritholtz.com/2011/11/4-major-sec ... 1900-2011/

Best wishes.
Taylor
"Simplicity is the master key to financial success." -- Jack Bogle

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Christine_NM
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Re: U.S. stocks in freefall

Post by Christine_NM » Fri Aug 19, 2016 3:00 pm

The quandl chart is inflation-adjusted earnings. Price of course was a different story in 1929.
10% cash 45% stock 45% bond. Retired, w/d rate 1.5%

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JoMoney
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Re: U.S. stocks in freefall

Post by JoMoney » Fri Aug 19, 2016 5:34 pm

^ Yes, the chart is showing inflation adjusted "earnings"... and there are some significant differences in the way earnings are calculated in more recent years relative to decades past... in particular, mark-to-market rules required huge losses to be accounted for by many financial firms during the global financial crisis. Since then, the rules have changed even more, particularly for how it's done during times of a disorderly market.
Because of the way index earnings are calculated, all of the enormous losses by financial firms negated a great deal of positive earnings by other companies. Even though those losses don't spill over to be the liability of some other company, the index calculates earnings by summing them all up together as if they were all one company.

How the earnings are aggregated can make a big difference. For instance, for the period ending June 30, 2009 Vanguard was reporting the P/E of a portfolio of stocks making up the S&P500 as having a P/E ratio of 16.6x
Whereas S&P was showing the "Reported Earnings" of the index as a P/E of 122.4x for that same June 30, 2009 period. S&P Index "Operating Earnings", which don't have to follow the same accounting standards were 23.1x, but even that shows a big difference between what Vanguard calculated as the weighted average P/E for a portfolio of stocks, versus S&P summing up all the earnings in the index.
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Da5id
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Re: U.S. stocks in freefall

Post by Da5id » Fri Sep 09, 2016 12:43 pm

We're all doomed! Stocks falling, bonds falling, commodities falling! Dogs and cats living together!

Oh, never mind.

Tamalak
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Re: U.S. stocks in freefall

Post by Tamalak » Fri Sep 09, 2016 1:20 pm

The fed glances at a 0.25% rate hike and goes "hmm" to itself and the entire world loses 2% of its value? That's just pathetic :oops:

IMO it's past time the fed start reloading! Take the pixie sticks away from the kids!

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Re: U.S. stocks in freefall

Post by Hector » Fri Sep 09, 2016 1:31 pm

An interesting day today; stock is down and bond is down (corporate, muni and treasury)
How often does bond move in the direction of stock on bad days?

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packet
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Re: U.S. stocks in freefall

Post by packet » Fri Sep 09, 2016 1:33 pm

Hector wrote:...How often does bond move in the direction of stock on bad days?

This time is different!

:beerCheers,
packet
First round’s on me.

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ofcmetz
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Re: U.S. stocks in freefall

Post by ofcmetz » Fri Sep 09, 2016 1:34 pm

Da5id wrote:We're all doomed! Stocks falling, bonds falling, commodities falling! Dogs and cats living together!

Oh, never mind.


Thanks for raising the hue and cry. For once my deferred comp goes in on a down day. Amazing how calm the markets had been for the last month.
Never underestimate the power of the force of low cost index funds.

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Re: U.S. stocks in freefall

Post by FrugalFrida » Fri Sep 09, 2016 1:42 pm

Hmm, I rebalanced from stocks to bonds earlier this week. (I had calculated a bond account pre-tax while the main account is post-tax, so I adjusted this)

NotWhoYouThink
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Re: U.S. stocks in freefall

Post by NotWhoYouThink » Fri Sep 09, 2016 1:43 pm

oops, sorry all. Forgot to warn you 2 days ago that all the weird assortment of stocks and bonds and funds that WF had FIL in had all been sold, and that was the day DH picked to buy his 3 fund blend. So now you know what caused the dip.

EnjoyIt
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Re: U.S. stocks in freefall

Post by EnjoyIt » Fri Sep 09, 2016 3:17 pm

Are US stocks in freewill again?

I'm so glad I am subscribed to this thread because without it I would never know.

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Re: U.S. stocks in freefall

Post by mickeyd » Fri Sep 09, 2016 3:21 pm

OMG. I can not locate my pistol. I wonder it that Bowie knife on the shelf will do me in as easily as the bullet!
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Re: U.S. stocks in freefall

Post by flyingaway » Fri Sep 09, 2016 3:46 pm

I took a long nap this afternoon and missed this buying opportunity.

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FreeAtLast
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Re: U.S. stocks in freefall

Post by FreeAtLast » Fri Sep 09, 2016 3:51 pm

It's days like this which confirm my long-held belief that all the "experts" of the US financial markets.....are nothing more than a flock of imbecilic sheep.
Illegitimi non carborundum.

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Munir
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Re: U.S. stocks in freefall

Post by Munir » Fri Sep 09, 2016 3:55 pm

It's interesting that only sellers of stocks (or those who have been waiting in the wings for a buying opportunity) in the last two weeks are posting today. Who was buying stocks in the last two weeks- if anyone? :confused
Last edited by Munir on Fri Sep 09, 2016 5:52 pm, edited 1 time in total.

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Re: U.S. stocks in freefall

Post by madbrain » Fri Sep 09, 2016 4:04 pm

Tamalak wrote:The fed glances at a 0.25% rate hike and goes "hmm" to itself and the entire world loses 2% of its value? That's just pathetic :oops:

IMO it's past time the fed start reloading! Take the pixie sticks away from the kids!


This seems to happen almost every time there is serious talk of the fed doing another rate hike ...

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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Sun Sep 11, 2016 7:01 pm

Hector wrote:An interesting day today; stock is down and bond is down (corporate, muni and treasury)
How often does bond move in the direction of stock on bad days?
Not often; it may be a sign of the end times. Time to invest in bullion and bullets. This is why we aren't supposed to pay attention to the ups and downs but I can't help myself. :mrgreen:

mpsz
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Re: U.S. stocks in freefall

Post by mpsz » Sun Sep 11, 2016 7:17 pm

Image

Seems like we're still caught in the "not so merry-go-round"

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VictoriaF
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Re: U.S. stocks in freefall

Post by VictoriaF » Mon Sep 12, 2016 8:05 am

The final, definitive prediction for 12 Sep 2016: S&P 500 will close lower today than it will open.

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

staythecourse
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Re: U.S. stocks in freefall

Post by staythecourse » Mon Sep 12, 2016 8:47 am

mpsz wrote:Image

Seems like we're still caught in the "not so merry-go-round"


Thats funny. Even funnier is Merrill Lynch investors are paying for this level of "research".

Good luck.
"The stock market [fluctuation], therefore, is noise. A giant distraction from the business of investing.” | -Jack Bogle

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Re: U.S. stocks in freefall

Post by mancich » Mon Sep 12, 2016 8:57 am

A potential .25% rate hike and people start freaking out? This just shows how everyone has become so used to an extreme low-rate environment. Interest rates rise and interest rates fall. And the world goes on. Stay the course and ignore the media :sharebeer

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slayed
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Re: U.S. stocks in freefall

Post by slayed » Mon Sep 12, 2016 2:56 pm

VictoriaF wrote:The final, definitive prediction for 12 Sep 2016: S&P 500 will close lower today than it will open.

Victoria


:D

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Leif
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Re: U.S. stocks in freefall

Post by Leif » Mon Sep 12, 2016 4:14 pm

VictoriaF wrote:The final, definitive prediction for 12 Sep 2016: S&P 500 will close lower today than it will open.

Victoria

I love the smell of market predictions from the morning :sharebeer
Investors should diversify across many asset-classes so that whatever happens, we will not have all our investments in underperforming asset classes and thereby fail to meet our goals-Taylor Larimore

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Re: U.S. stocks in freefall

Post by gks » Mon Sep 12, 2016 4:29 pm

VictoriaF wrote:The final, definitive prediction for 12 Sep 2016: S&P 500 will close lower today than it will open.

Victoria


Darn. I was thinking about adding to Total Stock Market today. Oh, well.

Greg

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Re: U.S. stocks in freefall

Post by boglephreak » Mon Sep 12, 2016 5:24 pm

i was hoping to buy on a further dip today, but, alas, it recovered mostly.... probably for the best since my contribution today only makes a small portion of the money i already have in it.

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Re: U.S. stocks in freefall

Post by flyersrule » Tue Sep 13, 2016 8:42 am

Back down this morning

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Re: U.S. stocks in freefall

Post by TomatoTomahto » Tue Sep 13, 2016 9:06 am

flyersrule wrote:Back down this morning

I invested DW's cash balance pension from a previous employer this morning: 50% TSM and 50% TBM. It looks like I stumbled into good timing :beer

By the time she draws on this money, it won't matter.

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Leif
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Re: U.S. stocks in freefall

Post by Leif » Tue Sep 13, 2016 10:08 am

This thread reminds me of the movie WarGames. A computer is analyzing millions of moves and countermoves in a nuclear exchange. The final conclusion is "A strange game. The only winning move is not to play". The market is also "a strange game". The winning move is not to play (around). Hopefully a lot of learning occurs in this thread (when you look at the bigger picture).
Investors should diversify across many asset-classes so that whatever happens, we will not have all our investments in underperforming asset classes and thereby fail to meet our goals-Taylor Larimore

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David Jay
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Re: U.S. stocks in freefall

Post by David Jay » Tue Sep 13, 2016 10:15 am

Munir wrote:It's interesting that only sellers of stocks (or those who have been waiting in the wings for a buying opportunity) in the last two weeks are posting today. Who was buying stocks in the last two weeks- if anyone? :confused


Every stock sold in the last 2 weeks was purchased (by someone).

(and yes, I do love the smell of tautologies in the morning)
Last edited by David Jay on Tue Sep 13, 2016 10:17 am, edited 1 time in total.
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grettman
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Re: U.S. stocks in freefall

Post by grettman » Tue Sep 13, 2016 10:16 am

Further advanced my project to simplify my portfolio today...

Sold Apple (My ISP dictates that I sell off my individual stocks) which was up. (only made little bit of money...)

Bought VTI which was down.

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VictoriaF
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Re: U.S. stocks in freefall

Post by VictoriaF » Tue Sep 13, 2016 11:15 am

Leif wrote:
VictoriaF wrote:The final, definitive prediction for 12 Sep 2016: S&P 500 will close lower today than it will open.

Victoria

I love the smell of market predictions from the morning :sharebeer


The final, definitive prediction for 13 Sep 2016: S&P 500 will close lower today than it has opened. Consistency is an investing virtue!

Victoria
WINNER of the 2015 Boglehead Contest. | Every joke has a bit of a joke. ... The rest is the truth. (Marat F)

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Re: U.S. stocks in freefall

Post by dougger5 » Tue Sep 13, 2016 7:29 pm

flyersrule wrote:Back down this morning


Automatic investments in a number of our accounts today.

Yay! Accidental market timing!

:twisted:
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Re: U.S. stocks in freefall

Post by madbrain » Tue Sep 13, 2016 10:15 pm

dougger5 wrote:
flyersrule wrote:Back down this morning


Automatic investments in a number of our accounts today.

Yay! Accidental market timing!

:twisted:


I sold 3% of my portfolio last wednesday, which happens to have been the all time high so far. This was prompted by all the Fed talk.

My intention was to buy again on the next big drop. I just wasn't awake during market hours today or last friday for the last 2 drops, so have not been able to place orders to buy back. Hopefully tomorrow I will manage. You do have to be correct twice for market timing, so far I managed only half.

So yes, I admit to doing a very small amount of intentional market timing. But it was with a small portion of the portfolio. Wish it had been more :)

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Leif
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Re: U.S. stocks in freefall

Post by Leif » Wed Sep 14, 2016 11:21 am

madbrain wrote:
I sold 3% of my portfolio last wednesday, which happens to have been the all time high so far. This was prompted by all the Fed talk.

So yes, I admit to doing a very small amount of intentional market timing. But it was with a small portion of the portfolio. Wish it had been more :)

Unusual to see this from a 4 digit poster :shock: . Please let us in on your next market insight!
Investors should diversify across many asset-classes so that whatever happens, we will not have all our investments in underperforming asset classes and thereby fail to meet our goals-Taylor Larimore

madbrain
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Re: U.S. stocks in freefall

Post by madbrain » Wed Sep 14, 2016 4:22 pm

Leif wrote:
madbrain wrote:
I sold 3% of my portfolio last wednesday, which happens to have been the all time high so far. This was prompted by all the Fed talk.

So yes, I admit to doing a very small amount of intentional market timing. But it was with a small portion of the portfolio. Wish it had been more :)

Unusual to see this from a 4 digit poster :shock: . Please let us in on your next market insight!


My previous attempts at market timing (last one around 2011) have resulted in losses, so I'm not sure that sharing my "advice" would be that helpful, and in fact, probably counterproductive.

All I can say in this case is that there appears to be a repeatable pattern with the fed talk in terms of drops and subsequent run ups.
I was obviously not very confident about it, since I only dared sell 3% of my portfolio. Looks like this insight only saved me about 2.5% of 3% vs the market, which is only 0.075%, really nothing of any significance. I would have needed to sell more for it to make more difference.

I wasn't able to buy back in today (was awake, but in a meeting) but the market didn't budge much, at least at closing. I do intend to reinvest the funds soon, though.

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Re: U.S. stocks in freefall

Post by soboggled » Wed Sep 14, 2016 4:26 pm

madbrain wrote:
Leif wrote:
madbrain wrote:
I sold 3% of my portfolio last wednesday, which happens to have been the all time high so far. This was prompted by all the Fed talk.

So yes, I admit to doing a very small amount of intentional market timing. But it was with a small portion of the portfolio. Wish it had been more :)

Unusual to see this from a 4 digit poster :shock: . Please let us in on your next market insight!


My previous attempts at market timing (last one around 2011) have resulted in losses, so I'm not sure that sharing my "advice" would be that helpful, and in fact, probably counterproductive.

All I can say in this case is that there appears to be a repeatable pattern with the fed talk in terms of drops and subsequent run ups.
I was obviously not very confident about it, since I only dared sell 3% of my portfolio. Looks like this insight only saved me about 2.5% of 3% vs the market, which is only 0.075%, really nothing of any significance. I would have needed to sell more for it to make more difference.

I wasn't able to buy back in today (was awake, but in a meeting) but the market didn't budge much, at least at closing. I do intend to reinvest the funds soon, though.

This time I think they mean it, based on reports of big wage increases, but trying to hold off until after the election..

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Re: U.S. stocks in freefall

Post by Buddtholomew » Wed Sep 14, 2016 4:26 pm

I arrived at the conclusion that managing around the edges is more psychologically comforting than beneficial to portfolio returns.
As you said yourself madbrain, it requires larger sums/percentages of your portfolio to matter much.
Add transaction fees and most likely the trades result in a loss or minute gain.
Just not worth the trouble.
"The first principle is that you must not fool yourself and you are the easiest person to fool" --Feynman.

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Re: U.S. stocks in freefall

Post by madbrain » Wed Sep 14, 2016 5:40 pm

soboggled wrote:This time I think they mean it, based on reports of big wage increases, but trying to hold off until after the election..


I certainly wish I was seeing those big wage increases ! Or any increase at all.
Fed already did one rate hike last year. They likely intend to continue, they have said that much.
It just seems like the market always "anticipates" that rate hike by going down before a rumored hike date, whether one actually happens on that date or not. Sure seems like something that is exploitable. In fact there was a thread about it recently.

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Re: U.S. stocks in freefall

Post by GoldenFinch » Wed Sep 14, 2016 7:49 pm

Deleted- not relevant.

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Uncle Pennybags
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Re: U.S. stocks in freefall

Post by Uncle Pennybags » Thu Oct 13, 2016 11:57 am

I read on a hobby board that this time the "freefall" is for real.

Image

PandaBear
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Re: U.S. stocks in freefall

Post by PandaBear » Thu Oct 13, 2016 4:03 pm

Back when I was a wee lad, my US History teacher said that during an election year, regardless of who wins, the US stock markets rally. Does anyone here know if that's been (historically) true? Moreover, if it is, is it due to the fact that there is no more uncertainty once a winner is declared?

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walletless
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Re: U.S. stocks in freefall

Post by walletless » Thu Oct 13, 2016 4:46 pm

PandaBear wrote:Back when I was a wee lad, my US History teacher said that during an election year, regardless of who wins, the US stock markets rally. Does anyone here know if that's been (historically) true? Moreover, if it is, is it due to the fact that there is no more uncertainty once a winner is declared?

We are between a rock and a hard place this year. Regardless of who wins, there should be little impact on the market. Then again, I am not a financial guru - just a lowly boglehead who does not listen to all the market theories, but perfectly happy to offer new theories :-)

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Re: U.S. stocks in freefall

Post by gks » Thu Oct 13, 2016 4:50 pm

I always look for this thread during bad times and thought I may have missed a RBD to invest, but saw it was a non-event.

Greg

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