U.S. stocks in freefall

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Sat Feb 10, 2018 2:11 pm

Volatility? What Volatility? That's what we have Volatility ETFs for. Good luck with those . . . and thanks for reading ~cfs~
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rgs92
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Re: U.S. stocks in freefall

Post by rgs92 » Sat Feb 10, 2018 2:15 pm

Cramer said that excessive XIV trading (the volatility index symbol, an ETF of some sort I guess) causes the wild swings in the total market.

Is this true? Is it a derivative of some sort? How would trading just this one thing cause volatility in the whole stock market?
It sounds like the tail wagging the dog. I don't understand.

(I actually hope it's true, since it would demonstrate --I think-- that everyone is not losing faith in stocks in general. I am dealing with this weird intraday volatility by just staying the course and holding firm permanently with my VBINX [vang balanced index] and overall 60/40 allocation. )

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Re: U.S. stocks in freefall

Post by sreynard » Sat Feb 10, 2018 2:23 pm

fishandgolf wrote:
Sat Feb 10, 2018 1:29 pm
limeyx wrote:
Sat Feb 10, 2018 12:42 pm
fishandgolf wrote:
Sat Feb 10, 2018 11:02 am
:!: Poof....lost a comma......just like that.... gone.......... :shock: Gosh.....I miss that second comma........... :(
Was it an Oxford one ?

.......No....it's a regular one........but I think I'm in a common coma from the loss of the common comma......... :oops:
A just common comma induced coma.... Hopefully this is a rare event and won't become a common coma.

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Re: U.S. stocks in freefall

Post by thx1138 » Sat Feb 10, 2018 2:27 pm

rgs92 wrote:
Sat Feb 10, 2018 2:15 pm
Cramer said that excessive XIV trading (the volatility index symbol, an ETF of some sort I guess) causes the wild swings in the total market.
Step one to successful investing - don't listen to Cramer or any other talking/screaming heads on TV.
I am dealing with this weird intraday volatility by just staying the course and holding firm permanently with my VBINX [vang balanced index] and overall 60/40 allocation. )
It really isn't weird at all. It was the lack of volatility for the past years that was weird. This is pretty normal actually, should happen every couple of years. Your staying the course is exactly the best thing to do.

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Sat Feb 10, 2018 2:28 pm

The Common Characteristics of Failed Exchange-Traded Products [good article from Morningstar].

Different firms have different approaches to product development. Some are more thoughtful than others. Many sponsors have shuttered dozens of ETPs. Others, like Vanguard, have never closed one.

Let's hear that again: Others, like Vanguard, have never closed one.

http://www.morningstar.com/articles/843 ... trade.html

Good luck, and thanks for reading ~cfs~
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squirm
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Re: U.S. stocks in freefall

Post by squirm » Sat Feb 10, 2018 2:55 pm

rgs92 wrote:
Sat Feb 10, 2018 2:15 pm
Cramer said that excessive XIV trading (the volatility index symbol, an ETF of some sort I guess) causes the wild swings in the total market.

Is this true? Is it a derivative of some sort? How would trading just this one thing cause volatility in the whole stock market?
It sounds like the tail wagging the dog. I don't understand.

(I actually hope it's true, since it would demonstrate --I think-- that everyone is not losing faith in stocks in general. I am dealing with this weird intraday volatility by just staying the course and holding firm permanently with my VBINX [vang balanced index] and overall 60/40 allocation. )
Why would anyone listen to that clown?

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Re: U.S. stocks in freefall

Post by squirm » Sat Feb 10, 2018 2:57 pm

rgs92 wrote:
Sat Feb 10, 2018 2:15 pm
Cramer said that excessive XIV trading (the volatility index symbol, an ETF of some sort I guess) causes the wild swings in the total market.

Is this true? Is it a derivative of some sort? How would trading just this one thing cause volatility in the whole stock market?
It sounds like the tail wagging the dog. I don't understand.

(I actually hope it's true, since it would demonstrate --I think-- that everyone is not losing faith in stocks in general. I am dealing with this weird intraday volatility by just staying the course and holding firm permanently with my VBINX [vang balanced index] and overall 60/40 allocation. )
How about the market was overheated, did you see a chart of spx? No pullback in two years? You think that can continue?

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Re: U.S. stocks in freefall

Post by cashmoney » Sat Feb 10, 2018 4:54 pm

squirm wrote:
Sat Feb 10, 2018 2:55 pm
rgs92 wrote:
Sat Feb 10, 2018 2:15 pm
Cramer said that excessive XIV trading (the volatility index symbol, an ETF of some sort I guess) causes the wild swings in the total market.

Is this true? Is it a derivative of some sort? How would trading just this one thing cause volatility in the whole stock market?
It sounds like the tail wagging the dog. I don't understand.

(I actually hope it's true, since it would demonstrate --I think-- that everyone is not losing faith in stocks in general. I am dealing with this weird intraday volatility by just staying the course and holding firm permanently with my VBINX [vang balanced index] and overall 60/40 allocation. )
Why would anyone listen to that clown?



He actually touts a buy an hold indexing as a core strategy for a retirement portfolio. his show is about the 5 % of a portfolio invested in '"mad money" that one could afford to lose.With that said I believe study's have shown that his mad money stock picks are generally worse than the proverbial monkey throwing darts.

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Re: U.S. stocks in freefall

Post by BogleBoogie » Sat Feb 10, 2018 5:35 pm

DrGoogle2017 wrote:
Fri Feb 02, 2018 12:49 pm
BogleBoogie wrote:
Fri Feb 02, 2018 12:48 pm
DrGoogle2017 wrote:
Fri Feb 02, 2018 12:40 pm
Lucky for me, I sold some yesterday, Vanguard didn’t let me exchange to another fund. So I had cash and took a nibbling this morning. Not too much, just in case, it might fall more. I have done a few buying low and selling higher this week. It dulled the pain of 740 points drop on the rest.
Yes, very lucky. This is the type of luck that will change your future.
Who knows, I take any luck I can get.
How's the luck going?

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Re: U.S. stocks in freefall

Post by lazydavid » Sat Feb 10, 2018 6:30 pm

cashmoney wrote:
Sat Feb 10, 2018 4:54 pm
He actually touts a buy an hold indexing as a core strategy for a retirement portfolio. his show is about the 5 % of a portfolio invested in '"mad money" that one could afford to lose.With that said I believe study's have shown that his mad money stock picks are generally worse than the proverbial monkey throwing darts.
A couple people have mentioned to me that you can make a tidy profit by shorting whatever he picks. I haven't bothered to research whether that's truly the case or not.

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Re: U.S. stocks in freefall

Post by DrGoogle2017 » Sat Feb 10, 2018 6:59 pm

BogleBoogie wrote:
Sat Feb 10, 2018 5:35 pm
DrGoogle2017 wrote:
Fri Feb 02, 2018 12:49 pm
BogleBoogie wrote:
Fri Feb 02, 2018 12:48 pm
DrGoogle2017 wrote:
Fri Feb 02, 2018 12:40 pm
Lucky for me, I sold some yesterday, Vanguard didn’t let me exchange to another fund. So I had cash and took a nibbling this morning. Not too much, just in case, it might fall more. I have done a few buying low and selling higher this week. It dulled the pain of 740 points drop on the rest.
Yes, very lucky. This is the type of luck that will change your future.
Who knows, I take any luck I can get.
How's the luck going?
It's great. Think long term my friend. Had I not sold, I would be hurting even more.

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Re: U.S. stocks in freefall

Post by oldcomputerguy » Sat Feb 10, 2018 7:04 pm

FIREchief wrote:
Fri Feb 09, 2018 8:46 pm
sreynard wrote:
Fri Feb 09, 2018 6:23 pm
SouthernCPA wrote:
Fri Feb 09, 2018 5:03 pm
Nothing has changed for me. I'll reallocate at the end of the quarter like I always do. My vanguard automatic investment is still buying and I'm still not worrying about it. It's super boring investing like a boglehead, but I prefer that to spending energy trying to time the market.

I'm staying the course because a little squall isn't going to sink the ship.
Queue Gordon Lightfoot.... :shock:
Absolutely. "Gentlemen, it's been good to know you." :(
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Re: U.S. stocks in freefall

Post by LadyGeek » Sat Feb 10, 2018 7:20 pm

lazydavid wrote:
Sat Feb 10, 2018 6:30 pm
cashmoney wrote:
Sat Feb 10, 2018 4:54 pm
He actually touts a buy an hold indexing as a core strategy for a retirement portfolio. his show is about the 5 % of a portfolio invested in '"mad money" that one could afford to lose.With that said I believe study's have shown that his mad money stock picks are generally worse than the proverbial monkey throwing darts.
A couple people have mentioned to me that you can make a tidy profit by shorting whatever he picks. I haven't bothered to research whether that's truly the case or not.
Caution on shorting. It's not the opposite of going long. See the wiki: Short selling stock
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Re: U.S. stocks in freefall

Post by cfs » Sun Feb 11, 2018 1:23 pm

Want to see a real free fall? Check this one.

LJM Preservation and Growth Fund [LJMAX] did not "preserve" and did not "grow" this past week. As per Barron's this fund lost 80% in 2 days [February 5,6], the managers made the wrong bet and lost bigly. More on this fund, this is from the LJM website:

-- 5.75% Load
-- 1.00% Redemption fee
-- 1.95% Management fee
-- 0.25% 12B1 fee
-- 2.59% Total annual fees

Ouch !!!

This is a 3-star fund, and here is the latest from Morningstar: LJM Preservation & Growth’s steep losses, poor risk controls, and inadequate oversight justify its Morningstar Analyst Rating downgrade to Negative from Neutral.

Already then, for those invested in the fund this new rating is too little, too late [if you are invested in this fund, good luck].

Muchas gracias por leer ~cfs~
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rgs92
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Re: U.S. stocks in freefall

Post by rgs92 » Sun Feb 11, 2018 1:29 pm

I was still wondering about how XIV trading could influence the entire market (or not). I don't understand how it could, but maybe there is some mechanism. That's all I was asking.

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Re: U.S. stocks in freefall

Post by drk » Sun Feb 11, 2018 2:31 pm

rgs92 wrote:
Sat Feb 10, 2018 2:15 pm
Cramer said that excessive XIV trading (the volatility index symbol, an ETF of some sort I guess) causes the wild swings in the total market.

Is this true? Is it a derivative of some sort? How would trading just this one thing cause volatility in the whole stock market?
It sounds like the tail wagging the dog. I don't understand.

(I actually hope it's true, since it would demonstrate --I think-- that everyone is not losing faith in stocks in general. I am dealing with this weird intraday volatility by just staying the course and holding firm permanently with my VBINX [vang balanced index] and overall 60/40 allocation. )
I know you asked about Cramer, but, if you're curious about what happened with XIV, I'd encourage you to check out this column by Matt Levine.

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Re: U.S. stocks in freefall

Post by GoldenFinch » Sun Feb 11, 2018 4:50 pm

cfs wrote:
Sun Feb 11, 2018 1:23 pm
Want to see a real free fall? Check this one.

LJM Preservation and Growth Fund [LJMAX] did not "preserve" and did not "grow" this past week. As per Barron's this fund lost 80% in 2 days [February 5,6], the managers made the wrong bet and lost bigly. More on this fund, this is from the LJM website:

-- 5.75% Load
-- 1.00% Redemption fee
-- 1.95% Management fee
-- 0.25% 12B1 fee
-- 2.59% Total annual fees

Ouch !!!

This is a 3-star fund, and here is the latest from Morningstar: LJM Preservation & Growth’s steep losses, poor risk controls, and inadequate oversight justify its Morningstar Analyst Rating downgrade to Negative from Neutral.

Already then, for those invested in the fund this new rating is too little, too late [if you are invested in this fund, good luck].

Muchas gracias por leer ~cfs~
These fees along with the fund performance appear both shocking and criminal.

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Re: U.S. stocks in freefall

Post by nedsaid » Sun Feb 11, 2018 5:16 pm

squirm wrote:
Sat Feb 10, 2018 2:55 pm
rgs92 wrote:
Sat Feb 10, 2018 2:15 pm
Cramer said that excessive XIV trading (the volatility index symbol, an ETF of some sort I guess) causes the wild swings in the total market.

Is this true? Is it a derivative of some sort? How would trading just this one thing cause volatility in the whole stock market?
It sounds like the tail wagging the dog. I don't understand.

(I actually hope it's true, since it would demonstrate --I think-- that everyone is not losing faith in stocks in general. I am dealing with this weird intraday volatility by just staying the course and holding firm permanently with my VBINX [vang balanced index] and overall 60/40 allocation. )
Why would anyone listen to that clown?
Yes, but he is a very rich clown. He got rich from running a hedge fund. I would not follow his advice as it is too emotion driven and too short term. But he does know a lot about market dynamics. The guy is worth listening to even if you don't agree.
A fool and his money are good for business.

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Re: U.S. stocks in freefall

Post by nedsaid » Sun Feb 11, 2018 5:20 pm

Portfolio7 wrote:
Fri Feb 09, 2018 4:00 pm
This from Michael Batnick at the Irrelevant Investor. I resemble this remark.

-1% Mock the permabears
-2% Meh
-3% Yawn
-4% Off the highs
-5% Pullback
-6% Healthy correction
-7% Buying opportunity
-8% Stay the course
-9% This too shall pass
-10% Correction territory
-11% I’m a long-term investor
-12% Stocks always come back
-13% Don’t panic
-14% Draw lines on a chart
-15% Look for attractive valuations
-16% I knew this was coming
-17% Blame Cramer
-18% This sucks
-19% I should buy some downside protection
-20% Bear market
-21% I should have listened to my gut
-22% Buy when there’s blood in the streets
-23% I was early
-24% Is this the bottom?
-25% This sucks
-26% Uggggh
-27% I can’t take this much longer
-28% I sold my stocks
-29% I’m never buying stocks again
-30% Good thing I sold
-31% I should buy gold
-32% And silver
-33% I don’t even care anymore
-34% Glad I stopped looking
-35% Bottom
This is brilliant. The way you find out your risk tolerance is to go through a true bear market. The only think wrong here is that we had two bear markets during the 2000's that bottomed out at about 50% down.
A fool and his money are good for business.

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Re: U.S. stocks in freefall

Post by nedsaid » Sun Feb 11, 2018 5:30 pm

willthrill81 wrote:
Thu Feb 08, 2018 7:23 pm
DanMahowny wrote:
Thu Feb 08, 2018 7:20 pm
willthrill81 wrote:
Thu Feb 08, 2018 5:56 pm
How do you know the market is overvalued today?
1) In late January, people were posting pics of their 401k statements on Facebook, bragging about how rich they were getting and were virtually guaranteed of an early retirement.

2) And I know a few friends and family that are actually borrowing money to invest in the stock market. "Easy money" they say.

3) And finally, many people are "100% certain that buying equities today is wise since the stock market is near a bottom, and will resume double-digit gains forever.

THAT"S HOW I KNOW THE MARKET IS OVERVALUED.
That is the result of a long bull market and not necessarily indicative of an overvalued market.

While I don't strictly believe in it, the efficient market hypothesis basically implies that the market and all securities within it are 'fairly valued'.
What I would say is that anecdotal stories are helpful. Sort of like the Peter Lynch cocktail party theory. He could tell the phase of a bull market by how people reacted to him at cocktail parties. He would introduce himself as Peter Lynch, manager of Fidelity Magellan fund. If people said something like, "that is nice," and show little interest, we were probably in the beginning stages of a bull market. When people asked him for stock tips, we were in the middle. When people started giving him stock tips, he knew we were approaching the end.

When the shoe shine boys started giving Bernard Baruch stock tips in the late 1920's and were bragging about their big gains in the market, it was a sign something was seriously wrong. When your brother-in-law, who has little interest in investing, the markets, and the economy mortgages his house to buy stocks; you know that danger is around the corner.

My guess, if I had to make one, is that this is a healthy correction and that we should see new market highs in a few months. I did not see, even at the peak, market euphoria. Still a lot of negativity in the financial press. Bull markets end when you run out of pessimists who can change their mind and become optimists, in other words you run out of buyers. But then again, I don't really know. Lots of stuff going on in the hedge fund world that is not disclosed to the public. I think what happened was that someone was doing crazy stuff with lots of money and things went wrong. I don't know how widespread this crazy stuff is.
A fool and his money are good for business.

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Re: U.S. stocks in freefall

Post by nedsaid » Sun Feb 11, 2018 5:43 pm

fishandgolf wrote:
Fri Feb 09, 2018 8:54 am
willthrill81 wrote:
Fri Feb 09, 2018 12:00 am


So they (TIAA) clearly think that the worst of the declines are over. We'll see if they're right.
+1

Thanks for posting willthrill81, great perspective on the market activity........ Time to get my "buying shoes" on :moneybag
I would caution that stocks are cheaper and not necessarily cheap. These are not "mortgage the house and buy stocks" kind of valuations. My guess is that forward P/E ratios have come down from about 22 to 20. Historically, the average is about 16 or 17. John Bogle believes we will likely see P/E contraction even if earnings grow. We will see.

If you are a relatively young investor in your 20's, 30's, or 40's, I would not think too much about this. Just keep buying at regualar intervals through your 401k plan. If you are older, you should be more aware of the additional risks and lower future expected returns that higher stock valuations bring.

If interest rates keep rising, this will have a dampening effect on stock prices. Higher interest rates tend towards lower P/E ratios. Keep an eye on that as well.

This pullback is healthy. People had a scare put into them and now realize that markets can go down too and not just up. This shook a lot of people out of complacency.
A fool and his money are good for business.

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Re: U.S. stocks in freefall

Post by BHUser27 » Sun Feb 11, 2018 6:14 pm

nedsaid wrote:
Sun Feb 11, 2018 5:43 pm
I would caution that stocks are cheaper and not necessarily cheap. These are not "mortgage the house and buy stocks" kind of valuations. My guess is that forward P/E ratios have come down from about 22 to 20. Historically, the average is about 16 or 17. John Bogle believes we will likely see P/E contraction even if earnings grow. We will see.

If you are a relatively young investor in your 20's, 30's, or 40's, I would not think too much about this. Just keep buying at regualar intervals through your 401k plan. If you are older, you should be more aware of the additional risks and lower future expected returns that higher stock valuations bring.
As always - excellent advice from @nedsaid
If interest rates keep rising, this will have a dampening effect on stock prices. Higher interest rates tend towards lower P/E ratios. Keep an eye on that as well.
Rising rates will impact bonds and bond funds as well - which is why the majority of my non-equity allocation is in non-bond instruments as of Jan 2018.
This pullback is healthy. People had a scare put into them and now realize that markets can go down too and not just up. This shook a lot of people out of complacency.
Indeed.

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Re: U.S. stocks in freefall

Post by DanMahowny » Sun Feb 11, 2018 7:17 pm

DOW currently 24,191

Next Friday's close 22,781 or lower.

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Re: U.S. stocks in freefall

Post by FIREchief » Sun Feb 11, 2018 7:19 pm

Using VTI as a gauge, the total US market is now down a whopping 2.2% for the year. Where do we go from here? I'm kind of hoping that the bearishness returns this week and drives another 5% to 10% out of the market. If that happens, I'm considering additional Roth conversions into the next tax bracket. If not, than "yawn" just another blip in the broad landscape of equity investing.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

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Re: U.S. stocks in freefall

Post by livesoft » Sun Feb 11, 2018 7:20 pm

I'm pretty confident that we go up from here ... at least over the next 10 years or so.
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Re: U.S. stocks in freefall

Post by RRAAYY3 » Sun Feb 11, 2018 7:24 pm

Trended up Friday and premarkets suggest more of the same tomorrow

Pretty sure the sale is nearing its “bottom” - once people get back to the reality of global economies / fundamental still remaining quite strong

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Re: U.S. stocks in freefall

Post by drk » Sun Feb 11, 2018 7:37 pm

DanMahowny wrote:
Sun Feb 11, 2018 7:17 pm
DOW currently 24,191

Next Friday's close 22,781 or lower.
Tea leaves, TA, or gut feeling?

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Re: U.S. stocks in freefall

Post by FIREchief » Sun Feb 11, 2018 7:38 pm

Well, aren't you guys a couple of party poopers.... :D
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Re: U.S. stocks in freefall

Post by thangngo » Sun Feb 11, 2018 7:46 pm

livesoft wrote:
Sun Feb 11, 2018 7:20 pm
I'm pretty confident that we go up from here ... at least over the next 10 years or so.
That's like saying... the sun will rise after the darkest of the night. I'll take it. :mrgreen:

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Re: U.S. stocks in freefall

Post by itstoomuch » Sun Feb 11, 2018 7:47 pm

I need to get the stuff much lower before I buy more of anything :twisted:
Ymmv :annoyed :mrgreen:
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Re: U.S. stocks in freefall

Post by livesoft » Sun Feb 11, 2018 7:54 pm

thangngo wrote:
Sun Feb 11, 2018 7:46 pm
livesoft wrote:
Sun Feb 11, 2018 7:20 pm
I'm pretty confident that we go up from here ... at least over the next 10 years or so.
That's like saying... the sun will rise after the darkest of the night. I'll take it. :mrgreen:
I'm also pretty confident that this thread or its decendent will still be going 10 years from now.
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Re: U.S. stocks in freefall

Post by nedsaid » Sun Feb 11, 2018 8:02 pm

I am a somewhat of a newer investor (7 years) but not a young investor (mid-60's and retired and taking 3.4% for living expenses). I did put money into the Total Stock Market Index on Friday. I am currently running a 60/40 very simple portfolio (60% Total Stock Market Index and 40% Total Bond Market Index). I do not plan to increase my 60/40 ratio.

Your comment about the PE ration decreasing even with growth earnings.....that surprises me. What is the primary cause of this? Inflation, interest rate increases, market fear? I am puzzled and would greatly appreciate your comments.
I got this question via personal message and will respond to it here.

First of all, growth of American business more or less mirrors the growth of the stock market. John Bogle has a model for predicting future 10 year returns for the US Stock Market. He divides his model into two parts: business or economic return and speculative return.

Historically, corporate earnings grow at about 6% a year. He adds to that the dividend yield which right now is about 1.6%. So that implies stocks growing at about 8% a year. Another way of looking at this is that the economy is growing at 3% and inflation is at 2%, so nominal economic growth is pretty close to that six percent. I would project it at 5%. But if the economy can go faster, so can earnings. Signs are pointing to an accelerating economy.

Then you have speculative return, which is defined as P/E contraction or expansion. In other words, how much will the market pay for a dollar of earnings? Will that number grow or will it shrink? If the market decides to pay more for a dollar of earnings in ten years than it does now, stocks can grow at more than 8% a year. If the market decides to pay less for a dollar of earnings ten years from now than it currently does, stocks will grow at a slower rate than the economic or business return of 8%.

Before the market turmoil of the last couple of weeks, the market was willing to pay $22 for each $1 of future estimated earnings. Today, the market will pay about $20 for $1 of future estimated earnings. This is an example of P/E contraction or negative speculative return.

John Bogle believes that P/E ratios are higher than their historical norm and that there will be a reversion to the mean. So he believes that P/E ratios will fall and thus the market would earn less that the 7%-8% business return. Thus he thinks stocks will return more like 4% to 5% over the next decade.

The 1990's were an era of P/E expansion or positive speculative return. That is why stocks returned more than the underlying business or economic return. Investors were enthusiastic.

Conversely, the 2000's were an era of P/E contraction or negative speculative return. Though corporate profits doubled during the decade, stocks actually had slightly negative returns. Investor pessimism wiped out all the business or economic return.

Another factor is that interest rates are rising. Low interest rates tend towards higher P/E ratios and higher interest rates tend towards lower P/E ratios. This too puts downward pressure on P/E ratios.

Your question was quite perceptive. All the factors you mentioned: inflation, interest rate increases, and market fear can depress P/E ratios and cause negative speculative return.

The reason stock market returns are hard to predict is that human emotion is difficult to predict. Knowing the business or economic return of stocks is relatively easy. Markets can be irrational, they can be excessively optimistic or pessimistic.
A fool and his money are good for business.

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MichaelRpdx
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Re: U.S. stocks in freefall

Post by MichaelRpdx » Sun Feb 11, 2018 8:06 pm

Hey, I've been vacationing for a week and not watching the news. Have I missed anything?
Be Appropriate && Follow Your Curiosity

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Earl Lemongrab
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Re: U.S. stocks in freefall

Post by Earl Lemongrab » Sun Feb 11, 2018 8:17 pm

RRAAYY3 wrote:
Sun Feb 11, 2018 7:24 pm
Trended up Friday and premarkets suggest more of the same tomorrow
No! How will I tax loss harvest VOO for IVV if that happens?
This week's fortune cookie: "Your financial life will be secure and beneficial." So I got that going for me, which is nice.

RRAAYY3
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Re: U.S. stocks in freefall

Post by RRAAYY3 » Sun Feb 11, 2018 8:20 pm

Earl Lemongrab wrote:
Sun Feb 11, 2018 8:17 pm
RRAAYY3 wrote:
Sun Feb 11, 2018 7:24 pm
Trended up Friday and premarkets suggest more of the same tomorrow
No! How will I tax loss harvest VOO for IVV if that happens?
Premarkets can change ... but we may have to brace ourselves for investments getting back to actually making us money

The horror!

squirm
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Re: U.S. stocks in freefall

Post by squirm » Sun Feb 11, 2018 11:43 pm

nedsaid wrote:
Sun Feb 11, 2018 5:16 pm
squirm wrote:
Sat Feb 10, 2018 2:55 pm
rgs92 wrote:
Sat Feb 10, 2018 2:15 pm
Cramer said that excessive XIV trading (the volatility index symbol, an ETF of some sort I guess) causes the wild swings in the total market.

Is this true? Is it a derivative of some sort? How would trading just this one thing cause volatility in the whole stock market?
It sounds like the tail wagging the dog. I don't understand.

(I actually hope it's true, since it would demonstrate --I think-- that everyone is not losing faith in stocks in general. I am dealing with this weird intraday volatility by just staying the course and holding firm permanently with my VBINX [vang balanced index] and overall 60/40 allocation. )
Why would anyone listen to that clown?
Yes, but he is a very rich clown. He got rich from running a hedge fund. I would not follow his advice as it is too emotion driven and too short term. But he does know a lot about market dynamics. The guy is worth listening to even if you don't agree.
His show is for entertainment only. His call on Bear was a classic. He's about as useful as Ron Insana, except Insana trades a virtual portfolio...lol.

rgs92
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Re: U.S. stocks in freefall

Post by rgs92 » Mon Feb 12, 2018 1:37 am

Thanks for that link about XIV drk.
( https://www.bloomberg.com/view/articles ... ost-worked )
Wow, XIV makes Bitcoin look super-tame.

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roymeo
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Re: U.S. stocks in freefall

Post by roymeo » Mon Feb 12, 2018 2:18 am

BuyAndHoldOn wrote:
Sat Feb 10, 2018 2:06 pm
Other than the [large] investors covering their losses on volatility instruments*: Why would anyone be SELLING their stocks right now? Or bonds, for that matter? You could surely wait for a better price! Or have sold a few weeks ago! (Which I thought about doing [with a position I am looking to unload], but, oh well).

I realize there are "trend" following strategies that attempt to avoid big draw downs, but such rigid adherence to "rules" could just as easily backfire as having no rules at all. (Unless your rule is buy, hold, re-balance according to AA, etc.).

* = that may have been most if not all of the rapid selling, mind you.
Because I've bothered to look and need to rebalance. Sure I missed the highs of December/January, but the highs of November/Februrary still put me high enough that some money should move around. Blink and you won't even notice it.
The sewer system is a form of welfare state. | -- "Libra", Don DeLillo

RRAAYY3
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Re: U.S. stocks in freefall

Post by RRAAYY3 » Mon Feb 12, 2018 8:48 am

Global markets bounce back and DOW projected up triple digits today

Hope anyone needing to buy did so last week

DrGoogle2017
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Re: U.S. stocks in freefall

Post by DrGoogle2017 » Mon Feb 12, 2018 1:05 pm

BogleBoogie wrote:
Sat Feb 10, 2018 5:35 pm
DrGoogle2017 wrote:
Fri Feb 02, 2018 12:49 pm
BogleBoogie wrote:
Fri Feb 02, 2018 12:48 pm
DrGoogle2017 wrote:
Fri Feb 02, 2018 12:40 pm
Lucky for me, I sold some yesterday, Vanguard didn’t let me exchange to another fund. So I had cash and took a nibbling this morning. Not too much, just in case, it might fall more. I have done a few buying low and selling higher this week. It dulled the pain of 740 points drop on the rest.
Yes, very lucky. This is the type of luck that will change your future.
Who knows, I take any luck I can get.
How's the luck going?
Sold some today at a small profit. Granted I have been on a vacation, sporadic WiFi at best, otherwise I would have made more money.

RRAAYY3
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Re: U.S. stocks in freefall

Post by RRAAYY3 » Mon Feb 12, 2018 1:10 pm

screaming back up to mid december! congrats to all who have survived so far.

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knpstr
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Re: U.S. stocks in freefall

Post by knpstr » Mon Feb 12, 2018 1:32 pm

RRAAYY3 wrote:
Mon Feb 12, 2018 1:10 pm
screaming back up to mid december! congrats to all who have survived so far.
It's the easiest thing I've ever done.
Very little is needed to make a happy life; it is all within yourself, in your way of thinking. -Marcus Aurelius

WhiteMaxima
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Re: U.S. stocks in freefall

Post by WhiteMaxima » Mon Feb 12, 2018 1:41 pm

RRAAYY3 wrote:
Mon Feb 12, 2018 8:48 am
Global markets bounce back and DOW projected up triple digits today

Hope anyone needing to buy did so last week
I am not totally out of the market yet. Just being cautions of extreme valuation and took some profit before the big drop.

RRAAYY3
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Re: U.S. stocks in freefall

Post by RRAAYY3 » Mon Feb 12, 2018 1:46 pm

knpstr wrote:
Mon Feb 12, 2018 1:32 pm
RRAAYY3 wrote:
Mon Feb 12, 2018 1:10 pm
screaming back up to mid december! congrats to all who have survived so far.
It's the easiest thing I've ever done.
I saw the other side of the coin this weekend when a friend mentioned selling everything and actually checked in with his parents to see if they were “ok”

All I did was show him 1 chart to provide some perspective. Media fear mongering apparently works on some ...

All I did was put more in.

sreynard
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Re: U.S. stocks in freefall

Post by sreynard » Mon Feb 12, 2018 1:52 pm

MichaelRpdx wrote:
Sun Feb 11, 2018 8:06 pm
Hey, I've been vacationing for a week and not watching the news. Have I missed anything?
Nope, all quiet on the western front.... A few people got excited and started running around in circles, but nothing significant. Just the normal noise....

Hope you had a good time. :sharebeer

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cfs
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Re: U.S. stocks in freefall

Post by cfs » Mon Feb 12, 2018 3:49 pm

MichaelRpdx wrote:
Sun Feb 11, 2018 8:06 pm
. . . Have I missed anything? . . .
Yes, you missed the good news, BH team was NOT selling equities during the downturn. Good luck, and gracias por leer ~cfs~
~ Member of the Active Retired Force, portfolio withdrawal and spending rate 1.7% ~

lazydavid
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Re: U.S. stocks in freefall

Post by lazydavid » Tue Feb 13, 2018 11:37 am

Looked to see if I had a rebalancing opportunity, but since all but our 401(k)s rebalance automatically, found we were only bond-heavy by about $3k. So I changed the future contributions to be 70% US Stock/30% International stock for a little while until it levels out, then will go back to 49/21/30. Yawn.

The good news is just over 2 years into BH-dom, I really thought I'd be more broken up about seeing more than a year's takehome pay evaporate in less than a week. Other than my wife freaking out a bit on the day of the "LARGEST MARKET DROP IN HISTORY (TM)!!!!!", it was pretty much a non-event. I'm hopeful that this portends good things re: my ability to weather a much larger decline, but obviously won't know for sure until it actually happens.

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Leif
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Re: U.S. stocks in freefall

Post by Leif » Tue Feb 13, 2018 12:18 pm

lazydavid wrote:
Tue Feb 13, 2018 11:37 am
I'm hopeful that this portends good things re: my ability to weather a much larger decline, but obviously won't know for sure until it actually happens.
In my experience it is not a single day or week or even a month that challenges your will. It is the steady drumbeat of bad news and declining markets. For me that was not 2000, but 2008-9. It was brutal rebalancing and seeing the market continue to go down. After a while you ask yourself why am I throwing good money after bad? My neighbor, who has a PhD in Economics from Harvard, was on TV. When asked if another depression could happen he said yes it could. That put the fear of God in me. I need to credit this site with helping me get through this period.
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

livesoft
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Re: U.S. stocks in freefall

Post by livesoft » Tue Feb 13, 2018 2:56 pm

As expected, RBDs are sometimes followed by ...
Reuters article wrote:After a wildly volatile week that pushed the market into correction territory, U.S. stocks gained roughly 3 percent over Friday and Monday, their best two-day gain since June 2016.
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MrNewEngland
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Re: U.S. stocks in freefall

Post by MrNewEngland » Tue Feb 13, 2018 4:10 pm

Leif wrote:
Tue Feb 13, 2018 12:18 pm
lazydavid wrote:
Tue Feb 13, 2018 11:37 am
I'm hopeful that this portends good things re: my ability to weather a much larger decline, but obviously won't know for sure until it actually happens.
In my experience it is not a single day or week or even a month that challenges your will. It is the steady drumbeat of bad news and declining markets. For me that was not 2000, but 2008-9. It was brutal rebalancing and seeing the market continue to go down. After a while you ask yourself why am I throwing good money after bad? My neighbor, who has a PhD in Economics from Harvard, was on TV. When asked if another depression could happen he said yes it could. That put the fear of God in me. I need to credit this site with helping me get through this period.
This is exactly what I was trying to emphasize in a post earlier. One week means nothing in terms of testing one's resolve. 2008-9 will look short lived when people look back on it but the feeling was desolate. There felt like there was no bottom in site in the market and people felt like any day they went to work could be there last. Last week people kept making cute post, it was obviously not testing anyone.

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