The stock market

[Willihammer]

I think this is interesting. Back in 1992 the market had been on a bull run similar to today's:

http://i.imgur.com/1TCdAjP.jpg

 

Just like today, it was trading at 25x earnings. If you had sold at that point you would have missed out on the run it made from 1992 to 2000 (when the market really did create a bubble):

 

 

[Willihammer]

Some good economic news this week. 2.9% 3rd quarter GDP growth was revised up to 3.2%. October non-farm hiring was greater than expected. Consumer confidence hit a 9 year high in November. And OPEC agreed to a production cap which is going to be a boon for US shale.

[Mike Sixel]

 

Some good economic news this week. 2.9% 3rd quarter GDP growth was revised up to 3.2%. October non-farm hiring was greater than expected. Consumer confidence hit a 9 year high in November. And OPEC agreed to a production cap which is going to be a boon for US shale.

 

apparently ST traders don't agree!

[Willihammer]

apparently ST traders don't agree!

Huh?

[Mike Sixel]

 

Huh?

 

All my stocks but 1 is down....

[Willihammer]

All my stocks but 1 is down....

OK...

[Mike Sixel]

 

OK...

 

The market is flat....so, not sure ST investors agree....is that a controversial post somehow?

[Willihammer]

The market is flat....so, not sure ST investors agree....is that a controversial post somehow?

Just seems like a non-sequitor. There's nothing to dispute. These are economic indicators. Are you suggesting the "st" market should move in lockstep with them?

[Mike Sixel]

Well, it is a thread about the stock market, and my comment was about how ST trading reacted to the good news.....I uh, think that makes sense to comment on. YMMV, of course.

 

I'm not suggesting anything, other than ST traders didn't find the news all that compelling.

[gunnarthor]

What, you don't own a bunch of oil and big bank stocks?  I hate Trump but our portfolio has looked pretty good since election day.

[Mike Sixel]

Oh.. Mine is up overall... Just not that day. Mostly tech.... And my employer, which is waaaaaay up

[Brock Beauchamp]

Damn. I really should have invested in Wells Fargo after the scandal. They're up 30-ish percent since their drop.

 

On the upside, Polaris is working out well for me since I picked up more stock when it plummeted to $72. Now sitting at $86.

[Mike Sixel]

I just wish I had not diversified, and put it all in NVIDIA....I'm up between 80 and 200% this year....I literally could have considered early retirement had I really gambled......(like in a couple years).

 

Heck if I had just stayed with my employer......

[Willihammer]

Banks are rallying somewhat on expectations of increased inflation (following Trumps election) and the OPEC deal which reduces risk of losses on oil-related loans. I suspect we'll see some inflation, but we really don't have any sort of confirmation yet. And if the Vienna deal is anything like the Doha deal, then there is no actual production cut coming. Doha was just a show to prop up prices in the short term, I would expect the same from Vienna. This would weigh on bank stocks.

[Willihammer]

One bank I did buy is the Bank of Greece. I bought in last summer when they announced changes to management as required by their bailout conditions. There are more indications now that the country might have reached bottom. Its speculative, its a penny stock, and if the bank nationalizes those shares will be worth zero. But there's a good amount of upside IMO.

[Doomtints]

I feel like the recent run is a bubble, but we'll find out soon enough.  

[Mike Sixel]

 

I feel like the recent run is a bubble, but we'll find out soon enough.  

 

In all of history, every run is a bubble, the real question is how far down will it go in the next year or so....

[DaveW]

 

I just wish I had not diversified, and put it all in NVIDIA....I'm up between 80 and 200% this year....I literally could have considered early retirement had I really gambled......(like in a couple years).

 

 

I told you to do it man! J/K, hindsight 20/20 etc

Nvidia has been one of my bigger "wins" stock wise in a long long time, so I am enjoying this wave. I just wish I had more balls and would have put more into it, unfortunately these damn weddings don't pay for themselves

My Marijuana stocks unfortunately have leveled off a bit, a lot of question marks up in the air at this stage.

I'd recommend continuing to invest in any energy/oil companies as well over the next couple months.

Bitcoin still continuing to rise, still time to jump on that train, I'd bet that it hits $900 in the next 60 days.

Edited December 8, 2016 by DaveW

[Mike Sixel]

Oh, I'm up a TON, like, I put several tens of thousands in......but it could have been even more.

[DaveW]

 

Oh, I'm up a TON, like, I put several tens of thousands in......but it could have been even more.

Ahhh....good work though! Maybe it speeds up retirement still?

[Mike Sixel]

 

Ahhh....good work though! Maybe it speeds up retirement still?

 

Probably cut a year off, yes. Might also get me a new car.....

[Brock Beauchamp]

That's amazing, Mike. I'm nowhere near that point but I hope the next time I see a T-Mobile coming, I'll have $5-7k ready to jump on it.

 

I don't know if I'm ready for a large leap like I made with Netflix - 100% gains in a month - but I was dead-set on T-Mobile in 2013 and that has turned into 125% gains. I just *knew* they were doing all the right things.

[Mike Sixel]

Well, I am A LOT older than you Brock, and have spent the last 10 years putting every penny I could into the markets and retirement, after getting a late start.

 

It helps that the giant US insurance company I work for that is HQ in MN allows us to buy at a discount, and that the stock is up over 400% in the last 5 years or so.....And, I took the money from the house sale and put it in the market at almost the perfect moment this summer......

[Willihammer]

Nice job Mike. Question- do you have a price target? How long will you hold NVDA?

 

[Doomtints]

Telecom stocks have been good to me.  They pay very nice dividends.  Sure, you may look at AT&T stock and see it was mostly flat ... but you toss in their giant dividend and you've made quite a nice penny.  Same goes with Verizon.

 

When Obamacare first rolled out, some health care stocks really rolled, particularly Tenet.  I kept a keen eye on Tenet and sold it when it appeared to peak and it worked out well.  The stock fell back to earth quickly, but I got out of it before it did.

 

Also, one would think that some of these companies that make everything consumers use would be great stocks to own.  You know, P&G, Kraft/Heinz, Mondelez, Unilever, etc., but because these stocks make everything consumers use, they are very susceptible to market conditions.  If you want to know how things truly are going, look at these stocks, but don't buy them.  If they start falling reconsider all of your investments.  These companies are the canaries in the coal mine.

I left my 401k investments alone but I sold all of my stocks the day after the election and put the money into 6-month CDs.  I am expecting a mini boom-and-bust.  If I'm wrong I'm wrong, but to be safe I decided to just get out of the market for 6 months.  This is based on the recent performance of the stocks I mentioned in the previous paragraph.

 

My strategy has been to keep 5 stocks on the burner and invested in even dollar amounts.  If one stock starts getting much higher than the others, I sell it down and put the funds into the other stocks that are in the black so that they are all even again.  I try not to sell anything that is in the red, sometimes it can take a year or more for a stock in the red to break even, but ride it out.  Sell it when it finally breaks even if you're not bullish on its future.

Also, stocks tend to run up a bit before quarterly earnings reports, but NEVER buy stocks during this time period because this is often followed by a big drop that can take a year to recover from.  Buy stocks AFTER earnings reports after the stocks have corrected themselves.  This usually takes about 2 weeks.

Edited December 9, 2016 by Doomtints

[Mike Sixel]

 

Nice job Mike. Question- do you have a price target? How long will you hold NVDA?

 

As a rule, I hold until I NEED to money.....as I'm not smart enough to know what the market will do (I mean, I like NVIDIA a lot, long term)......but, we will need some money early next year, so I might lock it in.

 

That said, I have a couple losers that I could sell, and take a tiny tax loss. Unless I love a loser, I usually sell those when I need cash, to keep the tax bill low. We are wondering what the new President and Congress will do to tax rates........and at some point, I'm going to have to start selling winners.....

[joethastud]

 

I told you to do it man! J/K, hindsight 20/20 etc

Nvidia has been one of my bigger "wins" stock wise in a long long time, so I am enjoying this wave. I just wish I had more balls and would have put more into it, unfortunately these damn weddings don't pay for themselves

My Marijuana stocks unfortunately have leveled off a bit, a lot of question marks up in the air at this stage.

I'd recommend continuing to invest in any energy/oil companies as well over the next couple months.

Bitcoin still continuing to rise, still time to jump on that train, I'd bet that it hits $900 in the next 60 days.

 

What Marijuana stocks did/do you have Dave?  I've gotten burnt on the ones I purchased.  Low dollar amount, high reward type stuff, but still, burnt.  Couple hundred here and they're worth pennies now.

Edited December 9, 2016 by joethastud

[Willihammer]

 

Telecom stocks have been good to me.  They pay very nice dividends.  Sure, you may look at AT&T stock and see it was mostly flat ... but you toss in their giant dividend and you've made quite a nice penny.  Same goes with Verizon.

 

When Obamacare first rolled out, some health care stocks really rolled, particularly Tenet.  I kept a keen eye on Tenet and sold it when it appeared to peak and it worked out well.  The stock fell back to earth quickly, but I got out of it before it did.

 

Also, one would think that some of these companies that make everything consumers use would be great stocks to own.  You know, P&G, Kraft/Heinz, Mondelez, Unilever, etc., but because these stocks make everything consumers use, they are very susceptible to market conditions.  If you want to know how things truly are going, look at these stocks, but don't buy them.  If they start falling reconsider all of your investments.  These companies are the canaries in the coal mine.

I left my 401k investments alone but I sold all of my stocks the day after the election and put the money into 6-month CDs.  I am expecting a mini boom-and-bust.  If I'm wrong I'm wrong, but to be safe I decided to just get out of the market for 6 months.  This is based on the recent performance of the stocks I mentioned in the previous paragraph.

 

My strategy has been to keep 5 stocks on the burner and invested in even dollar amounts.  If one stock starts getting much higher than the others, I sell it down and put the funds into the other stocks that are in the black so that they are all even again.  I try not to sell anything that is in the red, sometimes it can take a year or more for a stock in the red to break even, but ride it out.  Sell it when it finally breaks even if you're not bullish on its future.

Also, stocks tend to run up a bit before quarterly earnings reports, but NEVER buy stocks during this time period because this is often followed by a big drop that can take a year to recover from.  Buy stocks AFTER earnings reports after the stocks have corrected themselves.  This usually takes about 2 weeks.

That's an interesting strategy. On the one hand there is an argument for rebalancing periodically but that must add transaction costs and taxes selling winners all the time, no?

[Doomtints]

 

That's an interesting strategy. On the one hand there is an argument for rebalancing periodically but that must add transaction costs and taxes selling winners all the time, no?

 

 

True.  This is why I don't do it constantly.  But if I have $20k more in one stock than the others, it's time to redistribute that down into the other stocks that are in the black.  

 

This is what mutual funds do for you behind the scenes.  For example, if a fund is investing 5% in Amazon but Amazon jumps, they'll sell some off and put the money into the other stocks in the fund so Amazon remains at 5% of the fund.  This keeps all the money in play but mitigates risk.  

Also, you're not paying capital gains tax on it because you're reinvesting it.  You're not profit taking.

Edited December 9, 2016 by Doomtints

[Mike Sixel]

 

True.  This is why I don't do it constantly.  But if I have $20k more in one stock than the others, it's time to redistribute that down into the other stocks that are in the black.  

 

This is what mutual funds do for you behind the scenes.  For example, if a fund is investing 5% in Amazon but Amazon jumps, they'll sell some off and put the money into the other stocks in the fund so Amazon remains at 5% of the fund.  This keeps all the money in play but mitigates risk.  

Also, you're not paying capital gains tax on it because you're reinvesting it.  You're not profit taking.

 

what? You better be paying taxes, or you are in trouble......reinvesting doesn't matter at all....