Let the bargain hunting begin

[galumay]

Stock markets can be predicted only to probability basis, which can never ever be 100%.

Predicting the future in things like markets has about a zero probablility statistically, humans are reasonable at predicting nice stable things like sunrises, other than that the record of fortune tellers has not been great!

 

[TPI]

before the fall, I found nothing of value but since the correction some stock trade at price I am willing to pay for long term outlook (10 years+) ... I actually sold a fair bit of stock before the fall so some of them I just get back cheaper

even though it is not cheap or bargain, it is a price I am willing to pay to hold long term and if need be I add more if the price keep sliding .... it hard to know where is the bottom so I start biting a little when I see the price is ok and average down.

that has always been my theme and I will continue to do so...Trading my surplus capital for passive income stream.

I mostly buy cash flow +ve business so it doesn't bother me too much about daily price movement knowing
I get my dividend comes Reporting season and it will be in business many years from now

and when it get hot, it is not if but when I start selling down and repeat the process.

Hi ROE, just wondering if you are still shorting banks like CBA, or have you bought back into bank stocks with this correction?

 

[rimtas]

Predicting the future in things like markets has about a zero probablility statistically,

You are very wrong at this point, markets can be predicted because they are operated by humans. Humans can be predicted because their behaviour hasn't changed for million years.
And about statistics... I give you one example-imagine you go with me for lunch and I have ordered two chickens, and you none, just water. So statistically on average we both had a very nice lunch eating on average one chicken per person and drinking half the bottle of water each, despite the fact that I had two chickens and you only water.
Statistics is a Lie especially in stock markets and economy.

 

[galumay]

You are very wrong at this point, markets can be predicted because they are operated by humans.

Good luck with that! Funny how almost no one has been able to do it with any degree of accuracy or certainty over reasonable time frames.

 

[rimtas]

Funny how almost no one has been able to do it.

It is not funny that almost no one is making money in trading. Money is made by only those who's forecasts are right.
Many people are claiming that they do not forecast markets, but when you hit a BUY button you immediately forecast that the markets will rise from there. When you averaging down, you forecast that markets will soon turn, before you run out of money.

When you sell, you forecast that the prices will drop. It I simple as that. I am not talking about economists and analytics who "forecast" markets every day, they are just herding, depending on a move. Yesterday, when ALL ORDS made a temporary bottom, all mass media people were shouting that correction is imminent. Look what is happening today. A linear thinking, reaction to the market.

 

[DJG]

We need the Elliott Wave people to tell us where it's going...

Preferably with common sense..

You are very wrong at this point, markets can be predicted because they are operated by humans. Humans can be predicted because their behaviour hasn't changed for million years.
And about statistics... I give you one example-imagine you go with me for lunch and I have ordered two chickens, and you none, just water. So statistically on average we both had a very nice lunch eating on average one chicken per person and drinking half the bottle of water each, despite the fact that I had two chickens and you only water.
Statistics is a Lie especially in stock markets and economy.

That could potentially be the rationale behind averages I suppose.

 

[Smurf1976]

Stock market is a leading indicator, telling where the economy is heading. If ALL Ords crash to 1000, economy will collapse in response.

The economy collapses as an actual response to the All Ords falling?

Or the economy was going to collapse anyway, the markets foreseeing this and thus leading with a fall in the All Ords?

As a general rule, I think it's the latter. The market tends to lead the "real world" but to a large extent is just foreseeing, not causing in most cases (collapse of broad share indicies being a possible exception to that rule due to the wealth effect).

 

[cynic]

It is not funny that almost no one is making money in trading. Money is made by only those who's forecasts are right.
Many people are claiming that they do not forecast markets, but when you hit a BUY button you immediately forecast that the markets will rise from there. When you averaging down, you forecast that markets will soon turn, before you run out of money.

When you sell, you forecast that the prices will drop. It I simple as that. I am not talking about economists and analytics who "forecast" markets every day, they are just herding, depending on a move. Yesterday, when ALL ORDS made a temporary bottom, all mass media people were shouting that correction is imminent. Look what is happening today. A linear thinking, reaction to the market.

Some very large assumptions being made here!.

I've known plenty of people to hit a buy or sell button despite their perception of market direction!

Furthermore, I've also known of traders that were able to make healthy profits without forecasting market behaviour.

In fact I would even go so far as to suggest that those rare traders succeeding in this game are probably those that place little emphasis on forecasting.

 

[sydbod]

Can any of you guys see the possibility of a drawn-out slide with only small temporary relief rallies?

Yep, that looks about right.

a peak at very end of October
a bouncy ragged drop with bottom in the second week of December
a climb to a lower peek around very end of December and then
a low in the first week of February.
from then on it is all a dogs breakfast.

These Tarot Cards have NEVER been wrong ... but then again, this is the first prophecy they have made.

 

[rimtas]

I've also known of traders that were able to make healthy profits without forecasting market behaviour.

They forecast unconsciously. They will never hit a BUY button if their forecasts in their minds were bearish. At least minimal analysis is done before enter, which outcome is a forecast for a rising stock/market and thus the BUY button follows. It does not need to be done publicly.

 

[rimtas]

The economy collapses as an actual response to the All Ords falling?

Yes. ALL ORDS are people. When people turn pessimistic, they sell shares(which is instantly recorded on market and you can see it). Also they turn to a self preservation mode, decreasing their spending, postponing a further business expansion plans, downgrading on a living standards(later in the bear). All of this are recorded later in a companies results and in the statistics and economy overall. Then governments step in to take measures to prevent a further crash, usually after the bottom has been set. Government actions are a very good indicator of a large market peak/bottom, because they are the last to react to the trend of market mood.

One good example is situation now with realestate market and investor activity overall-when data about soaring investor loans entered the system, RBA decided to take measures(I must notice that this decision was made right near the peak). Markets are already in downtrend for a while, and by the time RBA releases its first package of "improvements" to lending for investors, markets will be even more lover. Later, everyone will be saying tat RBA has hurt the REIT market and it crashed, which is not true. RBA just reacted(last) on the top to a soaring trend, in afraid it will soar further.
It is just an example, other government institutions also join the party at the end. Remember how government was spending money in 2007, it just assumed that a "new era economy" has started.

Herding is a very, very powerful thing when it comes to masses and people at the top. It also has a forecasting value of a larger trends, you just need to know where to look.

 

[cynic]

They forecast unconsciously. They will never hit a BUY button if their forecasts in their minds were bearish. At least minimal analysis is done before enter, which outcome is a forecast for a rising stock/market and thus the BUY button follows. It does not need to be done publicly.

Again, you're making very large assumptions!

Analysis and forecasting are by no means synonymous!

Furthermore, there are traders that simply don't allow their opinion/perception of market direction to influence their trading decisions for the simple reason that their edge has nothing whatsoever to do with their forecasting ability!

 

[So_Cynical]

or by switching off their laptop and trying to forget that they have an active (red)portfolio.

True that, i switched off my laptop in like june 2008, turned it back on again in Oct/Nov to throw everything i had left at 3 gold stocks, and then sold out of 2 of those gold stocks in Feb 2009 with profits of around 30% - just in time for the ASX200 market bottom, then threw it all at.

Suncorp ($4.70)
Computershare ($7.10)
Energy Developments ($1.25)
Iluka ($2.95)
VRL ($ 82c)

Just to Name a few, ah the memory's looking back at the old trade confirmation emails.

 

[rimtas]

Analysis and forecasting are by no means synonymous!

Yes they are synonymous. First you analyse and the outcome is a forecast. Based on that forecast you make trading decisions.
Even those following technical trades always are forecasting-let's say someone follows MA200 and buys when prices are above and sells when they are below. That is the forecast, but discussion already gone to the level when I must abandon it for a simple reason-I suspect on the other side of the screen is a person with little knowledge about how the human brain works. SEEya mate.
Must go to check whether ebola virus is a real threat here because someone has just been hospitalized in the area where I live. Maybe soon trading will become the last thing to bother of.

 

[cynic]

Yes they are synonymous.

No they aren't - check your dictionary!!!

First you analyse and the outcome is a forecast. Based on that forecast you make trading decisions.

No! I certainly do not do this!!

Even those following technical trades always are forecasting-let's say someone follows MA200 and buys when prices are above and sells when they are below. That is the forecast, but discussion already gone to the level when I must abandon it for a simple reason-I suspect on the other side of the screen is a person with little knowledge about how the human brain works.

Yet more hasty and ill considered assumptions!

SEEya mate.

Bye bye!

 

[galumay]

as entertaining as this discussion has become we should probably drag this one back on topic!

Seems the bargain hunting season was very short! I am already happy that i tipped my purse in when I did, missed out on a little of the potential but over the length I hold it wont matter one iota.

 

[pinkboy]

as entertaining as this discussion has become we should probably drag this one back on topic!

Seems the bargain hunting season was very short! I am already happy that i tipped my purse in when I did, missed out on a little of the potential but over the length I hold it wont matter one iota.

Yes, me too. Had $70k in wages to pay on Monday, so things were tight....so was unable to cash in this week. Same as you, Im just accumulating for the long term, so no matter the entry point really. Just would have been nice to capitalise on this weeks little dip.


pinkboy

 

[herzy]

Yes, me too. Had $70k in wages to pay on Monday, so things were tight....so was unable to cash in this week. Same as you, Im just accumulating for the long term, so no matter the entry point really. Just would have been nice to capitalise on this weeks little dip.


pinkboy

Feel free to ignore me if you think my comment inappropriate, but I'd be wary of investing in a way that impacts your cash-flow. No matter how good your investments, insufficient cashflow brings many unstuck! (i.e. being forced to sell at the wrong time due to wages needing to be paid). I'd advise making sure you have a buffer in cash to avoid being forced to sell at a less than ideal time.

 

[herzy]

I bought into NAB relatively low (but not the bottom), which I'm happy with considering the 3 dividends I'll get in the next 13 months, totalling around 10% yield (plus franking credits). Longer term with a p/e of 12 it's not looking too bad either.

I was hoping IMF or AAD would get a bit cheaper, as they've both had great runs lately - but no such luck.

 

[Faramir]

I missed out yesterday. I was waiting for CCP to drop more. CCP went up today. Now it is out of my range. BOQ - I was expecting it to go lower. I am starting to change my feeliungs about BOQ. I can't describe what it is but I no longer have the urge to buy it. I can't explain why? There are other shares to consider but I decided to hold off. I can't explain why? Is this 'Beginner's Hestitation'?