Should I be Scared?
- Thread starter ENP
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tech/a
No Ordinary Duck
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What are you scared of?
How does it affect you?
Super?
Trading?
Life in general--mortgage etc?
Your job?
How does it affect you?
Super?
Trading?
Life in general--mortgage etc?
Your job?
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Markets fluctuate it just the way it is, and always will be.
What is important is your own situation, and it is important for you to keep your head and examine the facts in a rational and dispassionate way.
re examine your investments and think about each individual company/property/bond and how they are likly to be operating 3 - 5 years from now. If you think they will be fine, don't panic.
skc
Goldmember
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Please do all your scaring in the official scaredy cat thread.
https://www.aussiestockforums.com/forums/showthread.php?t=23227&p=649970&posted=1#post649970
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I never followed the markets pre-GFC, but surely back then you wouldn't have days when it would drop 170 points in one day?!??!
Julia
In Memoriam
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A fairly minor movement? What do you consider would be a major movement?
What is your own plan? Any thoughts about capital preservation? Stop losses?
What about the scenario where someone's trading/investment plan is simply inadequate?
We keep seeing the admonition "stick to your plan". Well, fine, if you already know your plan is foolproof. I suspect some of those people posting in panic today have no such plan.
The last similar consolidation in our market was 87 and the the first real pull back after 87 was 18 months and 30%. The second Pull back in 74 was 18+ months and 40%+
I'm one of your dreaded fundamentalist. I'm interested in an income stream that justifies the purchase price based on very realistic/pessimistic assumptions. No stop Losses, No thoughts directly of capital preservation, all focus is on the cash flow and getting that right - If I get it wrong I get burnt. I truly like a down market because my only controllable variable is the buy price and over the long term the dividend component of the yield is important.
Be scared!
No one knows their plan is fool proof, that is why we continually pay attention instead of being permanently on holiday and that’s also generally why we love the game.
Enjoy the emotions if you can afford to gamble the money - otherwise get serious and put some serious work into what you are doing and plan how to control the risks. - you probably worked hard for that money.
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yes, there was boom and bust cycles before the gfc many of them, And no recent falls are not the biggest in history, many larger % falls.
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% wise the falls could be that size or bigger. And don't remember in the '87 crash the market fell 500 points (25%) in one day.
No one should be scared. They should be excited. This really is the time to accumulate. This is a time when you can increase the NUMBERS of your favourite stocks by trading one for another without the complication of capital gains tax. There will be opportunities now that have been absent for the last year or more.
All you need to do is carefully examine the fundamentals, look ahead and think outside the square.
All you need to do is carefully examine the fundamentals, look ahead and think outside the square.
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Hmmmm. Outside the square, outside the square, outside the square.
Is there a listed company that makes adult dypers in Australia?
Is there a listed company that makes adult dypers in Australia?
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All you need to do is carefully examine the fundamentals, look ahead and think outside the square.
Are any of the fundamental approaches still valid in the current climate?
Is the market actually going to respect the fundamentals?
P.S. I've looked ahead and had a sneak preview, what I saw wasn't pretty! So I'm not just scared - I'm @#$%ing terrified!
Wysiwyg
Everyone wants money
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You must like being in the red and that aint no BUL.All you need to do is carefully examine the fundamentals, look ahead and think outside the square.
Are any of the fundamental approaches still valid in the current climate?
Is the market actually going to respect the fundamentals? QUOTE]
Yes this IS the time to look at fundamentals and that IS because the market doesn't respect them. The market often gets it wrong. As an example the market allowed me to buy more than a million ADI and a million CER last GFC for next to nothing. ADI was taken over @ 42c a year later and luckily I sold CER a week ago. A few more that I'm still holding and may trade to accumulate if the market tanks.
Take LYC; In the last GFC it had funding withdrawn and the SP dropped. Now it is fully funded and powering towards producing a product that will still be undersupplied regardless. The market will get it wrong for sure and punish it again with the rest so watch it and stocks like it.
I'm getting excited just thinking of the opportunities that are about to surface.
And yes BUL is one that hasn't come good but you know what, I'm still buying it. And this is the market to get it by the million.
tech/a
No Ordinary Duck
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Nioka
Would you mind posting those you are buying millions of--- when you buy them.
Id just like to share your joy!!
As time passes.
Would you mind posting those you are buying millions of--- when you buy them.
Id just like to share your joy!!
As time passes.
No one should be scared. They should be excited. This really is the time to accumulate. This is a time when you can increase the NUMBERS of your favourite stocks by trading one for another without the complication of capital gains tax. There will be opportunities now that have been absent for the last year or more.
All you need to do is carefully examine the fundamentals, look ahead and think outside the square.
You're right, behind every crisis there is opportunity, but timing is important. Just look at the 08 GFC-if you had bought (and then held) stocks at the bottom of that, or even index funds, or even gold after the Lehmann Brothers collapse, you would have done very well. I think portfolio management is important right now though - can lose a lot of money if too much capital is in the wrong asset classes and that can wipe out any gains that's made after the recovery.
Different kettle of fish for traders - horses for courses.
It looks like there is a bit of argument here that you shouldn’t be scared to buy value at the moment.
Well that’s what I try to do and let me spell out to any Beginner that there are some aspects to that approach that you should potentially be very scared about.
The first problem is that if you are wrong about the true value you will have lost a lot of money before you correct your mistake. You have to be very good at business analysis before you will be making good judgements. A superficial understanding and a valuation formula is not adequate for good business analysis.
The second Problem is that no matter how good your business analysis is, the future is unknowable so you will never be 100% correct. You had better look to some form of risk management to deal with this reality.
The third problem is that even if your analysis is right and the future unfolds as you expected, you can still sustain MASSIVE drawdowns in the interim (markets don’t always respect value in the short term) and you had better be able to deal with that.
Price stops can get you out of very dangerous markets and give you a chance to fight another day, there is no equivalent to price stops when you buy/hold based on perceived value (Ignoring price action) and that makes the approach very risky as you will be deep in the doo before you realise any shortcoming.
Well that’s what I try to do and let me spell out to any Beginner that there are some aspects to that approach that you should potentially be very scared about.
The first problem is that if you are wrong about the true value you will have lost a lot of money before you correct your mistake. You have to be very good at business analysis before you will be making good judgements. A superficial understanding and a valuation formula is not adequate for good business analysis.
The second Problem is that no matter how good your business analysis is, the future is unknowable so you will never be 100% correct. You had better look to some form of risk management to deal with this reality.
The third problem is that even if your analysis is right and the future unfolds as you expected, you can still sustain MASSIVE drawdowns in the interim (markets don’t always respect value in the short term) and you had better be able to deal with that.
Price stops can get you out of very dangerous markets and give you a chance to fight another day, there is no equivalent to price stops when you buy/hold based on perceived value (Ignoring price action) and that makes the approach very risky as you will be deep in the doo before you realise any shortcoming.
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What scares me is the absence of any competent economic leadership in the western capitalist world. Just cast your eyes over this lot and despair.
Europe; Merkel, Sarkozy, Berlusconi. Zapetro
Great Britain: Cameron
America: Obama
Australia: Gillard
Everything they decide seems to get their economies deeper in the s**t.
Europe; Merkel, Sarkozy, Berlusconi. Zapetro
Great Britain: Cameron
America: Obama
Australia: Gillard
Everything they decide seems to get their economies deeper in the s**t.
