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What are we buying on Monday?

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kid hustlr

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Well what a few weeks it has been.

My buy and hold ETF portfolio has taken a walloping over the past fortnight but tomorrow is another day!

But some food for thought in the chart below:



We are already -8% this year.

- Interest rates are low
- We are in a seasonally strong period for the market

What's not to love?

So what shares look good? What are you buying? I personally will be buying some VAS on Monday morning as a apart of my ultra long term buy and hold portfolio but there must be some stocks out there looking good?

- Banks >10% yield?
- Miners 20% cheaper than 2 weeks ago?
- What about those gun market leaders that have held up relatively well vs the index over the past 2 weeks (CSL ?)

There has definitely been a clense of a whole bunch of market darlings over the past few weeks but there must be some stocks out there looking OK?
 
IVV + VEU for me, thinking about a regular dollar cost average into both on Monday as well.

not looking to add to my long term Aust portfolio any further for macro reasons, just holding on to what i have and reinvesting the divs from those into international (non currency hedged) ETFs.

sold some covered calls on BHP last week as soon as they went ex-div, will look to close out if i can buy them back for a small fraction of the original premium collected, though i suspect that if everything gets hammered, most of what i make on delta i will lose on vega when the IV spikes again.
 
Yes Sharkman I've found myself preferring the non AUD etf' s as well mainly due to 'my over all net worth' being largely AUD.

It's just do happens to be VAS's turn
 
Another one of those once in 10 years opportunities presenting IMO.
The ETFs should revalue down heavily some time this week. IMO
 
What are we buying on Monday?

Puts? Or yes toilet paper, if I can avoid getting beaten up in the aisle at Woolies - can't be any worse than in the climate change threads What a bonanza for the (domestic) paper suppliers.

But you have a point Kid H - the value equation does look better than two weeks ago
 
What, are we buying on Monday?

- too soon, although I've got the cash sitting around. Not so sure that "buying the dips" will work, this time.

Market is likely to be responding to monetary stimuli, not fiscal (as per reaction when Fed and RBA lowered, but market dropped)
 
Doesn't feel like there's many players rushing to sit on the bid tomorrow morning!

Any other's with thoughts? I do agree that plenty of charts look broken and if i was actively trading I would very likely be 100% cash at this point.

Secondly, I love the short currency / reflation theme but refuse to be someone who just piles into gold. Anyone else think it's strange the AUD rallied this week?

EDIT:

Did you know I can borrow money at 3.50% from the CBA then turn around and buy CBA stock with a gross yield of 8% ?
 
Last edited:
The USA is virus ridden, we aren't seeing the whole truth due to political interference and lack of testing facilities. We shall see thousands of deaths in 6 weeks time.

Not the time to buy.

Reason $A improving, that's why.
 
VVLU is the Vanguard Global Value Equity Active ETF (Managed Fund).

What's value right now is cyclicals, namely Financials, Oil/Gas, Basic Materials. All the stuff everybody is dumping that only does well when yield curve is steepening.

What's done well is curve flattener/duration sectors. Tech, Healthcare, REIT, Utilities...essentially all proxies for duration.
 
kid hustlr said:
Did you now I can borrow money at 3.50% from the CBA then turn around and buy CBA stock with a gross yield of 8% ?
Click to expand...


Indeed you could. All you have to do is be confident the Corona virus isn't going to create even more drama than is currently unfolding and that CBA will not be seriously affected by such drama (how could they be ??) and that the current price is well near the bottom.

What is your judgement ?
 
wayneL said:
Toilet paper, if I can find any.

Otherwise, I may short some gamma and add some precious metals.

Really looking for ways to short fiat with without going all Mad Max.
Click to expand...

here in Singapore we had our toilet paper crisis about 2 weeks ago. people will get over it soon (maybe) - there was plenty of toilet paper on the shelves when i went to the supermarket yesterday. or everyone simply ran out of space to store any more (properties tend to be tiny here given the lack of space in general).

short gamma but delta neutral? or directional?

i'm looking short gamma short delta. have sold some covered calls on bounces already. very reluctant to buy premium with IVs at this level. may look into selling an XJO call spread (probably ATM-25'ish delta) if it happens to rally 2 days in a row. IV will fall on the rally but on the last couple of bounces the delta skew stayed quite steep, very little demand for OTM calls in the current mood of pessimism.
 
Knobby22 said:
The USA is virus ridden, we aren't seeing the whole truth due to political interference and lack of testing facilities. We shall see thousands of deaths on 6 weeks time.

Not the time to buy.

Reason $A improving, that's why.
Click to expand...

Really ? I understand from the Son of God that the Corona virus was a mere blip in the water , that no one (not many ) people would fall off the perch, that there were a million tests waiting to be used, that the government was absolutely at the top of it's game in preparation, that they had the very best person taking charge of the situation (Pence indeed...)
And of course 100million of the most fervent folk in the US have said "Amen" to these sentiments.
 
kid hustlr said:
Doesn't feel like there's many players rushing to sit on the bid tomorrow morning!
Click to expand...

What's the rush to buy the open? I don't get paid until Wednesday night.

Secondly, I love the short currency / reflation theme but refuse to be someone who just piles into gold.
Click to expand...

Normally I'd be selling gold and duration which have become overweights for me due to their stellar performance and using it to buy some stocks but I decided I'm just happy to leave them and accumulate my underweights back to equilibrium as new cash comes in.

I've been watching the coronavirus stuff for a couple of months now and just flabbergasted that the market wasn't falling and by luck I bought some June 63 puts on STW on the 21st Feb which has kept my cash levels up nicely. I even managed to sell the (previously worthless) March 56 puts I bought at the end of Nov 2019 at a slight profit! Unbelievable, when was the last time someone sold index puts for a profit

That said, vol on the XJO doesn't seem to have gone to the same levels as in the US, yet, still well under 30 at the highs.


Anyone else think it's strange the AUD rallied this week?
Click to expand...

I don't agree with @Knobby22 that AUD is doing well because of Coronavirus in the US.

Is it AUD rally or USD decline? The US Dollar Index has been utterly monkeyhammered, but I'm not sure why. I would've expected a breakout above 100. Maybe traders pricing in a closing of the interest rate differential that has had the USD yielding way more than other currencies as the Fed does even more emergency cutting?

Nothing weird about the AUD finally not going down just a tiny bit in an environment where DXY drops 5%.

Probably worth adding USD to your Monday shopping list IMHO.

Did you now I can borrow money at 3.50% from the CBA then turn around and buy CBA stock with a gross yield of 8% ?
Click to expand...

Did you know that past yields have never been a predictor of future yields?
 
With regard the $US/Aud, we have an exposure to China through raw materials, the U.S has a huge exposure through manufacturing.
How many US companies have offshored their manufacturing to China e.g phones, computers and most other electronic components to name a few.
 
kid hustlr said:
Did you know I can borrow money at 3.50% from the CBA then turn around and buy CBA stock with a gross yield of 8% ?
Click to expand...

Money is cheap and getting cheaper, stimulus on the way, the market is the only place offering decent yields other than risky (ratesetter type) credit, growth is still the only game in town, at some point the pile in begins in spite of COVID19, infection rates in China have well and truly flattened, all the virus growth now is ex China.
 
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