Down goes the Dow

JLW wrote:

In the interest of fairness...

https://realmoney.thestreet.com/investing/stocks/run-with-the-bulls-as-china-trade-talks-drive-market-14868336

You know, I have arrived at the very same conclusion watching this rebound unfold, and the legs it has displayed while i kept expecting it to pull back. And i quote from the article: "It's better to be part of the mindless herd of buyers than join the erudite intellectuals that will tell you why the market is wrong."

I am prone to put my remaining cash back in the market on Tuesday, and stop with the slow, incremental buying i've been doing YTD.

Yes, using your brain to figure out something is amiss is a bad thing. The market is always right, except in December, but heck that is ancient history, almost before the dawn of man.

Ghost of Igloi wrote:

Yes, using your brain to figure out something is amiss is a bad thing. The market is always right, except in December, but heck that is ancient history, almost before the dawn of man.

You cannot take any single window of time and from that infer a whole market. Look at the big picture.

What did W.C. Fields say? "If at first you don't succeed, try, try again. Then quit. There's no point in being a damn fool about it."

My approach has been to deal with degrees of certainty and invest incrementally based on likelihoods. That's why i haven't been in at 100% so far, and i haven't for over 2 years now. But it's like last February - we were way down and it recovered fully. This could be a repeat. A shakeout of weak hands?

Ghost of Igloi wrote:

agip,

I suppose one can think valuations and fundamentals will never matter. I think that is a short sided view. Bulls always think the market should deliver 10% returns. The last nineteen years have been half that.

We’ll see how it goes.

In the meantime have a good weekend.

Igy

No No No! Not with the year 2000 again. Even if you start there, the returns have been greater than you suggest. Go from 2003, and the returns are approaching 10%. You always want to have 2000 as your base year ONLY because 2000, 2001 and 2002 were terrible years. Very misleading on your part. Just pick a random year next time and we will see how the market has done. Fair enough?

Ghost of Igloi wrote:

Yes, using your brain to figure out something is amiss is a bad thing. The market is always right, except in December, but heck that is ancient history, almost before the dawn of man.

December was not a good month for the market but since the end of December the NASDAQ is up more than 20%. Quite a return in less than two months.

Sally Vix wrote:

Ghost of Igloi wrote:

agip,

I suppose one can think valuations and fundamentals will never matter. I think that is a short sided view. Bulls always think the market should deliver 10% returns. The last nineteen years have been half that.

We’ll see how it goes.

In the meantime have a good weekend.

Igy

No No No! Not with the year 2000 again. Even if you start there, the returns have been greater than you suggest. Go from 2003, and the returns are approaching 10%. You always want to have 2000 as your base year ONLY because 2000, 2001 and 2002 were terrible years. Very misleading on your part. Just pick a random year next time and we will see how the market has done. Fair enough?

Igy got burned by buying into the market just prior to 2000. That’s why he repeatedly references that date. It’s a lesson in bad timing that he is trying to teach us.

“We know best that which we have lived.”

Dufner wrote:

Sally Vix wrote:

No No No! Not with the year 2000 again. Even if you start there, the returns have been greater than you suggest. Go from 2003, and the returns are approaching 10%. You always want to have 2000 as your base year ONLY because 2000, 2001 and 2002 were terrible years. Very misleading on your part. Just pick a random year next time and we will see how the market has done. Fair enough?

Igy got burned by buying into the market just prior to 2000. That’s why he repeatedly references that date. It’s a lesson in bad timing that he is trying to teach us.

“We know best that which we have lived.”

A study done in the '90s concluded that one's portfolio performance is only 4% market-timing and stock-picking. 96% of its performance was being well-diversified. So, for the most part no one can time the market with any success. The strategy I employ and which many others recommend is dollar-cost investing where you invest on a regular basis. Since the market over time has always gone up, this is the only strategy I would recommend.

Dufner wrote:

Sally Vix wrote:

No No No! Not with the year 2000 again. Even if you start there, the returns have been greater than you suggest. Go from 2003, and the returns are approaching 10%. You always want to have 2000 as your base year ONLY because 2000, 2001 and 2002 were terrible years. Very misleading on your part. Just pick a random year next time and we will see how the market has done. Fair enough?

Igy got burned by buying into the market just prior to 2000. That’s why he repeatedly references that date. It’s a lesson in bad timing that he is trying to teach us.

“We know best that which we have lived.”

No. I get aggressive when it is in my favor. I’ll sit back and see if your strategy really works. Hasn’t in the past, but I hope it works for you this time.

Ghost of Igloi wrote:

Dufner wrote:

Igy got burned by buying into the market just prior to 2000. That’s why he repeatedly references that date. It’s a lesson in bad timing that he is trying to teach us.

“We know best that which we have lived.”

No. I get aggressive when it is in my favor. I’ll sit back and see if your strategy really works. Hasn’t in the past, but I hope it works for you this time.

Which strategy are you suggesting has not worked in the past?

Ghost of Igloi wrote:

Dufner wrote:

Igy got burned by buying into the market just prior to 2000. That’s why he repeatedly references that date. It’s a lesson in bad timing that he is trying to teach us.

“We know best that which we have lived.”

No. I get aggressive when it is in my favor. I’ll sit back and see if your strategy really works. Hasn’t in the past, but I hope it works for you this time.

My strategy has actually easily outperformed yours over the years. As was posted above, timing the market is a fool’s strategy. Dollar cost averaging combined with buy-and-hold is the way to go.

Dufner wrote:

Ghost of Igloi wrote:

No. I get aggressive when it is in my favor. I’ll sit back and see if your strategy really works. Hasn’t in the past, but I hope it works for you this time.

My strategy has actually easily outperformed yours over the years. As was posted above, timing the market is a fool’s strategy. Dollar cost averaging combined with buy-and-hold is the way to go.

Exactly, the last 100 years the S & P has done 10.3% annualized return

The last 110 years, S & P has returned 9.4% annually.

The last 120 years, S & P has returned like 9.3% annually.

Those are really good numbers.

Name one other investment which has such a long history of remarkable returns as the stock market.

Here is a calculator you guys can use to see how the market has done between any two years.

https://dqydj.com/sp-500-return-calculator/

Yes, it will work great if you live another 100 years, in the meantime the 19 year S&P 500 index return is 3.47%.

Ghost of Igloi wrote:

Yes, it will work great if you live another 100 years, in the meantime the 19 year S&P 500 index return is 3.47%.

and over that time how much have comparable investments made? Like, i don't know.... CDs? Or Hussman's cold day in hell fund? Or cash? Help me out here, With all the advantage of hindsight, what's better?

Ghost of Igloi wrote:

Yes, it will work great if you live another 100 years, in the meantime the 19 year S&P 500 index return is 3.47%.

That is a lie, Ghost.

If you start at 2000 January - it has done 5.5 %

If you start at 2000 December - it has done 6.3%.

Are you accounting for dividends, or are you just conveniently leaving those out? People owning stocks and mutual funds DO get dividends. Why would you leave those out?

Again, your 3.47% is bogus. Prove to me it is legit.

Again, here is the market calculator.

seattle prattle wrote:

Ghost of Igloi wrote:

Yes, it will work great if you live another 100 years, in the meantime the 19 year S&P 500 index return is 3.47%.

and over that time how much have comparable investments made? Like, i don't know.... CDs? Or Hussman's cold day in hell fund? Or cash? Help me out here, With all the advantage of hindsight, what's better?

Over the last 30 years, here is how CDs and the stock market have performed:

CDs - 1.09% annualized return

Stock market - 11.6 %

LOL - The stock market has a 10% advantage of annualized returns over CDs.

What is best is to run a balanced portfolio and avoid the big losses. The big losses the last 19 years are what have hurt investment returns. Equity returns are more bond like since March of 2000 and now bonds are likewise overvalued. So as poor as CD returns sound today, they were the best asset class in 2018. I think they will outperform again in 2019. Again, just an opinion and not a religion.

Sally,

Quit with the “lie” stuff. I said “index” return. I hope you have reinvested dividends on everything you own since 2000. Using your numbers it is far below the 10% you quoted earlier.

Shall I now call you a liar?

Igy

Ghost of Igloi wrote:

What is best is to run a balanced portfolio and avoid the big losses. The big losses the last 19 years are what have hurt investment returns. Equity returns are more bond like since March of 2000 and now bonds are likewise overvalued. So as poor as CD returns sound today, they were the best asset class in 2018. I think they will outperform again in 2019. Again, just an opinion and not a religion.

A return of 0.85% is being celebrated by you for 2018?

Here is how they have done over the last 30 years - a 1.09%