Down goes the Dow

Simple Math wrote:

agip wrote:http://www.businessinsider.com/chart-average-investor-returns-2012-12

Self serving bullspit by the investment industry.

The average investor, as long as he is not paying brokers' fees, will in the long run match the market. In order to underperform the market, he would actually have to be able to predict the market and then purposefully go against it. If he invests randomly, he will match the market. Common sense.

Common sense? Very funny.

Ritter wrote:

Simple Math wrote:

Self serving bullspit by the investment industry.

The average investor, as long as he is not paying brokers' fees, will in the long run match the market. In order to underperform the market, he would actually have to be able to predict the market and then purposefully go against it. If he invests randomly, he will match the market. Common sense.

Common sense? Very funny.

You really don't understand that simple and obvious concept?

Really?

DJIA cruising along at about 16,520 Tuesday morning. Nothing much is going on at the moment, as is usual this time of year.

Watch out for IPO's. Now that it's harder to make a buck, "investors" (speculators) are likely to flock to IPO's and drive up prices initially, and then possibly make a hasty exit. IPO guys know the appetite is out there, and I expect to see a rise in these things. If you're a small fish, be careful you don't get caught in a game of big rich players throwing around lots of money that you don't have.

All my opinion, of course. A good time, though, if you're looking to do an IPO.

Gold is also down today, to 1284.40, and really hasn't been doing much of anything. In one sense, when you look and see that gold and oil prices are relatively stable, you know that nothing much is happening, status quo. IMO. A fair time to go on vacation. I don't think anything much will happen in the markets over the first 3 weeks of August.

Currently dipping below 16,500

For me, the buying opportunity will be like that judge's definition of porn: I can't tell you what it is, but I will know it when I see it.

And I don't yet see it.

yeah, hard to get greedy or afraid of a 3.4% drop.

that since the Dow opened 2014 at 16500 we have just spun our wheels in the sand so far this year.

let me suggest wrote:

that since the Dow opened 2014 at 16500 we have just spun our wheels in the sand so far this year.

US stocks (vanguard total stock market index) is up a solid 4.8% for 2014

agip wrote:

let me suggest wrote:

that since the Dow opened 2014 at 16500 we have just spun our wheels in the sand so far this year.

US stocks (vanguard total stock market index) is up a solid 4.8% for 2014

AND, any shares you buy are yours and will swell in coming years, both in price and in dividends they receive.

No one should care about how one year goes. 73% of calendar years are UP years, and the rest down. So, we should all expect a down year here and there.

have to ask wrote:

Flagpole wrote:

Just YESTERDAY the second quarter 2014 results came out showing a 4% gain. Investors spooked by Argentina. Really, a non-issue.

Flagpole, my ashtonishment is getting the better of me, so I have to ask - Do you honestly believe that 4% gain number? After future revisions, do you expect it to still be +4%?

Bump for Flagpole.

have to ask wrote:

Flagpole, my ashtonishment is getting the better of me, so I have to ask - Do you honestly believe that 4% gain number? After future revisions, do you expect it to still be +4%?

Bump for Flagpole.[/quote]

I didn't answer the first time because it is uninteresting. I answer now only because apparently you find interest in this (though MY interest in a topic will continue to drive my responses). Any revision will be along the lines of what they usually are, so yes, it could stay at 4% or drop to 3%, but regardless, we are WAY out of the realm of being in a contracting quarter and thus no where close to recession.

When you read stuff from me about a certain percentage growth, keep in mind that I ONLY care about direction. I couldn't care less if the growth were 2% or 4% though 10% would be interesting as a one off. And in this case, I commented only to show that we were NOT on the precipice of recession as was stated by someone else.

Remember, I am not like most of you investors. I am NOT an emotional investor at all, so I don't get giddy with any movement in the market or economy. I continue to invest money that I don't need today regardless of the state of the market. Studies show that that's the best way to do it, and so do it I shall. I will stop investing ONLY in retirement (unless I don't need all of my SS income and nothing more...then I will simply invest the rest) or if before that time I need to have all the income I make.

American Shame wrote:

Ritter wrote:

Common sense? Very funny.

You really don't understand that simple and obvious concept?

Really?

K5, why do you keep changing names? Why not stick with K5, Simple Math/Match, or American Shame?

Flagpole, your posts are quickly becoming uninteresting.

You don't seem to be bringing anything to the table from your individual perspective--if indeed you even have one, which is seeming less and less likely.

Even if stocks do "swell"--and of that there is no guarantee--that's not the entire point. The time and point at which you buy are also relevant, as are other options you may have in the interim.

No one should care about how one year goes? That obviously depends on your perspective, and on just exactly how that year goes. You know this. Get your head out of your ass and just acknowledge that not everybody in the world is in your situation. I can pretty much guarantee that I am killing you this year, and I am almost entirely out of the markets.

Flagpole, your comments here haven't "shown" anything regarding the possibility of recession.

"studies show that" . . . I must say, and I apologize for doing so, ROTFLMAO

Do you get any satisfaction from playing to perfection the role of "the everyman" investor? I wonder why you even continue to comment here, or follow these threads. You've got it all sewn up, you are static, you will take nothing, and you give nothing.

DJIA around 16,440, about 10 minutes before close, and will likely close around the same level. IMO, still nothing to see here. Some people get excited about these things, but it's only a number, and not a particularly scintillating one at the moment.

Maserati wrote:

Flagpole, your posts are quickly becoming uninteresting.

Oh, the irony!

I noticed an unusual situation today -

large caps: down big: 0.94%

small caps: down less: just 0.40%

usually when the market sells off, small caps go down more than large caps. They are more volatile that way.

Anecdotally, I've noticed that when there is a fear based sell off - like today about Putin - and small caps don't sell off much - then the broad market selling is probably over. And the market will rally for at least a few days.

I'm not betting any money on this, but let's see if it works. I'll check back on Thursday.

"..usually when the market sells off, small caps go down more than large caps. They are more volatile that way.

Anecdotally, I've noticed that when there is a fear based sell off - like today about Putin - and small caps don't sell off much - then the broad market selling is probably over"

Any data to support this?

Worries over Russian troops amassing near the Ukraine border caused a sharp sell-off in global stock markets on Wednesday.

KEEPING SCORE: Germany's DAX dropped 1.2 percent and the FTSE 100 in London shed 1.1 percent. France's CAC was down 1 percent. U.S. markets looked set for another day of losses. Dow futures were down 0.3 percent at 16,319 and S&P 500 futures slipped 0.3 percent to 1,908.

ASIA's DAY: Japan's Nikkei 225 fell 1.1 percent to 15,159.79 and the Hang Seng in Hong Kong lost 0.3 percent to 24,584.13. The Kospi in Seoul shed 0.3 percent to 2,060.73 and China's Shanghai Composite gave up 0.1 percent to 2,217.46. Markets in Southeast Asia, Australia and India also lost ground.

Media whores wrote:

"..usually when the market sells off, small caps go down more than large caps. They are more volatile that way.

Anecdotally, I've noticed that when there is a fear based sell off - like today about Putin - and small caps don't sell off much - then the broad market selling is probably over"

Any data to support this?

well there are two parts:

1) do small caps go down more than the market as a whole? Yes, there are data to prove that. The beta of the russell 2000 is 1.3. The R2K is an index that follows small cap stocks. A beta of 1.3 means that if the market as a whole goes down 1%, on average the russell 2000 (and by extension small caps as a group) go down 1.3%.

And it works in the opposite direction - if the market goes UP 1.0%, small caps on average go up 1.3%.

2) Is there any data to support my anecdotal observation that when small caps stop selling off in relation to large caps...the correction tends to be over? um, not that I am aware. Just anecdotal observation.

Here's some data for you: the president of Ukraine just made a mint on his shorts.

The markets have always been responsive to announcements of political instability--however, this particular instability has teeth IMO. Russia is important to both europe and asia, and it knows it. There is more than one way to make money in this world, and the Russians do not discriminate between the ways.

Expect them to come out of this historical period ahead of the "west" in some ways.

Markets in general are right to be concerned about Russian influence and power. As usual in Russia, it is the handful of people at the top who get the real benefit--although they have to put their wealth somewhere, too, and you can only hold so much physical gold, art, jewels, and other luxury items.

Even though the DJIA is down, I still don't see much of interest, even though many commentators are constantly foaming at the mouth. I got out at the start of 2014, because I believed the markets to be overpriced at that point, and I therefore believe them to still be overpriced today, at basically the same level. I don't think that the 30% gains of 2013 were making up for gains that should have manifested earlier but for some reason, didn't. That 30% was too big, too fast, to be real. In good times, I can see 10%, so I can see a 20% "correction" coming, relative to the 2013 close.

ASSUMING that such a correction will happen, it will be interesting to see what form it takes, if it will be the result of a slow but constant chipping-away at the index levels. IMO that would be very dangerous, because I think that that kind of thing can be psychologically sustained, whereas the shock/response system of a quick drop is likely to be reversed, or at least somewhat compensated for, in a relatively short amount of time.