I bought SOXS more on the belief that AI is just another fleeting market fad. I have taken about half of my proceeds from SOXS and TECS and plowed into EM bond CEFs. The other half of proceeds to money market. In that way managing the risk on the leveraged ETFs. Also, in 2024 I will likely convert EM Bond CEFs distributions to cash, rather than reinvest.
In regards to timing a buy in EM Bond CEFs, I tend to look at discount to NAV and yield. The distribution of income date is significant, but less so in my opinion. EMD is also ex-dividend yet is currently up 1.58% on the day. The other point, volume on these investments is low, as such I always use limit orders, and buy in smaller increments when they are trending down.
The only reason I was paying attention to ex-dividend date on FAX is because that dividend is so freakin' big, like 13% annual yield! I was tempted just to grab a piece of that.
Looking at its performance over a longer period, I would be wary of holding it for more than the briefest of times. But that's just me. Good luck.
He's using it as a reverse indicator. One of the clients doing panic selling.
Yeah, most investors stay level headed, but when you start to see even an inkling of the panic driven stuff, you know it's capitulation time - when the weak hands are shaken out, selling subsides, and a rebound ensues.
yeah seattle is correct...i very rarely get calls from clients asking me to sell or just to talk about their fear of losses. When those calls do happen...it usually means millions of other investors have already sold and that the selling might be close to being complete. Which could set the stage for a rally. A contrary indicator.
Totally anecdotal and unscientific of course.
It does work the other way as well. Investors wanting to take on the latest rage. One reason I hopped on SOXS is all the AI hype. The hot ideas to climb on that enthusiasm, where as the decline in sentiment can be pretty rapid.
In September 2008, the weekend before Lehman it was pretty crazy. Be it brokers or clients. Panic. I bought a significant position in MS stock and preferred under $20 on one and $10 on the other, if I recall. And then things got worse. Worked out in the end, but then you never know.
In regards to timing a buy in EM Bond CEFs, I tend to look at discount to NAV and yield. The distribution of income date is significant, but less so in my opinion. EMD is also ex-dividend yet is currently up 1.58% on the day. The other point, volume on these investments is low, as such I always use limit orders, and buy in smaller increments when they are trending down.
The only reason I was paying attention to ex-dividend date on FAX is because that dividend is so freakin' big, like 13% annual yield! I was tempted just to grab a piece of that.
Looking at its performance over a longer period, I would be wary of holding it for more than the briefest of times. But that's just me. Good luck.
I have over 20 years experience in these funds as client investments. On any Closed End Fund buying right is key, and the discount to NAV can give one a hint to that. I also have the belief that EM bonds is a better relative value to DM bonds. Also, since these are leveraged, the borrowing cost is higher. I am trusting over time these costs normalize. Like anything I can be wrong, but comfortable with the risk.
yeah seattle is correct...i very rarely get calls from clients asking me to sell or just to talk about their fear of losses. When those calls do happen...it usually means millions of other investors have already sold and that the selling might be close to being complete. Which could set the stage for a rally. A contrary indicator.
Totally anecdotal and unscientific of course.
It does work the other way as well. Investors wanting to take on the latest rage. One reason I hopped on SOXS is all the AI hype. The hot ideas to climb on that enthusiasm, where as the decline in sentiment can be pretty rapid.
In September 2008, the weekend before Lehman it was pretty crazy. Be it brokers or clients. Panic. I bought a significant position in MS stock and preferred under $20 on one and $10 on the other, if I recall. And then things got worse. Worked out in the end, but then you never know.
As a postscript to the last comment, I also double leveraged bull on the S&P 500 at the same time. I can’t recall exactly, but more than 25% of my liquid net worth. I figured if Morgan Stanley went belly-up I may be out of a job anyhow.
It does work the other way as well. Investors wanting to take on the latest rage. One reason I hopped on SOXS is all the AI hype. The hot ideas to climb on that enthusiasm, where as the decline in sentiment can be pretty rapid.
In September 2008, the weekend before Lehman it was pretty crazy. Be it brokers or clients. Panic. I bought a significant position in MS stock and preferred under $20 on one and $10 on the other, if I recall. And then things got worse. Worked out in the end, but then you never know.
As a postscript to the last comment, I also double leveraged bull on the S&P 500 at the same time. I can’t recall exactly, but more than 25% of my liquid net worth. I figured if Morgan Stanley went belly-up I may be out of a job anyhow.
that's a version of the cuban missile crisis story.
A young broker on the desk heard a rumor that soviet missiles were inbound from Cuba and yelled at his boss 'we have to sell 'em!'
Boss grabbed him by his thin 1960s lapels and shouted 'NO YOU IDIOT, we're buying! If the rumors are false then we'll have bought low! And if the rumors are true the trades will never settle!'
Mixed on this one...a contrarian call from May 2023, saying that people hate stocks so probably a good time to buy. And yeah market did climb 10% soon after this article. But then it fell back 10% to around the same level as in May 2023, where we are today.
Investors have a sour outlook on U.S. stocks. Contrarians say that is good news for the market. Turmoil in the banking sector has dragged fund managers’ enthusiasm for stocks to a 2023 ebb, according to Bank of America’s most recent monthly survey. The stress adds to worries including lingering inflation, higher interest rates and a slowing economy that have driven them to cut their stockholdings to their lowest levels relative to bonds since 2009. Institutions have pulled a net $333.9 billion from stocks over the past 12 months, according to S&P Global Market Intelligence data, while individual investors have yanked another $28 billion. Billions have flowed into cash equivalents, driving total assets in money markets to a record $5.3 trillion as of May 10, according to the Investment Company Institute. To some, all that doom and gloom looks like a sign of hope. Many on Wall Street view extremes in sentiment one way or the other as the time to do the opposite. Warren Buffett famously advised investors to “be greedy when others are fearful.”
Getting very close to deflation in CPI...the Fed sees September into October month over month CPI to be just 0.11% and falling fast. Lowest number in a long time, if the prediction is accurate.
Have to think this might be a good time to buy longer-term bonds. Lock in that 5% rate for many years. Short term bonds don't yield much more anymore and when rates fall you won't get as big capital gain. I've been almost 100% in short term to get that 5.5% yield but will start buying some duration now.
the interesting thing is that many of the 'tech' companies aren't really tech companies anymore....google is an advertisement platform. As is Facebook. Apple is...consumer products and content delivery? Amazon is retail. Point is, if you want that ol' tech massive growth, the old names may not be able to deliver it. You might think you have a tech portfolio but it isn't anymore.
To get fast growth you might need to go to smaller companies that aren't household names. For that reason I use RYT, which is an equally weighted tech fund. Over the last 52 weeks, RYT has done much better than a more traditional market cap weighted fund like VGT.
But over longer periods of time VGT has done materially better, as megacap tech has done so well over the last 10 years.
Also, with RYT you don't face the prospect of major blowups like Alibaba and Tesla are going through...your money is more diversified.
Apple is not a high growth innovative company, and has not been for years. I have illustrated the facts on this many times. Buying back your stock, and increasing your prices is not a high growth innovative company. It slowing growth and maintenance of market share. The stock will be under $100 within a year.
DGTD prediction check!
on 10/24/22 Apple was trading at $148. Igy said it would be below $100 in a year.
It did get as low as $124, but nowhere close to double digits and is now at $173, a nice 17% gain (not including the dividend!) from where Igy said sell.
Have to give Igy credit for predicting the fall from 148 to 124. That was a good call. But then the AI boom carried it back up. So overall, Igy was wrong.
on 10/24/22 Apple was trading at $148. Igy said it would be below $100 in a year.
It did get as low as $124, but nowhere close to double digits and is now at $173, a nice 17% gain (not including the dividend!) from where Igy said sell.
Have to give Igy credit for predicting the fall from 148 to 124. That was a good call. But then the AI boom carried it back up. So overall, Igy was wrong.
Page 2936 if you want to go back and review.
In other news, the grass is still green and the sky is still blue...
Apple is not a high growth innovative company, and has not been for years. I have illustrated the facts on this many times. Buying back your stock, and increasing your prices is not a high growth innovative company. It slowing growth and maintenance of market share. The stock will be under $100 within a year.
DGTD prediction check!
on 10/24/22 Apple was trading at $148. Igy said it would be below $100 in a year.
It did get as low as $124, but nowhere close to double digits and is now at $173, a nice 17% gain (not including the dividend!) from where Igy said sell.
Have to give Igy credit for predicting the fall from 148 to 124. That was a good call. But then the AI boom carried it back up. So overall, Igy was wrong.
Page 2936 if you want to go back and review.
I still say the cycle low for Apple is under $100. The very large deficit spending by the Government is prolonging the pain, both for inflation, and asset prices.
Jeremy Grantham: "In the U.S., the three near perfect markets with crazy investor behavior and 2.5+ sigma overvaluation have always been followed by big market declines of 50%. The current superbubble features a dangerous mix of cross-asset overvaluation."
“In other news, the grass is still green and the sky is still blue...”
Thems tile teeth shinning brightly as another lot of SOXS bought at $9.17 sold at $13.31, up 45%.
He was talking about your wrong prediction on Apple, not the timed trade you did on a leveraged ETF that you already told us about. There is a difference.
“In other news, the grass is still green and the sky is still blue...”
Thems tile teeth shinning brightly as another lot of SOXS bought at $9.17 sold at $13.31, up 45%.
He was talking about your wrong prediction on Apple, not the timed trade you did on a leveraged ETF that you already told us about. There is a difference.
The real challenge for Apple shareholders is the apparent lack of growth. Perhaps that is a wrong view, but we will know soon enough on November 2nd. Are investors willing to pay up for a stalling profit picture? Alphabet is a victim of that, down 10% today. If so, Apple could be back under $160 in a little over a week.
