Down goes the Dow

For God's sake.

Stop jinxing it.

On the contrary! I believe I am honoring Mr Market for his accomplishments. He will see this and wish to continue the streak.

People should NEVER have a "hot hand right now." That just means they aren't investing as they should.

Since you brought it up, let's see how I'm doing against the Dow at this moment (it's a LITTLE off because I took a Dow snapshot of the moment, but still, we'll get a good idea):

Dow YTD: -9.54%

Flagpole YTD: -20.02%

Still not looking good for me against the Dow in 2022. Oh well. I couldn't care less at this point.

meh

first off this is a discussion board for opinions on the stock market. so when opinions on the stock market turn out to be correct, the opinionator should be kudo'd.

second of all, many/most of us are commenting on just a portion of our net worth...just our 'trading account.' So having a hot hand in a trading account is mostly the point.

But sure, agree with your major point, that taking the advice of someone with a 'hot hand' is probably not a great idea because that means he makes large directional bets that will not always be winners and in fact can cause large losses subsequently.

I'm reading about lots of rebalancing going on right now - portfolios that need to stay with a set % of stocks at the end of the month are buying right now. Combined with short covering and a not-terrifying inflation number and an extremely complacent bond market...lots of money coming in.

We just need oil to go back below $100....

If you look at fund managers who are beating the market, usually that is just happenstance and they might follow up a few good years with a number of bad ones. Of course there are some like Peter Lynch who are able to beat the market with regularity but those types are few and far between. Just remember index funds beat actively managed funds like 70- to 80% of the time.

Wow....May is now a flat month. After all that. We were down c.8% from 4/30 at one point.

the unweighted SP500 is actually up a percent or so.

As long as Tuesday is not a disaster, May 30 statements will bring some calm across the land.

Also, fund expense fees are much higher with actively managed funds and that is a major drag on the fund performance. Compare the Hussman fund with a fund like VTI. One has a fund expense fee of 1.23% versus like .03% (ballpark) with VTI. Over the long haul an actively managed fund just can't keep up an index fund simply because of that.

yeah my favorite story is that Morningstar once did a study on the predictive ability of its star system. Did 5 star funds continue to outperform vs say 2 star funds, etc. Morningstar found that its star system was entirely backward looking. That it did well at measuring past performance but not future performance.

The one factor that could predict future outperformance over the average fund? Cost. A cheap fund had the wind at its back. So if you had to pick one factor to use in your judgments of what fund to use....use cost.

Praise Pre that costs have come down to near zero in big ETFs now. Such an enormous benefit for individual investors. Massive. Trillions more wealth in our pockets as a result.

It seems like Morninstar would have realized that its 5-star funds were no longer performing like 5-star funds and the 2-star funds were no longer performing like 2-star funds and the positions of the two would have been reversed

Fund expenses matter very little when a low cost index is down 20% in a matter of months. No one is discriminating one stock versus another when buying an index fund. That has certainly been beneficial to index investor the past decade. I believe, it will not be favorable for index investors over the next decade.

well yeah if performance at the 5 star fund lagged, it would lose stars, certainly.

but the point of it all is that the stars did not predict anything. they only served as a review of past performance. but that's not how most people use them - they usually use them to choose where to put their money.

I should point out that after that study Mstar revised its star system. Maybe it works better now.

I believe NASDAQ to finish up around 5% in the last 2 days. Pretty solid. Nice way to finish off the week.

Barring a last hour swoon, pretty good day (dragged down a bit by my bitcoin holdings -- is now a net loser for me after being way up on this in 2020) and a pretty good week.

First one in some time

Can I get a V?

best week of the year, I just read

How about a "T" for Tesla?

Up 7%