I know a few on here appear to be pretty savvy with money. I would like some opinions on whats next for the market? Also, any good defensive stocks or segments to buy now.
Stock Market - Up, Down or sideways?
- Thread starter paschuler1970
- Start date
I'm not allowed to make recommendations on here. One simple rule: Bet not thy whole wad.
My investments are spread out and I have some cash. I'm thinking wait to see what the fed does next and if anymore action is taken with tariff.
If this thread is unacceptable, I'll delete it.
Buy and hold is for rookies. Everything is momentum today so when the bottom drops out- its the rookies are who left holding the bag.
Mutual funds are largely waste of money. Use ETFs instead.
Simple moving average investing is ideal for the average Joe. Easy to execute.
Don't get suckered into thinking average annual return is important - it means little. Aim for singles and double. If you avoid the wide swings you make more money over time.
The thread isn't unacceptable. Its NTOP's profession and he can't respond but the rest of can. Just take any advice for what its worth.
I'm 63 and my investment strategy is now based on a single factor. I have what I call a "sleep comfortable at night" portfolio. Since I retired, I have had no more than 35% in the market. That portion has done very well. I also have invested in many high-dividend stocks. The rest of my portfolio is in cash or cash equivalents. Not many bonds. That portion has not done well from a return perspective but it is what allows me to sleep well every night.
It depends on the momentum behind it.
Th DJIA has averaged 7.2% in its history but you only captured 4.9% of it if you bought and hold. You need avoid the big drops to have a higher capture rate.
Simple Moving Average investing beats buy and hold over 70% of the time.
I was watching Kramer one night and he was talking about Simple Moving Average, however, I really couldn't follow what he was saying...... I need to research it.....
No need to delete....I'm restricted because of my registrations. Doesn't matter for you and other "civilians".
Good luck to you in whatever strategy you use.
I'm fairly aggressive, even though I'm 68 but still working. I used to invest very actively and had numerous online accounts and platforms. I played the commodities markets, options, as well as stocks. But it's very difficult to keep up with them actively and 90% of the people who try doing that lose most or all of their money. My trading was very technical and I used more than moving averages, which are but one of 50 or so indicators. But I decided the stress and worry wasn't worth it and moved into some good mutual funds now. Mostly high growth, emerging markets, blue chip, some gold. I'm getting annual returns of between 17% and 22% and I'm OK with that. I have a very small amount invested in bonds, have some in cash of course, and I do keep track of indicators to re-allocate my funds between each mutual fund. You just have to stay informed and know which indicators are the best to use.
Options are a better alternative than buying individual stocks. But again, you really need to stay on top of them and know how to buy and sell them properly. Most of us don't have the time, ability or inclination to do that.
My best advice is to NOT be a day trader and to NOT buy individual stocks that need managed so actively every day. Buy good quality mutual finds with low or no loads, diversify between each type, and you'll accumulate some wealth.
There are various types of "simple" moving averages in various timeframes. It depends on what your investing horizon is. There are 5 day, 10 day, 21 day, 50 day, 200 day, etc. Those are the most common. And the significance of each and when one crosses over the other is what most people don't understand and what you hear when you tune into CNBC or Kramer.
Actually, I think this would be one of the best and most beneficial threads ever started on these forums. Thank you for starting it. I appreciate some of the insights, because honestly I am not as diligent about my investments as I need to be.
50 day verses 200 or the 252 day verses share price. Both have extensive research backing the methodology.
I don't have the technical expertise to do all kind of analysis. Two stocks I have had for years are PPG and Bank of NY Mellon. My wife worked at PPG in the early 70's for a couple years. She had I think 22 shares of stock which we have added to and sold off over time. We are in dividend reinvest in both and I hardly ever look at these two. They have both grown a good bit since we've had them.
I was going to do options as HailToPitt1985 suggested but got cold feet. I do some covered calls which have worked out ok.
I know there's some pretty smart fellows on here. I already picked up some good points.
Honestly, can you explain this a bit more? Not sure what you are saying. I am a novice.
Google - Micheal Garrison Simple Moving Average. A pdf of a white paper should come up. It's a pretty easy read on a SMA methodology and the research.
In a nutshell, when share price is above it's simple moving average- that can be an indicator of positive upside. When it moves below, it can be an indicator of downward momentum.
Positive is good, negative isn't.
I am a bullish long term but a few bear bumps would be possible
THe Toddy Too Hotty summary
1. There is typically a recession every 5-8 years and we are about 11 years out from the start of the last recession. Therefore one should be imminent.
2. On the US we have a strong economy and low unemployment so how much more can we increase GDP? Very difficult
But I am bullish overall because
3. There am are trade wars going on and despite that we have a very strong economy. If the trade wars go away the economy should get even stronger
4. There is so much oil production that energy costs will remain low indefinitely. They will get lower when russia Iran and Venezuela get on good terms with the major economies.
5. Space is the next frontier for the economy like the internet was in the 90s. A lot of room to grow the economy there and the US leads the pack
So with that said, if you are at or approaching retirement age why take a chance? Be cautious with your money.
I am retired now for 3 years. After the dip mid year last year I moved a nice amount to a safe 5 year fixed 3.3% return. This move was like NCPitt says, so I can sleep at night.
I have several good paying dividend stocks. Some reinvest but several come to me to supplement my social security and 2 small pensions we have.
So far I'm doing okay but at the same time I'm trying to avoid a big dip with the stocks I have. Ironically I held onto a gold stock I've had for a long time. Although it's not a lot of dollars, it's almost doubled since Jan. 1. It has me a little concerned because I'm not really a fan of gold stocks.I think gold going up is a negative indicator.
There's a lot more to it than that. I recommend reading Mastering the Trade, by John Carter, if you really want to get introduced into how each of the MA's work and what they mean, especially when one crosses over the other. He's a very accomplished day trader, but the principles he outlines explain a lot about the technicals of stock market investing. He gets into stochastics, Fibonaccis, options, and in great detail. There are many, many indicators he uses that are a bit more than just looking at moving averages, and that are more accurate.
But for the average stock market investor, just stay away from individual stocks, unless you are willing to have a lot of radical swings in your portfolio value. To me, it's not worth the stress. I did it for a couple of years, investing in 10 stocks or so at a time, watching them constantly, playing with commodities (gold, natural gas, soybeans), options. I made some money and sometimes a lot of it, but lost some too. I like to sleep at night, so I quit doing that.
Glad to see you have PPG. Good, strong company, good fundamentals, cash rich. They have been and will continue to acquire companies in their M&A activity. And they won't show wide swings so that's safe.
Here's a small historical tidbit- if your portfolio is down 5 years into your retirement; you are doing something wrong. Spending to much , too conservatives in your allocation, maybe too much volatility.
If your portfolio is down at the 5 year point- you are probably running out of money.
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One more thing, 70% of dividend stocks suspended or greatly reduced their dividend in 2008.
At the 3 year point of retirement I am actually up. I was fortunate a couple stocks I had at retirement and I bought since I retired have done well. They offset the bad ones I have. However, I am a very conservative person. I only have one car at this point and my house is paid off.
Question to those who seem to have more expertise in this issue
I really don’t get why you want to be that much more conservative in retirement
If you plan on living into your 90s you need almost as high of a return as you did in your younger years to keep your nest egg from declining. In addition historically if you look at the market even in 2008 drastic decreases in the market ended up with complete recovery in a couple of years. So yes your portfolio will take a 1-2 year hit but in a few years you’ll be up.
I’d like to know what your thoughts are on paying a management fee for. Someone to professionally manage your portfolio .
I really don’t get why you want to be that much more conservative in retirement
If you plan on living into your 90s you need almost as high of a return as you did in your younger years to keep your nest egg from declining. In addition historically if you look at the market even in 2008 drastic decreases in the market ended up with complete recovery in a couple of years. So yes your portfolio will take a 1-2 year hit but in a few years you’ll be up.
I’d like to know what your thoughts are on paying a management fee for. Someone to professionally manage your portfolio .
You want less volatility in your portfolio to capture more of the return. Management of volatility is probably more important than top line returns. If you lost 50% in 2008, you need to return 100% to break even- that took more than a couple of years.
If you were taking money out of the portfolio (like in 2008) you might not ever recover because of the drop plus your distributions.
Paying someone who simply puts you in asset allocation model then does nothing by rebalance the account is waste of money. Vanguard ETFs and a little reading- you can do the same thing yourself.
We're in a bankers bubble. Unemployment at record lows...stocks at all time highs...yet raising interest rates would crash markets.
If you take a look at Europe they're selling bonds with negative yields on junk rated companies. There's also the Deutsche Bank falling apart..
That being said bad news is good news. Buy tech stocks. Mix crypto into your non-stock holdings. Look for assets that perform well when currency value drops.
Bankers are the greatest can kickers of all time.
If you take a look at Europe they're selling bonds with negative yields on junk rated companies. There's also the Deutsche Bank falling apart..
That being said bad news is good news. Buy tech stocks. Mix crypto into your non-stock holdings. Look for assets that perform well when currency value drops.
Bankers are the greatest can kickers of all time.
I still pay a management fee at one brokerage company. Some of my company profit sharing went there. I believe this is a waste of money for me but I have yet to move it. However, I like having money at a couple places because I get advice from different sources. I do believe a local broker gives you better service than one of the bigger places. That is of course if the local broker doesn't churn your account.
As for changing philosophy once you retire, several brokers told me to be more conservative once I retired. I have only done this to a minor amount.
For instance, I bought 100 shares of Dominion Power on the advice of a local broker for the dividend. I Bought it right after I retired, 3 years ago. It's dividend grew from .647 then to .918 a quarter now. I added to it on the dips and used covered calls to pick up a couple dollars. It was a successful pick.
I have too many different stocks in different market segments which make it hard to keep track of. However, I did this to spread out the risk. Being an "old guy" I lived thru the 1987 drop that hit me pretty hard. People on here echo the fact that managing individual stocks is tough. I agree with this but I do have some time to do this.
I started this thread because I wanted other peoples opinion and I felt people on here would give good advice. I can see other peoples ways of investing now. A key point I was glad to see was from NCPitt and others, you want to sleep at night not worrying about this.
Selling and buying frequently to time the market helps the me group exclusively-
Brokers
On this we agree, Souf. Holding stocks and especially good growth stock mutual funds for the long term and not buying and selling at every perceived chance that some broker tells you about, is the best strategy. Stock mutual funds will get consistent 10%+ growth over the long term. If you're in the high quality ones, 15%+ growth year in and year out is expected. Forget the broker. Do some research, look into Fidelity funds, and you'll be fine.
I have 5-10 year percentage change gameplans .
Rebalance annually or after major connections if deviation by 2-3+%
Risk tolerance is the only thing to tweak.
Mrs Buffett and I just met with our financial advisors to plan for the next, quarter and years to come.
Their outlook is a Trump win so its stay the course of a balanced portfolio of high quality equities, equities what that pay dividents 3% +, aggressive funds, defensive funds, and balanced funds.
Our guys take some short positions in case things go in different direction.
You have to determine what type of investor you are, your age, your life plans, how much money you can invest / risk and risk tolerance.
Another big factor is do you have the time and expertise to do your own work or is it better to have a financial advisor with lots of different resources and product options.
High quality means you never have to sell in a dip or drop.
2.Index funds with a good track record check them out.
3.Bond funds
Remember you never lose or make money in the stock market until you sell.
Don't sell in a big dip or drop unless you're rebalancing.
Invest in dips and drops. Your acct may go down a bit more in the short run
but recover faster when the market corrects.
I was dumping new money in the market when the Trump trade negociations
pushed the market down. With the market at an all time high I just made some
nice money some of which I put on the sideline waiting for another temporary dip.
95% of our money is long haul investment money which has worked for us!
Get in for the long haul, just look at the averages over the last 40 years ( up, up, up).
There are some big day trade winners but day trade losers outnumber the big winners!
My 2 cents if you company offers a lump sum retirement package rather than an annuity and it looks good, take the lump sum, you can invest that money and grow it over years.
Plus its yours, its in your estate to leave to your spoiled children or girlfriend or boyfriend when you expire!
Stay, stay, stay away for risky junk, returns which appear to be to good because they are, quick money schemes. You will lose big money!
Before I teamed up with my current investment advisors I used Schwab. You'd be
surprised how much great advise you can get for a low price with a firm like them.
If you're not in the markets you can't make any money!
Their outlook is a Trump win so its stay the course of a balanced portfolio of high quality equities, equities what that pay dividents 3% +, aggressive funds, defensive funds, and balanced funds.
Our guys take some short positions in case things go in different direction.
You have to determine what type of investor you are, your age, your life plans, how much money you can invest / risk and risk tolerance.
Another big factor is do you have the time and expertise to do your own work or is it better to have a financial advisor with lots of different resources and product options.
In general without giving up a lot of inside baseball if the average person sticks to:
If your co offers a 401k with matching funds take that option first.
Some companies start the match at $.50 for each dollar invested, and match up to $ 1 for a $1 invested up to 6% of your pay.
1. A mix of High quality equities Pharma, consumer products, tech, energy, utilities, auto with good dividends, a record of paying and raising the dividend with dividend reinvestment you can't miss. Always reinvest the dividends.
I've gone with this strategy since I started investing at 19.If your co offers a 401k with matching funds take that option first.
Some companies start the match at $.50 for each dollar invested, and match up to $ 1 for a $1 invested up to 6% of your pay.
1. A mix of High quality equities Pharma, consumer products, tech, energy, utilities, auto with good dividends, a record of paying and raising the dividend with dividend reinvestment you can't miss. Always reinvest the dividends.
High quality means you never have to sell in a dip or drop.
2.Index funds with a good track record check them out.
3.Bond funds
Remember you never lose or make money in the stock market until you sell.
Don't sell in a big dip or drop unless you're rebalancing.
Invest in dips and drops. Your acct may go down a bit more in the short run
but recover faster when the market corrects.
I was dumping new money in the market when the Trump trade negociations
pushed the market down. With the market at an all time high I just made some
nice money some of which I put on the sideline waiting for another temporary dip.
95% of our money is long haul investment money which has worked for us!
Get in for the long haul, just look at the averages over the last 40 years ( up, up, up).
There are some big day trade winners but day trade losers outnumber the big winners!
My 2 cents if you company offers a lump sum retirement package rather than an annuity and it looks good, take the lump sum, you can invest that money and grow it over years.
Plus its yours, its in your estate to leave to your spoiled children or girlfriend or boyfriend when you expire!
Stay, stay, stay away for risky junk, returns which appear to be to good because they are, quick money schemes. You will lose big money!
Before I teamed up with my current investment advisors I used Schwab. You'd be
surprised how much great advise you can get for a low price with a firm like them.
If you're not in the markets you can't make any money!
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Your first mistake is thinking you are receiving 10% if you buy and hold. You don't- 10% is the simple average not the CAGR. The CAGR is what you capture.
Day trading is one thing - it's a whole other thing to understand the math of long term investing and use that to your advantage.
Historically, rebalancing only reduces your return by cutting off the positive trends.
I understand the math just fine
Fees cut your gains and reduce your compounding interest.
I also understand the math just fine, just as Souf said. You don't need to lecture me on this. I've experienced pretty many facets of trading in many forms and have an MBA in Finance. I'll stay the successful course I've already established, be aggressive, and focus on the long-term.
My point was it's misleading to say someone should be expecting 10-15% return as if that is the growth you are realizing.
The inflation adjusted CAGR for the S&P is under 7%. Mutual funds have underperform the S&P 500 95% of the time.
The statistics aren't taking into account what specific mutual funds are chosen and re-balancing in those funds over time. So possibly the overall annual mutual fund return, including bond funds, gold, etc. is 5%, but that doesn't reflect what the real returns are for some investors who happen to choose the right funds.
Exactly. And chasing individual stocks in hope of beating the market because you think you can do better than the market is futile. Index and growth funds work very well and many mimic the S&P real returns. It's all in what funds you pick.
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