Investing

Anyone else getting hammered?

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  • Jun 15th, 2013 8:13 pm
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Deal Addict
Feb 15, 2013
2445 posts
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bgallagher wrote:
Jun 12th, 2013 2:56 pm
Still looking for opportunities. Once I am done, I won't be bothered watching the market as I won't have any money to buy in.
Until then, I am on the look out.
This won't happen. If done successfully, an investor will always have cash coming in that needs to be deployed. The larger the portfolio the more cash that flows in that needs to be deployed ad infinitum.

Piles up like no tomorrow. Champagne problems.
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Mar 19, 2010
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Markham
Rickson9 wrote:
Jun 12th, 2013 4:26 pm
This won't happen. If done successfully, an investor will always have cash coming in that needs to be deployed. The larger the portfolio the more cash that flows in that needs to be deployed ad infinitum.

Piles up like no tomorrow. Champagne problems.
+1. Just today, I received dividends from N.WAG, N.DD and N.SDIV.
“Benign neglect, bordering on sloth, remains the hallmark of our investment process." —Warren Buffett
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Mar 17, 2004
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I just switch most of my investments to the couch potato ETF strategy. Been buying my ETFs over the past 1 month and prices just keep dropping. Kinda ***** to see everything in the red to start with but hoping it will rebound. Gonna keep buying my other ones like ZCN.TO which just keeps on falling
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Oct 4, 2009
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the watcher wrote:
Jun 12th, 2013 4:40 pm
I just switch most of my investments to the couch potato ETF strategy. Been buying my ETFs over the past 1 month and prices just keep dropping. Kinda ***** to see everything in the red to start with but hoping it will rebound. Gonna keep buying my other ones like ZCN.TO which just keeps on falling
When switching out of MFs to ETFs you should care less what the markets do. You are selling and buying back mmediately, keeping the same exposure.


I don't know why this is so hard for so many to understand but if you are in accumulation mode you should be praying all assets get destroyed. If you've depleted your human capital and are now retired, then hoping for higher markets makes sense.
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Apr 30, 2012
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S5 wrote:
Jun 12th, 2013 5:59 pm
When switching out of MFs to ETFs you should care less what the markets do. You are selling and buying back mmediately, keeping the same exposure.


I don't know why this is so hard for so many to understand but if you are in accumulation mode you should be praying all assets get destroyed. If you've depleted your human capital and are now retired, then hoping for higher markets makes sense.
Yes, I am hoping for a market crash as I missed the boat in 2009 (but I guess I have to get out of the market first before the market goes down the toilet).

virtuman1980 wrote:
Feb 21st, 2013 8:56 am
Haha...pretty interesting fellow indeed...but it was this persistence/stubbornness of his that got him the positive result in the end.
datako wrote:
Feb 19th, 2013 12:35 am
... Although, I'm a little surprised you went against what everyone advised ,op. You've got balls and absolutely crazy at the same time to do this.
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Sep 15, 2009
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rfdrfd wrote:
Jun 12th, 2013 1:21 pm
Listening to wesboag is extremely dangerous. Just google, "Why do I need stops in trading" ? No stops = unlimited risk. You really want to do that?

Wesboag: how do you know your hammering is only TEMPORARY? Do you have a crystal ball? Will you bet your left arm that your stock will go up given 5yrs? 10yrs? I won't.

This is a pure rookie mistake. If you get stopped out a lot, then it turns back up, that means you need to work on your entry zones (prices). You enter at the WRONG prices/levels. That's the solution. Not putting stops is every beginner's mistake. You will all experience it and realize later. Get out of your losers fast, let your winners run.
:facepalm:

Yes preaching long term PROVEN investment philosophy is "dangerous".

Short term "trading" and long term "investing" are complete opposites. I'm not sure how such elementary concepts prove to be such a difficulty for you to comprehend. That’s a serious question, not rhetorical. Further to this, with such a limited number of success stories with “trading” why do you feel that you have what it takes to be one of the .0005% of individuals that partake in such a self defeating activity and actually come out ahead over time? You are not the .005%, trust me on that.

Am I really making a “pure rookie mistake”? According to whom? your mentors at your little stock trading program?

Why are we talking about 5 and 10 years when "investing" should take on a much longer time frame then such? My crystal ball does tell me that over the LONG TERM, I WILL come out quite happy with my results.

Yes I know my “hammering” is only temporary, and I like it. It’s a time to add new funds. When you invest, you hypothesize that the fundamentals/growth/yield/ of a particular company/fund will continue/grow over the years. If my research is correct, my targets will be met. I believe in something called delay of gratification, just as should others. You my friend can’t see past tomorrow.

My definition of a Rookie, on the other hand: Glorifies their supposed correct “predictions”, disappears in the face of adversity and or questioning, pays more in commission than he/she gets in return for a single completed trade, constantly feels the need to prove him/herself, believes technical analysis is the answer (the only answer), gets hosed for $5000 over and over and over again by a makeshift “school” toting they have the answer to the stock market.

Sound familiar?
Certified Financial Planner (CFP)

"Our goals can only be reached through a vehicle of a plan in which we fervently believe, and upon which we must vigorously act. There is no other route to success...."
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Jun 9, 2003
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cjottawa wrote:
Jun 13th, 2013 1:29 pm
In support of what Wesboag wrote above, here's Warren Buffett:
A short quiz: If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef? Likewise, if you are going to buy a car from time to time but are not an auto manufacturer, should you prefer higher or lower car prices? These questions, of course, answer themselves.

But now for the final exam: If you expect to be a net saver during the next five years, should you hope for a higher or lower stock market during that period?

Many investors get this one wrong. Even though they are going to be net buyers of stocks for many years to come, they are elated when stock prices rise and depressed when they fall. In effect, they rejoice because prices have risen for the "hamburgers" they will soon be buying.

This reaction makes no sense. Only those who will be sellers of equities in the near future should be happy at seeing stocks rise. Prospective purchasers should much prefer sinking prices.
From 1997 Chairman's Letter To the Shareholders of Berkshire Hathaway Inc. (thanks to Bylo for the link)
With all due respect to Warren Buffet, who is a smart man, I don't see the "wisdom" in this analogy. You can't really compare burgers and cars to equities, because we get real value out of eating a burger and real value out of driving a car. Let's take burgers, because it's the clearest example: I'm not selling the burger at a later point in time. I'm buying it to consume it, so of course I want lower burger prices. In fact, if the price of burgers/beef continued to fall, monotonically and forever, I would be a very happy burger eater (ignoring the fact that no one would produce burgers in this environment unless the costs fell accordingly). If the same happened to the stock market, the economy would collapse.

With stocks, yes, we should like the price to fall because it'll be cheaper to buy, but the whole philosophy hinges on the premise that the drop is temporary and cyclical and will be followed by a gain. Historically this has proven to be true, but it is NOT a guarantee that it will always happen.

I get what he's trying to say, but it's a poor example, IMHO.
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Jul 23, 2007
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So far, I'm not worried. Haven't had any dividend cuts this year and I own thirty four Canadian dividend growth stocks. I get bored with bull markets and just love it when the bears come out. My preferred time to buy.
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Apr 30, 2012
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Stryker wrote:
Jun 15th, 2013 5:55 pm
So far, I'm not worried. Haven't had any dividend cuts this year and I own thirty four Canadian dividend growth stocks. I get bored with bull markets and just love it when the bears come out. My preferred time to buy.
Nicely done!! No dividend cuts out of all 34 securities. :cheesygri

virtuman1980 wrote:
Feb 21st, 2013 8:56 am
Haha...pretty interesting fellow indeed...but it was this persistence/stubbornness of his that got him the positive result in the end.
datako wrote:
Feb 19th, 2013 12:35 am
... Although, I'm a little surprised you went against what everyone advised ,op. You've got balls and absolutely crazy at the same time to do this.
Member
Feb 20, 2011
460 posts
89 upvotes
Kohanz wrote:
Jun 13th, 2013 2:57 pm
With all due respect to Warren Buffet, who is a smart man, I don't see the "wisdom" in this analogy. You can't really compare burgers and cars to equities, because we get real value out of eating a burger and real value out of driving a car. Let's take burgers, because it's the clearest example: I'm not selling the burger at a later point in time. I'm buying it to consume it, so of course I want lower burger prices. In fact, if the price of burgers/beef continued to fall, monotonically and forever, I would be a very happy burger eater (ignoring the fact that no one would produce burgers in this environment unless the costs fell accordingly). If the same happened to the stock market, the economy would collapse.

With stocks, yes, we should like the price to fall because it'll be cheaper to buy, but the whole philosophy hinges on the premise that the drop is temporary and cyclical and will be followed by a gain. Historically this has proven to be true, but it is NOT a guarantee that it will always happen.

I get what he's trying to say, but it's a poor example, IMHO.
When buying a stock you should not be planning on consuming the capital gains, but rather the dividends that the stock produces. That's where the true value of a stock lies. When the stock market crashes and prices are depressed that dividend stream can be bought on the cheap. Look at the historical yield of the SP500. WHen the market crashes yields increase. I would even go as far as to say a drop in price will most definitely be followed by a gain. Eventually prices drop far enough and yields increase to the point where investors begin to rebalance towards the cheap equities. In your example, beef prices would never fall indefinitely. Producers would rotate towards more profitable products. That's the market in action and the same applies to equities. Prices will fall to attractive enough prices that investors will want tot hold them again.
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