Investing

What did you buy? What might you buy??

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  • Oct 18th, 2018 12:13 pm
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Deal Addict
Nov 9, 2013
2409 posts
1052 upvotes
Edmonton, AB
CCHIPSS wrote:
Oct 11th, 2018 11:53 am
You are going to use margin during a possible start of a bear market? Are you trying to invest, or are you trying to gamble your life savings away.

We don't know if this is going to be bear. But during every bear market, there are people that use margin and ended up bankrupt, losing their house and all their assets.

If you time it perfectly, then of course you would win big. But it is funny that these are often the same people who yell at others for selling, asking "can you time the market"? Apparently those that sells early cannot time the market, but only those that uses margin to gamble everything away can time the market. (No offense to anyone of course. I am just saying we invest differently.)

I suggest this about investing: Taking a few punches is OK. But never take knockout blows.
1) I use margin when I think there are attractive buys. There aren't attractive buys unless prices go down.

2) I have a specific plan for margin and I'm not "gambling my life savings"

3) I don't think I can time the market or pick a bottom. Instead, I look at projected forward returns and buy when they are attractive (see #1).

Have you ever thought about ways emotions interfere with a persons ability to invest?
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Jan 28, 2007
426 posts
230 upvotes
South-Western, Ontar…
Elfwood wrote:
Oct 11th, 2018 11:16 am
What is this FTN doing?
Run from a day low of about $6.80 up to $8.44 and sitting at about $8.30 at the moment ... I could have bought in lower, but I don't try to time the market, I just look for an oversold stock ;)
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May 11, 2014
2317 posts
1290 upvotes
Iqaluit, NT
CCHIPSS wrote:
Oct 11th, 2018 11:53 am

You are going to use margin during a possible start of a bear market? Are you trying to invest, or are you trying to gamble your life savings away.

We don't know if this is going to be bear. But during every bear market, there are people that use margin and ended up bankrupt, losing their house and all their assets.

If you time it perfectly, then of course you would win big. But it is funny that these are often the same people who yell at others for selling, asking "can you time the market"? Apparently those that sells early cannot time the market, but only those that uses margin to gamble everything away can time the market. (No offense to anyone of course. I am just saying we invest differently.)

I suggest this about investing: Taking a few punches is OK. But never take knockout blows.
You need to be able to grasp and analyze what company's share actually have value. You can't assess the value of a single company based on the entire economy at large. This is called throwing the baby out with the bath water.
This is what happened in 2008. As an example, everything was being sold down even good companies. You're getting too worked up about the market as a whole yet not letting yourself look at individual companies on their merit.


The use of leverage in itself is not risky. Borrowing money is risky if you cannot afford it. Similar to buying a home. Buying a home when home prices go down doesn't make it more risky. You are buying an asset you feel has value at the price you accept. This is the exact same thing people should do with stocks.
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Jan 21, 2014
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Jojo_Madman wrote:
Oct 11th, 2018 1:05 pm
Run from a day low of about $6.80 up to $8.44 and sitting at about $8.30 at the moment ... I could have bought in lower, but I don't try to time the market, I just look for an oversold stock ;)
Did it give that high of a dividend payout every month consistently? yield is like almost 20%
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Jan 28, 2007
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South-Western, Ontar…
mkl38s wrote:
Oct 11th, 2018 3:22 pm
Did it give that high of a dividend payout every month consistently? yield is like almost 20%
When their NAV is at or above $15 it was consistent ... they have had a period for about a 12 months or so 6 years back where it didnt pay a dividend ... I've owned this stock with a 32% yield at times ... but this stock can be volatile
Deal Fanatic
Jan 27, 2006
8848 posts
3062 upvotes
Vancouver, BC
rivermornings wrote:
Oct 11th, 2018 12:34 pm
I don't understand why banks are falling?
A few things:

1. With the increasing rates, people are concerned about fewer people being able to afford loans... I know it's counter to what everyone has said in the past where increasing rates means better bank profits. While it's true that banks typically suffer near the end of a rate cycle as fewer borrowers come out of the wood work, personally, I think it's a little early in the rate cycle to assume that's going to happen. I would expect some deterioration in bank profits when rates are twice what they are now.
2. People are using banks as a source of funds either to cover margin calls OR to fund additional purchases.
3. The masses are panicking and are selling their ETFs which, due to market weighting, include a lot of banks.
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Jul 7, 2004
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What do you guys think of Berkshire B at this price?
Deal Addict
Jun 27, 2007
3883 posts
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CCHIPSS wrote:
Oct 11th, 2018 11:53 am
You are going to use margin during a possible start of a bear market? Are you trying to invest, or are you trying to gamble your life savings away.

We don't know if this is going to be bear. But during every bear market, there are people that use margin and ended up bankrupt, losing their house and all their assets.
I think I agree with your line of thinking. After longest bull run ever, it's not wise to go all in with mere 5% off the highs. Corrections are 10-15% and bear market could be 20-40%. Imagine 20% off 2940 - that's 600 points lower. Given where the last leg of the rally started (2135 post Trump election), I would say support lies somewhere near 2200. With numbers getting large, corrections will be larger too. 700 points on S&P is just 24% correction - while average bear market territory has been 40% decline (1700 SPX). Eventually, prior breakouts get tested and I see three major levels below -
1. 2500-2600
2. 2100-2200
3. 1500-1600

with extraordinary measures in the recovery (ZIRP, monetary easing, currency devaluation, other "tools"), there could be extraordinary corrections in the stock market. Money are still cheap, consumers over leveraged and debt levels are epic = conditions are ripe for another bomb to go off.

P.s. And nobody talking about failed easing efforts by Chinese government. They tried, but the measures exacerbated decline and it spilled over to the US market. If China buckles, we will see +1000 points decline within one day and market will get killed. Ok, I take off my bear goggles now.
After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: it never was my thinking that made the big money for me. It was always my sitting. Got that? My sitting tight!
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Nov 9, 2013
2409 posts
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Edmonton, AB
baz5 wrote:
Oct 11th, 2018 7:57 pm
What do you guys think of Berkshire B at this price?
A few different things I've read suggest that the estimated value is about 700 B (based on a sum of the parts valuation) which puts it at a ~28% discount. If this is indeed true, I would anticipate Buffet would be executing buybacks - I don't think we would find this out though until after the fact.

I think it's an attractive buy.
Deal Addict
Feb 4, 2015
3508 posts
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Canada, Eh!!
Enjoy logging in to brokerage accts and buy/sell BUT was so engrossed with it on Wed and Thurs amidst intermittent internet that today feel blahhh... like next day after heavy night partying.

So unlikely [99.9%] to do any trades today.

Have a great weekend all!!
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May 25, 2008
1311 posts
488 upvotes
Mississauga
After almost no buying/selling activity in the last 6 months, sold 1/2 my position in PKI (T) (first tranche in 2009) for a nice profit and bought more ENB.

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