Investing

Market timing step 2: going back in

  • Last Updated:
  • Oct 17th, 2020 9:15 pm
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kilburn305 wrote: You buying techno here? I wont be. maybe at nasdaq 9500 if it gets that "low".
I was tempted, but decided that 37% of technology in ZGQ (sans Amazon, Facebook & Tesla, so it didn’t drop as much as HXQ/ZNQ/ZQQ with 60% in IT) is “good enough” for me :) But hey, I can now buy 1 Amazon share with leftover USD in my RRSP! Maybe I should in case it splits and doubles? Face With Tears Of Joy

I wouldn’t go low volatility ETFs just yet, but, at my age, it’s probably better to stay away from holdings that can cause me a heart attack Face With Tears Of Joy Kidding, I just think the markets might be ready for new darlings.. :)
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Andrew Hallam was saying about a month ago:

"Fidelity Investments is one of the world’s biggest mutual fund companies. They reported that almost 20 percent of their investors pulled out of the stock market between February 20th and May 15th, 2020. What’s worse, almost one-third of the firm’s investors over the age of 65 did the same thing."

https://en.swissquote.lu/expat-investin ... ring-covid

I remember Peter Lynch who was a very successful manager for the Magellan fund with Fidelity from 1977 to 1990 complaining about the same thing. Some investors would do market timing jumping in and out depending on market conditions and invariably make less than the returns from the fund itself. Some things never change.
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I think one should move out of equities without hesitation only if it's a really big black swan contagion event -- WaMu, Lehman, Merrill or this pandemic as it worsened.

It's like standing in front of a freight train and it's so much easier to push the sell all button with online brokerages (first ones out usually little scathed; if you are getting out after 30% loss, you might as well stay put since you clearly appear to be a deer in headlights). Might as well step aside briefly and come back in to pick up the spoils.

Can't time the bottom but going back in after saving one's self a 10-15% (or more) haircut is good enough for many people.

Anything like some smaller developing country defaulting on its sovereign debt, minor "terrorist"-like attacks, news about big money moving out of equities into bonds are really not going to impact the market much with money floating around everywhere.
Last edited by alanbrenton on Sep 9th, 2020 10:35 am, edited 3 times in total.
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Stryker wrote: Some things never change.
Agreed, IMO the only sustainable long term edge in investing is behaviour.
Keep calm and go long
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alanbrenton wrote: I think one should move out of equities without hesitation only if it's a really big black swan contagion event -- WaMu, Lehman, Merrill or this pandemic as it worsened.

It's like standing in front of a freight train and it's so much easier to push the sell all button with online brokerages (first ones out usually little scathed; if you are getting out after 30% loss, you might as well stay put since you clearly appear to be a deer in headlights). Might as well step aside briefly and come back in to pick up the spoils.

Can't time the bottom but going back in after saving one's self a 10-15% (or more) haircut is good enough for many people.

Anything like some smaller developing country defaulting on its sovereign debt, minor "terrorist"-like attacks, news about big money moving out of equities into bonds are really not going to impact the market much with money floating around everywhere.
Even with the black swan event, one shouldn't be moving in and out of equities if they want the market return.

But it's up to you to do what you feel you're comfortable with.
TFSA: XAW | RRSP: VEQT + VAB | Non-Reg: XIC

It's really that simple.
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TuxedoBlack wrote: Even with the black swan event, one shouldn't be moving in and out of equities if they want the market return.

But it's up to you to do what you feel you're comfortable with.
I think most want to outperform the market but as you said here may times, that's easier said than done.

I totally agree with you. Market will keep going up in the medium to long-term.

I also think that pockets in the market is not semi-efficient when pricing securities so I'd rather be in those than some index for the time being.
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Get your PressReader out or just subscribe.


Why one of Canada’s leading actuaries says it’s time for retirees to get out of bonds

https://www.theglobeandmail.com/investi ... tes-bonds/

"In an interview, he suggested that similar logic applies to many personal portfolios. Bonds can no longer reliably generate much cash flow for retirees, so savers hoping to generate steady income from their holdings have to contemplate the notion of cutting back on their exposure to bonds."

Background;

"Real Return Bond - Long-Term"
https://www.bankofcanada.ca/rates/inter ... ian-bonds/
On this day in 1885, Charles Merrill was born in Green Grove Springs, Fla., the son of a family doctor. With Edmund C. Lynch, he founded Merrill, Lynch & Co. in 1914 to “bring Wall Street to Main Street.”
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MrMom wrote: Get your PressReader out or just subscribe.
The reader view on iPad still works for me.. :)
Why one of Canada’s leading actuaries says it’s time for retirees to get out of bonds
Yep, that’s why I took a chance on 5%+ yielding BHK! So far so good, a bit more volatile than BND, IEF and TLT, but as long as it keeps paying those monthly distributions - I’ll learn to ignore the daily swings.. :)
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"Bond" holders alert.

On this day in 1885, Charles Merrill was born in Green Grove Springs, Fla., the son of a family doctor. With Edmund C. Lynch, he founded Merrill, Lynch & Co. in 1914 to “bring Wall Street to Main Street.”
[OP]
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MrMom wrote: "Bond" holders alert.
BHK is holding the fort.. Face With Tears Of Joy
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[OP]
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Hm an interesting new ETF - IVOL (was recommended at today’s Market Call)
Why Should I Consider IVOL For My Portfolio?

Diversification

It’s great for diversification. According to sponsor KFA, the ETF has exhibited very low correlations with major indices.

Inflation Protection

IVOL is an inflation hedge. The response of the TIPs portion of the portfolio given rising inflation is obvious, but IVOL’s CMS spread options should enhance the fund’s sensitivity to inflation. As inflation expectations increase, the swap curve typically steepens and the value of the fund’s CMS spread options should increase. In a sense, per sponsor KFA, the options “function similar to options on inflation expectations.”

Current Income

Through TIPs and option trading income, IVOL has a current yield per SA of about 3.60%.
IVOL: Consider Risk Management

Added to the watchlist.. :)
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Aug 16, 2015
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In on tech. bought 15 shares of HQU. Don't want to tie up too much capital but would like to capture some upside if we get a sizeable bounce.

market makers will now trade aggressively against these 15 shares of HQU. financial crisis incoming. LOL.
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ZGQ is not even down to my last Friday “first tranche” entry price, so definitely a bit less volatile - fighting the urge to just buy the other 2/3rds and forget it till January.. Face With Tears Of Joy
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freilona wrote: ZGQ is not even down to my last Friday “first tranche” entry price, so definitely a bit less volatile - fighting the urge to just buy the other 2/3rds and forget it till January.. Face With Tears Of Joy
I wouldn't. I feel like china is still waiting to play their trump card. "mr market dont care" or at least that's what he will say. but mr market will just be bluffing. :D
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Due to circumstances totally within my control, we’re doing a complete reshuffle of our 2 corporate and 2 personal non-registered accounts. Due to lack of knowledge when we first got involved with Scotia McLeod, and still not knowing much when we later set up our personal accounts we ended up with 90% of our Canadian eligible dividend stocks in the corp accounts and our growth and balanced ETF’s in our personal. Not super efficient tax-wise, so with a couple of account transfers and a few trades and adjustments I figure we might as well get everything in their “proper” accounts moving forward.

However, with the slump lately and the seeming overall lack of optimism going forward, along with the US election looming it’s very tempting to try timing the re-entry over the next 8 weeks or so. Thoughts? Just buy the dips? Stagger it weekly? Just go all cash, or all back in?

Spectator mode was a lot easier.

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