Investing

Market timing step 2: going back in

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  • Jan 14th, 2021 11:00 am
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Oct 14, 2015
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Is this what's know as Stock Market Herd Immunity To Everything? (SHITE)

1221 markets.png
Member
Nov 30, 2017
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Toronto
My transition to cash plan didn't go as planned over the past few weeks as there were a few good opportunities and it was good to participate in more recovery. I'm not feeling too optimistic about the next few months with marshal law being prepositioned in front of Trump, virus mutation and generally feeling market not realizing vaccine =/= "back to normal", and a potential Dem senate next month. Therefore, I've gone mostly cash today. Will keep Gold, Oil/Energy for better or worse, and likely EV (stop loss). Will be too preoccupied IRL over the next few weeks so one less (big) thing to be thinking about.  
Sr. Member
Aug 16, 2015
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damn well that's going to leave a mark. many of my stocks down 3%. lets see if this is the start of something big.

good thing everyone isn't wildly bullish and bought lots of put protection.
Member
May 2, 2019
409 posts
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Vancouver
IrwinW wrote: I'd like to see a 20% correction over the next six weeks, but I wouldn't count on it.
Is that EMA-233 on the weekly chart? Fancy! Also, random.

Yeah, I wouldn't count on a correction here at all. There were unprecedented moves down and up this year. This extra momentum can drive the move further than the historic norm.

Bulls are in control. It may change on an unexpected news event (not COVID-related or US politics news, those are noise). Or if some resistance builds up, which takes time, months normally. Or if euphoria emerges like a year ago, so far no. The most likely case is for the bull market to continue. Less likely, a gradual decline. My unscientific estimate is 4+ months is a normal duration for a bear market (20+% decline), 8+ months for a bull market. The fast moves of 2020 won't be a new norm.
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yvrbanker wrote: Is that EMA-233 on the weekly chart? Fancy! Also, random.
Nope, neither fancy or random, but something I've been experimenting with after seeing this post from a guy who has a lot of success in precious metals.
Exponential MAs are more sensitive to price changes because they apply more weight to recent prices.
(...)
On a related note, most people use the 200 MA and they could have been stopped out or even gone short in March and in November as gold had back-to-back closes below the 200 dMA in both months. However, those who used the Fibonacci-based 233 dMA never had a single close below that MA. In fact, the last close below the 233 dMA happened 2 years ago, in December 2018.
https://stockcharts.com/h-sc/ui?s=%24GO ... 7062417142
ADDED:
The reason the 200 MA is so popular, is that before computer age, traders used slide rules to do their calculations, and hand drawn Point & Figure charts. Just to keep things simple, they went with 100, 200, 400 etc MA.
[OP]
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Aug 4, 2014
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Out of curiosity, checked all my manual December purchases (distributions/leftover cash additions to existing positions in different accounts) 3 were below this morning’s low (in brackets), 2 were above:

Dec 1: 5 ARKK @$113 ($126.25)

Dec 2:
2 VTI @$188 ($189.82)
4 ZPR @$9.59 ($9.75)

Dec 4: 1 ZRE @$22.30 ($21.62)
Dec 7: 56 XEF @$32.42 ($32.30)

All larger November purchases are green (even if just a bit). So my only losers remain from pre-March’20 drop: AC, BNS, NFI and preferred shares. Let’s see how next few weeks unfold.. :)
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May 2, 2019
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Vancouver
IrwinW wrote: Nope, neither fancy or random, but something I've been experimenting with after seeing this post from a guy who has a lot of success in precious metals.
Thanks for the explanation. Mind you, that guy used it on a daily chart. Nothing says it will be equally significant on the weekly.

I know one thing for sure. Trading is not about finding a secret formula that nobody knows. It's about human behaviour. To evaluate other people's thinking, it's best to use the indicators they use for their trading decisions. SMA-200 or EMA-200 (daily) are typical choices for long-term trends. I bet that guy doesn't own his success to using a Fibonacci number in a random context. His edge must be elsewhere.

I am guilty of a bias myself. I like EMA-200, even though more decisions are probably made on SMA-200. If EMA-200 ends up a better choice after all, it will be because the quants of the biggest trading firms use it more often in their trading computers. I have no good evidence of that.
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I bet that guy doesn't own his success to using a Fibonacci number in a random context. His edge must be elsewhere.
Absolutely true. He uses a dozen indicators that he shares with the public, and probably a few that he doesn't reveal.
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Dec 21, 2020
This is the story of Bob, the world's worst market timer.
[OP]
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Aug 4, 2014
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kilburn305 wrote: I'll summarize and save eveyone 5 minutes: Stonks only go up!
Congrats, in 10+ years you might join the coveted “I told you so!” club! Face With Tears Of Joy

Speaking of which.. if you ever see someone say, here or anywhere, “Remember I told you to sell or buy this or that? I was wrong, hope you didn’t listen!” - please let me know.. :)
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Aug 16, 2015
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freilona wrote: Congrats, in 10+ years you might join the coveted “I told you so!” club! Face With Tears Of Joy

Speaking of which.. if you ever see someone say, here or anywhere, “Remember I told you to sell or buy this or that? I was wrong, hope you didn’t listen!” - please let me know.. :)
Perplexing that this rule only seems to apply to the fed500
[OP]
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So, my worst 2020 mistakes (self-documented in this thread :)):

1) Not buying Nasdaq ETF in April (ended up buying a Fairfax bond instead)
freilona wrote: Damn had the order for ZQQ @$61.50 - so far the low is $61.53.. :)
2) Selling IEMG and VTI mid-July (later bought BHK Bonds CEF with proceeded and remaining USD cash)

IEMG: sold @$52.02 (today $60.51)
VTI: sold @$163.29 (today $193.91)
BHK: bought @$16.08 (today $16.18)

3) Selling CSU in November (it went $250+ higher in December)
freilona wrote: First thing in the morning, sold CSU, my biggest Canadian winner,@$1,511.76. Only ~19% profit, regret not selling higher sooner (or waiting a bit today lol), but with current rotation out of tech it was making me the most anxious. Will invest the proceeds in ZGQ in my TFSA and purchase the same amount of VCE in Joint Margin (to maintain Canadian equities %-age) It’ll still be a tiny part of both ETFs, but I think they’ll perform better short-term - and will definitely be easier to DCA long-term from the peace of mind perspective :)
Of course, if we had another market drop in the fall as many predicted/expected, they wouldn’t have looked as such. But, on the other hand, since our portfolio didn’t outperform a balanced 60/40 ETF (will double-check on January 1st) - it was “much ado about nothing”.. Time to open a “Just stay the f@#$ing course!” thread? Face With Tears Of Joy
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Dec 3, 2014
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freilona wrote: So, my worst 2020 mistakes (self-documented in this thread :)):

1) Not buying Nasdaq ETF in April (ended up buying a Fairfax bond instead)



2) Selling IEMG and VTI mid-July (later bought BHK Bonds CEF with proceeded and remaining USD cash)

IEMG: sold @$52.02 (today $60.51)
VTI: sold @$163.29 (today $193.91)
BHK: bought @$16.08 (today $16.18)

3) Selling CSU in November (it went $250+ higher in December)



Of course, if we had another market drop in the fall as many predicted/expected, they wouldn’t have looked as such. But, on the other hand, since our portfolio didn’t outperform a balanced 60/40 ETF (will double-check on January 1st) - it was “much ado about nothing”.. Time to open a “Just stay the f@#$ing course!” thread? Face With Tears Of Joy
This is a very mature post to be able to objectively identify where you went wrong in 2020. I have considered these things myself. I was holding a decent amount of cash going into the March crash, but did not deploy too much of it. I have since purchased quite a bit through the summer and fall, but I missed the real sales.

It is easy to hindsight invest, but your decisions were not necessarily bad ones. Much wiser investors then us amateurs were preaching caution throughout the year. That turned out to be poor advice. Sticking with a pre-determined plan is a good habit and I think you understand already the value of indexing.

You know that next time the market is in turmoil, if you look back on 2020 and decide "this time I will not be cautious like I mistakenly was in 2020" that the market will tank further and you'll wish you repeated your 2020 "mistakes", lol.
Sr. Member
Aug 16, 2015
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It's fine. Your performance chasing is going to lead to fomo and fomo is not good. Just imo.

The virus is mutating rapidly i was reading. Likely mutations we don't even know about yet.
Sr. Member
Aug 16, 2015
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I take it your not a fan of any of the dips currently still available?

Gold is down. Zdv is still only at 16. Etc etc
[OP]
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Aug 4, 2014
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The only dip I’ll be interested in is S&P 500.. :)
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Dec 8, 2020
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freilona wrote: So, my worst 2020 mistakes (self-documented in this thread :)):

1) Not buying Nasdaq ETF in April (ended up buying a Fairfax bond instead)
on the next split buy 100 shares TQQQ, park it & forget it for 10 years
.............................................

set a limit, play within it.
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Feb 26, 2017
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freilona wrote: So, my worst 2020 mistakes (self-documented in this thread :)):

1) Not buying Nasdaq ETF in April (ended up buying a Fairfax bond instead)



2) Selling IEMG and VTI mid-July (later bought BHK Bonds CEF with proceeded and remaining USD cash)

IEMG: sold @$52.02 (today $60.51)
VTI: sold @$163.29 (today $193.91)
BHK: bought @$16.08 (today $16.18)

3) Selling CSU in November (it went $250+ higher in December)



Of course, if we had another market drop in the fall as many predicted/expected, they wouldn’t have looked as such. But, on the other hand, since our portfolio didn’t outperform a balanced 60/40 ETF (will double-check on January 1st) - it was “much ado about nothing”.. Time to open a “Just stay the f@#$ing course!” thread? Face With Tears Of Joy
I think what is different is that you are actually posting your mistakes and being honest :). From reading RFDs it seems like everyone would be up 50% this year but the math makes me question that ;).
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Oct 14, 2015
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Chance7652 wrote:
... From reading RFDs it seems like everyone would be up 50% this year but the math makes me question that ..
Not me.
I haven't figured out what the difference is between "total return" and "personal return", but either way, I didn't beat the TSX.
Too lazy to look for a benchmark that would be a suitable comparison.

About 50/50 portfolio as of Dec 23.

1223 perf.png

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