Biggest crash in stock market history?

Dave Taylor

Dave Taylor

Rex kwan Do
slingblade_uhhuh

slingblade_uhhuh

JORBA Board Member/Chapter Leader
JORBA.ORG
Dave Taylor said:
So go Donald Trump and SP500 it?
Click to expand...

Most would say that a core holding is a core holding. Buy and hold.
Recognize the importance of asset allocation to cover the ups and downs. Maybe implement a slow moving bond fund in your portfolio to have money on hand for the dips to opportunistically buy more core.

FWIW: If you have the the desired money amount in your core holdings, and the time/money to analyze. Go in and out at the edges w/ individual stocks, bonds and commodities. If done correctly it can make a difference. But don't mistake the edges for something to buy and hold. Subscribe to one or two on-line financial analysis services to learn the timing. Keep in mind that financial analysis and opinions are like poop chutes. Everyone got one.
 
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Dave Taylor

Dave Taylor

Rex kwan Do
slingblade_uhhuh said:
Most would say that a core holding is a core holding. Buy and hold.
Recognize the importance of asset allocation to cover the ups and downs. Maybe implement a slow moving bond fund in your portfolio to have money on hand for the dips to opportunistically buy more core.

FWIW: If you have the the desired money amount in your core holdings, and the time/money to analyze. Go in and out at the edges w/ individual stocks, bonds and commodities. If done correctly it can make a difference. But don't mistake the edges for something to buy and hold. Subscribe to one or two on-line financial analysis services to learn the timing. Keep in mind that financial analysis and opinions are like poop chutes. Everyone got one.
Click to expand...
The best quote of I have heard is “no one is going to look out for your money better than you”. Trading/investing is emotional. The best thing to do is not read the news. Do your own research/technical analysis. I have done well using finviz.com bubbles and shorting the stocks that have floated the furthest away from the group.
 
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kidzach

kidzach

Well-Known Member
watched a news report yesterday on NKLA stock. It's a hydrogen/electric truck company. Found it interesting and was thinking of buying the stock today. Somehow the market cap of NKLA has overtaken both Ford and GM. So I did a lot of research this morning and I can't seem to get my head around all this. It seems they don't even have/own a building to even start to build these very cool looking trucks. Yet they will be taking orders end of the month. I guess sometimes hype is all you need. I wish this company well. Just not touching this now. Anybody have any thoughts ?
 
Dave Taylor

Dave Taylor

Rex kwan Do
I
pkovo said:
I don't like what is being done to the market, but I'll probably trade today and try and grab a few momentum bucks.

But.......I'll feel dirty about doing it
Click to expand...
’ve been cash a few days now since having a good return. Won’t consider shorting again until spx 3230ish. I think powell will eventually run out of ammo. Probably after DT gets in for round 2.
 
Dave Taylor

Dave Taylor

Rex kwan Do
kidzach said:
watched a news report yesterday on NKLA stock. It's a hydrogen/electric truck company. Found it interesting and was thinking of buying the stock today. Somehow the market cap of NKLA has overtaken both Ford and GM. So I did a lot of research this morning and I can't seem to get my head around all this. It seems they don't even have/own a building to even start to build these very cool looking trucks. Yet they will be taking orders end of the month. I guess sometimes hype is all you need. I wish this company well. Just not touching this now. Anybody have any thoughts ?
Click to expand...
BUBBLE
 
Patrick

Patrick

Overthinking the draft from the basement already
Staff member
Dave Taylor said:
So go Donald Trump and SP500 it?
Click to expand...

Dave - You share a ton of information about you/life/family - much appreciated, much respected.
Are you trading inside your retirement account? (i think you confirmed this awhile back)
Or is this a fun money account which you are pitting yourself against the market?
Or both? Do you have a base amount you don't mess with?

I think what you are saying with your comment is that anyone can win in an up market - you are looking at ways
to win when there is volatility, or bearish attitudes - an I agree that these can be taken advantage of.
can the individual, part-time trader win over time+market returns ? i'm skeptical.

My opinion of what the government is doing: rich people don't like to lose money in large chunks -
that needs to be in the equation. Policy is reactive, not proactive. Always has been.

---

I'm already on record that our money goes in every paycheck for the last 35 years, with another 4 years or so "following the plan."
It is a small percentage of income, but the math is compelling over the long haul, income increases, investment increases.
And TBH, I have no idea what our ROR is over those years, because of job changes, investment bank/brokerage house changes, etc.
I can say it has met expectations.

It is easy to model, just look at a market calc with reinvestment - here is 35 years of sp500 - 10.5% with div reinvestment.
using our rule of 72, that means it doubled every 7 years. I'm comfortable with this number because of the dollar-cost-avg
approach we take. https://dqydj.com/sp-500-return-calculator/ - so that $25/month i invested (saved?) in 1985 has doubled 5x
300 -> 600/1200/2400/4800/9600 - placed in an income fund, it would now will produce ~$50/month without touching the principal.
So not trump, reaganomics!

1592315758034.png
Yes - i know this doesn't count the drag of taxes, because it is in a retirement fund, but delaying is OK.
I can make the argument both ways, since I have no idea what the tax brackets will be like in the future.
I do know that putting it in a retirement fund creates barriers to taking it out - which is good for many people.

For the last 10 years or so: Total Market, Total Intl Market, Income Fund (rather than bond fund - it is corp paper and dividend paying stocks)
Dollar cost averaging, dividend reinvestment, corp match (wife), SEP (me) - it is doing as well as a professionally
managed IRA we hold (which allows for an equity backed loan - which is like a home equity loan, only backed by investments)
I've mentioned this before.

Re-balance every so often - 50/20/30 - might start upping the income % soon.

It is president proof, it is market timing proof, and i don't sit in front of a computer putting in limit orders, or sweating that i'm
the low person on the pole, with nobody left to buy near the limit. i did this for a couple years with some side money,
and there were winners and losers, but it was mostly sideways at the end - it predated the real-time information of the modern trading sw.
Even so, I didn't enjoy the pressure, and doubt i would have done better -

We worked the wages side of the equation harder than the investment income side. (this is an important concept)
The result was more money invested, which lead to more investment income!

My wife is 8 years from having RMDs on retirement accounts, 4 years from SS full retirement age - (at full retirement, SS benefit is not limited
by income - they reduce benefit for earnings above ~$1,500/month before full retirement) - I'm a little farther out, but not much!
I think that lines up nicely with her retirement from the full time job, to do some consulting and enjoy retirement.

We used to do EE bonds way back when they were a thing, through payroll deductions - rolled them tax free into a 529 plan.
We did the ESOP plan - didn't work out great cause it was the ATT/Lucent+whatever those other co were.
When we planned on having a kid, I started a whole life plan (monthly investment) - which i'll dissolve in a couple of years -
it hasn't done as well as the market, but would crush it if i die....probably should have done a 25yr term policy,
and moved the investment portion elsewhere.

your horizon may not be 40 years like ours was. But there is probably 25 years available.
There could be 3 or more corrections, but that means there will be 3 or more good runs.

Consistently adding money is just like training - it pays off on race day.

---

i'll add one more note - We have been very lucky. While we both had to take some extended time off
to take care of family, there were jobs to return to. We haven't had any extended illness, or long-term forced unemployment.
we are also still married - on our first marriage. Nothing has taken us too far off the plan we put in motion
a long time ago. I'm sure this is significant.
 
Dave Taylor

Dave Taylor

Rex kwan Do
Patrick said:
Dave - You share a ton of information about you/life/family - much appreciated, much respected.
Are you trading inside your retirement account? (i think you confirmed this awhile back)
Or is this a fun money account which you are pitting yourself against the market?
Or both? Do you have a base amount you don't mess with?

I think what you are saying with your comment is that anyone can win in an up market - you are looking at ways
to win when there is volatility, or bearish attitudes - an I agree that these can be taken advantage of.
can the individual, part-time trader win over time+market returns ? i'm skeptical.

My opinion of what the government is doing: rich people don't like to lose money in large chunks -
that needs to be in the equation. Policy is reactive, not proactive. Always has been.

---

I'm already on record that our money goes in every paycheck for the last 35 years, with another 4 years or so "following the plan."
It is a small percentage of income, but the math is compelling over the long haul, income increases, investment increases.
And TBH, I have no idea what our ROR is over those years, because of job changes, investment bank/brokerage house changes, etc.
I can say it has met expectations.

It is easy to model, just look at a market calc with reinvestment - here is 35 years of sp500 - 10.5% with div reinvestment.
using our rule of 72, that means it doubled every 7 years. I'm comfortable with this number because of the dollar-cost-avg
approach we take. https://dqydj.com/sp-500-return-calculator/ - so that $25/month i invested (saved?) in 1985 has doubled 5x
300 -> 600/1200/2400/4800/9600 - placed in an income fund, it would now will produce ~$50/month without touching the principal.
So not trump, reaganomics!

View attachment 131836
Yes - i know this doesn't count the drag of taxes, because it is in a retirement fund, but delaying is OK.
I can make the argument both ways, since I have no idea what the tax brackets will be like in the future.
I do know that putting it in a retirement fund creates barriers to taking it out - which is good for many people.

For the last 10 years or so: Total Market, Total Intl Market, Income Fund (rather than bond fund - it is corp paper and dividend paying stocks)
Dollar cost averaging, dividend reinvestment, corp match (wife), SEP (me) - it is doing as well as a professionally
managed IRA we hold (which allows for an equity backed loan - which is like a home equity loan, only backed by investments)
I've mentioned this before.

Re-balance every so often - 50/20/30 - might start upping the income % soon.

It is president proof, it is market timing proof, and i don't sit in front of a computer putting in limit orders, or sweating that i'm
the low person on the pole, with nobody left to buy near the limit. i did this for a couple years with some side money,
and there were winners and losers, but it was mostly sideways at the end - it predated the real-time information of the modern trading sw.
Even so, I didn't enjoy the pressure, and doubt i would have done better -

We worked the wages side of the equation harder than the investment income side. (this is an important concept)
The result was more money invested, which lead to more investment income!

My wife is 8 years from having RMDs on retirement accounts, 4 years from SS full retirement age - (at full retirement, SS benefit is not limited
by income - they reduce benefit for earnings above ~$1,500/month before full retirement) - I'm a little farther out, but not much!
I think that lines up nicely with her retirement from the full time job, to do some consulting and enjoy retirement.

We used to do EE bonds way back when they were a thing, through payroll deductions - rolled them tax free into a 529 plan.
We did the ESOP plan - didn't work out great cause it was the ATT/Lucent+whatever those other co were.
When we planned on having a kid, I started a whole life plan (monthly investment) - which i'll dissolve in a couple of years -
it hasn't done as well as the market, but would crush it if i die....probably should have done a 25yr term policy,
and moved the investment portion elsewhere.

your horizon may not be 40 years like ours was. But there is probably 25 years available.
There could be 3 or more corrections, but that means there will be 3 or more good runs.

Consistently adding money is just like training - it pays off on race day.

---

i'll add one more note - We have been very lucky. While we both had to take some extended time off
to take care of family, there were jobs to return to. We haven't had any extended illness, or long-term forced unemployment.
we are also still married - on our first marriage. Nothing has taken us too far off the plan we put in motion
a long time ago. I'm sure this is significant.
Click to expand...
I reallocate my IRA but that’s it. I trade with money I can afford to lose. I trade leveraged ETFs both directions as well as options on ETFs and individual stocks. I don’t make recommendations to people but I do express my view. I also don’t take purchasing advice from people. When I trade I look at charts(no fundamentals). Look at the whole tsla nkla bubble. Tesla’s electric semi is 20% less effocient at best vs current diesel technology. Truckers aren’t buying a less efficient truck to make money.
 
Patrick

Patrick

Overthinking the draft from the basement already
Staff member
Dave Taylor said:
I reallocate my IRA but that’s it. I trade with money I can afford to lose. I trade leveraged ETFs both directions as well as options on ETFs and individual stocks. I don’t make recommendations to people but I do express my view. I also don’t take purchasing advice from people. When I trade I look at charts(no fundamentals). Look at the whole tsla nkla bubble. Tesla’s electric semi is 20% less effocient at best vs current diesel technology. Truckers aren’t buying a less efficient truck to make money.
Click to expand...

Got it!

I'll stick with the "how the hell am i supposed to retire thread" :D
that is where my mind is.

--

On electric semi vs diesel -
as a replacement option, this creates resistance on how much diesel fuel/truck prices can rise.
amazon is going to put etrucks on the road, and not worry about the efficiency in the near term.
Should be able to figure out where there is money to be made.
 
pkovo

pkovo

Well-Known Member
kidzach said:
watched a news report yesterday on NKLA stock. It's a hydrogen/electric truck company. Found it interesting and was thinking of buying the stock today. Somehow the market cap of NKLA has overtaken both Ford and GM. So I did a lot of research this morning and I can't seem to get my head around all this. It seems they don't even have/own a building to even start to build these very cool looking trucks. Yet they will be taking orders end of the month. I guess sometimes hype is all you need. I wish this company well. Just not touching this now. Anybody have any thoughts ?
Click to expand...

I have the same thoughts. That one is an extreme example, but there are a lot of stocks like that right now. You have to totally detach yourself from fundamentals if you are going to buy into them.

Tesla is similar. People that are bullish on that one cite the fact that they are not a car company, but a technology company that builds cars....so you have to buy into the "vision" I suppose. Stock price is hovering around $1000 a share today.....started the year pre-covid at $430.
 
kidzach

kidzach

Well-Known Member
pkovo said:
I have the same thoughts. That one is an extreme example, but there are a lot of stocks like that right now. You have to totally detach yourself from fundamentals if you are going to buy into them.

Tesla is similar. People that are bullish on that one cite the fact that they are not a car company, but a technology company that builds cars....so you have to buy into the "vision" I suppose. Stock price is hovering around $1000 a share today.....started the year pre-covid at $430.
Click to expand...
Yeah I owned TSLA for a short time. Bought very early on the hype around $130. More than doubled my money and got out. Way too early it seems. Not sure if this will be the same story with NKLA. It just ran too quickly. Going to try and hold out until it drops back down to the $40's maybe.
 
pkovo

pkovo

Well-Known Member
kidzach said:
Yeah I owned TSLA for a short time. Bought very early on the hype around $130. More than doubled my money and got out. Way too early it seems. Not sure if this will be the same story with NKLA. It just ran too quickly. Going to try and hold out until it drops back down to the $40's maybe.
Click to expand...


Hindsight is always 20/20, but double your money is OK in my book!
 
Patrick

Patrick

Overthinking the draft from the basement already
Staff member
kidzach said:
Yeah I owned TSLA for a short time. Bought very early on the hype around $130. More than doubled my money and got out. Way too early it seems. Not sure if this will be the same story with NKLA. It just ran too quickly. Going to try and hold out until it drops back down to the $40's maybe.
Click to expand...

good move - when i was playing i would take my original investment off the table, then play the news/momentum.
lock in some gains, and try to find a top, with downside sell orders.

options scare me - always wanted to work them on holdings - never did.

TBH - tsla was my last play - i had brk.b which was pumpin (i consider it a diversified holding) and tsla tanked on the china
shutdown, so i sold brk.b, moved to tsla, it went up 50% and i sold - yeah, i missed a much bigger gain!!! oh well.
i'd rather clean a tough rock garden for my thrill! (mostly cause i suck at both stocks and rocks!)
 
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