03-09-2020, 01:16 PM
(03-09-2020, 01:00 PM)fenders53 Wrote:(03-09-2020, 12:44 PM)Otter Wrote:(03-09-2020, 12:37 PM)fenders53 Wrote:(03-09-2020, 11:34 AM)Otter Wrote:Mostly smells like market timing to me . Be a little humble when your Lotto ticket works out. It won't work out every time if you do it often enough. I try to time the market too in moderation but I don't recommend it for younger investors because you'll get it wrong as often as you get it right. But always have some cash for months like this. Grabbing qualiity shares now is not picking up pennies in front of a bulldozer. Emphasis on QUALITY. If you pick the bottom perfectly then good for you. I saved a ton of cash for this moment and that worked out too. Plenty of ways to survive the downturns. Do you still have a 100 stock port or did you sell it? There are plenty of stocks trading at a price that will look more than good soon enough.(03-09-2020, 10:57 AM)fenders53 Wrote: Of course you are, and you called it right. Got anything that might be helpful to your fellow long-term investors on a DGI forum?
Buy quality names with clean balance sheets when there is a multi-week uptrend or flat action. Not like it is going to bounce back to all-time highs overnight. You might miss out on the first few percentage points of an uptrend, but at least you won't be trying to catch a falling knife.
There's dollar cost averaging, and there's picking up pennies in front of a bulldozer. I think there is a bulldozer on the loose. Don't recall bond or oil price action like that even in 2009.
I fully intend to go long again, but don't think we are anywhere close yet. Still not officially a bear market.Mostly s
Haven't touched my DGI stuff. It is down in paper value significantly, with the rest of the market. Dividends still to cash. 401k still in stable value fund.
Put options were purchased with part of my savings allocated to future market downturn purchases. I made a judgment call early in February that this would not be an ordinary market downturn driven by business cycles/interest rates/etc, but a market shock caused by an external factor. I have every intention of taking profits and putting them on the long side of the ledger eventually (buying quality yield at a discount). I do not expect to find the market bottom, but do not have any interest in switching to a long position while markets are still in freefall, and facts on the ground indicate that things are only going to get worse on the medical/societal/economic front for the next several weeks.
You made a great call. I've congratulated you for that more than once here. If you were certain you would have been foolish to not sell off your 100 stock DGI port so be transparent. Tax losses or not your IRA put move was just a hedge, and a damned good one in retrospect. We owe transparency to less experienced investors. This isn't like S.A. IMO. Maybe I am a dreamer. Our words influence others whether you believe that or not. I'd like to think you share my concern for other's ports here? If not let me know and I'll shut up. I've been warning friends here to lay off oil 30% ago. I find no happiness in their losses as they continued to buy the oil knife.
I am rarely 100% certain about anything (the old trope, death and taxes comes to mind). In retrospect, liquidating my entire DGI portfolio and going 100% SPY Puts would have been the smart move in early February. Hindsight is always 20/20 though, and I was actually taking risk mitigation into account when I made the directional market timing bet in the first place. Was only willing to gamble money I could afford to lose.
I thought I had laid out what I was doing fairly clearly, but it is spread around a bit between this thread, the tips for surviving a correction thread, and the what are you buying today thread, and not all laid out in a single post. I am by no means arguing for wholesale abandonment of DGI investing as a strategy (as attested to by those big red numbers I'm seeing with some of my brokerages). Folks who waited for the wreckage to clear and bought any time for several years after the March 2009 lows have enjoyed stellar unrealized paper gains (I try to ignore those figures for DGI holdings), and massive dividend growth in the years since. I think we will soon have another similar opportunity.
Uncertainty is what is driving the volatility. At present, I am hard pressed to think of any scenario where we have reasonable certainty as to long-term earnings impacts for at least several months. Even imposing strong mitigation measures to slow the spread will have its own economic and societal repercussions (although I think that is absolutely the right thing to do).