Trading the stockmarket (NO Referrals)

[R.P.L]

Or perhaps 'how will you know?' is better phrasing.

Like I said, when it's following something approaching normal patterns for a couple of weeks. It's not an exact science (as much as some people will pretend otherwise) and if you're investing for the medium / long term then it doesn't have to be. You just don't want to see a severe loss in the first couple of weeks due to a once in a generation (possibly) crash.
People who are trying to beat the benchmarks will have their own strategies, but as they're always based on historical data I think their utility is probably limited in situations like this. Even professional investment houses with effectively unlimited resources and preferential deals struggle to consistently beat benchmarks.

 

[Journey]

I think 18k next week or the week after personally. There's some decent support in this 20k area (for the moment)

I'm calling my 18k this week as on point.

 

[caff]

To me, now seems a very good time to invest in technology funds. Looking on Trustnet, a lot with holdings in Microsoft, Alphabet, Apple etc. are rated 3*. But when you look at what these companies are currently doing, i.e. catering to homeworkers, surely they can only surge from the dip? The impact of the virus will be huge, but surely it will lead to more remote working and a drive towards cloud-based societies. Thoughts?

 

[Efour]

The idea is correct but I wouldn't touch anything with a bargepole just now. Personally.
Others might disagree. I'm saving all my loose change for toiletroll and beans.

 

[mid_gen]

To me, now seems a very good time to invest in technology funds. Looking on Trustnet, a lot with holdings in Microsoft, Alphabet, Apple etc. are rated 3*. But when you look at what these companies are currently doing, i.e. catering to homeworkers, surely they can only surge from the dip? The impact of the virus will be huge, but surely it will lead to more remote working and a drive towards cloud-based societies. Thoughts?

MSFT and Amazon will be worth buying. They will suffer from the knock on effects of the economic black hole, but should come out strong in the recovery. I think there is more downside coming though...professional traders are going to be gobbling up money from Joe bloggs by shorting for a while as everyone's mate says it's a good time to buy.

I think this lockdown might be a kick up the arse for people considering what they really need to be doing with their money, and Apple may not do so well, along with other luxury consumer goods manufacturers.

 

[Journey]

If London closes today, I can see the FTSE down in the 4,800 point range or below. Plus more to follow as it really sinks in.

 

[413x]

No upside in near term for me.

Let's face it.. What good news is likely to come in next few days?

What about bad.. Endless list there

 

[Simon]

Well a huge shut down is kind of priced in so if some cure / virus suddenly popped up then it might reverse some.

Who knows, a lot of the drop is also driven by bots and shorts

 

[413x]

Well a huge shut down is kind of priced in so if some cure / virus suddenly popped up then it might reverse some.

Who knows, a lot of the drop is also driven by bots and shorts

For sure.

I see turn around only when

A - Italy starts to see an actual plateau of deaths
B - a confirmed vaccine enters the market

Otherwise surely its just a continued decline

 

[Skeptic]

If everybody is expecting a lockdown, so is the market, therefore priced in. JPM suggest Q1 and Q2 recess of -5 and -14; this is also likely priced in. Unemployment expected to rise. All these are known knowns. How much worse can the news become? Dispassionately, people will die - we know that - so does the market. There will be future downside, of course, but volatility may be reducing.

PS AAZ up 7% today...

 

[413x]

It could become much worse.

Many more companies could go bust, many more jobs could be lost. The virus could be much worse than already stated.

For me, until there's any good news I'm expecting more down trend

 

[200sols]

It could become much worse.

Many more companies could go bust, many more jobs could be lost. The virus could be much worse than already stated.

For me, until there's any good news I'm expecting more down trend

Indeed, and until we know the situation in the US and how bad it will be markets wont recover IMO. If this goes on beyond Q2, and the 15-20% drop in GDP is sustained then a collapse will happen.

 

[Skeptic]

I wish you all the best with your decisions. I have no better insight, so my comments are all speculation too. When you have constructed a sensible portfolio, if individual companies go bust it matters not; if all companies in the world go bust, then we’ve a problem. If that happens, it will not matter if you are a gazillionaire or a pauper, there will be nowhere to spend the fake paper that the world is built upon.

If I recall correctly, you used to be ‘I’m now single Alex’ which suggests you are in your youth! If you genuinely don’t need the money for many years (i.e. you are investing, not buying individual stocks) then this is likely an opportunity to really enhance your wealth later on down the track. This is, of course, my opinion, so do disregard, but ‘it’s different this time’ is always worth reflecting upon.

All the best!

 

[Skeptic]

If this is such an existential threat, why are not all countries working together on a vaccine?

Surely if it was a binary bet (i.e. either we get rid of it, or civilisation collapses) then the world would come together to defeat it? That’s not happening, because the smart money knows that there is opportunity in a crisis. It also recognises that the world will continue on, and we will go back to the good old days of threats of nuclear war

 

[413x]

If this is such an existential threat, why are not all countries working together on a vaccine?

Surely if it was a binary bet (i.e. either we get rid of it, or civilisation collapses) then the world would come together to defeat it? That’s not happening, because the smart money knows that there is opportunity in a crisis. It also recognises that the world will continue on, and we will go back to the good old days of threats of nuclear war

Yeah agreed. If it all collapses nothing is going to matter.

I'm ready to buy back in with what I can, but holding off.

 

[xaldub]

Without meaning to be difficult, and to stimulate debate. When will you know that the market has stabilised?

If this is such an existential threat, why are not all countries working together on a vaccine?

Surely if it was a binary bet (i.e. either we get rid of it, or civilisation collapses) then the world would come together to defeat it? That’s not happening, because the smart money knows that there is opportunity in a crisis. It also recognises that the world will continue on, and we will go back to the good old days of threats of nuclear war

Because as bad as this situation is it isn't truly an existential threat. Yes, millions could die but they are going to mostly be elderly or those with chronic disease ( who it can be argued have minimal economic potential ). That sounds harsh, and I personally believe every life should be valued, but that isn't how governments will be looking at this crisis.

On a positive note there is some collaborative work going on between various countries and the private sector for creating a vaccine. And there are several effective treatment regimes emerging that can help reduce the viral load / recovery time , the details of which are being shared by medics across the world.

 

[mid_gen]

If this is such an existential threat, why are not all countries working together on a vaccine?

Surely if it was a binary bet (i.e. either we get rid of it, or civilisation collapses) then the world would come together to defeat it? That’s not happening, because the smart money knows that there is opportunity in a crisis. It also recognises that the world will continue on, and we will go back to the good old days of threats of nuclear war

It isn't an existential threat. Most people will get over it, a relatively small number of people will die. People will still be here.

The real threat is from the economic, everyone has been fooled the last few years with a rampant stock market that bears zero resemblance to the realities of the global economic situation. There are huge, huge sums of money that have been printed floating around the world economy now and it doesn't know where to go.

The UK government's approach to the crisis is short-sighted, as usual. Giving loans to prop up businesses just ensures that we won't recover, every effected business will be drowning in additional debt for years to come, if they last more than a few months.

 

[Skeptic]

Because as bad as this situation is it isn't truly an existential threat. Yes, millions could die but they are going to mostly be elderly or those with chronic disease ( who it can be argued have minimal economic potential ). That sounds harsh, and I personally believe every life should be valued, but that isn't how governments will be looking at this crisis.

On a positive note there is some collaborative work going on between various countries and the private sector for creating a vaccine. And there are several effective treatment regimes emerging that can help reduce the viral load / recovery time , the details of which are being shared by medics across the world.

I agree entirely. My understanding is that the measures in place are to stop things like the NHS getting overwhelmed, not because this virus is so unbelievably deadly that if we leave our houses we're basically in a scene from Black Mirror. The shutdown is necessary to stop the numbers spiking not because of the virus itself.

As a result, has the world fundamentally changed since, say, Xmas? Of course not. Temporarily yes, but will we really look back to March 2020 and think 'ah, remember the days before the virus came, things haven't been the same since'? I don't believe so. I don't believe the evidence supports that assumption.

As a result, the hypothesis of a broad, balanced tracker remains valid, and is arguably reinforced by this crisis. Some companies will go under, but others will rise; the index will capture both events.

I think that there's a point to be made about investment decisions based on the saturation of media. We are watching this crisis unfold, minute by minute, and are conditioned to react to what we perceive as a disaster.

 

[Skeptic]

It isn't an existential threat. Most people will get over it, a relatively small number of people will die. People will still be here.

The real threat is from the economic, everyone has been fooled the last few years with a rampant stock market that bears zero resemblance to the realities of the global economic situation. There are huge, huge sums of money that have been printed floating around the world economy now and it doesn't know where to go.

The UK government's approach to the crisis is short-sighted, as usual. Giving loans to prop up businesses just ensures that we won't recover, every effected business will be drowning in additional debt for years to come, if they last more than a few months.

Agreed. However, surely the opposite of that point is that those well-run companies, whose BoDs have made sound financial decisions, will then rise to the top? In short: the constituents of the FTSE/S&P might change, but the index will still exist, which is good for investors...

 

[xaldub]

I agree entirely. My understanding is that the measures in place are to stop things like the NHS getting overwhelmed, not because this virus is so unbelievably deadly that if we leave our houses we're basically in a scene from Black Mirror. The shutdown is necessary to stop the numbers spiking not because of the virus itself.

As a result, has the world fundamentally changed since, say, Xmas? Of course not. Temporarily yes, but will we really look back to March 2020 and think 'ah, remember the days before the virus came, things haven't been the same since'? I don't believe so. I don't believe the evidence supports that assumption.

As a result, the hypothesis of a broad, balanced tracker remains valid, and is arguably reinforced by this crisis. Some companies will go under, but others will rise; the index will capture both events.

I think that there's a point to be made about investment decisions based on the saturation of media. We are watching this crisis unfold, minute by minute, and are conditioned to react to what we perceive as a disaster.

I completely agree with you. Media outlets need to be adopting a more sensible and rational approach. The current methods are promoting fear, panic & mass hysteria which is reflected in the markets. Many people aren't thinking rationally and adopting a sheep mentality - follow the herd.