Discussion in 'Business, Careers & Education' started by mikeman, Feb 2, 2011.
I'm always amazed at the insight people have post-event.
So far so good, only ATK is green, everything else is red. Let the river run red.
Yep, the market went up probably 25% while I waited for a 5-10% drop. I don't really regret waiting and I don't really regret dropping in now even if it turns out to precede the fall. I have more to deploy and will get it all back over time.
Let me see if I am reading your investing strategy correctly:
1. Timing the market and thus losing out on a 25% gain.
2. Deploy money Wednesday then tell us the fall was coming Thursday (I assume you were red like the rest of us)
3. Say you didn't mind missing out on the 25% gain and are now telling us you will slowly get back in with your timing strategy.
We will all have more money to put into the market in the future...sort of how investing works. Keep adding and hopefully it keeps growing. Post in here more before you come in here saying you could predict yesterdays drop to the day.
Math never lies:
Lost out on 25% gain.
Waiting for 10% drop (let's be generous)
Hold till the correction is over.
-25% + 10% = -15%
You'd still be -15% behind someone who just buys and holds. Market timing doesn't work, no matter how much you look at the market everyday. Buy and hold may be boring, but it works. Remember the saying: "It's not timing the market, it's time IN the market."
It was sarcasm. Obviously if I could time the market perfectly I would have sat on the sidelines longer or put in money earlier. Didn't realize I was being that obtuse but I guess I must have been.
No debate here. I took some money off the table for a very specific reason a few years ago in order to de-risk in connection with a home purchase and was far too patient in jumping back in. In addition to investing in the market, I also allocate to private investments (some direct, some through funds) so I wanted to have cash available for that as well.
Deploying some bucks. Krft got hammered yesterday.
I'm off peaks by about 4-5% in all accounts, so a pretty decent correction I suppose.
You going in on KFT? I'm bearish. Holding my small stake in it, but still.
I think there is more correcting to do. Hopefully the weekend settles nerves.
BAC looks cheap here.
I have a bunch, had it since well before they spun off Mondelez, thinking about buying more.
Yes! I want more BAC. I am happy to gobble it up while it gets sold off. I've been bolstering dividend positions, but I may take a break from that soon and pick up more BAC.
Here's one for you, my brother bought Philip Morris USA in 2006, which spun off Kraft in 2007 then Phillip Morris International in 2008, Kraft then Spun off Mondelez in 2012. He has retained all companies since then, and the cumulative dividend is around 12% on his principle investment.
Bought BAC at 15.02 today and sold call options at $0.22 on it.
Doubled down on SBUX and also doubled down on DVYL. Bought more AAPL and PBR.
Don't think the downturn is over, so I'm sitting on cash and willing to double down on any long position when the math makes sense.
What does that mean for us non-finance types?
For every hundred shares of stock you have you can sell an option on it. Means that someone pays a free for the right to buy the stock at the strike price at a future date. If the price isn't over that strike at expiration, you keep the stock and the fee that was paid, otherwise, the person gets the stock at the strike price.
Its an excellent way to make an extra 1 or 2% on your positions.
For anyone who doesn't exactly know what they are doing, please do not go out and write a bunch of options. Writing covered calls can be a great method to generate some additional income, but the key word is covered.
I'm not as inclined to write covered calls right now given that vol is still so cheap
Naked calls are a bad idea. Make sure you own the stock. What's your experience with writing puts?
For those, make REALLY sure that you're not naked.
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