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Old 07-02-2014, 01:26 PM   #61
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Why? There are a lot of people here with more money than I have, I am sure.

My portfolio just happens to be more volatile. I like to live dangerously.

By the way, top of market to the next bottom, I have not "lost" $1M, but far more than $500K. It hurt like crazy to see that money go, but I kept telling myself it was the house money. I've got to keep on playin'.
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Old 07-02-2014, 01:36 PM   #62
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I knew you were a player but until now didn't realize what league you were in. Impressive.
Wow! Maybe an upcoming spot on CNBC's Fast Money show in the works?
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Old 07-02-2014, 01:40 PM   #63
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Nah, these guys are multi-decamillionaires, while I may never see that 8th figure.
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Old 07-02-2014, 01:41 PM   #64
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You're in trouble now NW-B. We'll be watching you more carefully.
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Old 07-02-2014, 01:46 PM   #65
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Nah, these guys are multi-decamillionaires, while I may never see that 8th figure.
You need an attitude adjustment. Try to be more positive!
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Old 07-02-2014, 01:48 PM   #66
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You're in trouble now NW-B. We'll be watching you more carefully.
Why? To see my "moves"? I have not been doing that well since mid 2011.

I repeatedly called "buy, buy, buy" at the market bottom in March 2009, and the posts are still there in the archive. I bought foreign and basic material stocks which beat the pants off S&P in 2009 till mid 2011. Then, they stumbled and I have lost ground since.

Here. Let me show it to you. Hold on.

This Quicken chart shows what I was talking about, when I said I beat the S&P in early 2011, but then gave up that gain. I did not trade often enough. Since then, the S&P has been beating me. However, I am only 70% in the market, with only 5% bond and 25% cash which did little to help.

Note that the plot of the S&P does not include dividend, but my plot is after WR, which is higher than the S&P dividend. So, I am doing OK, but not great.

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Old 07-02-2014, 02:46 PM   #67
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Why? To see my "moves"? I have not been doing that well since mid 2011.

I repeatedly called "buy, buy, buy" at the market bottom in March 2009, and the posts are still there in the archive. I bought foreign and basic material stocks which beat the pants off S&P in 2009 till mid 2011. Then, they stumbled and I have lost ground since.

Here. Let me show it to you. Hold on.

This Quicken chart shows what I was talking about, when I said I beat the S&P in early 2011, but then gave up that gain. I did not trade often enough. Since then, the S&P has been beating me. However, I am only 70% in the market, with only 5% bond and 25% cash which did little to help.

Note that the plot of the S&P does not include dividend, but my plot is after WR, which is higher than the S&P dividend. So, I am doing OK, but not great.

The S&P 500 is the one benchmark Quicken shows that does include dividends. No footnote mark on it.
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Old 07-02-2014, 02:48 PM   #68
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Originally Posted by NW-Bound View Post
...
This Quicken chart shows what I was talking about, when I said I beat the S&P in early 2011, but then gave up that gain. I did not trade often enough. Since then, the S&P has been beating me. However, I am only 70% in the market, with only 5% bond and 25% cash which did little to help.
...
Hmm ... he doth protest too much, methinks.

That is a weird way to benchmark if I'm understanding you. Comparing a 100% equity versus a balanced portfolio less withdrawals? Still I'm guessing you did quite well, nice going NWB.

For myself, over the last few years I've compared my portfolio to (1) an index based portfolio, (2) a Wellington based portfolio. Both of these benchmarks include some fixed income components that realistically have to be kept -- ibonds, cash, short term bonds.
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Old 07-02-2014, 04:49 PM   #69
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The S&P 500 is the one benchmark Quicken shows that does include dividends. No footnote mark on it.
Thanks. I never noticed that.

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Originally Posted by Lsbcal View Post
Hmm ... he doth protest too much, methinks.

That is a weird way to benchmark if I'm understanding you. Comparing a 100% equity versus a balanced portfolio less withdrawals?
I do not want to make it too easy on myself. Why be an active investor just to match the S&P? Well, if I just match it on the way up, but lose less than it does on the way down, I am happy too.

And well, my portfolio is not really balanced, as I have not spent that much time studying bonds, and felt more comfortable with cash.

Quote:
For myself, over the last few years I've compared my portfolio to (1) an index based portfolio, (2) a Wellington based portfolio.
I have been eyeing some balanced funds, with the idea of retiring from active investing and trusting them with my money. One of these days, but not yet...
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Old 07-02-2014, 04:59 PM   #70
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...(snip)...
I have been eyeing some balanced funds, with the idea of retiring from active investing and trusting them with my money. One of these days, but not yet...
I feel the same way. Part of the reason I mentioned getting a well thought out benchmark portfolio together is to watch it over several years. I usually check things at the end of each quarter and have done this for about 3.5 years now.

I'm impressed that these benchmark portfolios are not that far off and sometimes beat my brilliant portfolio. Tends to humble one.
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Old 07-02-2014, 05:28 PM   #71
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I have had the potential to "win" 6, 7 figures in the market but have always chickened out and sold early.

Recently I was in Gilead call options when it dipped down to $65 a few weeks back. I loaded up on August $70 calls dirt cheap but sold them much too early. I made $20,000 but today they are worth $600,000.
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Old 07-03-2014, 03:39 PM   #72
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Here is an article from today's G&M looking at 10 leading indicators of the end of a bull market. Nine of them are adverse.

Is the bull market over? Signs are not encouraging - The Globe and Mail
After a market goes up for a while certain things happen related to the rise, such as those "signs" in the article. They are measures of the past not the future.

Years ago I regressed a number of "indicators" I don't remember all of them, things like put/call ratio, and other "sentiment" measures against the past and future changes in the market. As you might expect all of these measures were correlated to past market changes (decreasing with time before present), the future correlation was zero.

All of changes in these measures

1. Is there a surge in individual investor participation in the markets?
2. Is there a significant increase in the use of margin debt?
3. Do we witness a sharp rise in IPOs and merger activity?
4. Do the stock prices of low-quality companies reach new highs?
5. Is the media bullish?
6. Is the Fed providing or withdrawing liquidity from the markets?
7. Are interest rates expected to decline or rise?
8. Are profit margins at a cyclical bottom or peak?
9. Are valuations extreme?
10. What does CAPE signal about the future?


can be explained by what has happened to the market in the past. None of them say anything about the future. As markets go up people get increasingly optimistic, as they fall the get increasingly pessimistic.

It is natural to think that somehow this rise in optimism or pessimism can foretell something about the future, but it doesn't (we would all be rich if it did, or maybe none of us would be, because we would all be doing the same timing thing, ergo no salami). The changes in these measures can be completely explained by what has happened in the past.

I have often thought I should re-run that experiment, but after I did it, it seemed so obvious, and I am basically lazy.
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Old 07-03-2014, 04:47 PM   #73
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...
I have often thought I should re-run that experiment, but after I did it, it seemed so obvious, and I am basically lazy.
Good points but maybe I'm biased being from California?

So often I find that the article writer is the lazy one. They do not present a multi-decade set of data to show how good a predictor their model is. But that would be real hard work and those writers have deadlines to meet, more articles to write, etc.
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Old 07-03-2014, 05:07 PM   #74
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Quote:
Originally Posted by CaliforniaMan View Post
After a market goes up for a while certain things happen related to the rise, such as those "signs" in the article. They are measures of the past not the future.

Years ago I regressed a number of "indicators" I don't remember all of them, things like put/call ratio, and other "sentiment" measures against the past and future changes in the market. As you might expect all of these measures were correlated to past market changes (decreasing with time before present), the future correlation was zero.

All of changes in these measures

1. Is there a surge in individual investor participation in the markets?
2. Is there a significant increase in the use of margin debt?
3. Do we witness a sharp rise in IPOs and merger activity?
4. Do the stock prices of low-quality companies reach new highs?
5. Is the media bullish?
6. Is the Fed providing or withdrawing liquidity from the markets?
7. Are interest rates expected to decline or rise?
8. Are profit margins at a cyclical bottom or peak?
9. Are valuations extreme?
10. What does CAPE signal about the future?


can be explained by what has happened to the market in the past. None of them say anything about the future. As markets go up people get increasingly optimistic, as they fall the get increasingly pessimistic.

It is natural to think that somehow this rise in optimism or pessimism can foretell something about the future, but it doesn't (we would all be rich if it did, or maybe none of us would be, because we would all be doing the same timing thing, ergo no salami). The changes in these measures can be completely explained by what has happened in the past.

I have often thought I should re-run that experiment, but after I did it, it seemed so obvious, and I am basically lazy.

Very intriguing and insightful to me. I have also "felt" this is the reality. Nice to have your empirical analysis, even as a single data point.

I always find it fun to confuse my colleagues when there is inside company info discussed and then someone states the obvious caution, "don't trade the company stock." With a straight face I ask, "so should I buy long or short the stock?"

Like stocks really move on singular correlation. LOL
It amazes me how many very smart people are completely clueless about investing and the market.


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