Is this the most volatile market in 50 years?

[Carpediem]

I'm in a similar situation - we're thisclose to FI, and keep falling backwards. It's making DH and I grumpy! I do have to laugh at myself - first world problems!

Add me to the grumpy club too. I've gotten to the point of almost dreading crossing my milestone because everytime I do, the market takes it away.

 

[Lawrencewendall]

+1
I suspect the media may be the "something else ".

Just saw this. Fear and doom is overblown.

https://www.americanthinker.com/blo...are_misleading_the_public_on_the_economy.html

 

[gstillson]

I have been trading the heck out of this and making money out of nothing at all (out of nothing at all)

Just this morning I sold 500 shares of SPY for $267 that I bought yesterday for $259.80.

I mean that is over $3500 for doing nothing but a couple mouse clicks. Probably I can buy it again for $259 in a couple days. Seems wrong, too easy.

 

[almost there]

What could possibly go wrong?

 

[street]

Great information and thanks for that chart >>> https://www.fool.com/investing/2018/...need-a-hi.aspx

 

[joeea]

Just saw this. Fear and doom is overblown.

https://www.americanthinker.com/blo...are_misleading_the_public_on_the_economy.html

That was hilarious. Thanks for the laughs.

 

[gstillson]

What could possibly go wrong?

That is my thought too? What is the worst that can happen here? I am stuck holding 500 shares of an index fund, while having a yearly gain of over 140%.

I am not on margin, so no risk there. I could miss out on some gains if a Santa Claus rally takes hold, but with the market so volatile and at the very least fairly valued if not a bit over valued, I don't think there is much of a risk of SPY shooting up to $400 over a month period.

 

[ERD50]

Market is up 0.01% as I type.

Is everything OK now?

-ERD50

 

[almost there]

I traded for years. Sleep so much better being out of the market. lol lol Too much drama for me. But knock yourself out!

 

[ExFlyBoy5]

Just saw this. Fear and doom is overblown.

https://www.americanthinker.com/blo...are_misleading_the_public_on_the_economy.html

Yeah, no political leanings with that article.

 

[TwoByFour]

A couple of observations on this topic:

Volatility is usually defined to be the standard deviation of annual returns. In a short term market you could just say it is the standard deviation of daily valuation of the S&P 500. In any event, it is commonly associated with the standard deviation.

The VIX is derived from a weighted average of puts and calls, so it is not the same as what an investor experiences. It is more forward looking, a measure of what investors think the market is going to do, not so much what it is doing.

The standard deviation is going to be affected by both market jumps and market declines. But nobody calls a rising market volatile. But if the standard deviation is higher for some period of time, that could mean the market is going up, so using the std dev as a measure of market declines is not accurate either.

I personally don't sweat short term movements and rarely pay attention to those. I worry more about long term movement - a 10% crash that lasts 2 years is far worse than a 20% crash that lasts 1 month.

There have been 52 crash/corrections (10% or greater) since 1926. In the first 30 years we averaged 7.1 crashes/decade, in the subsequent 40 years we averaged about 7.5/decade. In that regard, the market now (the last couple of decades) is about the same as it was 80 years ago.

[edit]
This market does not feel especially volatile to me. It feels like typical unpredictable market behavior. In any event it is out of my control so I ignore it.

 

[NYEXPAT]

I just think of it as a "Gift from the God's"!

 

[tb001]

There's another, personal reason though, that I think 2018 has been annoying for me. There was a few times that I came really close to the $2M milestone mark, for net worth. But, then I bought a house in September, and then with market losses, it seems like that $2M milestone keeps slipping further away. I know I'll cross that threshold eventually, and logically I know that it's not like anything truly magical happens once we hit these various thresholds. But, still, I want to get there!

We're in almost the same boat, right down to the house purchase at end of August. The number is different, but we were about 15% away from our target goal after buying the house. A few extra expenses and the market moves and it feels farther away than I'd like.

 

[jjflyman]

Are these posts due to a memory problem, or an arithmetic problem? Or something else?

-ERD50

Keep telling yourself that, all the way down to Dow 18,000 my friend.

 

[USGrant1962]

Keep telling yourself that, all the way down to Dow 18,000 my friend.

That is a 30% bear market. Not good, but hardly the stuff of worst or "most volatile market in 50 years". There's been 5 of those in the last 50 years, and a few more that were close.

 

[braumeister]

Even with some volatility and a lousy start to the month, there is still this to consider:

Historically, December has never been the worst month of the year.

 

[marko]

I'm intrigued.

This is thread like two people watching the same movie and one walks out laughing and the other walks out crying.

How can the esteemed members of the forum--usually level headed and fact based--have such divergent views of the same market?

Half here are just hunkering down (and/or ready to pounce on some opportunities) where the other half is ready for Armageddon. Seems to me that when it comes of finance, 'emotion' is a killer.

No conclusion here but ... fascinating.

 

[braumeister]

How can the esteemed members of the forum--usually level headed and fact based--have such divergent views of the same market?

Someone once told my my mileage might vary.

 

[Maenad]

How can the esteemed members of the forum--usually level headed and fact based--have such divergent views of the same market?

Because none of us are as level headed and fact based as we like to think we are! (And I definitely count myself in that observation!)

 

[Free bird]

Big banks churning accounts setting up the bonus. They make money the old fashion way...they skim it. Nothing new here. Your retirement is safe as long as they get some cream.

 

[Bestwifeever]

I'm intrigued.

This is thread like two people watching the same movie and one walks out laughing and the other walks out crying.

How can the esteemed members of the forum--usually level headed and fact based--have such divergent views of the same market?

Half here are just hunkering down (and/or ready to pounce on some opportunities) where the other half is ready for Armageddon. Seems to me that when it comes of finance, 'emotion' is a killer.

No conclusion here but ... fascinating.

The bolded imo are not really divergent.

 

[WestUniversity]

I don't get it... I keep seeing these headlines about 500 point drops in the Dow and think "so what? That's less than 2% in a day." I think some folks are sensitive to it because in our investing lifetimes, indeed less than 10 years ago, the Dow was in the 6000s and a 500 point swing was a big deal. Some of us might've been around when the Dow was 800. It's all relative. I suspect by the time I'm 80, the Dow will be having wild 2000 point swings in one day!!! Panic!

I believe groups with agendas are emphasizing the size of the point swings rather than percentage of the swing because they are trying to create a perception or to elicit a response. I’m finding it harder and harder to trust anyone in the media without cross checking everything they say...

 

[foxfirev5]

I'm intrigued.

This is thread like two people watching the same movie and one walks out laughing and the other walks out crying.

How can the esteemed members of the forum--usually level headed and fact based--have such divergent views of the same market?

Half here are just hunkering down (and/or ready to pounce on some opportunities) where the other half is ready for Armageddon. Seems to me that when it comes of finance, 'emotion' is a killer.

No conclusion here but ... fascinating.

Yes indeed. Personally my only concern is how much my dividend income will decline. I certainly hope I have enough cushion built in that it is not a factor. I really thought this group would be resilient enough not to get excited with these minor developments.

 

[MichaelB]

Great information and thanks for that chart >>> https://www.fool.com/investing/2018/...need-a-hi.aspx

If you believe any of the data in that link is relevant to this thread, why not introduce it here into the discussion so other can comment.,

Big banks churning accounts setting up the bonus. They make money the old fashion way...they skim it. Nothing new here. Your retirement is safe as long as they get some cream.

What exactly does this mean and how does it pertain to the discussion?

 

[target2019]

I'm intrigued.

This is thread like two people watching the same movie and one walks out laughing and the other walks out crying.

How can the esteemed members of the forum--usually level headed and fact based--have such divergent views of the same market?

Half here are just hunkering down (and/or ready to pounce on some opportunities) where the other half is ready for Armageddon. Seems to me that when it comes of finance, 'emotion' is a killer.

No conclusion here but ... fascinating.

Thread started out with voodoo sent in a spam email. Investors with equity ranges from 0-100% commenting, so I expect a wide range of reaction to a market that has essentially gone from 2695 to 2637 or so from Jan 1. It's a Rorschach test, IMO, and shows how diverse a population can be.