Stock Tips for the Covid market?

[powlusr]

I am retired and financially stable. I just sold my late father's farm and have a bit of money to add to my Fidelity retirement fund. Any good stock tips? I did just buy some XOM (Exxon). Looking for some other ideas.

[Retiired]

GDX - VanEck Vectors Gold Miners ETF

With the Fed injecting 6 or 7 trillion dollars into the economy, there is a better than 50/50 chance that GOLD will continue to rise as ours and every other nation continues to print money out of thin air. The gold miners that constitute the ETF will continue to increase earnings and raise dividends with others will be doing the opposite during the pandemic downturn in the short term.

[SnowballCamper]

Probably won't find much for stock tips here. Even the stock picking & market strategy area hardly has any specific stock recommendations. In my short time here, most seem to be index oriented, but with some market timers.

[Onward]

Hmmmmmm. A bunch of early retirees who are index-oriented....

What does that tell you?

[Boho]

This is just me speculating:

A coronavirus breakthrough is possible at any time. It's kind of too late to take advantage of. There's still the Chinese tariff issue which few would notice in the near future, but if it affects earnings after a cure, the optimism from the cure could be short lived.

If I were still playing with a trading simulator I might trade optimistically if there's a dip in the market, then sell when my trade paid off a bit, then stick to a normal portfolio for a while.

[Sunset]

With the market about 15% down for the year/high point when it was overpriced, it is probably not really on sale or down.

OP - why would you buy XOM - doesn't their debt scare you ?

I would buy VTI or BRK.B (as this is Warren's type of environment).
Or I might just buy TIPs as perhaps we will go into a Depression

[Brian]

I just checked my stock balances last night. I was happily surprised my vanguard health care sector fund is almost back up to pre-COVID value. It's performing much better (+10%) than by other funds (most 500 index). Hard to say it will continue to out perform. I've over weighted my portfolio in the health care sector due to aging baby boomers demands.

[JOHNNIE36]

After being absent for many months, I thought this would be the perfect time to get back on this site. I’m especially interested in your thinking about Vanguard Wellesley fund. It was about five years ago when I shifted a large chunk into that fund based on the thoughts and recommendations of many on this forum. I liked what I read because I’m not one to study the market. I like the 6.5% return the fund was returning. Still like it and would like the thoughts of others on the forum. Getting ready to turn 84 and love peace and quiet. Happy to be back and wishing everyone happy investing. Stay safe.

[atmsmshr]

IMHO - stock tips would be to hold a stable store of money for now, and invest later.

With the dollar as a world reserve currency, there are very few other countries can extend liquidity and debt like the Fed and Treasury. That could create a credit crunch for a lot of foreign national companies as the business cycle contracts. May be a good buy for foreign in the future - but not now. About half of the worlds capital is USA based equity anyway.

With that said, for bonds:

Short term Treasuries bills and intermediate bond funds that are not diluted with other corporate paper seem to be a safe store of value for now. TIPS are going negative, forecasting a bit of near term deflation?

CDs and MMs are next best store of money, but the farther their underlying value is from federal paper is they have a small but increasing chance of lockup for a period of time as bankruptcies work through the financial system.


Gold and Silver are a store of value, but may not be as liquid or stable. You have navigate how to buy/sell/store the physical gold, ETF/fund, mining company.

Corporate bonds are being downgraded. Fed is propping up 'fallen angels' like Ford that were downgraded. Some corporations will borrow in the downturn, and not repay previous debts. Neman Marcus, Macy's Penny's may be only the first big names to begin the default process.

Municipal bonds? In a time of shrinking tax base and some unrealistic pension promises - I expect to see some municipal bankruptcies.


Equity / stock. Right now the index fund PEs for USA are climbing as earnings start the expected first quarter slide. Second quarter will be worse.

There are some essential items that should weather better than others. Examples include utilities, consumer staples like groceries, food supply chains.

Other companies that have low debt and operating costs should easily survive. High tech stocks like FANG will be impacted in different ways (Amazon and Netflix up, Apple iPhone sales down). The NASDAQ QQQ is more broadly diversified, but may be a little pricey for now.

Keep a 6 foot pole between your wallet and the following equity classes: Energy, sports and leisure, food service, hotel, amusement, REIT and travel. Maybe some bargains at the end of the year or early next year. Tough to tell the walking dead from survivors right now.

Cash? DW and I have twelve months of cash expenses set aside - but we are retired and need certainty of near term liquidity.

Bottom line - understand your risk tolerance and diversity funds amongst stocks and bond funds AND financial institutions.

YMMV

[powlusr]

Quote:

Originally Posted by Sunset OP - why would you buy XOM - doesn't their debt scare you ?

I think Exxon will pull through this and pick up the scraps from the smaller companies that go under. they have a lot of cash on hand. They are at half price right now.

[Fermion]

I'd wait for the 80% off red tag on Exxon.

[OldShooter]

Quote:

Originally Posted by Onward Hmmmmmm. A bunch of early retirees who are index-oriented.... What does that tell you?

When we trade individual stocks we get the feeling that we are dealing in a cloud. The cloud buys from us, the cloud sells to us. It is easy to forget that on every trade we are dealing with an individual (or that individual's computer program). The vast majority of our pipsqueek dealings are with professionals -- I have read 95%. In my Adult-Ed investing class I strongly discourage students from dealing with individual stocks. Here is a slide:

The key question is the one in red. The professionals aren't always right -- we pipsqueeks can get lucky once in a while. But that doesn't change the basic situation. There was a very insightful post here a few months ago. The poster said that the worst thing that had happened to him was that he had made money on his first individual stock trade.

[powlusr]

Quote:

Originally Posted by OldShooter ... individual stocks...

I have 90% of my money in index funds per the Bogle model, but I want to gamble with the other 10%.

[Fermion]

Oldshooter, you are still in the 2000s.

You are not trading against a human anymore, you are trading against this:

[OldShooter]

Quote:

Originally Posted by powlusr I have 90% of my money in index funds per the Bogle model, but I want to gamble with the other 10%.

Nothing wrong with that. You obviously know what you're getting into. I never understood it, but my multmillionaire business partner and his wife used to go to the casino with a $200 budget to have fun. Same thing, basically, but the casino odds are known. At the same time I was looking down my nose at that, I was racing sports cars at a cost of several $K per weekend.

[OldShooter]

Quote:

Originally Posted by Fermion Oldshooter, you are still in the 2000s. You are not trading against a human anymore, you are trading against this:

No. Computers do not come out of the manufacturing plant and go to work on Wall Street all on their own. They are bought by humans who then program the machines' behavior. So it is always humans trading with humans. The computers are just some humans' interfaces to the market, just as my keyboard is my interface.

That said, the machines' speed and data resources underline the dangers to us pipsqueeks. That's why I mentioned them in my post.

[sengsational]

My first thought was to buy what has taken the biggest beating. Not at the sector level, but maybe the country level. Why has Australia taken more of a beating? Maybe somebody "knows something" or maybe when this passes, it will level up to where it was before.

[Fermion]

No, we are at the point that some trading decisions require speeds too fast for a human to analyze and execute, so the computers ARE making the decisions, albeit within a given set of parameters.

Sometimes the programmers do mess up a bit on establishing the parameters and things get a bit hairy.

[Jeffman52]

First, this is just my opinion. Never invest speculatively with money you aren't comfortable losing. Stocks can be up 400% one minute and then drop to nothing before you can get your profit out. Just be aware of the risks and do your own research. Dont trust "random guy/gal 001" from the internet without your own due diligence.

Oil is a good bet right now. Oil prices wont stay low like this long after they open the economy back up. Just about anything with oil is a good investment right now.

OXY - Their books are awful so I should have done more research, but hey I'm up 15.19% in that and think I can double or better before I need to dump this and get out.

BIO stocks are one of those "Golden egg" or just "egg" stocks.

GNPX I am up 21% this week
CYDY I am holding long in. UP 218% since I first invested but has been sitting stagnant waiting on FDA approvals for HIV and Coronavirus treatment.

[OldShooter]

OK, OK, if we're headed down the stock picking path I think there is a lot of behavioral "spin" on stock prices right now. Good video where two Nobel winners discuss this: https://review.chicagobooth.edu/econ...kets-efficient (beware the transcript; it is not verbatim.)

Thaler's mutual fund (https://www.marketwatch.com/story/wh...its-2019-02-26), like all stock picker funds, has not done all that well but I would look to their portfolio to get ideas for stocks where investors seem to be "misbehaving" and are unduly pessimistic. (Thaler's well-worth-reading book is titled "Misbehaving.")