Coronavirus - Financial impact

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I helped an old relative sell of his small stock holdings, as statistically speaking he won't live 3 more years, so he can wait for a rebound. His BND fund has done great and he is keeping that.

Myself, I went to buy an option and my roth is not set up for it and I have to do the application on paper :facepalm:

At least I can console myself as everything goes down, that it's going to make a great Roth conversion opportunity. :cool:
 
Just read this morning that Japan is closing schools until end of March.

Imagine that in the USA. Worker productivity would go to zero as people scrambled to figure out what to do with their kids all day.

Time to buy even more puts. At this point I don't even know if we hold DOW 20,000.
 
I'm looking forward to moving "all in" once the irrational sell off is complete. Now, to know when that is..... :whistle:
 
Tiger8693 said:
I'm looking forward to moving "all in" once the irrational sell off is complete. Now, to know when that is..... :whistle:
Click to expand...

I am already eyeing waterfront properties that I missed out on in the 2008 crisis.

I remember seeing some really sweet deals. Probably would need the market to drop well below 20,000 and I would have to be in a good cash position.
 
What happens to the Market Efficiency?

Up till last week, all indices kept setting new highs, even though the virus outbreaks were occurring around the world, cruise ships were quarantined or wandering the ocean without a place to dock, supply chains from China were disrupted including pharma products. Buy, buy, buy...

Then, suddenly, the market caught wind of all the bad news going on already for 2 months, and got scared out of its wits. Sell, sell, sell...

Hmmm... What's goin' on?
 
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My thinking is "everything is priced in" is sort of a lie.
 
Before something gets priced in, whether good or bad news, there has to be a sign of it getting acknowledged first. In this case, there is no indication of the "market" even knowing what's going on.

I saw an article on the Web saying that the market has been bid up by traders pumping stocks on reddit. I never go there, so do not know how pervasive it is.

But how do a bunch of individual traders have such an influence on the large overall market? How can a few manage to fool the masses? Oh, of course that happens all the time. :facepalm:
 
NW-Bound said:
Before something gets priced in, whether good or bad news, there has to be a sign of it getting acknowledged first. In this case, there is no indication of the "market" even knowing what's going on.
Click to expand...

I think we are starting to see the signs in the market.

I'm a little disappointed in myself for not selling more individual stocks (oil) when I KNEW this virus was going to have an impact...but admittedly would have felt foolish and deeply regretted if I had moved to cash and nothing happened.
 
There’s a thread for heath aspects of Covid-19 and another for travel, so let’s keep this thread focused on financial topics and not just repeat the same posts everywhere.
 
Nobody knows what is going to happen in the market. There will definitely be at least 1 or 2 quarters of much lower profits and productivity...because of major disruptions in the supply chains. What will the market do with that information? If you're willing to roll the dice and hope that there is a quick turnaround, go for it...I hope you have a strong stomach. On the other hand, if you want to lock in some of your gains, sell now. Sometimes, it's difficult to catch a falling knife!
 
NW-Bound said:
What happens to the Market Efficiency?

Up till last week, all indices kept setting new highs, even though the virus outbreaks were occurring around the world, cruise ships were quarantined or wandering the ocean without a place to dock, supply chains from China were disrupted including pharma products. Buy, buy, buy...

Then, suddenly, the market caught wind of all the bad news going on already for 2 months, and got scared out of its wits. Sell, sell, sell...

Hmmm... What's goin' on?
Click to expand...

The first part of timing the market was relatively easy.....
 
I am fortunate (or unfortunate) to be still in the accumulation phase. Will not touch my equites for 5 more years. My reaction to this has been to change 401K contribution from max down to 6% to get the company match. Also instead of the additional $1500/month going into taxable (equities) it will now sit in MM until I feel this current black swan has run it's course. When will I know? ?? Heck, I may wait in cash (MM) until after the election. I know-not suppose to time the market. I just can't see putting $ into the market right now.
 
Of course you have forgotten golden rule number one. We know this from 40 of battling the CBOT while growing grains.

The Wall Street boys make money on both sides of the numbers, they don't mind "helping" the market go down on "fears". They make money when it goes down and again when it goes up. And if for some reason they screw it up. they turn to the "government" us, to bail them out. They are playing with house money all the time.
 
NW-Bound said:
What happens to the Market Efficiency?

Up till last week, all indices kept setting new highs, even though the virus outbreaks were occurring around the world, cruise ships were quarantined or wandering the ocean without a place to dock, supply chains from China were disrupted including pharma products. Buy, buy, buy...

Then, suddenly, the market caught wind of all the bad news going on already for 2 months, and got scared out of its wits. Sell, sell, sell...

Hmmm... What's goin' on?
Click to expand...


“In the short run, the market is a voting machine but in the long run, it is a weighing machine.”

- Benjamin Graham
 
LRDave said:
The first part of timing the market was relatively easy.....
Click to expand...

Anytime I buy back at a lower price than I sold, it's a win. Even if I still lose money, I lose less than buy/hold. I don't need to buy back at the exact bottom. I don't understand why people make it so hard.

Anyway, I did raise enough cash for a 7-figure war chest, to deploy when I feel like it. Is the market getting back to where it was last week any time soon? I don't think so.

Still have too much in the market, but this kind of loss, I am used to. Been there too many times.
 
The only put contracts I bought were on Carnival. Strike price of 37.5, expiry July.

CCL was at 41.5 then, already down from 50 when the virus news broke. It is at 30 right now, and still falling. The price of the puts has quadrupled.

The money I make on this is literally peanuts compared to the loss on my long positions, but as a lark it still brings in enough to buy food to stock up for 6 months.

Just kidding about stocking food for 6 months. I have not even figured out what amount of food that is, how big a pile, but dollarwise it's what Quicken says we usually spend. My consolation prize.
 
Fermion said:
My thinking is "everything is priced in" is sort of a lie.
Click to expand...


+1

I bought more puts when the market opened today. I’m at about 1% of portfolio for puts now. I’m probably done at this point.

And I’m glad I dropped my equities to 50%. The question with that is, do I buy when I hit my rebalancing bands? It doesn’t look like that’s far off...
 
Fermion said:
Just read this morning that Japan is closing schools until end of March.



Imagine that in the USA. Worker productivity would go to zero as people scrambled to figure out what to do with their kids all day.



Time to buy even more puts. At this point I don't even know if we hold DOW 20,000.
Click to expand...



Puts are WAY UP today. Much higher premium than there would be just based on today’s swing in the market alone.
 
Was 100% cash Monday morning, now between yesterday afternoon and this morning I am up to 92% equities again although it is mostly miners and crypto at this point.
 
NYEXPAT said:
Was 100% cash Monday morning, now between yesterday afternoon and this morning I am up to 92% equities again although it is mostly miners and crypto at this point.
Click to expand...

Dang, that is going all in.
 
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