Stocks - The Best Buys 2

[Slava]

Originally Posted by Shazam

Oh, um, nothing at all, really. There really is no timing the market.

Well that post is from November 2018, so if you took that advice and sold it because you were afraid of the recession, what have you missed? ~ 1000 points on the TSX, 100 on the S&P? Throw some dividends on top and it's not exactly been a successful strategy?

[snootchiebootchies]

Originally Posted by MJK

I have some cash I am looking to invest, what is looking good out there right now?

The TSX has been up something like 20% over the past 4 months. I'm thinking of waiting for the summer doldrums to hit before deploying more cash unless a mini-correction hits earlier.

So was that correction in the second half of last year the extent of the long-anticipated bear market? Anyone think there is more to come?

[MJK]

Originally Posted by snootchiebootchies

The TSX has been up something like 20% over the past 4 months. I'm thinking of waiting for the summer doldrums to hit before deploying more cash unless a mini-correction hits earlier.

So was that correction in the second half of last year the extent of the long-anticipated bear market? Anyone think there is more to come?

I have made some decent cash over the past 2-3 months so just sold some stock while on upswing.

I am open to being patient but unsure what would be a good investment when it's time to get back in. I've made the most money on SUGR

[Shazam]

Originally Posted by Slava

Well that post is from November 2018, so if you took that advice and sold it because you were afraid of the recession, what have you missed? ~ 1000 points on the TSX, 100 on the S&P? Throw some dividends on top and it's not exactly been a successful strategy?

Yes, you're agreeing with me.

[Sr. Mints]

Originally Posted by MJK

I have some cash I am looking to invest, what is looking good out there right now?

I have some Maxar shares you can buy. Terrific company

[bluejays]

Originally Posted by snootchiebootchies

The TSX has been up something like 20% over the past 4 months. I'm thinking of waiting for the summer doldrums to hit before deploying more cash unless a mini-correction hits earlier.

So was that correction in the second half of last year the extent of the long-anticipated bear market? Anyone think there is more to come?

I'm not a trader or a pro at this by any stretch (as my track record shows here ), but I personally believe this can't go for much longer. With interest rates low, things should continue to hum along at a relatively stable pace, but I can't see extreme growth in any particular industry. Jobs numbers will probably be mediocre going forward, as with foreign trade. Interest rates probably won't raise. So solid companies paying dividends are a good safety blanket assuming growth and capital appreciation probably isn't there. I have a lot of income trusts and they've depreciated badly and will probably get worse when interest rates increase a year from now. I'll probably hold them for close to a year, and if they appreciate I'm out. Bank stocks, who the hell knows, but I suspect down. Teck industry in the next year is probably on the verge in the of some very big things after some meh years (with AR, VR, etc). I also personally think US stocks will continue to perform well.

[Johnny199r]

Originally Posted by snootchiebootchies

The TSX has been up something like 20% over the past 4 months. I'm thinking of waiting for the summer doldrums to hit before deploying more cash unless a mini-correction hits earlier.

So was that correction in the second half of last year the extent of the long-anticipated bear market? Anyone think there is more to come?

The TSX was the worst performing stock market in the world in 2018. It's on fire so far in 2019, but I don't see a correction being imminent or predictable.

[wwkayaker]

I have been hesitant to purchase any stocks for awhile and have been accruing cash in case the market drops. The valuations for companies that I’m interested in owning don’t make sense to purchase at the moment. Some of the gurus I follow have either pulled out of the US markets completely or are sitting on lots of cash in anticipation of a pullback. That being said, experts have been warning of a recession for some time and nothing has happened.

[Johnny199r]

Originally Posted by wwkayaker

I have been hesitant to purchase any stocks for awhile and have been accruing cash in case the market drops. The valuations for companies that I’m interested in owning don’t make sense to purchase at the moment. Some of the gurus I follow have either pulled out of the US markets completely or are sitting on lots of cash in anticipation of a pullback. That being said, experts have been warning of a recession for some time and nothing has happened.

If you are an ETF indexer, there is no point in ever waiting to put money in the market. Individual stocks on the other hand? Different story I guess.

[wwkayaker]

Originally Posted by Johnny199r

If you are an ETF indexer, there is no point in ever waiting to put money in the market. Individual stocks on the other hand? Different story I guess.

I don’t have index funds aside from a small chunk of emerging markets. I don’t think your rationale for investing in ETFs at any time is correct. From what I understand, ETFs are priced according to the net asset value of the stocks held within the ETF; overvalued stocks would create overvalued ETFs and undervalued stocks would lead to undervalued ETFs. Am I incorrect?

[Slava]

Originally Posted by wwkayaker

I don’t have index funds aside from a small chunk of emerging markets. I don’t think your rationale for investing in ETFs at any time is correct. From what I understand, ETFs are priced according to the net asset value of the stocks held within the ETF; overvalued stocks would create overvalued ETFs and undervalued stocks would lead to undervalued ETFs. Am I incorrect?

That’s definitely the case. ETFs can trade over/above “what they should” based on the value of those underlying holdings. If they trade frequently and there is enough volume it becomes less of a concern. To be clear, there are a lot of factors though. Depending on the ETF structure you don’t actually own those underlying securities and instead own a derivative product based on them, and that adds another layer as well.

It really depends on what you’re buying and it’s not easy enough to create a simple rule. If you’re buying a massive index you’re taking a different approach compared to buying a small, sector specific, or levered product. Literally everything from the rational to the holding period will different here.

[OMG!WTF!]

Originally Posted by wwkayaker

I have been hesitant to purchase any stocks for awhile and have been accruing cash in case the market drops. The valuations for companies that I’m interested in owning don’t make sense to purchase at the moment. Some of the gurus I follow have either pulled out of the US markets completely or are sitting on lots of cash in anticipation of a pullback. That being said, experts have been warning of a recession for some time and nothing has happened.

Whatever you do, do not follow gurus. We've had hundreds of new highs on the NYSE in the last 10 years. Almost every time there's a new high or close to a new high someone says it's all over and we're over valued and the crash is coming. One day they will be right but that day will be when trend lines are broken not when someone calls it a high. You'll see it coming if you know what to look for.



I think there's just an abundance of money out there. The top 500 funds amount to over 100 trillion in value. And there are thousands more funds out there. Even with the influx of IPO's we see now there is still a drive higher.



Trump will mangle things eventually but it might take some time.

[Johnny199r]

Originally Posted by Slava

That’s definitely the case. ETFs can trade over/above “what they should” based on the value of those underlying holdings. If they trade frequently and there is enough volume it becomes less of a concern. To be clear, there are a lot of factors though. Depending on the ETF structure you don’t actually own those underlying securities and instead own a derivative product based on them, and that adds another layer as well.

It really depends on what you’re buying and it’s not easy enough to create a simple rule. If you’re buying a massive index you’re taking a different approach compared to buying a small, sector specific, or levered product. Literally everything from the rational to the holding period will different here.

Certainly buying a massive index (an S&P 500 etf) is different than a specialized sector. If I buy XIC and XAW for my RRSP which I won't touch for at least twenty years, I don't see the point in timing, given the rationale that I believe stock markets will be higher then, than they are today.

There is always an exception, like the long term stagnation the Japanese stock market faced, but that's why you diversify between Canada, U.S and the rest of the world.

[wwkayaker]

As far as gurus go, I’m looking at investors like Buffet, Munger and Mohnish Pabrai. Guys like Jim Cramer are a waste of time and basically entertainment for speculators, IMO.

My view of the market and plan for the next year or two could be completely wrong. I have read a lot about index funds and I agree with them but I enjoy selecting companies. I was also investing whenever I had the money. More recently, stocks look very expensive so I haven’t bought anything. I also haven’t sold any of my holdings. I’m content now to pile up some cash and see what happens.

Slava, given your work, you probably have better insight into a potential correction. To my knowledge, index funds weren’t as popular or as available, during past corrections, as they are now. There is some concern about how a crash with a large percentage of money in index funds would play out. Even John Bogle was concerned about how high levels of passive investing would impact the markets.

[TorqueDog]

Lots of earnings calls recently sending some stocks moving in ways people weren’t expecting. TSLA beat earnings and demolished anyone betting against the stock, while AMZN fell short and dropped prices huge after hours.

I’ve had some success trading call options on MSFT the past couple days, going for small positions / gains as my margin account is new and light on capital as I’m just getting back into trading again.

Anyone else been active in the markets lately?

[Shazam]

Made a few thousand with QQQ, should've bought TQQQ instead.

I find it somewhat pointless these days though, I have a few hundred thousand in savings and I can't make any sort of dent upwards screwing around with this sort of stuff. I guess I gotta start using options. My daily movements end up in the tens of thousands now, not to mention my stock holdings.

[Johnny199r]

Originally Posted by Shazam

Made a few thousand with QQQ, should've bought TQQQ instead.

I find it somewhat pointless these days though, I have a few hundred thousand in savings and I can't make any sort of dent upwards screwing around with this sort of stuff. I guess I gotta start using options. My daily movements end up in the tens of thousands now, not to mention my stock holdings.

I'm in the same situation. I know timing the market is a fool's errand, but I'm sitting on a couple hundred grand, waiting for a dip in the market for a buying opportunity.

I'm currently invested in Xaw and Xic ETFs and Mawer balanced.

[sa226]

In my ongoing quest to have a comfortable retirement while not having to do much work, in the past 12 years I have gone from Mutual funds to pure growth investing to 90/10 index investing with a horizon of 20+ years.

Now im slowly moving into pure dividend growth investing.

I think its the perfect balance of decent forecastable returns with a fairly hands off but involved approach. With a 20 year horizon, the power of compounding returns with reinvested dividends is pretty enticing.

Is it boring as hell? Yep. I've come to realize that im never going to find the next apple, so this is going to be my new approach.

[Johnny199r]

Originally Posted by sa226

In my ongoing quest to have a comfortable retirement while not having to do much work, in the past 12 years I have gone from Mutual funds to pure growth investing to 90/10 index investing with a horizon of 20+ years.

Now im slowly moving into pure dividend growth investing.

I think its the perfect balance of decent forecastable returns with a fairly hands off but involved approach. With a 20 year horizon, the power of compounding returns with reinvested dividends is pretty enticing.

Is it boring as hell? Yep. I've come to realize that im never going to find the next apple, so this is going to be my new approach.

I like indexing. It requires no time, no effort. How do people find the time and expertise to buy/sell dividend stocks?

[sa226]

Thats kind of the point, there isn't much selling going on. Do your research, find the stocks that fit your criteria and hold. keep tabs on the company so that you're not blindsided by a company slashing its dividend.

Added complexity is that the TSX isnt very diversified and US dividends are subject to different taxes.

Getting into it takes some work, but once you're going its quite hands off.