Investor Sentiment

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Sorry, as for disappointed, who would be more disappointed, the person who saw his share price drop from $13.22 to $12.18 (-7.87%) with buy and hold, or the person who got out at $13.07 (an actual gain of 2.27%) and then got back in at $12.63 and watch it drop to $12.18 (-3.56%)? I'll take the latter. :^Plus, when I actually "sell" my shares, that -3.56% is wiped out with a gain. Not losing any shares remember.

Sure it would of been nice to wait till it fell to $12.18 per share to buy into it, but show me someone who knew it would fall that far and I might just start believing in psychics. :D
 
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azanon wrote:
Guess that just depends on your perspective. I see it as simply a down market. Look at the dow, nasdaq, s&p 500 at Jan 1, 2004 and look at it today. Did it fluctuate on the way there? Well sure. When does it ever go in a perfect straight line? Being that it is bear so far, if there is a time the strategy on this site should be working, given both the bear market and the fluctuations.... it would be now. I rest my case.
If it fluctuates going up and down, why can't I make more money in either? Show me your returns at the end of the year, we'll see who did better. I'm onlly trying to help others. You're just pissed cause your losing! :P
 
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If you're consistantly beating the s&p500 over the long term milk man, by all means, market time away. I'm far more concerned with trying not to lose, than I am trying to win, so i'm perfectly willing to accept the long-term returns of the s&p500, and go about my business in this world enjoying other things. As far as day-to-day fluctuations go, if i did watch what happened every single day, i'd probably end up irrationally selling when the price is lowest. In my short investment tenure so far, by best returns have come from investments i had the patience to leave alone for a long period of time. Your experience may vary.
 
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mlk_man wrote:
That's why I use both Rolo. If you see that the market is trending up, you just in and ride. Like Aug 2003 to Jan 2004. Could I have gotten in and out because of my system a couple times when the market dipped? I don't know, wasn't doing this then.
I am learning, albeit the hard way as many of us must experience, that different markets require different strategies. I would say that in a raging bull market that is mostly linear, a "just let it ride" strategy is best suited. I did water down my gains with timing in 2003; I clearly could have made 150% rather than 75% (I was making that for a while).

When momentum clearly sputters, it is time to change tactics. In hindsight, given this waffling market (and it was early in it that we knew it would do this), more sensitivity to changes and moving averages is in order. (Okay, so it took a few months and several thousand dollars for me to learn this, but I think I got it now! I also "got" that I need to learn more quickly.;) )

I do not have the über-plan, however, by observing the market, others' ideas, and attempting my own, it is under development. I think that is pretty much what we are all doing. (Except for Az :Dj/k)
 
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If it fluctuates going up and down, why can't I make more money in either? Show me your returns at the end of the year, we'll see who did better. I'm onlly trying to help others. You're just pissed cause your losing!

Even the sun shines on a dogs ass some days.
 
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Yepper, but most dogs would rather sit on there a** and lick their nuts than do anything to help their owners future. :cool:
 
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azanon wrote:
I think it only fair to point out the converse;Timers tend to do well in bear markets cause (obviously) they're not always in the market 100% of the time during a downward trend.

That's a great point. The only way to beat the market is to be out when it is going down.

Knowing when we are in a bull or bear market and taking advantage of it will help the longer term investors greatly. Just a couple of adjustments here and there will do wonders for an account. I admit the minute tweaking isn't adding much to my return, but it has helped, and a switch in my bias at the right times over the years it has been an even greater help. Some years better than others. Sometimes it hurts (2001, ouch). But it does keepme on top of the market by following it. This year has been a tough trading environment for me but we are at a point where some are saying we are entering a bear market, yet I say not so fast.

(For the record, I think we are still consolidating within a bull market and NOT going into a bear market, so buy and holders should be fine this year.)

But think of the possibilities.If we were entering a new bear market, the buy and holders would be sitting ducks. If we are still merelyconsolidating it is a great buying opportunity and time to get aggressive. Because I have indicators (and sentiment is one) I can make a decision and act accordingly. Buy and holders may get more sleep than I do but they miss those opportunities to move aside or get more aggressive at key moments. Right now I believe we are at one of those key moments.

Hot dawgs! (In my best Shea Stadium accent). Get your hot dawgs. Rolo, you ready for another one? :)
 
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If we were entering a new bear market, the buy and holders would be sitting ducks.

I guess with a 30-year pre-retirement investment horizon, I just dont feel that vulnerable to short-term volatility. Reminds me of that movie Denzel played in where that demon was going around possessing people; remember his song? "Time...eeee is on my side... yes it issssss!"

My approach is boring, plain, and generic, but the approach that makes the most sense to me is 110-your age goes in common stock, and a properly diversified portfolio in foreign and domestic securities, including stocks, bonds, real estate, and maybe even a sprinkle of precious metals. Rebalancing one's portfolio ensures that you will sell when the price is high, and buy when the price is low.

The folks you need you most are the G fund lovers that pervade throughout the federal government. Those that have a portolio like i described; pure buy-and-hold diversification, are way ahead of the game, if you ask me.
 
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azanon wrote:
I guess with a 30-year pre-retirement investment horizon, I just dont feel that vulnerable to short-term volatility. Reminds me of that movie Denzel played in where that demon was going around possessing people; remember his song? "Time...eeee is on my side... yes it issssss!"

My approach is boring, plain, and generic, but the approach that makes the most sense to me is 110-your age goes in common stock, and a properly diversified portfolio in foreign and domestic securities, including stocks, bonds, real estate, and maybe even a sprinkle of precious metals. Rebalancing one's portfolio ensures that you will sell when the price is high, and buy when the price is low.

The folks you need you most are the G fund lovers that pervade throughout the federal government. Those that have a portolio like i described; pure buy-and-hold diversification, are way ahead of the game, if you ask me.
Yes, the G funders were my main target for this site. But when the S&P 500 was down 50% and the Nasdaq 78% from top to bottom, I just can't see sitting and watching. Even a diversified account got hit pretty hard.
 
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But when the S&P 500 was down 50% and the Nasdaq 78% from top to bottom, I just can't see sitting and watching. Even a diversified account got hit pretty hard.

It was just as insane to be in the market from 1/1999-12/1999 as it was to be in it from 2000-2002, for obviously different reasons. the way i see those drops is, no one should have been up that much in the first place, so the "crash" was just bringing the market down to planet earth.

Does that make sense? If you're argument is that it was insane not to sell after 2000, i say fine. But I dont see how this so called "rational" person would have also been in the market from 98-end of 99 given the extreme overvalued levels of the market at that time. Granted it went up anyway, but such is the nature of the market and such is why timing is a fools game.

I was in during both the bad and the good of that period cause i was buy and hold. It all evened out.
 
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azanon wrote:
But I dont see how this so called "rational" person would have also been in the market from 98-end of 99 given the extreme overvalued levels of the market at that time.
Yeah, I missed someof the 1999 21% gain. I was getting conservative around May of that year. I remember because I sold my kids' mutual funds and the market went up for about 6 or 8 months after. I was not happy but of course I ended up doing the right thing because of 2000-2002. Missing those gains in 1999 did hurt but I actually managed a 4.5% gain in 2000 in my TSP account. I'm more proud of that gain than the 39% I made in 2003.
But I started to get bullish too early andtook more losses in 2001 and 2002. Overall I didslightly better than a hypothetical diversified account from 2000-2003 (The S and I funds weren't available until mid 2001). Considering the carnage in the market, it's not too bad and timinghelped. The 39% gain in 2003was sure nice but the point is I was able to shift gears at the right time. Like you said, the G funders didn't do that.

*Total 2000-2003
My Return G Fund FFund C Fund S Fund I Fund 20% Each
3.74% 22.62% 39.24% -19.84% -10.37% -22.36% 2.37%

http://www.tsptalk.com/returns/returns2.html

* I didn'tstart tracking my returns until 2000.
 
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azanon wrote:
but the approach that makes the most sense to me is 110-your age goes in common stock
What is the modified formula if you expect to plotz by 60, on the outside? :shock:

(If I manage to make it that far, I will pick up every vice known to man!)
 
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tsptalk wrote:
Hot dawgs! (In my best Shea Stadium accent). Get your hot dawgs. Rolo, you ready for another one? :)
Yes I am! So ready, that I didn't sell all my stuff! (tee hee...had to be said)
 
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What is the modified formula if you expect to plotz by 60, on the outside?

Not sure what you're asking. Stocks keep up with inflation better than anything. Someone in good health that retires moderately early can expect to live maybe 40 years or more after retirement, so inflation protection still is important. Its a common misconception to think its wise to move out of stock when you retire. 110- your age is perfectly appropriate till you are pushing up daisies.

No one's saying you have to hold the maximum growth stocks at 60+. The actual kinds of stocks you own can have a tremendous bearing on your risk. Head on over to the retire early homepage, and you'll find plenty of old timers that still have 40-60% stock.

Azanon
 
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hehe...I am being a little facetous...What I am saying is that the IRS expects me to live to 83. I am thinking 60 max, but an anyeurism is likely in my late fifties. :s My point is differing time horizons.


[line]


Reverse Psychology Rules Stocks
BY JONAH KERI

INVESTOR'S BUSINESS DAILY

No good luck charm will help you for very long in the market. To succeed at investing, rely on objective analysis. That means looking at price and volume cues from the major indexes and individual stocks.

The market also offers a slew of secondary measures, which can help you assess the investing landscape. When used correctly, these psychological indicators usually are contrarian gauges. In other words, when they move one way, the market often moves the other.

To find these indicators, go to IBD's General Markets & Sectors page, B2 in the print edition. Here's a quick rundown:

• Nasdaq volume vs. NYSE volume: Nasdaq stocks now garner a lot more daily volume than their NYSE counterparts. Former big names like Cisco (CSCO) and Intel (INTC) may no longer be market leaders. But big-money investors still trade a huge number of shares daily.

There's no hard and fast rule for measuring the volume ratio between Nasdaq and NYSE stocks. But in general, when NYSE volume approaches or exceeds Nasdaq volume, you may be near a market bottom. When Nasdaq volume jumps while NYSE trade stays tame, you may be looking at a market top. The five-year low occurred a month before the market took off in October 1998. The indicator flashed a one-year low on Sept. 17, four days before the market hit bottom last fall.

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• Public/NYSE specialist short sales: Excessive shorting often foreshadows a market bottom. When the public starts selling loads of borrowed shares (in hopes they'll drop lower) relative to shorts by NYSE specialists, you're near the end of the decline. Why? The crowd is always wrong.

The public is expressed as the numerator, specialists as the denominator. So this contrarian gauge shoots up when individual investors are sure the market can only go lower. The ratio hit a five-year high in September 1998, a month before the market launched into a roaring new bull. The highest level in the past year? The ratio hit 1.5 on Sept. 21, the exact bottom after the terrorist attacks.

• Put/call premium ratio: A cousin of the put/call volume ratio, this gauge compares the premiums paid on all puts vs. calls. The calculation is more complex than the put/call volume ratio. But like other contrarian indicators, we often see this ratio hit extreme levels near a market turn. It spiked to a five-year high three months before the market sold off in late 1997. It hit a five-year low six weeks before the 1998 bull.

NYSE short interest ratio: This gauge measures the total number of shares being shorted vs. the NYSE's average daily volume. A value of 4 means four days' worth of short interest.

The bigger the number, the more shares traders are shorting as they turn bearish. Also, the bigger the number, the more buying it takes traders to cover those short positions in the event of a rally. As the ratio starts to spike up, a new bull market may soon arrive.
 
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Sure Rolo. You just killed my Wednesday night comments :). I saw that on sentimentrader.com yesterday. Good stuff. Thanks.
 
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tsptalk wrote:
Sure Rolo. You just killed my Wednesday night comments :). I saw that on sentimentrader.com yesterday. Good stuff. Thanks.
ROFLMAO!

The extra-funny thing is that I have been seriously neglecting reading my IBD, so it's not like I am saturated with information or anything!

Aw man that is funny.
 
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tsptalk wrote:
Ibelieve once the sentiment indicator gets to a level where there are more bears than bulls (or close to it), we will be looking at the bottom.
The latest AAII investor survey numbers are in, 34% bullish, 36% bearish. Good news.
 
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