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Comments
I think it’s just a case of experience and time and I’ll be as relaxed as others.
Luckily I am still in a positive, but the actual loss from the high is a massive figure that takes some getting around my head.
I still pucker up every time my portfolio losses as little as a penny, I'm practically addicted to checking my brokers, financial management and aanalysis software. It's a habbit I haven't been able to break since I bought my first share, but then I have no interest in day trading, I buy almost exclusively with the intention of holding long term, I have bought and turned around and sold relatively quickly, and with the intention to do so, but for me that has always been the exception, and it's something I only do when I think I'm on to an opportunity too good to pass on, not to mention that I manage my own investments, I don't use a fund manager, nor do I invest in any. So for me constantly checking on my portfolio, financial management software, and commodity prices has become second nature to me, a summary of all that information is the first thing I see whenever I unlock any of my phones or tablets.
with day trading, you can keep your money in zero risk cash, and only invest when something is clearly underpriced
like my mate did yesterday, bought 5000 POLY shares at 550p
sold today for 800p
that's £12.5k profit, in one day
I don't know how closely you follow your investments, but from being 3.16% down yesterday, as I type this, my portfolio is now only down by 0.30%, that's a recovery of over 2% in roughly 24 hours.
Many millions of people, who have a career, profession or full time job and family that they want to focus on, have no interest in becoming a Wall Street wannabe. They want to take their earnings and invest in a simple way to build up a sum of money they can use in retirement while they get on with their lives.
Buying and holding a low cost index fund or funds, invested in a selection of assets that match your risk appetite and regions that interest you, for the long term, through the ups and downs of the stock market, is a perfectly sensible and proven solution that requires little more than rudimentary knowledge and no effort whatsoever once set up. My investments increased 27.7% (£67K investment growth net of additional contributions) last year by simply doing just that. No trading, no transactions, nothing.
What will the returns be this year? I have no idea, but I do know that over the next 20 years I will do OK. Trying to time the market is incredibly difficult.
The S&P500 increased by 1.5% on 24th and 2.24% on 25th. So what exactly was I supposed to be watching and paying attention to?
he runs on the basis that 2 successful trades to one unsuccessful is an acceptable ratio
I think he makes over £100k a year typically, last year was more like £300k-£400k
I made a lot last year too, I've not been trading much this year, too busy with work
My mate's predictions are more frequently correct, on Thursday morning he said
S+P will "bounce into 4350 area on friday"
He thinks it will drop to 3660 in April or May, we'll see if he's right
Why did I post?
Even relatively passive investors should be aware of how world events affect their life savings
On this day, as Japan rampaged across the Pacific with county after country collapsing to surrender, and inflation fears rock the US as they struggle to get topside of a war with a country 6,000 miles across the Pacific, and Europe is occupied by the Nazis, 2 years before D-Day...
$10,000 invested in the S&P500 on that day would turn into $51,000,000 in 2018. All you had to do is...nothing.
He looks for specific companies that are undervalued, which is what me and my mate do.
Often the bargains are to be had months before or months after one on the index dips
Buying index-trackers and typical managed funds during dips in the indices is not very similar to Buffett's approach
https://www.investopedia.com/articles/01/071801.asp
The view in late 2020:
https://www.fool.com/investing/2020/12/30/move-over-warren-buffett-theres-a-new-must-follow/
whereas all the news now says the tables are turned:
https://www.thestreet.com/memestocks/reddit-trends/cathie-wood-vs-warren-buffett-who-will-win-in-2022
So the benefit with value investing is that you have a logical reason to expect your investments to weather economic storms, whereas when pursuing growth stocks, your life savings are exposed to much more short to medium term risk. If retirement is 25 years away, this is less important.
And believe it or not but some ''financial advisers'' today in the press where suggesting that now is a good time to get out of the FTSE, LSE, NYE, and NASDAQ and invest in AIM - Alternative Investment Market, instead. I was shocked with that suggestion.
Why I’ll never buy an active investment fund again | Financial Times (ft.com)
Many people know about this stuff already I think
I read this earlier:
“Nearly 90% of stocks in the S&P 500 traded above their 10-day moving averages on Friday. Since 1982, the broad index has been higher over the next year in 35 out of the 36 times when more than 90% of its stocks trade above their 10-day moving averages, according to Ned Davis Research. The firm’s version of the Zweig Thrust Indicator, which occurs when the barometer rises from below 40% to above 61.5% in a 10-day period, hit that level on Friday for common stocks only.”
The bulk of my money is in a low cost fund with a total 0.16% annual fee (the lowest Fees available through my pension provider) that tracks the FTSE USA index, a bit broader than the S&P500 by adding an extra 100 or so mid-cap US companies. Performance is broadly aligned with the S&P500.
I'm buying more units each month this year then looking at buying some Bonds (UK Gilts) and accumulating some cash as I should have enough equity units purchased by the end of this year for my retirement growth needs.
meanwhile how is Tesla doing? It's 23% down YTD but 37% up over last 12 months. Berlin gigafactory comes online this year.
On the investment side, I'm selling some of my bond funds on the basis that recently they've held up better than global share prices, and I see this as an opportunity to increase the holdings of the funds (ones invested in shares) that have given me consistent long term performance. Additionally once we get into the 2022/2023 financial year in a couple of weeks, I'll be putting next year's allowance into my ISA, and may be buy a couple of new funds. Clearly, a careful eye needs to be kept on the performance of markets across the globe, and any decision making modified as circumstances evolve.
Freetrade plus, pays 3% interest on cash balances up to £4k, that's about a tenner a month you get for keeping ready to access cash in your account, granted that's what the plus membership costs, but seeing how it's a trading platform, earning a tenner a month from dividends is not a hard nor expensive achievement to reach, not to mention all the additional benefits you get from a Freetrade plus account
I already have an emergency fund, a fully funded minimum of 6 months+ of household expenses kept on the sidelines, it's more now. It's been invaluable for unexpected car repairs and vets bills, having an emergency cash fund is probably the best thing I did when getting my financial shit together, along with getting out of debt.
I'm aiming for a total retirement portfolio across my pension, wife's pension and ISA of 70% stocks, 20% bonds (Gilts) and 10% cash plus a separate cash emergency fund. I have built the stocks allocation first and as mentioned above will redirect salary sacrifice contributions to bonds and wrapped cash from 2023 onwards plus any additional savings after tax will add to this, maybe sooner if the market bounces back into the green in the 2nd half of 2022. Once I get to the desired asset allocation I will rebalance annually. I keep things simple, one low cost index fund for my pension, one for my wife's pension and one for our S&S ISA.
The Financial Times guide to investing