Markets tanking early Q1, anyone also saw this coming too?

I knew the market was going to tank on January of 2016.

For example: a specific stock, I have multiple posts here about DIS. The recent one was vague and idiotic, just ignore it but I have a post months ago with an analysis about it against the yuan devaluation. DIS is down to 93 last I looked. It was 120 tops last year.

My current portfolio is above all major indices: Dow, S&P500 and NASDAQ. I was preparing a month ago for the widespread drop.

To those with investments in the markets, preferably U.S. did you also see the market going down? Did your financial adviser warn you it will go down?

Just curious. Thanks.

p.s. Don't ask me what to do while it's going down. I don't know yet, and I'm not going to pretend to know.

I know, right!

I dumped all of one of my stocks last week and took the puny $240 per share profit.

Really sucks! Back in October it was at $747!

If I knew back in October this stock was going to free fall in the past appx. 2 months, I would had dumped it back then and made my $528 per share profit.

I have a stock right now that's at $8 below what I paid for that I am pretty much stuck with and it doesn't seem like it's going to go back up to what I paid for.

If I sell I will take a big loss beyond what capital investment tax laws allows me to claim as loss per tax year.

Yeah I know the feeling of getting stuck. Painful thing last year was that I was rooting for the August drop (somewhere in August IIRC) but was too busy with something that I literally forgot my portfolio when all hell broke loose.

Got stuck with IBM, TWX and others in the red. Got used to that (callousness through experience lol). Missed an entry point back then cause I was also a bit busy.

In my case though I took profits in December most if not all the greens I have.

That stock I have that's $8 below what I paid for, I should had dumped it when it dropped to as low as $1 over what I paid for and taken the $1 per share profit.

But like you I was busy with other stuff and it just flew by me thinking it will go back up again and once it reached $5 per share over, I would sell.

I'm the worst kind of investor there is, except not investing at all. I put all of my money into several mutual funds. One was doing absolutely great for a long time, and I've got about a 25% return so far, although that's taken a bit of a hit with the market going down now, and when it dumped a few months ago.

I'm in a position where I won't need to touch those funds for several years at least, so I try to remind myself that over the long term, I'm going to be fine and can ride out these ripples. If we have a true crash, though, I'm screwed.

Regardless, I'm not of a mind to take a loss over this current drop. I'll wait it out and see what happens.

But NO, I didn't see this drop coming.

wait a wee bit and it will be a good time to buy.

I recently cashed out my stocks. All of it that I had in equities. I just wish I had done it earlier.

No, my financial advisor did not warn me the downturn was coming. In fact he resisted my withdrawing my investments. Wanted me to keep it all and ride out the turbulence. Gave me the whole "over time stocks rise... you can't time the market by getting in and out.... how will you know when it is the bottom and get back in.... etc" . I had to be clear and insistent to cash it in. I told him I expected to see the market drop 20% or more in the next six months. I told him that everything I read shows very weak conditions. I added that there is more political turmoil coming that will drive the market lower. Told him that the hopes on emerging markets, BRIC, had ended and they were tanking. He kept telling me I was making a mistake. It is in his interest that I stay invested. That is where his commissions come from.

I guess I'll find out whether I was right or he was.

It has gone down a good bit since then. I expect more. My current thinking is that when the DOW hits 14,000 then I'll assess getting back in.


I hope nobody got into oil a year ago when people where saying it looked like it was a good time to buy. It has plunged since then.

whoever is right, you did your due diligence and acted on what you think is best. Actually, I added the question about financial advisors because I had a feeling that they won't even if they knew something was brewing. My father and I experienced that with an INternational Bank with all their supposed international experts.

About the oil, this is just my opinion (hopefully doesn't get to PWEC but will try to contain it)
I remember a conference where they promoted fracking as the new thing and immune to the oil downturn. Well, there are articles saying that it's also vulnerable. These banks and their advisors have their own agendas.

Back to my opinion. I think the low oil prices are there to kill off U.S. oil companies including the fracking. IMO once enough U.S. companies are killed off OPEC or whatever is behind the prices will start controlling/jacking it up again.

Not to mention Iran flooding the market after the sanctions.

I have one investment in oil because I'm an adventurous idiot sometimes. For example, I knew that the market is going down but my decision was to ride it out 50%. Sometimes I shake my head and just like my teacher in college shook his at me, "Hey, you knew! Why did you still do this?"

Financial Advisors never look out for your best financial interests.

As long as you keep your account open with them, they make money like commissions and such, don't they?

Now with E-Trade and AmeriTrade and ScottTrade, etc anyone can buy and sell stock at will on their own without needing a license or without needing a stockbroker or financial advisors.

I used to trade stocks. On 3-14-2014 I told everyone to:



You'll notice that the thing has quad-rupled since I posted this. If you have some cash, this might be a good time to get in before the next quad-druple-ing.

This decline is mostly in response to the rise in interest rates and the massive decline of oil.

The era of "easy money" is quickly ending.

I did buy Facebook. In 2012 when it bottomed out at $17.83.

remember the markets are a GLOBAL phenom now and does not reflect America in general like the used to.

The markets are indeed global but what happened when the Fed finally increased interest rates? Almost every other major country followed suit.

Oil of course is most definitely an international commodity and it is well beyond the control of any one country or national leader.

the global economy is hurting right now, there are only a few nations with sound markets and sound economic practices (i.e. heavy in renewable natural resources, heavy in manufacturing, stable tourism base etc.)

i don't pretend to know when the market's going to drop out like it has recently, but i think that watching the yuan and the chinese markets crash repeatedly since last year was a pretty good indicator of things to come.

Markets go up and down, sometimes more, sometimes less. But it always goes up in the long term. If you invest in sound business, then you'll be financially sound as well. When things start to take a turn for the worse, it's odd how people suddenly tend to forget that what their investing in is a company. If it's a sound company, it won't suddenly disappear, it'll be around, and you'll be fine.

The thing is to have the capital (and liquidity) to survive the long mood swings of the market. That is a lot easier if you are wealthy.

+1


The problem is the "day trader" mentality of many investors and how that is encouraged to a large extent by Wall Street.

With the recent global financial problem this just plays in my head over and over:

Nirvana playing a David Bowie cover (superb):

https://youtu.be/fregObNcHC8


or

You can choose the original "Babylon 5" version by Bowie himself:

https://youtu.be/eL-aV556HzE

I would say that emotion is really hard to fight for people doing this with their own money. Most of the other 50% of my portfolio are classified as defensive stocks and are companies that aren't going to just disappear.

Brain says stay put but I don't want to deal with a full head on drop like in August emotionally so I decided to off the 50% last December. Truth be told, I forgot my portfolio during that drop (August) and after a few months when the market partially recovered, it was fine.

I keep telling myself I set aside the 50% for exactly this moment but it's no comfort even if the other half is less volatile than the Dow, SP500 and NASDAQ (reason why it's defeating them all when the drop occurred). The only comfort though is I didn't have to do anything during the "chaos" because it was already set up last December. Again, it's #%&*$# hard not to feel anything

Mentality is also part of it. For some stupid reason I really can't get into tech stocks and that cut my potential returns a lot (Admittedly took some gains with AAPL but never went back in. Also took my profit with MSFT).

For my tax-deferred retirement accounts, I can sell funds at any time without much in terms of penalties. However, for those that aren't, it's a tougher decision. I've held some stocks for a very long time and the profits from them would really incur some nasty levels of capital gains taxes. Unless I suspect a major drop in the value, I just hedge my bets by shorting in those cases. Even in the worst scenarios, I can just sell to cover.

So far...the strategy has worked fairly well. I'm pretty cash-heavy at the moment and hedged against losses. The really worrisome thing about the current situation is that we're in uncharted waters with so many powerhouses of the global economy running into trouble at the same time.

https://www.caseyresearch.com/articles/o...016-stock-crash

Yeah, crash predictions are a dime a dozen...

Think of it another way. Analyst predicts Microsoft Business crash in 2016. Analyst predicts Intel to lose all their assets in 2016. Analyst predicts Apple to suddenly falter and become a penny stock in 2016.

Essentially this is what they are predicting, or at least the way it's received by the emotional masses. If I see a "crash" I'm thinking buying opportunity. Even in a car crash, someone is making money, and that's the auto body repair company. Just make sure you're in a position to be they guy to fix it.

Another big 500-600 points tumble so far today.

The DOW needs to be around 15000 to be stable. Think of the markets like the temp of your home. 80 degrees too hot, 60 degrees too cold, 70 just right. We've been running the heat at 90 degrees. The natural reduction in heat output via a sell-off is much needed.

My invested 50% did took a hit but not as bad as I was expecting. There are still gains that I haven't realized yet in there.

It's at 15,700+. So when it reaches 15,000 it will stop?

Imo, the markets have been oversold and too high for years. Companies stock prices that are 4 and 5 times value or even higher have never made sense to me...


Wheels

One of my stock just went to about 70 cents over what I paid for today after hours.

Tomorrow I will sell them.

It was at $114 a year ago. I should had sold them if I knew then what I know now.

Been there. We all wish for that crystal ball but for some reason it always fails us...
Hope you can get out without losing any money.


Wheels

That stock I was talking about is now at $2.65 over what I paid for.

All this time of lately it has been at $2-$5 below what I paid and just sitting there being sluggish.

I am selling all and taking my $2.65 per share profit while I still can.

Nothing goes up forever, or expands infinite. Can you say 'derivatives' nuclear weapon of financial destruction. Plenty of sound companies went under in previous depressions, debt never just disappears.

A friend of mine working for a company selling derivatives hates some of their products. From his perspective it's a "nuclear weapon" to common investors.

Actually expecting another drop after the so-called rally last Friday. I need to go for the record though that I have never, ever successfully predicted or "sensed" when the market will go back up.

TBH, years on the stock market have taken their toll on me and I'm really tired of reacting to the ups and downs.

I vote for Oselisan to be the official SimHq Financial Adviser!

That's a fallacy. Wealth is never lost, it is only transferred. Sound companies never just go out of business. A sound business means that it continues to adapt to market conditions. General Electric is about as long lasting as one could want. I'm proud to tell you that "we've" owned GE since 1950's. There's nothing since 1950 that has caused "us" to ever doubt the long term sound business practice of GE.

And to answer the previous, 15000 is where the DOW needs to hang around and stabilize. In other words, it begins to build a foundation of trades at that level. That could mean 14000 to 16000 as a target for stabilization. once stabilized, it can then continue back to 17000 and then 20000.

One of the reasons we do not recommended selling is that invariably people get the sale and repurchase timings incorrect because nobody can predict the top and bottom of the markets.

The switch or surrender of investments are usually done when a fund is not performing in line with the sector, or a client's attitude to risk and loss. The aim is usually to meet the attitude to risk and recommend funds or shares in line with their requirements and risk.

If the aim is to fund for income in retirement then your adviser is correct as it is usually wiser to 'ride the storm' than try to second guess the markets, that's the job of the fund manager or portfolio manager to rebalance the holdings.

The trouble is that yes we get paid adviser charges or commission from your holdings but also everything we do has to be accounted for and 99.99% of transactions done via a financial adviser must be advised. Client insistence or execution only transactions can not be allowed to happen too often otherwise it can be seen that we are not doing our job and basically trying to pass future bucks and not performing the necessary due diligence for our clients. We must provide the correct advice and provide evidence as such before any instruction contrary to this advice can be accepted.

I don't think that would be healthy for me with this type of market (late cycle?).

It's difficult especially if it's for a friend and in an informal way. For example, I no longer have DIS stock (got out with 50%+ profits) but the reason I'm still following DIS up to now is because my friend didn't heed my advice when I told him to get out the moment the opportunity presented itself. He entered at a fairly high price last year. It was a bit difficult to break it to him that there's a possibility things could get worse for DIS when the earnings report come in.

Just remembered an adviser who complained and told me how her clients cursed her over the phone when the markets went down.

Best time to be an adviser is during a bull market when everyone appears to be a genius.

Sure hope some of you took my advice on FB. $127 per share. More than quadrupled now.

Not a derail intended comment, but...

Oselisan, have you ever considered the foreign exchange market as an alternative to stocks? I dumped all my stock (managed by UBS) years ago. Since then I've had a friend manage an account on the foreign exchange market. He's consistently accomplished 1-2.5% returns per month. Every single month for the last 5 five years. I'm not qualified to do this nor willing to be up in the middle of the night when the London market is open, but my friend is a pro. Surely others can do this too?...