Stock market correction or bear market/crash? Either way I bailed.

Sarenco said:
The real (inflation adjusted) annualised total return (with dividends reinvested) of the S&P500 from the start of 1999 to the start of this month was ~3.33%. That's actually quite a bit lower than the (real) annualised return of the S&P since its inception.

That's not to suggest that I have the slightest idea what's going to happen to stock prices in the future. I treat all predictions of future corrections or returns with the same degree of scepticism.

When it comes to the future, nobody knows nothin'!
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i have no clue whatsoever if markets will keep rising but i dont think a trebling of the market since a specific date ( march 6th 2009 ) means a single thing when assessing it

been looking over historical prices of the S+P going back to the nineteenth century , the low reached in the great depression era of 1933 had not been visited in nearly forty years , had the same thing happened in the past decade , the market would have went back to levels not seen since the late seventies

i find that fascinating
 
galway_blow_in said:
anyone who invested in the year 1999 or early 2000 would have expected to be where things are right now , i realise the gains in the nineties were exceptional but the trebling since march 2009 has to be looked at in context i think , that low had been last reached in the last quarter of 1996 which shows how bad things were in 2008 - 2009

if you look at the european markets bar germany , you would have done better leaving your money in savings since the end of the nineties , with regards europe , its incredibly overdue a long sustained bull market , europe is still below where it was in may of 2015 , the rising euro now looks like it might keep a lid on gains , japan is doing well but the yen is falling against the euro so no real benefit to owning japanese markets by the looks of things , shows how important currency is
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i agree with your analysis with regard to europe it is long overdue a sustained bull market, therefore I think it is a good idea to invest more in europe and less in US market and I think this is what is happening now. Also we have had a very turbulent period in stock markets since 1999, but the period 1980 to 2000 was fairly calm with steady increases. Maybe we are back in such a period again after all the turmoil. People tend to put more emphasis on the events they have just experienced thinking that this is going to repeat and much less on events that may have happened in the distant past, this is always a mistake.
 
I know this is an old thread but it is interesting nonetheless because it started in the stock market correction and then panic at the beginning of 2016. Its interesting that this period has been largely forgotten about now but it was a real fear in those first few weeks of 2016, I myself was scared because I did not know what was happening and why there was this panic. At this stage I have weathered 3 big panics, the 2002 crash, the 2008 financial collapse and then the 2015/2016 mini panic. In 2002 I had very little invested so not a big issue, in 2008 I actually gained from in following years, however 2016 was a big thing for me probably because I now had much more invested and was watching big sums being wiped from my investments daily and did not know why it was happening. Anyone else any thoughts and whats in store for coming years.
 
joe sod said:
I know this is an old thread but it is interesting nonetheless because it started in the stock market correction and then panic at the beginning of 2016. Its interesting that this period has been largely forgotten about now but it was a real fear in those first few weeks of 2016, I myself was scared because I did not know what was happening and why there was this panic. At this stage I have weathered 3 big panics, the 2002 crash, the 2008 financial collapse and then the 2015/2016 mini panic. In 2002 I had very little invested so not a big issue, in 2008 I actually gained from in following years, however 2016 was a big thing for me probably because I now had much more invested and was watching big sums being wiped from my investments daily and did not know why it was happening. Anyone else any thoughts and whats in store for coming years.
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bank of america has trebled in value since the low it reached in february 2016 , financials and energy were the big winners this past two years , both seem likely to continue to do well under a trump presidency as both really done nothing for years since the crash , i know they were at deaths door in early 2009 but valuations were very low as recent as eighteen months ago

interesting to see if european financials might too have a good run in the next few years , they have a lot less going for them of course
 
Hi joe

No one knows.

Those who bailed out a year ago may well be regretting it now, but they could end up delighted with their decision if there is a big crash in the next year or two.

It seems to me that stock market prices are too high. But what can I do about it? Sell off my portfolio and pay a lot of CGT?


Where do I put the proceeds in the meantime? Irish property? Bank deposits?

When would I buy in again?

To time the stockmarket you have to be right twice. You have to sell at the top and buy back in again at the bottom. I have had no success in doing that in the past.

If you invest in the stock market for the long term, it's best to brace yourself for the inevitable big crashes and big gains.

Brendan
 
Looking at some earlier posts here, offering advice and the mistakes, my experience in investing has been financially bad, got wiped out on a few stocks. My saving grace was that we sold our house pretty much at peak market prices in March 2008 and realised a tidy profit (this was luck, not strategy). The experience I believe has left me with an acute sense of following my own instincts rather than the advice of experts.
Notwithstanding that expert advice is of course to be taken on board, the point is to sound out as much expert advice as possible, the pro's and con's. Once its a case of two experts disagreeing, then you really need to pay attention to what is happening in your part of the world, or at least in the part of the world, or industry sector etc, where your investment will be producing its bread and butter.

I have small stock holdings now, food producing companies mostly, some goldmoney.com and some crypto.
Im a bear on the whole QE scheme. My understanding is that in a normal functioning monetary system as one asset class rises it can act as a draw of wealth from another asset class e.g. if stocks are falling, gold, art, may see rises as they can act as 'safe havens'.
What we have today is rising stocks, bonds, property, art & antiques etc, and even the emergence of cryptocurrency.
This is all on the back of very modest global growth. Coupled with rising political tensions, possible oil hikes, an increasingly unstable trade environment (Brexit, Trump = economic war?) someone is going to lose out big at some point, sooner rather than later. What the rammifications will be I dont know - lets hope its a speed bump. But history would probably indicate otherwise.
 
TheBigShort said:
my experience in investing has been financially bad, got wiped out on a few stocks. My saving grace was that we sold our house pretty much at peak market prices in March 2008 and realised a tidy profit (this was luck, not strategy). The experience I believe has left me with an acute sense of following my own instincts rather than the advice of experts.
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I don't follow that.

You got wiped out on a few stocks which you chose yourself - presumably by following your own instincts?
The only profit you made was due to luck - not strategy.

But you rely on your own instincts?

It seems that luck has rescued you from your instincts and you should aim to be lucky rather than rely on your instincts.

Brendan
 
TheBigShort said:
What we have today is rising stocks, bonds, property, art & antiques etc, and even the emergence of cryptocurrency.
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This is because interest rates are low, inflation expectations are low.

Art, antiques, gold, provide no yield. This hardly matters when interest rates are low as then deposits also provide no yield.

Bonds provide a known yield, when interest rates rise bond prices will fall creating a higher yield.

It costs more to hold shares when interest rates rise, this is true of all shares. Some shares benefit as a hedge against inflation, some suffer from a slowing economy. Who knows what the aggregate response of shares is.

Property, now that is a different matter.
 
Brendan Burgess said:
You got wiped out on a few stocks which you chose yourself - presumably by following your own instincts?
The only profit you made was due to luck - not strategy.
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To clarify, the stocks I got wiped on was from following the advice of others, and not using my own instincts. Hence;

TheBigShort said:
The experience I believe has left me with an acute sense of following my own instincts rather than the advice of experts.
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Apologies if I didnt convey that properly.
 
cremeegg said:
This is because interest rates are low, inflation expectations are low.

Art, antiques, gold, provide no yield. This hardly matters when interest rates are low as then deposits also provide no yield.

Bonds provide a known yield, when interest rates rise bond prices will fall creating a higher yield.

It costs more to hold shares when interest rates rise, this is true of all shares. Some shares benefit as a hedge against inflation, some suffer from a slowing economy. Who knows what the aggregate response of shares is.

Property, now that is a different matter.
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Thks cremegg, I get all that. But all my indicators are telling me all is not well in economic theory land.
 
TheBigShort said:
the stocks I got wiped on was from following the advice of others, and not using my own instincts
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OK, that makes sense now.

The stock market is efficient. With a few rare exceptions like Warren Buffet, people can't beat it. So this is one area where you can ignore the experts - stock brokers, journalists and investment managers. If you want to invest in the stock market, buy a fund or a portfolio of diversified shares.

For example, this would worry me: "I have small stock holdings now, food producing companies mostly,". If the amounts are small, it doesn't matter. But if they are significant, owning a lot of one sector is not a good idea.

Brendan
 
Thanks Brendan

The sums arent insignificant (to me), but I havent bought any new stock for a few years now, so im happy to keep as is, acknowledging your advice for diversification all the same.
In fact, diversification is the aim, but on my own terms and in my own time.
I expect a market correction (at a minimum) at some point sooner or later and I have some (embryonic) ideas to focus on tech stocks outside the giant tech companies now. Lot of research work required though.
 
Speaking of instinct, I think there are several UK shares that come to mind that are cheap with good dividends of 5% plus , dividends that are well covered. I like articles done by Seeking Alpha which are very, very informative. E.G Refer to one they done on Bank Of Ireland some time ago. Sterling might be over the worst of Brexit or already built into price. The English are very resilient and if sterling falls another 5% it will bounce back. So by my reckoning at worst Sterling may fall another bit but investing in solid UK shares with strong dividends is a good idea. At least in doing this I don't think I could do any worse than deposit interest of pretty much zero, I believe I could invest in the UK shares through my daughter who has a part time UK job and studying in UK and dividend income would be below the 5k threshold and therefore no tax payable by her. This would be money I would be gifting her.
 
ive discovered in the past six months that only passive investing suits me , otherwise im constantly second guessing myself , i made some money on bmw in 2013 but wrongly thought it would go up more , made nice money on kerry and glanbia from 2009 to 2013 but that was only because my brother is a dairy farmer and i was familiar with both companies and from 2009 things could only go up , luckily i had no money in stocks at all before the crash arrived but even since then more often than not ive chosen stocks which have lagged the market , they say a relatively small percentage of any index actually drives it so the chances of beating the market are even smaller than most people think

my equity portfolio made up of two etf,s is up nearly 6% since last july when i put in a six figure plus some , it only needs to go up another 4% in the next six months for me to be more than happy

as regards instinct , mine told me last summer that energy was having a very temporary pull back and i had planned to buy two well known british energy giants , sarcenco then produced his video explaining how dividends are a fallacy so i changed my mind :cool:
 
The greatest mistake any of us make is thinking too much about the short-term with regard to our investments.

My pension fund is invested in a global equity fund. The costs are reasonable. I don’t really care whether a correction comes or not; it might even be better as my ongoing contributions will get me more units.
 
But how did you see the video Galway was it sent to you privately if not referred to on a forum ? I would agree that dividends are inferior to capital gains but I think most people investing expect both to happen really over time. Don't personally like ETFs. Very complicated as per Rory Gillen and I like things straightforward. Britain is on sale per Seeking Alpha and is being treated tough with Brexit but there are currently excellent companies that will outperform once this whole Brexit thing blows over. Think energy, insurance, utilities as examples in not naming names. They will grow dividends plus a capital gain over time. Just a case of being patient. When a market crash comes I believe many UK stocks won't fall to the same degree.
 
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