"Herd" mentality

[Evolved1]

I was thinking of posting this in the "General Markets Talk" thread, but then I saw an individual posting in a wanky manner, using all sorts of stock market verbiage to make himself seem important (the same poster who is reviled on his own footy club board for being a deluded w***er). So, on that basis, you'll just have to put up with me posting my thoughts in a separate thread, because I'd rather not have my opinions associated with said w***er.

So ..... I read all these articles with all of these so-called stock market experts cautioning against the "herd mentality" when it comes to selling all your stocks given the panic (unjustified IMO, but my personal opinion counts for naught when it comes to public sentiment) surrounding COVID-19. They advise that selling all of your stocks will lump you in with the "herd". Now, given that all these "experts" are advising AGAINST selling all of your stocks, wouldn't that make all of these so-called "experts" who advocate holding on to your stocks part of the "herd"? I mean, I have almost literally NOT read a single "expert" advocating that you sell ALL of your stock given the current market uncertainty. Seriously, WHERE ARE THEY?! (if for nothing else, than for some diversity of opinion). So, if you hold on to your stocks, are you not part of the "herd"? Something to think about.

I mean, if you had listened to all of these "experts", your net worth would have already decreased by a not-so-insignificant percentage. Yeah, yeah, yeah, I know, given enough time the stock market will adjust back to (or higher than) current levels. But this is just so ******* stupid. If you KNOW that the market is going to tank (in the short term, at least) with the uncertainty surrounding COVID-19, wouldn't you be better off backing out and putting that money elsewhere, like a guaranteed fixed percentage return, before re-investing when the stock market is on the uptick? How long are you prepared to wait to recoup your losses? 1, 2, 5, 10, 15 years? YES, of course, given enough time, it will return to its current average. But, if you can avoid it, why bother? Seriously, it's so stupid. fu** all these "experts", man. "Take a loss now, you'll make it back eventually." LOL!

Oh, I know, but you are all short-term fortune tellers, able to predict the future (like this wanky poster in the GMT thread bragging about how cool he is in the current market) who is able to profit even in a bear market. If that is the case, go for your life!

Disclaimer 1: Yes, my net worth did take a very slight hit. But not to the extent of the "herd" who listened to all of these stupid "experts" telling them to do nothing. Sucks to be you. But it's not too late to back out now.

Disclaimer 2: This could be the very FIRST commentary advising you to BACK OUT of the stock marketer before it gets worse. Who's part of the "herd" now? Think it about it!

Disclaimer 3: Do not take financial advice from a poster on an internet footy forum.

I trade using technical analysis and market sentiment. I find market sentiment a more reliable indicator.

The herd are always being played in every area of life.

 

[Kram]

there is no doubt being liquid is easier when you have a balanced portfolio and one can "reserve" funds in liquid positions

there is also a benefit to being young with no kids, regular income and savings as you can go harder in tough markets than someone in the exact opposite position in life. That's why I recommend building wealth from the age of 5 years old.

For kids uncles and parents should say to kids, here is you birthday and christmas money...........but it goes into the bank. Anything you have in the bank at the years end, we'll match it dollar for dollar. $100 for birthday and $100 for Christmas (from the entire family) and then doubled at years end is a pretty handsome start for a 5yo.

Then instead of leaving money in the banks generating 0% interest, buy bank stocks (in a family trust which costs $0 to set up) and get 7.5% dividend yield. Banks are highly liquid and easy to get out of.

Every 7 years or so, there is a correction. The markets were toppy late last year, so selling out of growth stocks made sense and all we had to do was wait for a reason for a correction........even if that was just the US election. Covid was a surprise not many saw coming but from a financial markets point of view, Covid was a non-event but we all knew the damage governments would do.

For me I set myself a rule of buying around $100k a fortnight on bank stocks and then wait for the day my heart sank. That was the 18th of March and that's when bought up hard putting in $500k in a single day.

The easy to pick winners were Myer (350+% returns), VRL (200+%) and qantas (100%). Then from there you then go down into the distressed stocks doing capital raises and companies like MXR offered 300% returns this fortnight.



There is always opportunity and loads more in bad times than good times

Have you looked up to the sky yet, thanked the lord and taken the money and run on MYR yet?

Only buys I made during the crash was more OGC and take part in 4 cap raises. Did put a bid in for SAR on the 23rd of March but it fell a few cents short and started flying up the next day..

 

[Power Raid]

Have you looked up to the sky yet, thanked the lord and taken the money and run on MYR yet?

Only buys I made during the crash was more OGC and take part in 4 cap raises. Did put a bid in for SAR on the 23rd of March but it fell a few cents short and started flying up the next day..

I'm out of everything in my personal portfolio other than circa 10% of what I normally hold in banks. I'm on the side lines waiting to see what happens in the US and also watching for tax selling in June. If the riots continue this will present a buying opportunity.

We also have London holiday in August/ September which traditionally put downward pressure during those months. We also have the US elections. All of this on the back of corona, low growth and massive government debt.

That said MYR is one I will keep an eye on, as I can see that going OK despite the online push. I nearly bought back in today but felt they could go lower.


Your decision to back gold was probably rewarding. I'm thinking gas might be a not bad punt soon.



Property is a decent punt from here buy picking up sub-dividable lots. With the last grant, 50-85% returns pa was the range in suburbs like Aubin Grove and Canningvale.

 

[Evolved1]

Do any of you ladies and gents trade forex or cryptocurrencies?