ochotona wrote: ↑Thu Mar 26, 2020 8:04 am
Bogglyhead panic build... forum titles. Everyone has a plan until they get stabbed.
Have we hit bottom? Time to buy?
Selling 100% stocks on a bounce
Why isn't this time different?
Do ppl who rebalance annually do anything different in this type of market?
Why not stand on the sidelines for a little while?
Bought Vanguard Total Stock market 2 weeks ago, now ready to sell, how do I do this?
Get out now or ride it out?
How much you lost/gain since Feb 20,2020 ?
The Black Swan is Here
VTI dividend drop
Dumping small value?
Any Retirees With AA = 100% Equities?
Guys I Rebalanced (Moved Monies Out Of S&P 500)
When to jump back in?
We have a little bit of that, too.
9pm EST Explosions in Iran (Isfahan) and Syria and Iraq. Not yet confirmed.
ochotona wrote: ↑Thu Mar 26, 2020 8:04 am
Bogglyhead panic build... forum titles. Everyone has a plan until they get stabbed.
Have we hit bottom? Time to buy?
Selling 100% stocks on a bounce
Why isn't this time different?
Do ppl who rebalance annually do anything different in this type of market?
Why not stand on the sidelines for a little while?
Bought Vanguard Total Stock market 2 weeks ago, now ready to sell, how do I do this?
Get out now or ride it out?
How much you lost/gain since Feb 20,2020 ?
The Black Swan is Here
VTI dividend drop
Dumping small value?
Any Retirees With AA = 100% Equities?
Guys I Rebalanced (Moved Monies Out Of S&P 500)
When to jump back in?
We have a little bit of that, too.
I have not subscribed to BH.
So will someone let me know when they see this.
"I have Sold ALL my Stocks and Bonds and went totally to Cash."
Now I see they are going to devalue the Currency
Smith1776 wrote: ↑Sat Mar 28, 2020 9:11 pm
lmao my favourite one is "Guys I Rebalanced (Moved Monies Out Of S&P 500)." How TF does that constitute rebalancing? That's the opposite of rebalancing. It's capitulation.
Apparently as long as you have an “asset allocation,” you get to keep your Boglehead card — even if you time the market by dynamically shifting your asset allocation around.
Lots of people on this forum do the same thing. I'm one of them in the sense that I shifted from the PP to a GB thinking that "prosperity" is likely to dominate, so overweighting stocks would be better in the long run.
However, we are on average much happier and less tempted to market-time than your average 100% stocks investor...geez, those guys must be REALLY crying into their soup. Can't say they weren't warned though.
I really respect David Grabiner over there. He's 100% stocks and some of those stocks are extra risky. He seems...ok. But he's definitely in the minority and he never recommends his portfolio to anyone else.
9pm EST Explosions in Iran (Isfahan) and Syria and Iraq. Not yet confirmed.
Smith1776 wrote: ↑Sat Mar 28, 2020 9:11 pm
lmao my favourite one is "Guys I Rebalanced (Moved Monies Out Of S&P 500)." How TF does that constitute rebalancing? That's the opposite of rebalancing. It's capitulation.
Apparently as long as you have an “asset allocation,” you get to keep your Boglehead card — even if you time the market by dynamically shifting your asset allocation around.
Lots of people on this forum do the same thing. I'm one of them in the sense that I shifted from the PP to a GB thinking that "prosperity" is likely to dominate, so overweighting stocks would be better in the long run.
However, we are on average much happier and less tempted to market-time than your average 100% stocks investor...geez, those guys must be REALLY crying into their soup. Can't say they weren't warned though.
I saw some 100% stocks investors on Bogleheads say they were salivating at all of the bargains.
Since by definition they can't have any cash, I suggested they use leverage.
Smith1776 wrote: ↑Sat Mar 28, 2020 9:11 pm
lmao my favourite one is "Guys I Rebalanced (Moved Monies Out Of S&P 500)." How TF does that constitute rebalancing? That's the opposite of rebalancing. It's capitulation.
Apparently as long as you have an “asset allocation,” you get to keep your Boglehead card — even if you time the market by dynamically shifting your asset allocation around.
Lots of people on this forum do the same thing. I'm one of them in the sense that I shifted from the PP to a GB thinking that "prosperity" is likely to dominate, so overweighting stocks would be better in the long run.
However, we are on average much happier and less tempted to market-time than your average 100% stocks investor...geez, those guys must be REALLY crying into their soup. Can't say they weren't warned though.
My GF has her entire 401k (read: life savings) in a S&P 500 fund. I've been telling her for 2 years she ought to diversify into some LTT, but she ignored my advice. Her retirement date is gonna get pushed out by years, unless she can find some rich guy to marry. Any of you guys interested? She's really cute.
If you don't rebalance out of gold in the next year or two, maybe she could marry you.
Smith1776 wrote: ↑Sat Mar 28, 2020 9:11 pm
lmao my favourite one is "Guys I Rebalanced (Moved Monies Out Of S&P 500)." How TF does that constitute rebalancing? That's the opposite of rebalancing. It's capitulation.
Apparently as long as you have an “asset allocation,” you get to keep your Boglehead card — even if you time the market by dynamically shifting your asset allocation around.
Lots of people on this forum do the same thing. I'm one of them in the sense that I shifted from the PP to a GB thinking that "prosperity" is likely to dominate, so overweighting stocks would be better in the long run.
However, we are on average much happier and less tempted to market-time than your average 100% stocks investor...geez, those guys must be REALLY crying into their soup. Can't say they weren't warned though.
My GF has her entire 401k (read: life savings) in a S&P 500 fund. I've been telling her for 2 years she ought to diversify into some LTT, but she ignored my advice. Her retirement date is gonna get pushed out by years, unless she can find some rich guy to marry. Any of you guys interested? She's really cute.
If you don't rebalance out of gold in the next year or two, maybe she could marry you.
Nope, my point was that if someone was going to marry her, it wasn't going to be me. To be fair, she knew this going in.
ochotona wrote: ↑Wed Apr 01, 2020 3:53 pm
This stock market is just so argggh and I hardly own any. It's just so much foreboding about jobs and all.
Yeah stocks are drunk. We are still in the bad economic news is good news regime. 6M+ unemployment claims in the last week, with the 3M+ last week we now have more unemployment claims in the last 2 weeks than we had the entire financial crisis... and stocks are rallying today. Of course they are still in their down trend, I'm still bearish in the short term. But yeah, basically, when volatility is high like this the big league pitching thrown by markets is very hard to hit on a day by day basis.
I think we at the very least need to retest that 2350 area. I only see that holding if data somehow takes an unexpected turn for the better. I'm currently thinking we are most probable to bottom in the 1900-2100 range. If we lose that area, worst case scenario is the 2000 and 2007 highs of around 1550. If we reach that 1550 level I'm buying as many LEAP's as I can afford, haha. That's my back the freaking truck up number. That would be a once in a lifetime kind of opportunity. Because it would be so good, I think it's too good to be true, so I see the 1900-2100 as the most probable bottom given the info I have at the moment. But yeah, the day to day moves make no sense sometimes.
ochotona wrote: ↑Thu Apr 02, 2020 10:41 am
PM, other than the option expiring worthless, is there any other risk associated with LEAPS?
Not really, so long as you sell before time decay becomes an issue. I would likely sell with about 3-6 months left for that reason and either roll them or keep profits. I mean, there is always the risk the market goes down and you take a loss (capped at purchase price)... but I do not see a realistic scenario at the moment where the S&P could go much lower than 1550. If we did go lower than 1550... it would be the type of scenario where losing money on your options would be the least of your worries.
pmward wrote: ↑Thu Apr 02, 2020 10:45 am
If we did go lower than 1550... it would be the type of scenario where losing money on your options would be the least of your worries.
Hussman's got his bug in my ear, so I'm thinking 1100. Then there's always Nenner... Dow 5000. Maybe instead of bottom picking I'll use leverage when I get a risk-on signal. Paul Novell actually has model portfolio involving 2x and 3x QQQ and SPY, and 3X TLT. They are 40% and 50% CAGR, and bone-burning volatility!!!
I can't even tell you how many back up the truck Leaps I have bought in the past, esp. on GLD and SLV.
Can't lose. Really. Can't lose. Uh huh.
I understand where you are coming from but I envision this for your situation: We hit your 1550, you buy Leaps when volatility is still high. Maybe 1-2 years out expiration. We then settle in a range for months, carving out a U bottom. People either don't have money or don't want to spend money for a long time after this.
Volatility drops. Your options are in the red. Time decay sets in as well. You sell just to save a bigger loss or roll and hope. The once in a lifetime opportunity becomes an ehhh.
Just my general experience!
Being about 2% down YTD, I have thought of selling everything and going into CDs for an undetermined amount of time. But the issue for me is I would likely never get back in for years. So I see no option other than staying the course and rebalancing.
Cortopassi wrote: ↑Thu Apr 02, 2020 11:08 am
I can't even tell you how many back up the truck Leaps I have bought in the past, esp. on GLD and SLV.
Can't lose. Really. Can't lose. Uh huh.
I understand where you are coming from but I envision this for your situation: We hit your 1550, you buy Leaps when volatility is still high. Maybe 1-2 years out expiration. We then settle in a range for months, carving out a U bottom. People either don't have money or don't want to spend money for a long time after this.
Volatility drops. Your options are in the red. Time decay sets in as well. You sell just to save a bigger loss or roll and hope. The once in a lifetime opportunity becomes an ehhh.
Just my general experience!
Being about 2% down YTD, I have thought of selling everything and going into CDs for an undetermined amount of time. But the issue for me is I would likely never get back in for years. So I see no option other than staying the course and rebalancing.
Everything about this is correct. When you do go to buy the leaps, the volatility premium will be extraordinarily high. They will not be a "deal". They will be fairly priced. Meaning a crap-shoot on whether you come out ahead or not.
ochotona wrote: ↑Thu Apr 02, 2020 10:41 am
PM, other than the option expiring worthless, is there any other risk associated with LEAPS?
Nope, that's it. As long as you are long the leaps, and not short, your maximum risk is your purchase price.
Assuming you sell before they expire, anyway.
If you hold to expiry, you end up with a long position in the underlying that you probably don't want.
You only end up long if the leaps expire in the money - and then you can immediately close your position for a profit. A lot of brokers will close the position for you automatically and you never end up holding the underlying stock. So no risk at all. If the options expire out of the money you end up with nothing, including no added exposure.
pmward wrote: ↑Thu Apr 02, 2020 10:45 am
If we did go lower than 1550... it would be the type of scenario where losing money on your options would be the least of your worries.
Hussman's got his bug in my ear, so I'm thinking 1100. Then there's always Nenner... Dow 5000. Maybe instead of bottom picking I'll use leverage when I get a risk-on signal. Paul Novell actually has model portfolio involving 2x and 3x QQQ and SPY, and 3X TLT. They are 40% and 50% CAGR, and bone-burning volatility!!!
The only way we go to 1100 is if the entire financial system melts down. I see no evidence yet to even consider this scenario. My mind may change with emerging info, but at the moment the way things are playing out 1900-2100 looks like the most likely bottom. If you wait for a for sure, can't miss "risk on signal" you would be buying back in higher than we are today. The problem is early signals are not reliable, and reliable signals are too late. I personally plan to start scaling in little by little instead of trying to find the perfect bottom. I may even start dabbling a little bit around 2350 depending on what the trends in price action and active cases are looking like at that time. But I would not even consider leverage until we are at least in the 1900 range.
Also, be careful of levered ETF's. The time decay factor in them is huge. I personally have a rule to never hold those overnight as the gap risk is too large. And holding for more than a week or two is silly. Those ETF's always lose in the long run due to the way they are structured. And their 2x or 3x is only setup to be intraday, they rebalance every night, so anything more than an intraday hold is not really 2x or 3x.
ochotona wrote: ↑Thu Apr 02, 2020 10:41 am
PM, other than the option expiring worthless, is there any other risk associated with LEAPS?
Nope, that's it. As long as you are long the leaps, and not short, your maximum risk is your purchase price.
Assuming you sell before they expire, anyway.
If you hold to expiry, you end up with a long position in the underlying that you probably don't want.
You only end up long if the leaps expire in the money - and then you can immediately close your position for a profit. A lot of brokers will close the position for you automatically and you never end up holding the underlying stock. So no risk at all. If the options expire out of the money you end up with nothing, including no added exposure.
Yes, I meant to say "if they expire in the money". If brokers will close it for you automatically, that is different from my experience with commodity options, which will leave you with a position if they expire in the money.
pmward wrote: ↑Thu Apr 02, 2020 11:47 am
Also, be careful of levered ETF's. The time decay factor in them is huge. I personally have a rule to never hold those overnight as the gap risk is too large. And holding for more than a week or two is silly. Those ETF's always lose in the long run due to the way they are structured. And their 2x or 3x is only setup to be intraday, they rebalance every night, so anything more than an intraday hold is not really 2x or 3x.
My remarks were kind of in jest. Those vehicles are dangerous. Reading the prospecti just makes me... brrrr...
From Fidelity - "Buyers and sellers of LEAPS should consider the implications of Greeks.* Vega (an option price’s sensitivity for a given change in implied volatility) can be much higher for LEAPS. If you are thinking about buying LEAPS, you may want to do so when implied volatility is relatively low. Also, rho (an options’ sensitivity to a change in interest rates) can be important."
So buy a LEAP when VIX has quieted down substantially, when we're stable at whatever low or negative rate we end up at, and people are basically just lying on the floor bleeding out and whimpering?
