Gyroscopic Investing

Posted: **Mon Aug 24, 2015 3:24 pm**

Tyler wrote: I feel sorry for people who got hammered by stop losses this morning. Trying to get in and out of a volatile market, even semi-passively, just doesn't always work out the way you planned.

Yeah, I witnessed this happen today. A guy I share an office with owns an ungodly amount of company stock. His stop loss triggers early this morning, selling 3000 shares. Then, after agonizing about it for awhile, he decides to buy it all back, but could only buy 2500 since the price had gone up.

I just kept to myself while all this was going on, but it was a bit painful. On the one hand, I wanted to say something, offer some advice, but on the other hand I felt like it might have been out of place.

Posted: **Mon Aug 24, 2015 4:27 pm**

LC475 wrote:
buddtholomew wrote: Is anyone disputing the fact that a US-centric equity allocation outperformed (past tense) the PP over an arbitrary period of time?
Over any arbitrary period of time? Of course I would disagree with that, only because it's clearly not true. I would not actually dispute such a claim, because it's so obviously and easily verifiably not true that it's not worth my time to actively dispute it.

whatever dude. Get a life.

Posted: **Mon Aug 24, 2015 5:46 pm**

Tyler wrote:
I feel sorry for people who got hammered by stop losses this morning. Trying to get in and out of a volatile market, even semi-passively, just doesn't always work out the way you planned.

Why do you feel sorry for them? I don't have any stop losses, because I'm not going to sell any of my holdings until I'm good and ready to sell.

Posted: **Mon Aug 24, 2015 5:55 pm**

Libertarian666 wrote:I don't have any stop losses, because I'm not going to sell any of my holdings until I'm good and ready to sell.

This is definitely the correct answer. Stop losses promote bad portfolio management. I wrote about it a while ago why they're not the great idea that they seem to be:

https://web.archive.org/web/20160324133 ... portfolio/

Posted: **Mon Aug 24, 2015 7:35 pm**

Jack Jones wrote:
Tyler wrote: I feel sorry for people who got hammered by stop losses this morning. Trying to get in and out of a volatile market, even semi-passively, just doesn't always work out the way you planned.
Yeah, I witnessed this happen today. A guy I share an office with owns an ungodly amount of company stock. His stop loss triggers early this morning, selling 3000 shares. Then, after agonizing about it for awhile, he decides to buy it all back, but could only buy 2500 since the price had gone up.

I just kept to myself while all this was going on, but it was a bit painful. On the one hand, I wanted to say something, offer some advice, but on the other hand I felt like it might have been out of place.

I figured out awhile ago that it is never a good idea to offer advice on such matters. If the person loses money following your advice, they will blame you, but if they make money they probably won't thank you.

I sometimes still slip up on this. Maybe there is a 12-step program for it?

Posted: **Mon Aug 24, 2015 9:15 pm**

For anyone looking to try to outguess this violent correction please be aware that this might just be a false bottom and there could be more pain to come.

Posted: **Mon Aug 24, 2015 9:30 pm**

Reub wrote: For anyone looking to try to outguess this violent correction please be aware that this might just be a false bottom and there could be more pain to come.

So to summarize, violent bottom pain?

Posted: **Tue Aug 25, 2015 12:48 am**

Now that's gross anyway you look at it.

Posted: **Tue Aug 25, 2015 9:40 am**

And this is where I get disgusted with gold yet again. Dollar down what, like 1.5% yesterday with no rise (even a small loss) in gold. However, today, dollar up and gold getting hammered.

I guess I still expect to see it below 1000 before any meaningful rise. Seems appropriate that a dip like that would be some sort of final flush out.

Posted: **Tue Aug 25, 2015 1:00 pm**

about the best that can be said for gold the last few years is " it ain't stock "

it has no idea what it is supposed to respond to and something else beats it to the punch . it hasn't been good keeping up with inflation , it hasn't been good at following the dollar . the best we can say about it is it isn't stock and gives you a place to put money that does not follow every move stocks make

Posted: **Tue Aug 25, 2015 3:40 pm**

Cortopassi wrote: I guess I still expect to see it below 1000 before any meaningful rise.

I hope so. For a while there, I thought I had missed my chance to buy.

Posted: **Tue Aug 25, 2015 4:54 pm**

Wow, what happened!? I didn't look at the market since 1PM?! 500 point reversal down? Man.

Posted: **Tue Aug 25, 2015 5:57 pm**

Cortopassi wrote: Wow, what happened!? I didn't look at the market since 1PM?! 500 point reversal down? Man.

Sorry, guys, I looked again. If I stop looking probably everything will go up.

Posted: **Tue Aug 25, 2015 6:17 pm**

The Dragoncar Uncertainty Principle at work.

Send that man a blindfold!

Posted: **Tue Aug 25, 2015 9:28 pm**

buddtholomew wrote:
LC475 wrote:
buddtholomew wrote: Is anyone disputing the fact that a US-centric equity allocation outperformed (past tense) the PP over an arbitrary period of time?
Over any arbitrary period of time? Of course I would disagree with that, only because it's clearly not true. I would not actually dispute such a claim, because it's so obviously and easily verifiably not true that it's not worth my time to actively dispute it.
whatever dude. Get a life.

No, you get a life!

Just kidding, of course!

I will do my best to do a life.

Just do remember there are definitely times that a PP has or would have outperformed stocks, sometimes for very extended periods of time.

Posted: **Wed Aug 26, 2015 8:53 am**

Since getting in the PP in March 2014, at this moment in time I am now pretty much at 0% return for 18 months in.

I will say that I have had less stress during that time period and looked and worried about the market much less.

When we are talking the market moving 300+ points daily, it is difficult not to watch. Frustrating, at least for now!

I feel like Bluto:

https://www.youtube.com/watch?v=bjIH1jdx2_A

Posted: **Wed Aug 26, 2015 8:59 am**

Then haven't you lost money factoring in inflation?

Posted: **Wed Aug 26, 2015 9:06 am**

Nothing to see here, everything's great!

Oh yeah, 3rd day of losses in a row. Only down 70K now.

When will you guys come to your senses?

Posted: **Wed Aug 26, 2015 9:33 am**

Reub wrote: Then haven't you lost money factoring in inflation?

I suppose so. Say hi to me when I greet you at Walmart in 20 years...

Posted: **Wed Aug 26, 2015 9:45 am**

buddtholomew wrote: Nothing to see here, everything's great!

Oh yeah, 3rd day of losses in a row. Only down 70K now.

When will you guys come to your senses?

When will YOU come to your senses? It is utterly perplexing to me that you invest in a portfolio you hate and believe is broken, but refuse to exit. Face it: the PP is not for you. You prefer stocks for your long-term and can't tolerate even the smallest shred of volatility for your short-term money. You tried the PP and found it didn't suit you. No shame in admitting that.

Posted: **Wed Aug 26, 2015 9:56 am**

buddtholomew wrote: Nothing to see here, everything's great!

Oh yeah, 3rd day of losses in a row. Only down 70K now.

When will you guys come to your senses?

Come to my senses and invest in what?

Posted: **Wed Aug 26, 2015 9:57 am**

buddtholomew wrote: Nothing to see here, everything's great!

Oh yeah, 3rd day of losses in a row. Only down 70K now.

When will you guys come to your senses?

Of course I wouldn't expect you to divulge details but if you started with $1 million, that's a measly 7% drawdown, well within the range of what'd be expected from even a 100% bond portfolio. I thought you were a wealthy guy. Given the negativity I'd have expected you to be down a LOT more than $70k.

Posted: **Wed Aug 26, 2015 10:31 am**

You're going to be richer in the long run, Budd.
But, keep these posts coming anyway. I'm enjoying the avatar.

Posted: **Wed Aug 26, 2015 10:38 am**

iwealth wrote:
buddtholomew wrote: Nothing to see here, everything's great!

Oh yeah, 3rd day of losses in a row. Only down 70K now.

When will you guys come to your senses?
Of course I wouldn't expect you to divulge details but if you started with $1 million, that's a measly 7% drawdown, well within the range of what'd be expected from even a 100% bond portfolio. I thought you were a wealthy guy. Given the negativity I'd have expected you to be down a LOT more than $70k.

Typo, 7K and I'm speaking about today only.

Posted: **Wed Aug 26, 2015 12:16 pm**

Pointedstick wrote:
buddtholomew wrote: Nothing to see here, everything's great!

Oh yeah, 3rd day of losses in a row. Only down 70K now.

When will you guys come to your senses?
When will YOU come to your senses? It is utterly perplexing to me that you invest in a portfolio you hate and believe is broken, but refuse to exit. Face it: the PP is not for you. You prefer stocks for your long-term and can't tolerate even the smallest shred of volatility for your short-term money. You tried the PP and found it didn't suit you. No shame in admitting that.

I might just exit the PP the next time it's beating the market. If stocks are beat down it might be a good time to switch back to a classic bogleheads. But today is not that day

Ps I would also like to get a life please send me your newsletter

Gyroscopic Investing

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