Pensioncraft: Sell off Half Way?

[GeoffF100]

Here is an interesting recent Pensioncraft video: "Michael Burry Market Crash 2022 - Halfway There":

https://www.youtube.com/watch?v=KPla4wM3zOs

I have to agree with Ramin. It has the ring of truth. That does not mean it will definitely happen, and we certainly cannot predict the timing.

[TUK020]

Here is an interesting recent Pensioncraft video: "Michael Burry Market Crash 2022 - Halfway There":

https://www.youtube.com/watch?v=KPla4wM3zOs

I have to agree with Ramin. It has the ring of truth. That does not mean it will definitely happen, and we certainly cannot predict the timing.

Pretty cogent argument to accumulate cash for the next 6-9 months and pause any further buying

[monabri]

Doesn't MB have a very US point of view? Does anyone in the UK think the US market is attractive? Perhaps one should sidestep the US market until things are clearer but what about other markets?

[CryptoPlankton]

Here is an interesting recent Pensioncraft video: "Michael Burry Market Crash 2022 - Halfway There":

https://www.youtube.com/watch?v=KPla4wM3zOs

I have to agree with Ramin. It has the ring of truth. That does not mean it will definitely happen, and we certainly cannot predict the timing.

Pretty cogent argument to accumulate cash for the next 6-9 months and pause any further buying

As a long term investor, I'm happy to leave such attempts at market timing to those with faith in their crystal balls. Most studies suggest it isn't generally a winning strategy. With inflation high, I'd rather put any cash earmarked for investment to work right now, even if it does turn out there are further lows ahead in the short term. If the market happens to rally over the next six months, what does someone who hoarded cash do then?

Still, it was an interesting watch, thank you.

[tjh290633]

Here is an interesting recent Pensioncraft video: "Michael Burry Market Crash 2022 - Halfway There":

https://www.youtube.com/watch?v=KPla4wM3zOs

I have to agree with Ramin. It has the ring of truth. That does not mean it will definitely happen, and we certainly cannot predict the timing.

Pretty cogent argument to accumulate cash for the next 6-9 months and pause any further buying

There is an old adage:

"Never buy on a rising market, nor sell on a falling market."

Perhaps too prescriptive, but worth bearing in mind, especially if you apply it to individual shares.

TJH

[JohnW]

I’m tempted to think that means buy on a falling market and sell on a rising one.

[tjh290633]

I’m tempted to think that means buy on a falling market and sell on a rising one.

How else can you interpret it? Do nothing at all?

TJH

[scrumpyjack]

I agree it is impossible to time buying or selling ideally, though I think there is something in the old adages about buying when everything and everyone is total gloom and panic, and selling when everyone is universally optimistic.

We certainly have not yet reached the gloom and panic stage, but then in many economic cycles that stage does not happen. People talk about recession but we still have very low unemployment and much of the present economic instability may be down to re-emerging from Covid and the energy price bubble, both of which may be short term.

I shall stick to my long held policy - when in doubt, do nowt.

[TedSwippet]

I’m tempted to think that means buy on a falling market and sell on a rising one.

How else can you interpret it ("Never buy on a rising market, nor sell on a falling market.")? Do nothing at all?

To be honest, I don't think you can interpret it. That is -- and in common with so much else that is passed off as investing folklore, for example "cut losses and let profits run" -- it is too generic and vague to be actionable.

What constitutes a "rising market"? Two consecutive days of gains? Three? Five? A month of overall gain rather than loss? A quarter? A year? How do you pick your starting point for this period of measurement? -- that will make a huge difference. By the time you have enough history to declare that this elusive "rising market" has occurred (note, past tense!), you have missed the gains of investing into it. All the same arguments apply, just inverted, for a "falling market".

You might as well say "buy fewer losing lottery tickets, and more winning ones". Equally inactionable. :-)

[tjh290633]

What constitutes a "rising market"? Two consecutive days of gains? Three? Five? A month of overall gain rather than loss? A quarter? A year? How do you pick your starting point for this period of measurement? -- that will make a huge difference. By the time you have enough history to declare that this elusive "rising market" has occurred (note, past tense!), you have missed the gains of investing into it. All the same arguments apply, just inverted, for a "falling market".

I would have thought that a rising or a falling market is easily defined by the trend. A falling market is down from a previous peak, and a rising market is up from a minimum. Obviously you need to consider a sensible period of time to establish the trend, because the market is likely to have many reversals along the way.

If you have ever lower successive minima, then the market is falling. Ever higher successive maxima, it is rising. What you are looking for is a sustained reversal of the trend.

TJH

[GrahamPlatt]

If you have ever lower successive minima, then the market is falling. Ever higher successive maxima, it is rising. What you are looking for is a sustained reversal of the trend.

TJH

All very well, but how can you know when the bell is going to ring?

[tjh290633]

If you have ever lower successive minima, then the market is falling. Ever higher successive maxima, it is rising. What you are looking for is a sustained reversal of the trend.

TJH

All very well, but how can you know when the bell is going to ring?

You don't, you wait until it has rung before making your decisions.

TJH

[TedSwippet]

If you have ever lower successive minima, then the market is falling. Ever higher successive maxima, it is rising. What you are looking for is a sustained reversal of the trend.

All very well, but how can you know when the bell is going to ring?

Indeed! See also:

14 Meaningless Phrases That Will Make You Sound Like A Stock-Market Wizard - Business Insider

[CliffEdge]

Will the stock market be higher in eleven years time than it is now?

[DrFfybes]

Will the stock market be higher in eleven years time than it is now?

Now that would be an interesting poll

[tjh290633]

Will the stock market be higher in eleven years time than it is now?

Look how long it took the FTSE100 to return to its high point at the end of 1999. That's the trouble with tracking indices.

TJH

[TUK020]

Will the stock market be higher in eleven years time than it is now?

UK or globally?

[CliffEdge]

Will the stock market be higher in eleven years time than it is now?

UK or globally?

I think lifestrategy 100 is both UK and global and pays an income

[JohnW]

Look how long it took the FTSE100 to return to its high point at the end of 1999. That's the trouble with tracking indices.

The UK market is 4% the size of the global stock market, and the FTSE250, correct me if needed, is 17% of the UK market. How that could be one of the better indexes to tie one’s fortunes to needs a bit of explainig.

[TedSwippet]

Look how long it took the FTSE100 to return to its high point at the end of 1999. That's the trouble with tracking indices.

The trouble here is perhaps the short-cut of using an index as a proxy for investor returns. With dividends reinvested, the FTSE 100 total return is 116% since 1999 (source: AJ Bell). Certainly a laggard, but not zero return by any means.