FTSE at 3700 and no winners.

Dithering_Dad

Hmnn, ftse shot up again this morning, perhaps I was a bit rash to have moved back to cash - though the last time I waited too long, it shot back down and I lost quite a few bob. Better to 'pocket' my small gains and wait for the next drop.

Here are today's results:

Closing Price Tuesday 28th October
£61,307.95 - Amount my pension pot would be if I had left it alone.
£74,892.98 - Amount in my Pensions Pot now (Equities).

Closing Price Wednesday 29th October
£63,048.33 - Amount my pension pot would be if I had left it alone.
£77,489.62 - Amount in my Pensions Pot now (Cash Fund).

Difference between leaving pension alone and actively managing: £14,441.29

GDB2222

Dithering_Dad wrote: »

Difference between leaving pension alone and actively managing: £14,441.29

Nope, that's the difference between leaving pension alone and actively managing AND GETTING IT RIGHT. As I see it, you have made two trades in and out of equities, both successful. Well done to you, but it is impossible to conclude from just two trades that you can get it right in future. Only if you keep getting it right will I conclude that you can, in fact, walk on water (financially speaking).

There's so much random noise in investment performance that it is very hard to tell a good manager from a lucky one. I attended a lecture at London Business School where it was suggested that you would need to watch an investment manager for more than 40 years to be able to tell which group he was in.

Generali

GDB2222 wrote: »

Nope, that's the difference between leaving pension alone and actively managing AND GETTING IT RIGHT. As I see it, you have made two trades in and out of equities, both successful. Well done to you, but it is impossible to conclude from just two trades that you can get it right in future. Only if you keep getting it right will I conclude that you can, in fact, walk on water (financially speaking).

There's so much random noise in investment performance that it is very hard to tell a good manager from a lucky one. I attended a lecture at London Business School where it was suggested that you would need to watch an investment manager for more than 40 years to be able to tell which group he was in.

Nick Taleb gives an interesting example in Fooled by Randomness.

Take 1,000 traders and say you'll sack the worst performing 50% when you tally performance at year end.

After year 1 you have 500 left.
After year 2 you have 250 left.
After year 9 you have 2 guys left who have outperformed the average every year.

There's not necessarily anything special about them, they're just thrown up by the method of measuring how good or bad an investor is.

Dithering_Dad

GDB2222 wrote: »

Nope, that's the difference between leaving pension alone and actively managing AND GETTING IT RIGHT. As I see it, you have made two trades in and out of equities, both successful. Well done to you, but it is impossible to conclude from just two trades that you can get it right in future. Only if you keep getting it right will I conclude that you can, in fact, walk on water (financially speaking).

There's so much random noise in investment performance that it is very hard to tell a good manager from a lucky one. I attended a lecture at London Business School where it was suggested that you would need to watch an investment manager for more than 40 years to be able to tell which group he was in.

Actually I have done more trades than these, but they're on a different thread. Not all of them have gone as well as I would like, for instance I bought back into the market at the end of Black Friday and my pension pot went from 70k to almost 80k the following Monday & Tuesday. I left the money in equities too long and it fell back, so in reality I 'lost' £5k when I finally moved back into cash at £75k. Had I moved a day earlier, I would have banked an additional 5k.

The reverse is happening today, I banked at last night's closing price and perhaps the markets will continue to rise today and tomorrow and I'll have missed out on significant gains.

So I'm no guru, I'm simply happy to take small profits when I can and stay out of the market until the situation is right to take these small profits.

StevieJ

Generali wrote: »

Nick Taleb gives an interesting example in Fooled by Randomness.

Take 1,000 traders and say you'll sack the worst performing 50% when you tally performance at year end.

After year 1 you have 500 left.
After year 2 you have 250 left.
After year 9 you have 2 guys left who have outperformed the average every year.

There's not necessarily anything special about them, they're just thrown up by the method of measuring how good or bad an investor is.

Must be Woodford and Bolton:beer:

sabretoothtigger

Its only risen 2% today so far and could easily lose that before close, the sp500 fell 5% in the last few minutes of trade yesterday on the day fed rates dropped to their lowest in fifty years.

The higher it goes the more likely it'll fall back down, I reckon your better off getting off the ladder before it falls over

Simplest thing to do right now is buy low, sell high(er) and in a market that is oscillating you couldn't do any better. Its effectively flat but volatile?

StevieJ

Off topic but funny.

http://boards.fool.co.uk/Message.asp?mid=11292155

StevieJ

sabretoothtigger wrote: »

Its only risen 2% today so far and could easily lose that before close, the sp500 fell 5% in the last few minutes of trade yesterday on the day fed rates dropped to their lowest in fifty years.

The higher it goes the more likely it'll fall back down, I reckon your better off getting off the ladder before it falls over

Simplest thing to do right now is buy low, sell high(er) and in a market that is oscillating you couldn't do any better. Its effectively flat but volatile?

US markets likely to bounce out of the traps, the fall last night was reputed to be a result of a negative comment re GE that has been denied also GDP better than expected.

sabretoothtigger

Their GDP fell 0.5% just like ours? I had thought they were doing better tbh. Needs a chart I reckon


I'm all for a continued rise, just skeptical thats its the correct value. I'm not sure I agree with your ftse 5000 level not before next year anyhow

StevieJ

sabretoothtigger wrote: »

Their GDP fell 0.5% just like ours? I had thought they were doing better tbh. Needs a chart I reckon


I'm all for a continued rise, just skeptical thats its the correct value. I'm not sure I agree with your ftse 5000 level not before next year anyhow

US GDP down 0.3% (not 0.5), re the 5000, it is not whether I am right or wrong, it is having a valid explanation of why it may happen. To quote Thunderbirds ' anything can happen in the next 24 hours'
http://www.bloomberg.com/apps/news?pid=20601087&sid=aAewsi3edRGY&refer=home