Thoughts on the stock market at present?... In recovery?

StevieJ

peawack wrote: »

Take no notice of p/e ratios anyway. The rules of investment have changed, and p/e ratios are based on future earnings : i.e. 2009. With a deep and prolonged recession (possibly a depression ) on our door-step, these ratios are nigh on irrelevant.

See what I mean.

peawack

What do you mean by ' see what I mean' ? Very enlightening. All I said was that there are bad times ahead, that's not news is it ?
I am actively buying shares right now, but I don't necessarily take notice of everything I read or hear.

Blah99

I believe the current bounce has a lot to do with the performance of the Dow and how that's linked to the US elections. It certainly doesn't mirror or relate to the underlying economic conditions, which are absolutely no different than when we had the lows of last week (excluding the bank bailouts, which are neither here nor there outside of the sector).

I've been spread betting on the FTSE100 with a strategy based purely on trends over the last few days in the lead-up to today, and I've done fairly well. I've only done this because I feel there is no fundamentals-based logic behind the continued rise - whilst the economic environment would seem to favour shorting the index I've made money by going long.

Now that the elections are (nearly) done I'm going to stop this strategy and watch what happens over the next few days. The imminent rate announcement will have little impact on the market in my opinion because it's already priced in. My gut feeling is that we're nearing the top of this bounce and we'll be on the way back down again in the next week or 2 once reality sets in again.

GiusCo

peawack wrote: »

I am actively buying shares right now, but I don't necessarily take notice of everything I read or hear.

One question: do you always find your "buy" movement met by the "sell"? And... are you investing or daytrading (weektrading)?

Not a personal investigation into your rules ... just to understand what happens if your "buy" or "sell" is not met promptly these volatile times.

purch

One question: do you always find your "buy" movement met by the "sell"?

just to understand what happens if your "buy" or "sell" is not met promptly these volatile times.

You can always tell when a thread has run it's course........total gibberish :eek:

GiusCo

purch wrote: »

You can always tell when a thread has run it's course........total gibberish :eek:

sorry... I use the trading bookies, not the market (not yet) :rolleyes:


quietly going back now ......

amcluesent

>once reality sets in again<

Yep. No doubt Obama's 1st 100days will include some feel-good announcements such as bailing out of Iraq which will boost markets.

But the fundamentals haven't changed and the UK market should sink again, as the lack of credit, closures, job-losses and inevitable tax-hikes become clear.

StevieJ

peawack wrote: »

What do you mean by ' see what I mean' ? Very enlightening. All I said was that there are bad times ahead, that's not news is it ?
I am actively buying shares right now, but I don't necessarily take notice of everything I read or hear.

Apologies, I just meant that most people think the current mood (be it positive or negative) will persist beyond what it normally does i.e. it is different this time.
Anyway good luck with your buys and sells.

rjp_2

I would suggest not trying to time the market. Most people should only consider investing for the long term. This allows time for assets to recover if things go bad. Otherwise, cash is the most practical choice.

For long term investment, asset allocation is much more important than timing. By asset allocation, I basically mean what proportion of the investment is in shares vs bonds. You don't need to go all-out and put 100% of the money into equities. Indeed, both shares and bonds may represent good value now for the long term investor.

If you don't want a financial advisor, pick up a few books on investing from the library -- most books I've looked at will tell you pretty much the same things. You need to decide how long you can invest for, what your risk profile is and so on. Only then should you decide how to save or invest the money.

amcluesent

>asset allocation is much more important than timing<

Not so sure, the old rules of buy and hold, £-cost averaging etc. seem broken. The market's back where it was a decade ago and loads of blue-chips are washed up if not bust.

IMHO shares now need quite active management or you'll get blown away.