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Is the stock market over heating?
Comments
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I'm confident there will be some sort of correction, I just don't have clue when and perhaps more importantly at what level the market will be before it happens. I'm focusing on maintaining or perhaps reducing exposure slightly over time by taking an arbitrary profit when available, as the market rises, rather than avoiding the equity market altogether.
All told I'd rather do this, stay in the market, but dilute some further short term potential growth by taking profit now as it presents, build a larger cash pot, and hope to claw that back later with bells on at a better value.
I just want to try and avoid a situation where my investments ride the wave and then end up seeing all the gains washed out.
My target is around 20% gain which I've already acted on in some cases.'We don't need to be smarter than the rest; we need to be more disciplined than the rest.' - WB0 -
They don't want to fly off to their villas worrying about June 2011.
The old stockmarket adage was a good one when most landed gentry who invested could live anywhere in the british empire they chose to.
Makign sure to always have that cash available to you was probably a great idea and also sterling was solid gold back then.
Right now? with us plain people not leaving uk and considering if we should hold paper sterling instead of stocks, its not really applicableEven I'm looking at gold :eek:
Even wasnt the exception, it was normal to keep gold and now normal is entirely the oppositethere will be a correction
Its only the wild ideas which can justify running away from reasonable ownership of profitable working assets. If we get a marxist revolution, I was wrong and I will say as much as I write from foreign shores.
Nobody on this thread has yet said the companies are unprofitable. In 2000 when PE was 100 or more, we should have been banging the drum on that argument but most of us werent because look how much they had gone up and who wouldnt want to be an investor doing that well0 -
It's all well and good predicting a crash but why and more importantly where would you put your money?
This is where the problem lies. I recently bought a house in Northern Ireland which, in my opinion, is one of the few remaining undervalued asset classes.
I had a look for Property Funds that invest exclusively in Northern Ireland for my investments outside my own private residence but the only things I see have high investment minimums (resulting in little-to-no diversification unless you have a REALLY high net-worth).
Yesterday, I moved my main pension fund to cash and it should be complete on Monday. However, I don't expect huge imminent drops. The transfer to cash was done purely because I'm switching providers. I know I could have just transferred as-is but, in a cash fund, I have a better idea of the transfer value to expect.
I'll be back in high-risk funds by the end of next week - so it's a one-week gamble on prices and could go either way.0 -
I have held funds since 2011 and have used my tax free allowance since then. Not sold any or taken any profits in that time. Is it wrong to assume that as part of a managed fund the fund manager will be assessing the market behaviour and positioning my investment depending on the level of risk I have accepted?0
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I'm confident there will be some sort of correction, I just don't have clue when and perhaps more importantly at what level the market will be before it happens.
Or after. When do you get back in? There are a lot of private investors sitting on piles of cash, mithering about interest rates, and saying they don't trust the stock markets at current levels. Of course, when the FTSE was at 4000 and 5000, they didn't trust it either, so when will they trust it enough to invest?My target is around 20% gain which I've already acted on in some cases.
20% from when you bought? What's so magical about your buying price?I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.
Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.0 -
BTW, has anyone noticed how people have stopped talking about "the lost decade" now that the last decade has actually been OK for investors?
yes, Gadget, I have certainly noticed.
and as I generally am a regular rather than LS investor, I have seen gains over the period.0 -
Does any of this matter if you intend to hold for 20/30 years plus? (Genuine question.)0
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Does any of this matter if you intend to hold for 20/30 years plus? (Genuine question.)
Well if you preserve capital during downturns then that leaves you in a better position to take advantage of cheaper assets when the opportunities arise. Someone who sold out of equities (or at least heavily reduced exposure) anywhere up to mid 2008 and subsequently re-invested some time in 2009 would almost certainly be in a better position now than someone who'd simply not taken any action at all.
Identifying prolonged or severe downturns in time is the problem however. When markets fall it tends to happen much faster than it took to rise. The other possibility is a rebalancing portfolio that forces you to sell off some of your gains to safer assets during the good times and vice versa.0 -
Shaolin_Monkey wrote: »The other possibility is a rebalancing portfolio that forces you to sell off some of your gains to safer assets during the good times and vice versa.
To which "safer assets" is the question?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Suggest you listen to the recent In the Balance radio programme, The Madness of Markets? available on the BBC IPLAYER.
http://www.bbc.co.uk/programmes/p0188t1y
Puts into perspective all the cheap money that's sloshing around the financial system.0
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