Is the stock market over heating?

sabretoothtigger

FTSE pre QE levels would make it incredibly cheap as they have withdrawn no QE and likely will not succeed in doing so as no other buyer will replace them. If there was demand for our cash and so for our bonds then maybe you have a natural flow but we still fail to export.

Demand favours selling sterling and in the end even sell dollar because it is just 1 country just 300 mil people from 7000

Funny thing is Gold is returning to 2009 as if nothing happened since then, we have lots more cash in circulation (though not in use below 100k units on balance sheets)

don't forget the dividends!

Thats vital logic, yield for useful business far outweighs bonds. In the 30's divs did similar I think

http://seekingalpha.com/article/1241011-why-microsoft-and-intel-investors-should-be-glad-the-stocks-are-languishing
Ironically low share prices is how to get rich

A_Flock_Of_Sheep

My IT LSE: EDIN has taken a hit and I am in minus capital territory. I havn't looked to see the extent of "damage" and to be fair I don't want to look. But I definitely know it's in the red.

BUT this trust is forming a cornerstone of my Equity Income portfolio and as such I will eventually (not instantly) be using the dividend for income. As it is paid per share although in the short term it will be painful to look at m account seeing a (hopeful long drop) I know that I can purchase for argument sake at a 30% off price getting in effect 30% more shares. So that in theory should be 30% more pence per dividend at income pay out time.

The dividend pay out is due end of July which I will use with some other dividends coming in to buy more shares.

If I had purchased into the trust at it's lowest point back in the crash 0809 per share was less than £3.00 now over £5. I would welcome a drop to £3.00 per share if anything else to bolster the number of shares in the holding.

Back in 08 09 EDIN was formed of a vastly different portfolio and tanked significantly. The portfolio has changed a lot since the arrival of Mr. Woodford

People are still investing - at about 2pm today according to HL someone purchased over £40k into EDIN so if it drops 3% tomorrow they will be at a deficit.

Glen_Clark

chucknorris wrote: »

I don't have anything in bonds or commodities and I don't feel inclined to do so, anyone got a good argument why I should invest in them?

You have said it yourself in the first part of your sentence. You should invest a bit in bonds and commodities because you don't have anything in them. We don't know which way commodity or other prices will go so just follow the golden rule: diversify & chill

marathonic

A_Flock_Of_Sheep wrote: »

I think there will be some good buying times ahead though. Plus don't forget the dividends!

This is very true. Have you seen some of the yields available after the recent drops? This week is a great week for building a high-yield portfolio.

marathonic

A_Flock_Of_Sheep wrote: »

My IT LSE: EDIN has taken a hit and I am in minus capital territory. I havn't looked to see the extent of "damage" and to be fair I don't want to look. But I definitely know it's in the red.

It's 6.3% below the peak? Why the worry?

The S&P500 seems to have dropped significantly after the London close. It looks like tomorrow could be fun too. Here's hoping the market is a good bit lower at midday when my fund purchases happen

Glen_Clark

I'm thinking of topping up my BP holding as its on a PE of 6.:) With a posse of lawyers chasing them in America, a Communist Government Majority Partner in Russia, and a Price Rigging Investigation in Britain what could go wrong :eek:

lvader

Bsed on current aftermarket activity we would open about 0.5% down or around 6120.

A_Flock_Of_Sheep

marathonic wrote: »

It's 6.3% below the peak? Why the worry?

The S&P500 seems to have dropped significantly after the London close. It looks like tomorrow could be fun too. Here's hoping the market is a good bit lower at midday when my fund purchases happen

For my I purchased below its peak anyway. I have grown some balls and logged on it is 1.04% in the red. But it has gone ex dividend 12 June and the Div is payable 31 July. It climbed over the last two days even after going Ex but has now gone back to its ex level.

marathonic

A_Flock_Of_Sheep wrote: »

For my I purchased below its peak anyway. I have grown some balls and logged on it is 1.04% in the red. But it has gone ex dividend 12 June and the Div is payable 31 July. It climbed over the last two days even after going Ex but has now gone back to its ex level.

Ah right, even better with the dividend.

I'd love to have cash on the sidelines at the moment. As I say, my pension will be reinvested tomorrow and will have missed out on 8%+ of the drop - but I can't access that for another 25 years so it doesn't have me salivating as much as I would be if I'd the same amount of cash in an ISA

The way I'd look at EDIN is that you're buying an income (dividend) of over 4% for life. This will probably rise, as will the capital value, but the dividend level significantly exceeds what is available in annuities so, at current levels, it represents a good buy and hold-for-life prospect to me.

A_Flock_Of_Sheep

marathonic wrote: »

Ah right, even better with the dividend.

I'd love to have cash on the sidelines at the moment. As I say, my pension will be reinvested tomorrow and will have missed out on 8%+ of the drop - but I can't access that for another 25 years so it doesn't have me salivating as much as I would be if I'd the same amount of cash in an ISA

The way I'd look at EDIN is that you're buying an income (dividend) of over 4% for life. This will probably rise, as will the capital value, but the dividend level significantly exceeds what is available in annuities so, at current levels, it represents a good buy and hold-for-life prospect to me.

I know a lot of people herald the Cheap tracker route but EDIN ticks boxes so much for me. I don't think it is guaranteed but the funds objective is: to achieve an increase of the Net Asset Value per share by more than the growth in the FTSE All-Share Index; and growth in dividends per share by more than the rate of UK inflation.

Hence why a sale for me would be ideal - more shares = more dividend which in theory should rise over time. I have about 25k uninvested at the ready for Mr Market's sale.

EDIN has changed since Woodford's arrival. If you look back at the historic financial reports during the 0809 crash the fund held a larger proportion of financial sector shares. These were dumped and AFAIK there are no mining sectors in it either. The latest letter said they are turning more cautious due to a prospect of forthcoming headwinds.