Sell In May And Fly Away...

Glen_Clark

Jegersmart wrote: »

The reason why commodities/basic materials stocks have not joined is probably because if you take a look at prices for oil, metals and soon - these are not really responding to QE, as they are usually more affected by actual demand/supply in the economy, which is still very weak

Good point.

Inflation is low if you eat Ipods, Live in an LCD Television, and heat your home with BluRay disc players

grizzly1911

Glen_Clark wrote: »

Good point.

Inflation is low if you eat Ipods, Live in an LCD Television, and heat your home with BluRay disc players

Capital outlay wise yes running costs less so.

buying a cheap gadget these days is a bit like buying a printer, only in this case it isn't ink but power.

Remember the days when 1 light bulb would do and we only had single sockets, two to a room?

merlingrey

Well looking into my crystal ball:

The Central banks will not end or cut stimulus they are going to keep pumping money in bond markets.

They might talk of cutting back to please some people but it will not happen.

The Federal reserve is front running and backstopping the market.

I see FTSE @ 7300 in 2 months

atush

Newbie2saving wrote: »

:beer: ha, ha, thanks for the tip! Last year didn't live up to this 'advice' though did it? From what I have read recently equities are being snapped up and there is a bit of a rally on!

Maybe not, but all the recent crashes were when I was there and had no access to trade lol. I just listened to all the bad news and gloom on Radio 5 (which I can get at my gite).

I was in America on 9/11, and as soon as I could fly home and the markets opened, I started buying.

redbuzzard

A_Flock_Of_Sheep wrote: »

May is nearly over and June is upon us. What are your thoughts for Equities over the next 4 to 8 weeks?

My thoughts are that nobody has any reliable idea what the stock markets will do, if they had, it would be doing it.

For us investors, not the short term traders, the sensible options are to stick with a reasonable allocation and ride the waves for better or worse, (with the long term better in mind), or maybe to de-risk a bit.

De-risking feels right to me although I don't want to indulge in timing as a rule - it has always cost me money, selling too soon or buying too early.

But I see nothing wrong in banking quite exceptional gains. I sold half my Japan index at +20% in only 3 months , the rest is now +28% - but that's a nice problem to have.

I have just reduced UK and American index funds too after an exceptional run.

I expect to miss some gains, but to a degree this is just rebalancing if you want to put it in rational terms.

The problem is what to rebalance to. Whether you call it a bubble or not doesn't matter, but bonds are not cheap and prices will come down with a bump should interest rates rise; conversely there has to be a limit to how far they can rise when the reference point is negative real yields on treasury bonds.

I have put a bit of property in (IT) and some less volatile mixed asset funds and absolute return style funds. But there's something a bit odd about the idea that money can be made, or even protected, in a falling market when a large proportion of the players is trying to do that. There must be some massive counterparty risk somewhere, and the hedging instruments themselves cannot be free.

Another problem is that the measure of price is money; and the money itself is of uncertain future value. Physical assets have a certain attraction. Property, or even gold, perhaps. Maybe the price doesn't matter so much if you think the monetary system is aiming for hyperinflation, and you have the actual physical asset.

Sorry to ramble.

Glen_Clark

grizzly1911 wrote: »

Capital outlay wise yes running costs less so.

buying a cheap gadget these days is a bit like buying a printer, only in this case it isn't ink but power.

Remember the days when 1 light bulb would do and we only had single sockets, two to a room?

Good Point, I should have added the condition that you never plug them in.