FTSE 100 Index Tracker - Worth a short term punt?

Ryan_Futuristics

It really is a 50:50 punt right now ... You can't tell whether we're in the dip or just sliding down over the edge (I think the SMAs would suggest we're headed more down than up in the shortish-term)

The markets act like an irrational 5-year-old - sometimes they settle down quickly, other times they blow up ... much more group social dynamics than numbers at this level ... As such there is thought to be a level of support at 6,000 (if not 6,200)

I did increase my Woodford holding today - great way to get UK exposure (it's at about 80% UK) and a fairly broad mix of large, mid and small-caps that should give a balance of defensive stability and long-term growth

gkerr4

very difficult - we are normally in the middle of a "festive rally" at the moment, but it seems very bearish.

I have a punt mid-november into the xmas period - usually do, usually through a spread bet facility. Its actually down a couple of % this year which is the first time for a long time. I'll close the position next monday / tuesday and see how it turns out.

i think, historically, that january wouldn't be a good month for a recovery (could be wrong there though) in which case a closing 'down' position next week would't give me confidence in a recovery through january. I'd probably look to top-up longer term tracker holdings though.

benalder284

Ryan_Futuristics wrote: »

It really is a 50:50 punt right now ...

In the short term it's really always a 50/50 punt - it will go up or it will go down. It is going down for lots of reasons and issues including uncertainty over longer-term impacts of QE, the possibility of deflation, Putin's irrationality and foreign policy implication etc. etc. If you have a crystal ball you can realistically price these uncertainties - but nobody does and nobody can.

I take the view that time in the market and sensible diversification are your best weapons in the unequal fight.

Ryan_Futuristics

benalder284 wrote: »

I take the view that time in the market and sensible diversification are your best weapons in the unequal fight.

There's always a good rationale for that perspective - but at the same time, not many people get rich on 5-7% returns

And the fear now is that after a century of booming growth, we could be in for one of relative stagnation (with an ageing global population and environmental bottlenecks threatening growth altogether)

So my philosophy is that if you generally only buy assets at good value, all you need is for the market to recognise an asset's underlying value ... The idea of simply being exposed to a bit of everything doesn't fill me with confidence

Kendall80

Ryan_Futuristics wrote: »

So my philosophy is that if you generally only buy assets at good value, all you need is for the market to recognise an asset's underlying value ... The idea of simply being exposed to a bit of everything doesn't fill me with confidence

Exposing yourself (um!) to a bit of everything but crucially at the right times - (or at least not the wrong times!) should surely be the aim. Difficult to judge I grant but returns should be greatly enhanced.


More on topic - the FTSE and other euros are up over 2% today. It will be interesting to see if that continues tomorrow. We may have passed an October-like dip... probably not though.

Thrugelmir

Kendall80 wrote: »

More on topic - the FTSE and other euros are up over 2% today. It will be interesting to see if that continues tomorrow. We may have passed an October-like dip... probably not though.

Was reading an article yesterday. Of the constituents in the FTSE 350 in the past year. 185 are negative with average prices down 19.3%. While 165 are winners with average gains of 14.8%.

Indexes hide a multitude of sins. Much in the same way that fund managers are successful on the back of a single theme. Rather than overall stock selection.

Ryan_Futuristics

Kendall80 wrote: »

Exposing yourself (um!) to a bit of everything but crucially at the right times - (or at least not the wrong times!) should surely be the aim. Difficult to judge I grant but returns should be greatly enhanced.


More on topic - the FTSE and other euros are up over 2% today. It will be interesting to see if that continues tomorrow. We may have passed an October-like dip... probably not though.

Well I say keep it as simple as possible - just use CAPE and Price/Book, average them together, work out what's looking cheap, keep rotating into that ... And keep some good fixed income or cash reserves for stability

Ryan_Futuristics

And yeah, I keep placing fund orders and cancelling when I realise the dip could be a big one (almost bought more emerging markets two days ago)

Always good to look at the where the Hang Seng's been trading overnight

I think it'll come down to the fed decision today - if they announce a rates hike for next June, maybe a bit more sell-off, if they stay cautious, probably a rebound across the board (maybe not Russia)

PenguinJim

Ryan_Futuristics wrote: »

I did increase my Woodford holding today - great way to get UK exposure (it's at about 80% UK) and a fairly broad mix of large, mid and small-caps that should give a balance of defensive stability and long-term growth

I increased my holding today, too - I've been fortunate enough to buy in during October's and this month's dips.

Looking forward to it "dipping" 50% next week. (Can buy lots more!)

Edit: I used some money I had tucked away for Emerging Markets, coincidentally enough - I agree it's not a good week to increase exposure there.

Ha. Look at me discussing these things like I have the first clue. I should write a column!

Ryan_Futuristics

Interesting thing with EM is value and company fundamentals were good before this sell off - most the sell off is just fear (which we thought was already priced in)

The Fed minutes come out around 7pm, and a negative tone about rate hikes could see this panic selling reverse rather quickly ... Either way, I think there's some good long term value in increasing EM exposure once the sell off seems to have settled

What you're seeing right now really is the market at its most fearful and irrational