Anything which didn't go down in the Oct 2018 crash?

newatc

The thread made me do a quick analysis of my funds and I'm about 5% down on the year (no income taken) despite moving slowly to more defensive stocks. I think that would be about par but that's instinct rather than science.

Thrugelmir

RomfordNavy wrote: »

What would be interesting would be to identify some marker relating to whether the market is currently over or under valued which could help with buying decisions and potentially prevent buying in just before a downturn.

Markets are forward looking. Smart money will be positioning more defensively well before a downturn. There again the wrong call might be made. Markets are based on sentiment and opinion. Who holds the upper hand the bulls or the bears.

Prism

newatc wrote: »

The thread made me do a quick analysis of my funds and I'm about 5% down on the year (no income taken) despite moving slowly to more defensive stocks. I think that would be about par but that's instinct rather than science.

Yes its been a relatively poor year (compared to recent years). I have had a high percentage of defensive stocks for the last 12 months and they have done their job, so I am about +5% over that time. My mid/small companies funds have really struggled though

Alexland

Overall I am sitting at roughly 0% gain during 2018 and hoping to see something from Santa in December.

seacaitch

RomfordNavy wrote: »

Personally I can see much more Brexit uncertainty going forwards so maybe best to avoid investing any further in UK equities at the moment, or at least hold off until previous investments are back to zero, taking into account dividends. Then perhaps drip feed so as to try and avoid too much negative territory.

Much of the way that markets operate can be counter-intuitive to new investors. Unintuitively perhaps, your logic as laid out above is back-to-front:

(i) the more information certainty you require when making an investment (ie. when "information risk" is low), the higher the price you will pay;

(ii) the more information uncertainty you can tolerate (ie. when "information risk" is high), the lower the price you will pay.


When information risk is high, investors are wary or even fearful, and prices are low; when information risk is low, such that investors can see clearly to the horizon or even beyond, uncertainty is scarce, confidence is high and thus prices are high.

The corollary of this is that, perhaps unintuitively for newer investors, it is commonly the case that it safer to invest (ie. prices are lower and thus future returns are higher) when uncertainty is high than it is to invest when uncertainty is low.

Simply put: the "price" you pay to obtain more certainty is lower returns.

The obvious examples of this are the low returns available from risk-free assets such as government bonds, or from cash.

With stocks, it's very often the case that the more fear you feel when making a purchase, due to the uncertainty you see, the greater your future returns will turn out to be. And vice versa.

Wildsound

Alexland wrote: »

Overall I am sitting at roughly 0% gain during 2018 and hoping to see something from Santa in December.

The majority of funds managers I've seen recently seem to think a "Santa Rally" is on the cards this year. Lets hope there's some gold in that stocking come Christmas and not a lump of coal!

Alz1986

Not sure if anything stayed up. But the L&G pharma index faired well and performance is impressive. Will be adding to it.

Prism

Alz1986 wrote: »

Not sure if anything stayed up. But the L&G pharma index faired well and performance is impressive. Will be adding to it.

Yes, my best performing fund of the year, although it was preceded by two years of fairly average returns. I have skimmed a little off the top to add to Fundsmith. In general, defensive stocks have held together reasonably well

newatc

newatc wrote: »

The thread made me do a quick analysis of my funds and I'm about 5% down on the year (no income taken) despite moving slowly to more defensive stocks. I think that would be about par but that's instinct rather than science.

Prism wrote: »

Yes its been a relatively poor year (compared to recent years). I have had a high percentage of defensive stocks for the last 12 months and they have done their job, so I am about +5% over that time. My mid/small companies funds have really struggled though

Alexland wrote: »

Overall I am sitting at roughly 0% gain during 2018 and hoping to see something from Santa in December.

OK make me feel bad <s>

Alexland

newatc wrote: »

OK make me feel bad <s>

Maybe you hold stuff that will shine brighter next year?

That's what I am hoping on the things I hold that returned below zero this year.

My result would have been worse if I hadn't 'averaged down' when buying opportunities occurred.

Alex