Has the dead cat finished bouncing?

Prism

Anyone who claims to have an opinion on the future direction of the economy and asset prices is deluding themselves, especially under these current unprecedented circumstances.  We could have already found a cure or we might never find a cure. There might be inflation, there might be deflation. Nobody knows. Rather than making rash decisions with no evidence to back it up then continuing as normal with a balanced set of assets is the only thing that makes sense.

Sailtheworld

kinger101 said:

Thrugelmir said:

Sailtheworld said:

Thrugelmir said:

Sailtheworld said:

Thrugelmir said:

What's fundamentally changed since Friday or the Friday before? The future still holds the same uncertainties. Other than hot money speculating on the latest tit bit of news. There's some wild volatility in underlying share prices day to day beneath the index headlines. . 

So much new data has probably emerged that it would be impossible for a person to digest it all and determine the correct market price 

Um...... there's currently a lack financial data. 

Market prices aren't just set based on financial data of course. Besides which the point still stands - no person could possibly analyse all the available data of the last two weeks and determine whether the market was right or wrong. It's gut feel people are working on when they say the market is too high and probably it's more to do with personality than anything else - I bet it's quite rare to find someone who calls falls who calls rises anywhere near as often. i.e. to date they've been wrong most of the time.

Guess that's why you religiously bought a poorly performing investment such as VRWL. 

It can hardly be said to be poor.  Just predictably average.

The average investor makes market returns minus costs. A World tracker is just a way of keeping costs down and reliably achieving those market returns with no variation.

If there's really as many people who can predict the future as well as they think a tracker still works because they'll push market average returns higher. I'm standing on the shoulders of giants.

Most people though, no matter what they think, don't have an investment edge. Any edge will probably limited to an area where they've put in the proverbial 10,000 hours - probably their day job. Even then we have to remember only about 1/10 fund managers can outperform the market over a period of more than a few years so it makes me wonder what skill they've honed over the 10,000 hours - marketing and fee harvesting a cynic might suggest.

DiggerUK

When the statutory financial warning "you may not get back.....etc., etc.," was made clear, it seems that it was then immediately viewed as something silly and did not need to be taken seriously.

It might be worth a few moments of your time to wonder if now is the time you just "might not get back all you invested"

The governor of the BOE has warned of a drop in GDP of 14%

and the Chancellor has just poured more cold comfort in to the mix...

Sailtheworld

DiggerUK said:

It might be worth a few moments of your time to wonder if now is the time you just "might not get back all you invested"

It's not different this time - that's good advice anytime. If only wondering were knowing we'd all be as rich as Croesus.

ProDave

Reality, and the markets seem two different things.

Rolls Royce announce 9000 redundancies and their shares are up 4% today.

bowlhead99

ProDave said:

Reality, and the markets seem two different things.

Rolls Royce announce 9000 redundancies and their shares are up 4% today.

'We are going to get rid of some of the expensive resources that we don't need to employ to maintain our projected business levels" = value of a share of the business more valuable than if they had announced they were not going to bother looking at their costs...

Bravepants

ProDave said:

Reality, and the markets seem two different things.

Rolls Royce announce 9000 redundancies and their shares are up 4% today.

Of course they are, the company has just offloaded a liability, and streamlined itself.

Sailtheworld

ProDave said:

Reality, and the markets seem two different things.

Rolls Royce announce 9000 redundancies and their shares are up 4% today.

If it had been a bolt out of the blue and people were shocked and stunned to hear an aero engine supplier might be looking at reduced demand then it might be surprising if the shares had gone up by 4% perhaps.

The reality is that the effect of Coronavirus isn't exactly a big secret. They were £7 in February and even with today's 6% rise they're still only £2.83. That's a 60% decrease in a matter of weeks. I'd say the market and reality had bumped into each other to be honest.

Prism

Well Fred asked this question on 1st May and my equities are about 5% up from then so I guess the cat wasn't actually dead at all and has plenty of spring left in it. 

BananaRepublic

Rolls Royce looks a good long term bet. The share price was recently much higher suggesting a good foundation. Aviation will be hit for quite some time, but it will pick up again.

Prism said:

Well Fred asked this question on 1st May and my equities are about 5% up from then so I guess the cat wasn't actually dead at all and has plenty of spring left in it. 

It's a slow bounce. The force of gravity can be less in stock market land. Seriously though, I suspect we have seen the worst, and it isn't as bad as I feared, unless you run a small gym, cafe etc.