Economy crash =/= stock market crash?

Thrugelmir

Type_45 said:

adindas said:

Type_45 said:

masonic said:

Type_45 said:

My commodities position has made almost 14% since I bought it two months ago.

I am looking to sell it this week when an attractive price becomes available and I will keep the proceeds in cash. 

This will mean that I am approximately 27% in cash.

I think you've done well to catch the end of that trend. I was sceptical it had much further to run. So seems a sensible move to lock in those gains. With a slice of your metal holdings you'll have something resembling a bonds proxy when combined with this cash, but without the interest rate sensitivity.

Yes, it should then be quite a defensive position after I sell the commodities shortly.

Gold (some physical + SGLN) = 30%
Cash = 27% (most of which I will leave in my S&S ISA ready to use as and when)
Silver (some physical + SSLN) = 18%
Gold Miners ETF (GJGB) = 15% (Disaster so far.  Only bought it recently and it's gone down 18%)
Crypto = 9% (An even bigger disaster.  Lost 2/3 of its value since October 2021.  Absolutely horrendous).

My hope would be a melt-up where my Gold Miners ETF and crypto get a boost before I reduce my exposure to them.  I went way OTT with the crypto exposure (it was 20%).

Timing the market during the bear market make perfect sense. That is what many of the hedge fund managers are doing.

Also doing DCA will generally beat Lump-sum during the bear market.

In the past, when a person was saying this in this MSE they always got heavily attacked.

I am expecting the equities market to collapse.  When it does, I also expect gold/silver to go down with it.  But I expect gold/silver to come out of it better once money starts flowing there.

Having a cash allocation means that:

1)  Some of my portfolio is safeguarded when everything goes down.
2)  I have cash to take advantage of cheap gold/silver stocks (SGLN & SSLN) in anticipation of gold/silver rising sharply before equities do.
3)  If I so choose, I can buy equities at a 50%-80% discount.  My plan is to stick with gold/silver ETCs (SGLN & SSLN), but I may be tempted to buy a small bag of equities (probably VWRP) at a 50%-80% discount.



You obviously don't share my views about the financial Armageddon we are facing.  But let me ask you this theoretical question:  if you thought the market was about to tank by 80%, how would you be positioning your portfolio?

If company profits attributable to stock holders fall in the short term and future expectattions are lowered. What's this "discount" ?  Individual share prices are somewhat more complex than what somebody paid yesterday to buy the stock. 

Type_45

Thrugelmir said:

Type_45 said:

adindas said:

Type_45 said:

masonic said:

Type_45 said:

My commodities position has made almost 14% since I bought it two months ago.

I am looking to sell it this week when an attractive price becomes available and I will keep the proceeds in cash. 

This will mean that I am approximately 27% in cash.

I think you've done well to catch the end of that trend. I was sceptical it had much further to run. So seems a sensible move to lock in those gains. With a slice of your metal holdings you'll have something resembling a bonds proxy when combined with this cash, but without the interest rate sensitivity.

Yes, it should then be quite a defensive position after I sell the commodities shortly.

Gold (some physical + SGLN) = 30%
Cash = 27% (most of which I will leave in my S&S ISA ready to use as and when)
Silver (some physical + SSLN) = 18%
Gold Miners ETF (GJGB) = 15% (Disaster so far.  Only bought it recently and it's gone down 18%)
Crypto = 9% (An even bigger disaster.  Lost 2/3 of its value since October 2021.  Absolutely horrendous).

My hope would be a melt-up where my Gold Miners ETF and crypto get a boost before I reduce my exposure to them.  I went way OTT with the crypto exposure (it was 20%).

Timing the market during the bear market make perfect sense. That is what many of the hedge fund managers are doing.

Also doing DCA will generally beat Lump-sum during the bear market.

In the past, when a person was saying this in this MSE they always got heavily attacked.

I am expecting the equities market to collapse.  When it does, I also expect gold/silver to go down with it.  But I expect gold/silver to come out of it better once money starts flowing there.

Having a cash allocation means that:

1)  Some of my portfolio is safeguarded when everything goes down.
2)  I have cash to take advantage of cheap gold/silver stocks (SGLN & SSLN) in anticipation of gold/silver rising sharply before equities do.
3)  If I so choose, I can buy equities at a 50%-80% discount.  My plan is to stick with gold/silver ETCs (SGLN & SSLN), but I may be tempted to buy a small bag of equities (probably VWRP) at a 50%-80% discount.



You obviously don't share my views about the financial Armageddon we are facing.  But let me ask you this theoretical question:  if you thought the market was about to tank by 80%, how would you be positioning your portfolio?

If company profits attributable to stock holders fall in the short term and future expectattions are lowered. What's this "discount" ?  Individual share prices are somewhat more complex than what somebody paid yesterday to buy the stock. 

My equities ETF of choice is VWRP.  In the year or so since I've dabbled in it the price has ranged from 78p-88p.

By "discount", I mean that it would look very attractive if I could suddenly buy it for 40p, for example.


That being said, I've no interest in trying to catch a falling knife, and I would probably prefer to buy gold via SGLN (which will also go down and therefore be at a discount) until I was sure the equity markets (specifically VWRP) had bottomed out.

Type_45

masonic said:

Type_45 said:

You obviously don't share my views about the financial Armageddon we are facing.  But let me ask you this theoretical question:  if you thought the market was about to tank by 80%, how would you be positioning your portfolio?

I don't know if that was an open question, but if I knew it I'd be using options and inverse ETFs to profit on the way down. If I only strongly suspected it, probably a heavy allocation to cash, some US TIPS for currency diversification, the obligatory slice of gold, and some exposure to residential property. Taking equities perhaps down to 30-40% and focused on defensives.

In your "strongly suspect" scenario, what would be your approximate/desired percentage allocations between those asset classes (given that you've said that about ~35% would be defensive equities)?

OldMoneySaver

adindas said:
We do not know where the bottom is, but we do know that we are currently in the bear market...

But that's the point - we can see (with hindsight) that the markets have been declining in recent months, so we know we have been in a bear market, but we don't yet know if we still are, in terms of where prices are going next.  Today could be the bottom and anyone denying that possibility is just guessing, however much comfort they derive from charts, etc.

masonic

Type_45 said:

masonic said:

Type_45 said:

You obviously don't share my views about the financial Armageddon we are facing.  But let me ask you this theoretical question:  if you thought the market was about to tank by 80%, how would you be positioning your portfolio?

I don't know if that was an open question, but if I knew it I'd be using options and inverse ETFs to profit on the way down. If I only strongly suspected it, probably a heavy allocation to cash, some US TIPS for currency diversification, the obligatory slice of gold, and some exposure to residential property. Taking equities perhaps down to 30-40% and focused on defensives.

In your "strongly suspect" scenario, what would be your approximate/desired percentage allocations between those asset classes (given that you've said that about ~35% would be defensive equities)?

I'd be unlikely to hold more than 10% in gold, taking the total to ~45%, perhaps 15% in property making ~60%, then the other 40% split between the bonds and cash - to some extent directed by wishing to hold the cash outside of a tax wrapper in a consumer savings account. Would then plan to 'over-rebalance' in stages back to about 80:20 equities/bonds by the point markets had reached that 80% low point. Can't say I've thought long and hard about it though as it's not an outcome I even slightly suspect.

Type_45

masonic said:

Type_45 said:

masonic said:

Type_45 said:

You obviously don't share my views about the financial Armageddon we are facing.  But let me ask you this theoretical question:  if you thought the market was about to tank by 80%, how would you be positioning your portfolio?

I don't know if that was an open question, but if I knew it I'd be using options and inverse ETFs to profit on the way down. If I only strongly suspected it, probably a heavy allocation to cash, some US TIPS for currency diversification, the obligatory slice of gold, and some exposure to residential property. Taking equities perhaps down to 30-40% and focused on defensives.

In your "strongly suspect" scenario, what would be your approximate/desired percentage allocations between those asset classes (given that you've said that about ~35% would be defensive equities)?

I'd be unlikely to hold more than 10% in gold, taking the total to ~45%, perhaps 15% in property making ~60%, then the other 40% split between the bonds and cash - to some extent directed by wishing to hold the cash outside of a tax wrapper in a consumer savings account. Would then plan to 'over-rebalance' in stages back to about 80:20 equities/bonds by the point markets had reached that 80% low point. Can't say I've thought long and hard about it though as it's not an outcome I even slightly suspect.

That sounds like a good plan.  And some people I listen to say 10% gold is all you need in such a doomsday scenario.  

What is the reason though to have your cash in a savings account, as opposed to leaving it in cash in your S&S ISA?  (It seems to me the interest you'd earn is minimal, and you'd not want to take money out of the ISA unless you can help it.)

Type_45

OldMoneySaver said:

adindas said:
We do not know where the bottom is, but we do know that we are currently in the bear market...

But that's the point - we can see (with hindsight) that the markets have been declining in recent months, so we know we have been in a bear market, but we don't yet know if we still are, in terms of where prices are going next.  Today could be the bottom and anyone denying that possibility is just guessing, however much comfort they derive from charts, etc.

You probably want my view on this too:

Today is not the bottom of the bear market, in my opinion.  In WW1 terms, we still think it will be over by Christmas but actually there are years of this ahead.

GSP

Type_45 said:

OldMoneySaver said:

adindas said:
We do not know where the bottom is, but we do know that we are currently in the bear market...

But that's the point - we can see (with hindsight) that the markets have been declining in recent months, so we know we have been in a bear market, but we don't yet know if we still are, in terms of where prices are going next.  Today could be the bottom and anyone denying that possibility is just guessing, however much comfort they derive from charts, etc.

You probably want my view on this too:

Today is not the bottom of the bear market, in my opinion.  In WW1 terms, we still think it will be over by Christmas but actually there are years of this ahead.

Hopefully Putin’s health will give in well before then. Not to say his generals will be any different and take over where he left off.

In truth there’s no indication what’s going to happen once Russia take east Ukraine. My opinion is they’ll settle for that. Gives them a victory, and perhaps the best outcome for world peace though I shudder to think of them actually gaining anything.

Russia losing is not an option, if they lose, we lose if you know what I mean. They need to be able to take something away from their ‘special operations’.

george4064

Type_45 said:

Thrugelmir said:

Type_45 said:

adindas said:

Type_45 said:

masonic said:

Type_45 said:

My commodities position has made almost 14% since I bought it two months ago.

I am looking to sell it this week when an attractive price becomes available and I will keep the proceeds in cash. 

This will mean that I am approximately 27% in cash.

I think you've done well to catch the end of that trend. I was sceptical it had much further to run. So seems a sensible move to lock in those gains. With a slice of your metal holdings you'll have something resembling a bonds proxy when combined with this cash, but without the interest rate sensitivity.

Yes, it should then be quite a defensive position after I sell the commodities shortly.

Gold (some physical + SGLN) = 30%
Cash = 27% (most of which I will leave in my S&S ISA ready to use as and when)
Silver (some physical + SSLN) = 18%
Gold Miners ETF (GJGB) = 15% (Disaster so far.  Only bought it recently and it's gone down 18%)
Crypto = 9% (An even bigger disaster.  Lost 2/3 of its value since October 2021.  Absolutely horrendous).

My hope would be a melt-up where my Gold Miners ETF and crypto get a boost before I reduce my exposure to them.  I went way OTT with the crypto exposure (it was 20%).

Timing the market during the bear market make perfect sense. That is what many of the hedge fund managers are doing.

Also doing DCA will generally beat Lump-sum during the bear market.

In the past, when a person was saying this in this MSE they always got heavily attacked.

I am expecting the equities market to collapse.  When it does, I also expect gold/silver to go down with it.  But I expect gold/silver to come out of it better once money starts flowing there.

Having a cash allocation means that:

1)  Some of my portfolio is safeguarded when everything goes down.
2)  I have cash to take advantage of cheap gold/silver stocks (SGLN & SSLN) in anticipation of gold/silver rising sharply before equities do.
3)  If I so choose, I can buy equities at a 50%-80% discount.  My plan is to stick with gold/silver ETCs (SGLN & SSLN), but I may be tempted to buy a small bag of equities (probably VWRP) at a 50%-80% discount.



You obviously don't share my views about the financial Armageddon we are facing.  But let me ask you this theoretical question:  if you thought the market was about to tank by 80%, how would you be positioning your portfolio?

If company profits attributable to stock holders fall in the short term and future expectattions are lowered. What's this "discount" ?  Individual share prices are somewhat more complex than what somebody paid yesterday to buy the stock. 

My equities ETF of choice is VWRP.  In the year or so since I've dabbled in it the price has ranged from 78p-88p.

By "discount", I mean that it would look very attractive if I could suddenly buy it for 40p, for example.


That being said, I've no interest in trying to catch a falling knife, and I would probably prefer to buy gold via SGLN (which will also go down and therefore be at a discount) until I was sure the equity markets (specifically VWRP) had bottomed out.

Not sure if it really matters here, but VWRP is 78-88 pounds rather than pence.

Thrugelmir

Type_45 said:

Thrugelmir said:

Type_45 said:

adindas said:

Type_45 said:

masonic said:

Type_45 said:

My commodities position has made almost 14% since I bought it two months ago.

I am looking to sell it this week when an attractive price becomes available and I will keep the proceeds in cash. 

This will mean that I am approximately 27% in cash.

I think you've done well to catch the end of that trend. I was sceptical it had much further to run. So seems a sensible move to lock in those gains. With a slice of your metal holdings you'll have something resembling a bonds proxy when combined with this cash, but without the interest rate sensitivity.

Yes, it should then be quite a defensive position after I sell the commodities shortly.

Gold (some physical + SGLN) = 30%
Cash = 27% (most of which I will leave in my S&S ISA ready to use as and when)
Silver (some physical + SSLN) = 18%
Gold Miners ETF (GJGB) = 15% (Disaster so far.  Only bought it recently and it's gone down 18%)
Crypto = 9% (An even bigger disaster.  Lost 2/3 of its value since October 2021.  Absolutely horrendous).

My hope would be a melt-up where my Gold Miners ETF and crypto get a boost before I reduce my exposure to them.  I went way OTT with the crypto exposure (it was 20%).

Timing the market during the bear market make perfect sense. That is what many of the hedge fund managers are doing.

Also doing DCA will generally beat Lump-sum during the bear market.

In the past, when a person was saying this in this MSE they always got heavily attacked.

I am expecting the equities market to collapse.  When it does, I also expect gold/silver to go down with it.  But I expect gold/silver to come out of it better once money starts flowing there.

Having a cash allocation means that:

1)  Some of my portfolio is safeguarded when everything goes down.
2)  I have cash to take advantage of cheap gold/silver stocks (SGLN & SSLN) in anticipation of gold/silver rising sharply before equities do.
3)  If I so choose, I can buy equities at a 50%-80% discount.  My plan is to stick with gold/silver ETCs (SGLN & SSLN), but I may be tempted to buy a small bag of equities (probably VWRP) at a 50%-80% discount.



You obviously don't share my views about the financial Armageddon we are facing.  But let me ask you this theoretical question:  if you thought the market was about to tank by 80%, how would you be positioning your portfolio?

If company profits attributable to stock holders fall in the short term and future expectattions are lowered. What's this "discount" ?  Individual share prices are somewhat more complex than what somebody paid yesterday to buy the stock. 

My equities ETF of choice is VWRP.  In the year or so since I've dabbled in it the price has ranged from 78p-88p.

By "discount", I mean that it would look very attractive if I could suddenly buy it for 40p, for example.

So you'd buy shares on the basis of price compared to recent historical activity, rather than any financial or economic fundamentals. Presumably VWRP was selected originally as was an above average performer.