Next recession, trade wars, up to 50% portfolio losses
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A lot of the people here seem to be contributing to the result they fear.0
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Investment wise. Currently very low cash balance. As have identified a couple of long term opportunities that offer reasonable value. Not that they are exciting. However should outperform cash in the medium term. Nothing to suggest that the world markets en masse are going to come crashing down anytime soon. It's the large cap stocks that hurt the indices. Leaving many little changed.0
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OldMusicGuy wrote: »Which means?
Sentiment drives markets.0 -
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So Maybot is about to put our 3 nuclear powers up against the might of Russia.
Anyone now still feel a stock market crash is not iminent.
As before I am keeping my pension pot in cash right now.
What do the DUP think? If they are against war, vote of no confidence = Jeremy as PM. That might be good for keeping us out of a war but I still see that crash.
Why do people think the pound sterling would hold its value better than a world tracker fund in a crisis?“It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair0 -
Thrugelmir wrote: »Sentiment drives markets.
That's also why I won't be moving anything out of cash in the short term, because I have just retired and do not want to suffer more pound cost ravaging. Instead, I will take advantage of rising interest rates to set up a bond ladder with a lot of the cash. But I will not be selling any of the significant amount I have in the markets for the long term.
IMO that is a sensible, risk averse strategy for someone that has just entered the decumulation phase. I think anyone can see we are entering more volatile times than we have experienced since 2008. Whether there will be a big crash or not, who knows. But I have set a strategy to protect myself from pound cost ravaging for the next 5 to 10 years, which is the crucial phase of retirement for me.0 -
Would anybody consider investing in an ETF which shorts the market?
https://www.investopedia.com/articles/etfs-mutual-funds/072816/top-3-etfs-short-ftse-100-xuks-suk2.asp0 -
Would anybody consider investing in an ETF which shorts the market?
https://www.investopedia.com/articles/etfs-mutual-funds/072816/top-3-etfs-short-ftse-100-xuks-suk2.asp
Yes, my pension has some of Boost's 3x daily ftse100 short etp, and some db-xtrackers s&p500 2x inverse daily swap, which I use from time to time as a general hedge without selling off individual equity/ fund positions. I have only a few £k in each at the moment.
If you're thinking of using such a product it is worth checking the maths on how a (geared) daily inverse track will work and maybe plotting some charts of few random daily paths that the FTSE 100 could take, and what the daily inverse would look like. If the main market is choppy (a bit up, a bit down but no massive overall change) it can be quite possible to have a large (un)/favourable movement on the geared short ETP. They are not really suitable for holding over the long long term as something in your standard rebalanced portfolio- but more for capturing short term sentiment.
If it was outside a tax wrapper I would just use spreadbets / CFDs or options on the index where your value is driven by what the index looks like on the particular day the bet/ contract is due to expire (or the overall movement since you started it) - and not the particular path it happened to take to get there. More straightforward with such products to create a broad general hedge for your long holdings, for a decent period of time (with gearing to avoid needing a massive amount of initial front money), and know what your result on the short will be for a given ending value of underlying FTSE / S&P etc.0
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