Interesting melt down in US stocks this evening. Appears to be Russia as yields are fairly steady.
Unless you're seeing something different to me I wouldn't call a 1% fall a "meltdown". Admittedly the Dow & the S&P500 were both in positive territory with about 2 hours to go, but nothing a profits warning or a statement from The Fed wouldnt spark.
Interesting melt down in US stocks this evening. Appears to be Russia as yields are fairly steady.
Unless you're seeing something different to me I wouldn't call a 1% fall a "meltdown". Admittedly the Dow & the S&P500 were both in positive territory with about 2 hours to go, but nothing a profits warning or a statement from The Fed wouldnt spark.
Maybe not a meltdown, to be fair, but the NASDAQ's now 11% down from the peak and below its 200d moving average.
Next week will give some indication if earnings are going to allay inflation fears. Netflix wasn't a good start and shares like Peleton, masquerading as tech shares, are getting hammered.
Interesting melt down in US stocks this evening. Appears to be Russia as yields are fairly steady.
Unless you're seeing something different to me I wouldn't call a 1% fall a "meltdown". Admittedly the Dow & the S&P500 were both in positive territory with about 2 hours to go, but nothing a profits warning or a statement from The Fed wouldnt spark.
Maybe not a meltdown, to be fair, but the NASDAQ's now 11% down from the peak and below its 200d moving average.
Next week will give some indication if earnings are going to allay inflation fears. Netflix wasn't a good start and shares like Peleton, masquerading as tech shares, are getting hammered.
Yup. It wasn't just last night that there have been large falls in the Dow and NASDAQ, this has been going on since the start of the year.
And its effect on some very popular funds has been dramatic. On 31/12 BG America stood at 18.65. It is now 14.68 and will be a lot lower tonight. BG Global Discovery was 22.76 on 31/12. Now it is 19.01. Last year's gains being wiped out in weeks.
Even everyone's favourite - Fundsmith Equity - has hit the buffers. 6.78 on 31/12, now 6.16.
You refer to Peleton. I will offer you a similar share I hold - Experian. Down 20% since the start of the year for absolutely no good reason I can see. (It has even published really good results during this time).
These are huge falls which just make me think that we kid ourselves we are investing. Really at times like this I can only say we are gambling.
If anyone's portfolio is higher now than at the start of the month, then I will happily use you as my financial adviser!
Interesting melt down in US stocks this evening. Appears to be Russia as yields are fairly steady.
Unless you're seeing something different to me I wouldn't call a 1% fall a "meltdown". Admittedly the Dow & the S&P500 were both in positive territory with about 2 hours to go, but nothing a profits warning or a statement from The Fed wouldnt spark.
Maybe not a meltdown, to be fair, but the NASDAQ's now 11% down from the peak and below its 200d moving average.
Next week will give some indication if earnings are going to allay inflation fears. Netflix wasn't a good start and shares like Peleton, masquerading as tech shares, are getting hammered.
Yup. It wasn't just last night that there have been large falls in the Dow and NASDAQ, this has been going on since the start of the year.
And its effect on some very popular funds has been dramatic. On 31/12 BG America stood at 18.65. It is now 14.68 and will be a lot lower tonight. BG Global Discovery was 22.76 on 31/12. Now it is 19.01. Last year's gains being wiped out in weeks.
Even everyone's favourite - Fundsmith Equity - has hit the buffers. 6.78 on 31/12, now 6.16.
You refer to Peleton. I will offer you a similar share I hold - Experian. Down 20% since the start of the year for absolutely no good reason I can see. (It has even published really good results during this time).
These are huge falls which just make me think that we kid ourselves we are investing. Really at times like this I can only say we are gambling.
If anyone's portfolio is higher now than at the start of the month, then I will happily use you as my financial adviser!
It does seem like a large element of gambling and guesswork.
@golfaddick, at what % would you implement a stop loss on a fund?
AFAIK that isn't even possible. Not on unit trusts anyway or whatever they call them now. It is one of the many ways in which funds are not traded in the best interest of ordinary punters. Even if it is better than when I started getting into this stuff, back in around '89, when there was a 5% bid-offer spread. For no good reason.
That's true Prague. Lazy wording from my behalf, as I mean an approx mental stop loss for a fund. Lets say for example if somebody held one too many BG funds, I would advise an approx % before they sell and risk losing their capital.
The classic investor mistake is to hold on too long, and only sell once things get painful (which probably means taking a big loss too). We saw this with many holders of Woodford's fund. Sometimes, at times like this I find it useful to move into global trackers.
That's true Prague. Lazy wording from my behalf, as I mean an approx mental stop loss for a fund. Lets say for example if somebody held one too many BG funds, I would advise an approx % before they sell and risk losing their capital.
The classic investor mistake is to hold on too long, and only sell once things get painful (which probably means taking a big loss too). We saw this with many holders of Woodford's fund. Sometimes, at times like this I find it useful to move into global trackers.
Well again, James Slack may beg to differ. I am one of those who got done by Woodford, but that's because he went rogue. That is more about lack of regulatory oversight than market behaviour. Punters bought in thinking he would run it much like he did at Invesco, whereas unbeknown to us, he had gone completely in another direction with the fund, and nobdoy really knew. In fact one of my bugbears is how difficult it is to see what a fund, any fund, is investing in at any one time. On the Hargreaves Lansdowne platform it kindly allows me to see what the 10 biggest holdings are. But in most cases that won't let you see 75% of the total holdings.
Today's FT editorial. ( "A much needed market correction" )They can be as wrong as the next financial commentator, but to me it makes a lot of sense: Extract below
Even after the recent sell-off, markets and technology stocks in particular are still up significantly from two years ago. The “correction” is aptly named: valuations of some of these companies got out of hand relative to their underlying earnings. A minor fall will add some needed discipline to the market, reminding investors that share prices can go both ways. Bitcoin, an obvious indicator of speculative frenzy, has fallen to its lowest level for five months.
Others may see the recent drop as a buying opportunity. While the Fed is embarking on a tightening cycle in response to higher inflation, long-term equilibrium interest rates are still likely to end up low by historic standards, supporting equity values. The fundamental demographic and technological drivers of the secular decline in long-term interest rates, such as ageing populations putting away more to save for their retirement, will only change slowly. Tech companies, too, have often proved resilient. The changes provoked by the pandemic, whether it is how we shop, work or relax, may take longer to bed in than first predicted. Markets may have got ahead of themselves with the bull market but they should not overdo the correction either. With or without Netflix they can chill.
Today's FT editorial. ( "A much needed market correction" )They can be as wrong as the next financial commentator, but to me it makes a lot of sense: Extract below
Even after the recent sell-off, markets and technology stocks in particular are still up significantly from two years ago. The “correction” is aptly named: valuations of some of these companies got out of hand relative to their underlying earnings. A minor fall will add some needed discipline to the market, reminding investors that share prices can go both ways. Bitcoin, an obvious indicator of speculative frenzy, has fallen to its lowest level for five months.
Others may see the recent drop as a buying opportunity. While the Fed is embarking on a tightening cycle in response to higher inflation, long-term equilibrium interest rates are still likely to end up low by historic standards, supporting equity values. The fundamental demographic and technological drivers of the secular decline in long-term interest rates, such as ageing populations putting away more to save for their retirement, will only change slowly. Tech companies, too, have often proved resilient. The changes provoked by the pandemic, whether it is how we shop, work or relax, may take longer to bed in than first predicted. Markets may have got ahead of themselves with the bull market but they should not overdo the correction either. With or without Netflix they can chill.
My overall book is down about 5% from the start of the year; my tech holdings are down almost 20%! It's an interesting aricle and I totally understand it. I was heavier into tech a year ago and I'm glad to say I rebalanced or I'd be down a lot more. I'm not panicking and I'll simply hold for now. A 20% drop, however, requires a 25% rise to get back to the same position.
Netflix doesn't surprise me as there's much more competition out there now that have been slow to catch up; Prime's content improves all the time, plus you get the Amazon delivery advantages, and Disney+ has a lot that appeals to families and if people are choosing just one then Neflix is no longer necessarily the first choice.
Just examining the damage to my funds portfolio. The damage to the Baillie Gifford funds is pretty apparent. Looking at the last 6 months, here are how two of their funds do compared with two other funds I hold in the same respective sectors
BG European down 13%; Jupiter European down 3%
BG Positive Change down 16%; Janus Henderson Global Sustainable Equity down 2%
So, should I be like a footie club chairman? Has BG lost its mojo? Sell, sell, sell? I don't think so. Unfortunately I can only get limited info from H-L on the holdings, but certainly their European fund does not seem to suffer from "too much tech", so I'm going to put my money where my mouth is and top up a fair bit on that one.
Positive Change is a more awkward one. Only 33 holdings; 8% of the fund in Moderna, 7% in Tesla. 18 % in the Pharma and Biotech sector, 14% in Technology Hardware& equipment. Tesla bothers me more than Moderna, but overall I think it invests in the right sectors for growth. Its 3 and 5 year performance is simply stellar (109 and 219%). Sod it, I'll top that up too.
(and if you think I'm trying to pull a big Warren Buffett here or something, I'm only investing because I still have a dollop of cash in my SIPP, sitting in stark rebuke to my own rant against cash )
Just examining the damage to my funds portfolio. The damage to the Baillie Gifford funds is pretty apparent. Looking at the last 6 months, here are how two of their funds do compared with two other funds I hold in the same respective sectors
BG European down 13%; Jupiter European down 3%
BG Positive Change down 16%; Janus Henderson Global Sustainable Equity down 2%
So, should I be like a footie club chairman? Has BG lost its mojo? Sell, sell, sell? I don't think so. Unfortunately I can only get limited info from H-L on the holdings, but certainly their European fund does not seem to suffer from "too much tech", so I'm going to put my money where my mouth is and top up a fair bit on that one.
Positive Change is a more awkward one. Only 33 holdings; 8% of the fund in Moderna, 7% in Tesla. 18 % in the Pharma and Biotech sector, 14% in Technology Hardware& equipment. Tesla bothers me more than Moderna, but overall I think it invests in the right sectors for growth. Its 3 and 5 year performance is simply stellar (109 and 219%). Sod it, I'll top that up too.
(and if you think I'm trying to pull a big Warren Buffett here or something, I'm only investing because I still have a dollop of cash in my SIPP, sitting in stark rebuke to my own rant against cash )
I'll have a word with both BG and Jupiter and see if I can get a fuller breakdown of the shares each one holds instead of just the 10 largest that the monthly fact sheets give.
Interesting that you feel confident topping up some BG funds. Are you deciding simply on the dip price and past performance? What if the falling knife continues to drop and tech/growth funds take a further pounding. They've been in a super bubble since CV hit.
Interesting that you feel confident topping up some BG funds. Are you deciding simply on the dip price and past performance? What if the falling knife continues to drop and tech/growth funds take a further pounding. They've been in a super bubble since CV hit.
If something I hold drops, and I have cash to invest, I try to establish if the reasons I bought it then, still apply, and if the answer seems to be “yes” , then I buy some more. Getting the same thing for a better price. Stood me in good stead, and is especially appropriate for income-driven stockholdings.
Comments
Next week will give some indication if earnings are going to allay inflation fears. Netflix wasn't a good start and shares like Peleton, masquerading as tech shares, are getting hammered.
And its effect on some very popular funds has been dramatic. On 31/12 BG America stood at 18.65. It is now 14.68 and will be a lot lower tonight. BG Global Discovery was 22.76 on 31/12. Now it is 19.01. Last year's gains being wiped out in weeks.
Even everyone's favourite - Fundsmith Equity - has hit the buffers. 6.78 on 31/12, now 6.16.
You refer to Peleton. I will offer you a similar share I hold - Experian. Down 20% since the start of the year for absolutely no good reason I can see. (It has even published really good results during this time).
These are huge falls which just make me think that we kid ourselves we are investing. Really at times like this I can only say we are gambling.
If anyone's portfolio is higher now than at the start of the month, then I will happily use you as my financial adviser!
You can do it with investment trusts I think.
Someone who knows may correct me.
The classic investor mistake is to hold on too long, and only sell once things get painful (which probably means taking a big loss too). We saw this with many holders of Woodford's fund. Sometimes, at times like this I find it useful to move into global trackers.
Even after the recent sell-off, markets and technology stocks in particular are still up significantly from two years ago. The “correction” is aptly named: valuations of some of these companies got out of hand relative to their underlying earnings. A minor fall will add some needed discipline to the market, reminding investors that share prices can go both ways. Bitcoin, an obvious indicator of speculative frenzy, has fallen to its lowest level for five months.
Others may see the recent drop as a buying opportunity. While the Fed is embarking on a tightening cycle in response to higher inflation, long-term equilibrium interest rates are still likely to end up low by historic standards, supporting equity values. The fundamental demographic and technological drivers of the secular decline in long-term interest rates, such as ageing populations putting away more to save for their retirement, will only change slowly. Tech companies, too, have often proved resilient. The changes provoked by the pandemic, whether it is how we shop, work or relax, may take longer to bed in than first predicted. Markets may have got ahead of themselves with the bull market but they should not overdo the correction either. With or without Netflix they can chill.
My overall book is down about 5% from the start of the year; my tech holdings are down almost 20%! It's an interesting aricle and I totally understand it. I was heavier into tech a year ago and I'm glad to say I rebalanced or I'd be down a lot more. I'm not panicking and I'll simply hold for now. A 20% drop, however, requires a 25% rise to get back to the same position.
Netflix doesn't surprise me as there's much more competition out there now that have been slow to catch up; Prime's content improves all the time, plus you get the Amazon delivery advantages, and Disney+ has a lot that appeals to families and if people are choosing just one then Neflix is no longer necessarily the first choice.
BG European down 13%; Jupiter European down 3%
BG Positive Change down 16%; Janus Henderson Global Sustainable Equity down 2%
So, should I be like a footie club chairman? Has BG lost its mojo? Sell, sell, sell? I don't think so. Unfortunately I can only get limited info from H-L on the holdings, but certainly their European fund does not seem to suffer from "too much tech", so I'm going to put my money where my mouth is and top up a fair bit on that one.
Positive Change is a more awkward one. Only 33 holdings; 8% of the fund in Moderna, 7% in Tesla. 18 % in the Pharma and Biotech sector, 14% in Technology Hardware& equipment. Tesla bothers me more than Moderna, but overall I think it invests in the right sectors for growth. Its 3 and 5 year performance is simply stellar (109 and 219%). Sod it, I'll top that up too.
(and if you think I'm trying to pull a big Warren Buffett here or something, I'm only investing because I still have a dollop of cash in my SIPP, sitting in stark rebuke to my own rant against cash