The Stock Market - A daily diary

I’m not sure what more you could ask for Ina company.   both of these beat EPS AND REVENUE.  yet here I am humiliated with next to nothing.  If I have to hear the phrase priced into earnings again I’m going to lose it.  We know I wasted six weeks paying attention to APT.  losing 6K in calls.   whatever.   But this helpless feeling is 10X worse.   How I bet on both companies to perform ... they do... yet everything was taken ?  if my little brain finds out there was indeed a way to capitalize on these during their peak highs this morning I’ll be frozen in place. is there anything else I could’ve done besides selling into earnings here to make a profit ? 

To make it as concise as possible:  No, a trailing stop is not executed in after-hours trading or pre-market trading.

If it is a day order, obviously it cancels at EOD.  If it is GTC, it will stay active until the inside bid triggers it.

Did you have day trailing stops in place?  If so, consider GTC orders.  Make it as hands-free as possible. 

So humiliating.   I chose wal mart over target 

walmart brings in 6.8x more revenue than target yet I had to sell my calls AT A LOSS.  
targets 150s and 155s today maxed out over 18 to 1 on your money.  Minimum 8 to 1 I believe.  this feeling of helplessness I’ll never forget.  the investors liked target CEOs one minute speech better than Walmart’s regarding Q3 outlook even though BOTH said they were uncertain.  this is so fuking backwards it’s incredible 

You have to look at NPM, Net Profit Margin.  Target is lower than the sector, but still higher than Walmart.

You also have to look at the efficiency—Walmart is run more efficiently than Target is.

Target is more into E-commerce.  Target appeals more to younger folks with more upscale items than Walmart.

Target is more interested in profit margins.

So, there are points for both companies.  But you have to also look at longterm and which company has the potential to bring an investor more return.

Well Boys and Girls the market just keeps moving up and I have no logical reason for it. Anybody help me with this? Tomorrow I am trimming anything above a 40% gain since purchase. That is 12 stocks getting a haircut! Hell, 8 are in a tax free account 

Welcome to the forum Johnny. The markets are inexplicable. I went from 2% cash to roughly 15% cash one third of a way into this rocket ship recovery. It leaves me with a ton of cash on this sidelines growing weeds, but the 85% that I left in the market is due for a reality check.

I hate to admit that these markets have me stumped. 

If you figure it out let me know.

A lot to that.

Look at it this way:  Where else would you put your money right now to get the return the stock market will get you?  Especially, something that is as hands-free.  People are going to want to invest for their retirement and make their money work for them.

Why sell now?  Do you need the money?  Do you feel the market is going down now?  Where will you put the money after you sell?  Are you okay with possibly missing out on more profit?

If you are going to try to 'time' the market and just wait for a big dip -- I understand.  But that is very risky.  If you do not think it is going up anymore -- will you think it has bottomed when it does dip?  Or will you wait too long to get back in -- and miss even more profits?  So, you could potentially 'miss out' twice if you time it wrong.

Look at how quickly the market bounced back from this past dip.

Who knew the clock was ticking down last night? Counting down the minutes to "reality check" #1. The markets were way overdue to blow off some steam. In my post yesterday, I was going to say the reality check might be tomorrow or next month or in 4 months but that would have been cliche. 

Raiders. I understand your advice as up until late June of this year I was 98% invested and had been fully invested my entire life. Sometimes people have to make a decision to take out some insurance. My 15% cash is waiting for the right opportunity. Johnny.....I hope you were able to get out of those positions today before things went south.

Yikes.  Oh god yikes.    What a day.  This is literally a casino.  Last week I turned 2K into 10K with with great workday earnings riding the waves of that massive $CRM Steam.  then this week I threw the 10K into CrowdStrike calls on Monday hoping to run it up into earnings yesterday.   I woke up yesterday and at open the options on 135s were worth 75K. So I held and held.  then the massive tech selloff happend half hour after open with zoom.  so I panic sold for a 30K profit.  not bad at all.  I see how it hit 157 pre market and my brain said to me ... if we can open at this level , these options just may be worth six figures which would’ve given me a heart attack.  

They beat earnings and it still tanked post market as well as premarket.  So I was a blessing in disguise that I sold otherwise I would’ve taken a loss on them at open this morning.   so next we go to peloton.  Bought some 90s expiring next Friday as they report earnings next week.  and the tank continues. All I do is buy calls.  Are we honestly gonna see money moving away from this inflated tech sector here or is this just a one day blip? thinking of changing course to puts tomorrow since the chatter does not seem to be too positive regarding futures already being down 

hope you all made it out of today better than I did 

Do you have a reason why?  Just uncomfortable?  Why late fall and not early spring or next fall? 

So, you have over 1/4 of your money just sitting there making no money?

Was just curious about your reasoning here.

Raiders. You are one full steam ahead, 100% all in investor that's for sure. He just took out some insurance....75% in is still a lot and it all depends on age, current financial position, and goals. 

Rush....Welcome back! Stay away from the Dumbocrats. That's my advice for the day!

Gamble,

It is not that I think people should be all in high-risk stocks.  Without knowing a person's closeness to retirement or particular financial situation -- it is hard to tell what to do.

My concern is usually with folks trying to time the market -- that does not work.  So, unless you really have a valid reason(s) for getting out, you should stay in.  Maybe rearrange some.

If you are 20, 30, 40 -- NO WAY should you get out.  50, 60 -- I have no problem rearranging but not to cash.

People cannot even time the market by day -- so, should not try to time it by months or years.

The other issue is just holding onto cash.  Unless you have absolutely all of the money you and your family will ever need for retirement you should have your money working for you somewhere and not just in a savings account.

Maybe he is doing something besides just sitting on it.  But I gathered that is what he is doing.  It is a very rare occasion when that is the best plan --short-term or long-term. 

I am not against taking it out for 'insurance'.  I get that.  But in your mind you are either scared (worried) or happy with profit so far (implying you feel a drop is coming).

I think some time back WSC had said he had targets picked out to get back in -- drops to 20k, drops to 15k, drops to 10k etc.   What are you doing until they hit target?  How long do you wait?  What if it never hits target again?

I really understand that.  But what do you do in the meantime, while waiting to pick your 'spots' to get back in?

WSC did not say if he had his money working elsewhere -- maybe he did.  But I can never advocate a person that is a ways from retirement to sit on cash.  Buy a rental house or something.

If you have enough emergency-type cash reserve on hand -- make the rest work for you.  It can be something easy to move in and out of if you need it.

To back it up some.  This is from 2018:

https://money.cnn.com/2018/01/31/retirement/retirement-savings-stock-market/index.html?iid=EL

I think you're absolutely right to question whether keeping 100% of your retirement stash is the right way to go at your age, or for any age at that matter.

And if history is any guide, its demise will likely come via a major setback, with a near 60% drop in stock prices like the one from late 2007 to early 2009 not outside the realm of possibility.

But even knowing that, I don't think the answer is making a move as radical as shifting your entire nest egg into a safe haven. One reason is that, for all you know, making such a move now could be way premature. Over the past several years, Cassandras have predicted the imminent collapse of this bull market for a variety of reasons -- the downgrading of U.S. Treasury securities in 2011, Brexit in 2016, the election of Donald Trump -- and yet it's still going strong. If you abandon stocks every time you get jittery about the economy or the financial markets, you may lose out on some impressive growth in the value of your savings.

Another reason I'm not a big fan of investors fleeing to "safer investments" is that the investments they chose sometimes aren't as safe as they think they are

Besides, even if you do manage to get the timing right when exiting the market, you've then got to decide when to get back in. That's hard to do in real time as opposed to with the benefit of 20/20 hindsight. Get that decision wrong and you might miss out on the often explosive gains stocks' generate in the early stages of coming of a recovery. For example, stock prices skyrocketed 39% in just the first three months after hitting bottom in the wake of the financial crisis.

So rather than trying to figure out when to get in and out of the market and which investments really offer the safety you seek, I recommend you set an investing strategy you can live with in all sorts of market conditions. And by that I mean creating a mix of stocks, bonds and cash that can generate reasonable returns, given the amount of risk you're willing to take, and how long your money is likely to remain invested.

But what you don't want to do -- and this applies whatever your age -- is to get into that Wall Street "risk on-risk off" mentality of jumping from stocks to bonds or cash based on where the market appears to be headed in the short term. When it comes to investing the money you'll be counting on in retirement, you want to develop a rational, disciplined strategy that balances risk and reward, not engage in a never-ending guessing game you can't consistently win.

They put a graph on here to illustrate missing out on the top ten days.

https://www.wealthify.com/blog/time-in-the-market-versus-timing-the-market

You can actually measure the effect of doing nothing versus doing something, by looking at how different your returns would have been in the past. The graph below shows the effect on your overall returns of missing the best 10 days in the FTSE 100 since 1986 versus staying invested.

The bottom line
Evidence suggests that ‘time in the market’ rather than ‘timing the market’ is the more suitable approach for the vast majority of non-professional retail investors. Historic performance of a market such as the FTSE-100 shows that in the long run there are typically more positive upward movements in the market than negative downward movements by a factor of 3 – 1. So, ignore the daily ups and downs, stay invested and think long term.

This breaks it down on many levels.  This should be enough to emphasize my points.

https://www.capitalgroup.com/individual/planning/investing-fundamentals/time-not-timing-is-what-matters.html

Raiders. I have been investing for going on 4 decades and everything you say is true. At 15% cash, as a result of my June sales, I am personally at the highest cash percentage I have held in my lifetime. Prior to this year, I have sat between 95-97% invested my entire life. I got spooked by these markets, quite frankly, because we are in unchartered waters with this pandemic. I got it wrong but it's ok. I gambled and I lost with that 15% but opportunities will arise again. 

That’s what I have no problem with.  

Folks that are already squared away can and should be less aggressive.  

Maybe he is that position as well.  But I know an awful lot of folks that are not and get irrational about taking money out at the wrong time and too often.  

Depending on the situation, you have to consider taxes, fees and potentially missed profits.  

During this past dip I know several that got out and were on the sideline when the market ran right back up.  

People have to realize with this type of investing as they say:  Time not timing is what matters. 

Luv you guys! Soon to be a very healthy 68 ( Oct 11th if you want to give me a shout out on that day ). As was stated earlier by someone I am totally squared away. Easily 3G's coming in each month more than is going out. Yes I feel a little queasy about the market because the world I grew up in is no longer the world I live in, if that makes sense. If I stay the course should run out of money turning 93 yrs of age according to my group so having money around to help people in need when I want to makes me feel good. Will always read the financials daily, just used to do that for like forever , so if an opportunity comes along I'll bite!  I am Canadian and sitting right on the American border watching the world go by now. The thing to figure out for me owning a decent % of American companies is where you want your $ to be positioned. The Canadian $ has risen 8c against yours in 7 months. That to me is a 8% loss. Having Larry in charge of your finances scares the shit out of me!! Please remember to Vote!! It was a Great Derby!

Very nice post!  Congratulations on having done a fine job for your retirement. 

Brother-in-law is a Canadian pilot and that currency drop is a big deal for them right now as well. 

As squared away as you are, I see nothing wrong with some cash on hand for a buying opportunity. But I would have it in something that is making a bit of income as opposed to all cash only.

Yes.  Derby was good.  I was rooting for Honor AP because one of my favorite horses of all time was AP Indy.  Honor AP got bumped twice coming out of the gate and was dead last.  He came up fast and was closing to finish fourth.  If he hadn’t been bumped I think he would’ve won. 

Nice to see you in here and glad you have an interest in the financials.