What stocks are you buying in this bear market ...

[Jingthing]

... 

which might be approaching a bottom?

 

It's obvious these are very unusual times in the global markets.

But history shows us such crisis times are the best times to invest.

But picking the winners is the difficult part.

 

Of course you can't pick exact bottoms but in the long run that doesn't matter if you're in for the long run.

 

From a US perspective the best advice has always been highly diversified total market index funds. The chances of beating the market by picking stocks is remote and even professionals have a hard time with that.

 

But it seems to me, this time in history is rather different.

 

My gut feeling says now is the time for picking stocks.

 

So for people looking at stocks now or in the near future, what stocks are you looking at?

[Jingthing]

I will answer first.

 

I'm looking at tons of stocks.

 

I don't have the skills to analyze companies myself so I'm overly dependent on media sources.

 

So far I've bought Berkshire Hathaway-B. This stock holds so many other stocks that it's much more like an ETF than a one company stock.

 

I will probably soon buy Mercado Libre (Uruguay) and Palo Alto Networks.

 

Mercado Libre is a potential future Amazon of Latin America. Software/Fintech. I have contact with expats there that rave about their services. Palo Alto Networks is a leader in cybersecurity.

 

But prices are now so low now for very many appealing companies, it sure isn't easy coming up with the finalists.

 

Personally I am not interested in short term trades. I want stocks with great long term potential to hold indefinitely. 

 

I'm cool with moderate risk, bored with very low risk and low potential, and open to smaller gambles on high risk. 

Edited October 31, 2022 by Jingthing

[bluebluewater]

I am not buying anything right now and have no intention to do so in a falling market.  This is no time to fight the tape.  WHEN that time does come I'll be looking at the regional banks (USA) whose share price has fallen and offer some really good dividends.  At my age that is much the best as far as I am concerned.  I'll have those divvy's reinvested and not do a lot of thinking along the way.  Once again, at my age that is ALSO much the best!

[Jingthing]

1 minute ago, bluebluewater said:

I am not buying anything right now and have no intention to do so in a falling market.  This is no time to fight the tape.  WHEN that time does come I'll be looking at the regional banks (USA) whose share price has fallen and offer some really good dividends.  At my age that is much the best as far as I am concerned.  I'll have those divvy's reinvested and not do a lot of thinking along the way.  Once again, at my age that is ALSO much the best!

Understood but if you buy the right stocks and intend to hold long term it doesn't really matter if the falling isn't over (which it probably isn't). Historically people end up losing for being out of the market during key surges.

[OneMoreFarang]

No stocks, just beer. Prost!

 

[Thailand J]

At 62 my question is what to sell.  I am fully invested, mostly in broad market index funds.

I keep very low cash, BRK/B is my "cash account", meaning instead of keeping cash, I put about 10%  into BRK/B and sell whenever I need cash. The last time I sold it was at $277 per share, today it is $295. My cost basis is $103 or so.

If I have money to invest I'll still put it into index funds.

Market timing is very difficult, but it is a no-brainer to buy in a bear market. Latest forecast from Factset, S&P 500 will go up 18.9% in 12 months.

 

Edited October 31, 2022 by Thailand J

[1FinickyOne]

2 hours ago, Jingthing said:

if you buy the right stocks and intend to hold long term

Did great w/buy and hold from the time I was 50... not sure I have long term left... I am mostly in cash... I have bought the dip a couple of times and thought I caught the bottom. I didn't and sold at a loss... and glad to be out.

[Boomer6969]

2 hours ago, Jingthing said:

I will answer first.

 

I'm looking at tons of stocks.

 

I don't have the skills to analyze companies myself so I'm overly dependent on media sources.

 

So far I've bought Berkshire Hathaway-B. This stock holds so many other stocks that it's much more like an ETF than a one company stock.

 

I will probably soon buy Mercado Libre (Uruguay) and Palo Alto Networks.

 

Mercado Libre is a potential future Amazon of Latin America. Software/Fintech. I have contact with expats there that rave about their services. Palo Alto Networks is a leader in cybersecurity.

 

But prices are now so low now for very many appealing companies, it sure isn't easy coming up with the finalists.

 

Personally I am not interested in short term trades. I want stocks with great long term potential to hold indefinitely. 

 

I'm cool with moderate risk, bored with very low risk and low potential, and open to smaller gambles on high risk. 

And what is the market never recovers? Or at least a huge chunk of it, as climate change drives a major reshuffle of the economy?

Edited October 31, 2022 by Boomer6969

[Fat is a type of crazy]

Not stock tips but I point out that for people with Thai baht or in my case Australian dollars the US market doesn't look cheap - risen a fair bit lately and after taking into account exchange rate it is still fairly high. Over 2 years S&P nice in AUD and THB. 

[Inala]

33 minutes ago, Boomer6969 said:

And what is the market never recovers? Or at least a huge chunk of it, as climate change drives a major reshuffle of the economy?

Wonder why a few nations, mostly in the west, worry about climate change, while most of the world does not? China, India, Russia, most of Africa, most of Latin America, these places could not give a flying <deleted> about it. In any case, war is coming and climate change will be relegated to the back burner for perhaps decades. We've had a long break without a major war, probably the longest in modern history, and since mankind has always been intent on killing each other, it's time to get back into it. Russia, even if defeated in Ukraine, is not going anywhere and China with Xi's recent re-election is now just a few years off invading Taiwan. With that background looming, I'd be looking for stocks that will perform even in war time. No idea what these are, but maybe commodities such as iron ore, aluminium and rare earths such as lithium? We need these to make ships, planes and missiles. Gold? Actually, do stock exchanges even remain functioning whilst a war is going on? 

[nigelforbes]

There's only one issue as far as markets are concerned and that's the Fed/inflation, everything else is noise.

 

I don't buy stocks or bonds, only actively managed funds. I went into wealth preservation funds about a year ago and I'm still there with less than 35% in global equities (thank goodness). I'm also about 40% in cash. My holdings are down less than 1% over the past year. I have a short list of funds I want to buy into when the upturn starts, all actively global equities funds, the big question is when that will be.

 

I don't believe for one moment that the current S&P surge will last, it's just another bear trap. The 10 year and 3 month bonds are still rising and remain over 4%, latest estimates are that the Fed will max out at 5% in the Spring...0.75% this week, 0.50% in December. The VIX has fallen to its lowest level in a month but is still over 25, the USD Index remains way too high at over 111%. Part of the reason the S&P rose over the past seven days results from safe haven buying of equities such as Apple that has attractive  dividend payments. I'm pretty certain we'll see a retracing of steps downwards after the Fed speaks this week. Also, US unemployment figures remain way too high and that's a key Fed measure, there's no real indication the rate increases are starting to have an effect on the real economy. The PCE (Price Index Report) is the Fed's preferred measure of inflation and that just came in up by 0.5%, until inflation is tamed I don't believe equity markets increases are sustainable.

 

Having said all those things, the falls in some of the FAANG stocks were massive, there is a small chance that pent up consumer demand might generate a surge, if that happens it will play right into the Fed's hands and the December increase will be much higher, not lower.

 

 

 

Edited October 31, 2022 by nigelforbes

[mania]

4 hours ago, Jingthing said:

which might be approaching a bottom?

Boy I see just the opposite

With DJIA at 32k+ & Nas nearly 11k I am thinking major dump headed this way ????

[Lacessit]

I'm in cash, precious metals, and peer-to-peer lending. Not really interested in casinos.

[Peterw42]

OP, where do you get the idea that markets are falling, trending downwards ?

All the major indices have been back on the rise for most of October.

If you go back to fundamentals, buy low and sell high, I wouldn't be buying anything.

And given that markets are down from unrealistic highs, highs that basically came from governments printing money for covid, that made its way into the share market in the form of companies buying back there own stock.

The way I see it, markets are not really down or trending down, and if they are trending down its from governments printing money, things are not going back up based on the same printing money.

 

 

 

[nigelforbes]

I personally don't see the DJI as representative of the market, ditto the Nasdaq. I think only the S&P offers a representative view of the market as a whole. The former(s) comprises 30 stocks, the later comprises 500, the issue is the scale of the view. And I think the DJI has been rising for about half a month, since 12 October, not a full month at all. Not that a two week surge means much at all, a 200 day MA is a much more representative of trend, which incidentally is down.

 

.https://www.marketwatch.com/investing/index/djia/charts?mod=mw_quote_advanced 

Edited November 1, 2022 by nigelforbes

[Sparktrader]

1 hour ago, Boomer6969 said:

And what is the market never recovers? Or at least a huge chunk of it, as climate change drives a major reshuffle of the economy?

Markets always go up.

[Sparktrader]

Iron ore stocks have been bearish. Next year bounce back i think.

[nigelforbes]

11 minutes ago, Sparktrader said:

Markets always go up.

I love it when people reference the great crash of 1929 and think that just because markets crashed and recovered nearly 100 years ago that they must do exactly the same forever! There is no comparison between 1929 and today, in fact, there's no comparison between the current events and any time in the modern past. It's perfectly reasonable to think that markets might not recover, several respected analysts are talking in terms of recovery within a decade.

[Sparktrader]

Just now, nigelforbes said:

I love it when people reference the great crash of 1929 and think that just because markets crashed and recovered nearly 100 years ago that they must do exactly the same forever! There is no comparison between 1929 and today, in fact, there's no comparison between the current events and any time in the modern past. It's perfectly reasonable to think that markets might not recover, several respected analysts are talking in terms of recovery within a decade.

I made no mention of 1929. There are bearish people preaching doom every year. They are wrong 9/10. Markets always go up. Gdp growth means markets have to go up.

 

Not logical to think markets will never recover.

[nigelforbes]

4 minutes ago, Sparktrader said:

I made no mention of 1929. There are bearish people preaching doom every year. They are wrong 9/10. Markets always go up. Gdp growth means markets have to go up.

 

Not logical to think markets will never recover.

Markets are probably the least logical mechanism known to man.

 

Indeed there are far too many doom mongers who comment on this subject and I would normally disregard them, this time around I disregard them 80%. But consider for a moment the precedent for market over performance following a global pandemic the scale of covid and the lockdowns and supply chain disruptions it has caused. Consider also the unprecedented money printing exercise that preceded the pandemic and the over valuations that resulted. There are no comparisons in modern history to these things. So will we recover? Yes of course we will, that's not an issue, the only issue is when and how that timeframe fits with everyone's plans. That said, it's not unreasonable to think that people who are wrong 9/10 times will eventually be right once, and that's all it will take.

[Sparktrader]

5 minutes ago, nigelforbes said:

Markets are probably the least logical mechanism known to man.

 

Indeed there are far too many doom mongers who comment on this subject and I would normally disregard them, this time around I disregard them 80%. But consider for a moment the precedent for market over performance following a global pandemic the scale of covid and the lockdowns and supply chain disruptions it has caused. Consider also the unprecedented money printing exercise that preceded the pandemic and the over valuations that resulted. There are no comparisons in modern history to these things. So will we recover? Yes of course we will, that's not an issue, the only issue is when and how that timeframe fits with everyone's plans. That said, it's not unreasonable to think that people who are wrong 9/10 times will eventually be right once, and that's all it will take.

US GDP growth exceeded expectations last qrtr.

 

 

[nigelforbes]

3 minutes ago, Sparktrader said:

US GDP growth exceeded expectations last qrtr.

 

 

"The growth came in large part due to a narrowing trade deficit, which economists expected and consider to be a one-off occurrence that won’t be repeated in future quarters"

https://www.cnbc.com/2022/10/27/us-gdp-accelerated-at-2point6percent-pace-in-q3-better-than-expected-as-growth-turns-positive.html

 

(It also resulted from increased government spending).

 

And it's just as well it wont be repeated because if it is it will mean the Fed's medicine isn't working, in which  case we can expect them to increase the size of future rate increases, not make them smaller.

.

[Onerak]

1 hour ago, Inala said:

Wonder why a few nations, mostly in the west, worry about climate change, while most of the world does not? China, India, Russia, most of Africa, most of Latin America, these places could not give a flying <deleted> about it.

They do care about climate change. But they (specially India and China) don't want to bend to the demands/dictates of Western countries who have laid their economic foundations after looting and pillaging asian and african countries and polluted  the earth since industrial revolution. They will go their own ways that don't hinder their progress. More percentage Indian/Chinese are aware of climate change and its impact than Americans. 

Edited November 1, 2022 by Onerak

[Sparktrader]

5 minutes ago, nigelforbes said:

"The growth came in large part due to a narrowing trade deficit, which economists expected and consider to be a one-off occurrence that won’t be repeated in future quarters"

https://www.cnbc.com/2022/10/27/us-gdp-accelerated-at-2point6percent-pace-in-q3-better-than-expected-as-growth-turns-positive.html

 

(It also resulted from increased government spending).

 

And it's just as well it wont be repeated because if it is it will mean the Fed's medicine isn't working, in which  case we can expect them to increase the size of future rate increases, not make them smaller.

.

Choppy markets are common after downturn. I expect 12 months of chop then a bull market.

 

 

[Lacessit]

3 minutes ago, Sparktrader said:

Choppy markets are common after downturn. I expect 12 months of chop then a bull market.

 

 

Michael Burry is predicting a major crash, and has sold every stock he owns. I daresay he has made a lot more money by following his own advice than you have.

[Sparktrader]

21 minutes ago, nigelforbes said:

Markets are probably the least logical mechanism known to man.

Only short term. Long term they reflect profits. If profits grow on average 8% then stocks on average go up 8% pa.

 

BHP was $14 in 2016. The price was illogical. Analysts said sell. Went to $54 back to $35. 

 

 

[Jingthing]

2 hours ago, Boomer6969 said:

And what is the market never recovers? Or at least a huge chunk of it, as climate change drives a major reshuffle of the economy?

You can invest in climate adaptation. There is a theory going around that the market won't do much for 10 or 20 years.  If that's the case SOME stocks will.

[Sparktrader]

Just now, Lacessit said:

Michael Burry is predicting a major crash, and has sold every stock he owns. I daresay he has made a lot more money by following his own advice than you have.

Who is Michael Burry?

[Sparktrader]

https://www.cnbc.com/2022/10/10/paul-tudor-jones-believes-we-are-in-or-near-a-recession-and-history-shows-stocks-have-more-to-fall.html

 

300 days for average recession is about 12 months of chop.

 

I agree with Paul.

 

Paul is 20 times richer than "Burry".

 

 

[nigelforbes]

7 minutes ago, Sparktrader said:

Only short term. Long term they reflect profits. If profits grow on average 8% then stocks on average go up 8% pa.

 

BHP was $14 in 2016. The price was illogical. Analysts said sell. Went to $54 back to $35. 

 

 

You of course can find isolated examples but markets remain completely illogical.

 

Ah yes, averages. Averages can be used to justify almost anything, whether or not they are actually relevant is another story. Why? Because averages rely on historic data and markets are forward looking, just because they did something in the past doesn't mean they will continue to do the sane thing in the future.