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@little5bee I got rid of my energy holdings, but ARII is part play in this sector, being mfr of railroad cars which is down due to energy sector mainly. However, I have bought and sold COP a few times over the last year, each time making money. Best of luck with CVX.
Looks like mostly tax related trades this week. A bump up next week likely as typical.
To me, it looks like a market waiting for an excuse to pull back but not finding it. Am fully invested at close to 80% in equities so nothing more to invest but thinking of paring it down to about 60% over the next couple of weeks to lock in some profits.
If my suspicions/intuition are right, a disappointing quarter reporting for AAPL last week of Jan might turn out to be a catalyst/excuse (not a cause) for a small correction for the entire market even if they cover up the results with massive share buybacks or the shares have already priced it in to be below $100 by then. But that is a big IF.
Hi Slick! Glad you started this. I almost did when I talked to Old Skeet. Some of this is old info....sold TMSFX--bio is down soooo don't need to short it anymore. JOHAX---don't need Asia....have enough already as I do closed funds. They seem to underperform when they're closed.....I guess that's why they closed them. Newer info: have bought WAVIX and RYSBX---been thinking about the dollar with QE overseas and everybody slow.....we're the best! Like anybody else would come close to being that...lol. And with the terrorist threats also I think the problem the Saudi's will have next year from cuts in the budget. I think there will be trouble in the Middle East, soooo....who's yer daddy? Yep, the dollar! And the rest of the world can just....well, smooch my hindquarters! God bless the Pudd p.s. If all this crap doesn't work out, well, just call me a pro like they do on CNBC!
Had raised cash few months back and started a very slow nibble in December using automatic investing in FPACX and OAKBX every two weeks through Schwab. My momentum play account has been 75% cash for almost four months now. The taxable portfolio has been at 20-25% cash for a long time, close to a year.
Not doing much except following my target allocations and occasionaly making some adjusts inside a sleeve but keeping the portfolio's area allocations (cash, bonds, stocks) close to their targets. Currently, my portfolio bubbles as of a December 2016 ending Xray analysis at 25% cash, 20% bonds, 35% domestic stocks, 15% foreign stocks and 5% other. Unless there is a good pullback in the stock market I most likely will follow the current allocation until something takes place to warrant a change.
In equities, I am favoring good dividend paying world equity and allocation funds over their domestic counterparts due to domestics being currently overbought and high in valuation. In fixed income, I am favoring short duration, bank loan and convertible securities funds in the coming rising interest rate environment.
Sometimes there is just not much for me to do except to just monitor the markets looking for opportunity to develop. This is not to say I don't have some long term investment strategies currently engaged, as I do, it is that that I don't have any ballast positions or any special investment positions engaged at this time.
In closing, I am heavy in cash, light in income and neutral in equity.
I just replaced TRP PRASX New Asia with TRP PRIDX, (International Discovery.) At the New Year. This is when I always make adjustments and changes. Only 2.6% of portfolio. (Now watch it take a nosedive, eh?) I'm letting everything else just run. One small-cap fund did poorly, another did OK, in 2015. (MSCFX and PRDSX.)
Just wondering what your asset allocaton might be? How much (percent) in cash, bonds and stocks are you holding? I been selling more than I have been buying for the past two years ... raising my allocation to cash by about five percent each year. Thinking of late, perhaps I should have done ten percent per year and that would have put me about a third, rather than a quarter, in cash.
After the close on January 4, 2016 I will be 100% cash and will remain so for the foreseeable future. Unlike many knowledgeable posters on MFO my actions are very "unscientific" and I do not advocate this move to anyone else. Briefly stated, some of my reasoning is as follows:
1. I believe we are already in the early stages of a bear market although the major indices do not reflect this officially as yet. However, they look as if they spent most of 2016 in a broad "rolling top" pattern and the downside will accelerate. Many stocks are under their 200-dma and many more are already well off of their YTD highs - 20% or greater. This is being masked by a "Nifty Fifty" phenomenon similar to the late 1970's in which a handful of very large-cap stocks (AMZN, NFLX, FB, GOOG, MSFT, V, etc.) did extraordinarily well, giving the major indices a false read if taken by themselves.
2. No sector did well in 2015 after July 1st, i.e., nowhere to hide.
3. Rising interest rate environment, albeit slowly. However, the mindset has changed.
4. Law of Averages: we are entering the seventh year of a bull market with barely a 10% correction in that time span. This is one of the 2 or 3 longest bull markets in the past 100 years. We are certainly due for a larger correction.
5. I think as the 2016 Presidential campaign narrows down to two candidates and it intensifies it will have a corrosive effect (yes, I know, a Presidential year is supposed to have positive returns historically). Voters will increasingly realize that the major candidates do not have their concerns or interests in view and offer no solutions to the major problems they face. They are beholden to business interests and Wall St.
6. Risk:Reward ratio does not feel right to me. I think there is little upside left and I do not see any catalysts for it. Conversely, the downside - once it begins - is considerable. I am not hanging around for a 5% equity return in view of the above - it is the equity equivalent of reaching for yield in bonds (see "Kinder Morgan").
7. Insiders are heavy sellers, not buyers, in most stocks.
Clearly, everyone on MFO can poke holes in my reasoning but "You Pays Your Money, You Takes Your Pick". I have a gut feeling that a much better entry point for equities will arise sometime in the next 6 to 18 months and cash preservation for this potential opportunity is my major concern.
Bonds? Too much risk for too little return. Take a look at M* Fund Category Returns for taxable bond funds. All of them were either flat (at best) or lost money. There may be some opportunities in Municipal bond funds or selected Muni CEFs (with low or no leverage) but I need to research this further.
After the close on January 4, 2016 I will be 100% cash and will remain so for the foreseeable future. Unlike many knowledgeable posters on MFO my actions are very "unscientific" and I do not advocate this move to anyone else. Briefly stated, some of my reasoning is as follows:
1. I believe we are already in the early stages of a bear market although the major indices do not reflect this officially as yet. However, they look as if they spent most of 2016 in a broad "rolling top" pattern and the downside will accelerate. Many stocks are under their 200-dma and many more are already well off of their YTD highs - 20% or greater. This is being masked by a "Nifty Fifty" phenomenon similar to the late 1970's in which a handful of very large-cap stocks (AMZN, NFLX, FB, GOOG, MSFT, V, etc.) did extraordinarily well, giving the major indices a false read if taken by themselves.
2. No sector did well in 2015 after July 1st, i.e., nowhere to hide.
3. Rising interest rate environment, albeit slowly. However, the mindset has changed.
4. Law of Averages: we are entering the seventh year of a bull market with barely a 10% correction in that time span. This is one of the 2 or 3 longest bull markets in the past 100 years. We are certainly due for a larger correction.
5. I think as the 2016 Presidential campaign narrows down to two candidates and it intensifies it will have a corrosive effect (yes, I know, a Presidential year is supposed to have positive returns historically). Voters will increasingly realize that the major candidates do not have their concerns or interests in view and offer no solutions to the major problems they face. They are beholden to business interests and Wall St.
6. Risk:Reward ratio does not feel right to me. I think there is little upside left and I do not see any catalysts for it. Conversely, the downside - once it begins - is considerable. I am not hanging around for a 5% equity return in view of the above - it is the equity equivalent of reaching for yield in bonds (see "Kinder Morgan").
7. Insiders are heavy sellers, not buyers, in most stocks.
Clearly, everyone on MFO can poke holes in my reasoning but "You Pays Your Money, You Takes Your Pick". I have a gut feeling that a much better entry point for equities will arise sometime in the next 6 to 18 months and cash preservation for this potential opportunity is my major concern.
Bonds? Too much risk for too little return. Take a look at M* Fund Category Returns for taxable bond funds. All of them were either flat (at best) or lost money. There may be some opportunities in Municipal bond funds or selected Muni CEFs (with low or no leverage) but I need to research this further.
Simply put, I'm out. GLTA.
I could not agree more and hope DlphcOracl proves prescient. But my worry is everyone seems to be bearish on the boards as well as the sentiment polls. Those that aren't bearish seem to be expecting muted returns. I am 15% corporate junk and 85% muni junk and will act accordingly depending on the upcoming market action of which I haven't a clue. By the end of this week I will either be 0% in corporate junk or much heavier than my current 15%. I am as lousy as the next guy when it comes to predictions but hoping junk corporate surprises in 2016 to the upside after all the negative press the past year. That might mean oil will also have to surprise to the upside in 2016.
Hi DlphcOracl, Couldn't agree with you more (rolling tops). Yup! Lower highs, lower lows, not out yet. But selling into rallys as I can, as Jimmy says, "It's time to ring the register." I agree there is no reward, only risk. If the market taught you nothing in 2015, cash is king. God bless the Pudd
I added FMIJX and HSCSX to my retirement accounts the past week. I am about 33% US large cap, 26% Bond, 23% US small-mid cap, 16% International and 3% Cash.
You have found the proverbial fly in the ointment and I certainly have entertained similar thoughts in this regard - namely, EVERYONE is bearish or predicting paltry returns for 2016. Since it is the job of Mr. Market to frustrate the maximum number of investors, nothing would do so more than a rip snorting stock year in 2016 with 20% to 25% return on the S&P 500 index.
That said, I just don't see it. As much of a self-aggrandizing clown as Jim Cramer is, he DOES have an excellent feel for the market and market action and he has been pointing out the discrepancy between the major indices and the bear market action in many stocks under the surface for the past 3-4 months. Additionally, I found last week disconcerting, the proverbial maraschino cherry on the sundae of doom. The traditional Santa Claus rally should have taken the indices higher last week into Monday/Tuesday of next week, i.e., the final week of December has one of the highest percentages of being positive. An old Wall Street bromide is:
" If Santa Claus should fail to call, bears may come to Broad & Wall".
Last week's poor action simply reinforced my decision ( made 3-4 months ago) to bail out at year's end or first few days in 2016 and not hang around for a few percentage points of gain. Put another way: the low-hanging fruit has been picked over.
It is always interesting to see how sentiments build on themselves in either direction by allowing to see only what further reinforces the sentiment. Not to discount it, that is what current markets are built on as much as we like to pretend that it is built on numbers and data.
Hi DocK, I also own FMIJX. I think it's a very good fund. Have not added to it for a while due to dollar strength. Small caps.....I will wait 'til the end of the interest rate rise to add. I feel there will be time. The 3% cash JMO I would want more than that just in case. Curious.....what is your age? Is this a 401? Have you seen a bear? Are you a Cowboys fan? ..... Sorry, I get carried away sometimes. lol God bless the Pudd
I'm looking into another strong small cap option to go along with WSCVX. HSCSX is definitely one I'm looking at. HUSIX seems compelling, too, but these highs and lows with the deep value funds sometimes just turn me off since I'd need to keep adding during downturns to really reap the benefits. I just want to (need to) dca in.
I'm 61, Simple IRA, only see deer in Indiana, Purdue fan. I was struck by a study that was published many years ago that studied the portfolios of clients at the major brokerages. It found that a portfolio of good mutual funds 25% large US, 25% small mid US, 25% bond, 25% International beat 90% of the brokerage clients portfolios. So I try to keep it simple and stay close to this model in my retirement accts. I have a large emergency fund of cash and a bit of farm land.
Thanks for providing more detail on your take on the markets and your positioning. I too, believe stocks (S&P 500 Index) are expensive selling on as reported earnings at a P/E Ratio of 23. This is not to say they can't continue to do this but it sure does limit the upside potential from my perspective. I am going to hold off on doing much of anything until I see how January starts and perhaps finishes. As folklore has it ... As goes January ... so goes the year. If anything, I most likely will continue my current path and build cash through the year taking most all fund distributions in cash. This will raise my allocation in cash by about 1.25% per quarter so just in doing this I could be better than thirty plus percent in cash come this time next year. If I do some trimming that would raise my allocation in cash even more.
Notice that I deliberately avoided saying anything about P/E, valuation, etc. and that did not enter into my thinking at all. There are probably ten different ways of assessing valuation with widely discordant conclusions and the only time stock valuation is helpful is when it is at an obvious extreme, e.g., the super-low valuations toward the end of the 1973/1974 bear market or the dot.com extremes in late 1999/early 2000. At current levels, stock market valuation does not tell me anything. And, stocks can move in a given direction for a considerable period of time despite valuations, i.e., the stock market can remain irrational longer than you can remain solvent.
I am totally flexible and will watch the first month or two from the sidelines in 100% cash. If earnings are solid for equities and the market moves higher I will cautiously take a constructive position in equities via several ETFs. Right here, right now - I am out. The latter half of 2015 did not feel right to me.
Thanks for your clarification on my P/E comment. I took your comment under Item 6 ... risk reward, with upside being limited with greater downside being considerable ... to mean, without directly saying, that stocks were expensive. My bag.
What I meant to say was: if 2016 is a positive year I believe the returns will be muted, in the 5% to 8% range. However, if 2016 is confirmation of a bear market which began in the latter half of 2015, the S&P 500 may lose between 20% to 35%. That is what I meant by "asymmetric risk:reward ratio", i.e, one up, four or five down. I do not anticipate either corporate earnings or bullish market spirits resulting in stellar returns in 2016 and if past is prologue (2000-2002 and 2007-early 2009) the next bear market will wipe out 35% to 50% of the S&P 500 levels, especially after it has/had gained over 200% from the low of 666 in March 2009.
Comments
To me, it looks like a market waiting for an excuse to pull back but not finding it. Am fully invested at close to 80% in equities so nothing more to invest but thinking of paring it down to about 60% over the next couple of weeks to lock in some profits.
If my suspicions/intuition are right, a disappointing quarter reporting for AAPL last week of Jan might turn out to be a catalyst/excuse (not a cause) for a small correction for the entire market even if they cover up the results with massive share buybacks or the shares have already priced it in to be below $100 by then. But that is a big IF.
Glad you started this. I almost did when I talked to Old Skeet. Some of this is old info....sold TMSFX--bio is down soooo don't need to short it anymore.
JOHAX---don't need Asia....have enough already as I do closed funds. They seem to underperform when they're closed.....I guess that's why they closed them. Newer info: have bought WAVIX and RYSBX---been thinking about the dollar with QE overseas and everybody slow.....we're the best! Like anybody else would come close to being that...lol. And with the terrorist threats also I think the problem the Saudi's will have next year from cuts in the budget. I think there will be trouble in the Middle East, soooo....who's yer daddy? Yep, the dollar! And the rest of the world can just....well, smooch my hindquarters!
God bless
the Pudd
p.s. If all this crap doesn't work out, well, just call me a pro like they do on CNBC!
Not doing much except following my target allocations and occasionaly making some adjusts inside a sleeve but keeping the portfolio's area allocations (cash, bonds, stocks) close to their targets. Currently, my portfolio bubbles as of a December 2016 ending Xray analysis at 25% cash, 20% bonds, 35% domestic stocks, 15% foreign stocks and 5% other. Unless there is a good pullback in the stock market I most likely will follow the current allocation until something takes place to warrant a change.
In equities, I am favoring good dividend paying world equity and allocation funds over their domestic counterparts due to domestics being currently overbought and high in valuation. In fixed income, I am favoring short duration, bank loan and convertible securities funds in the coming rising interest rate environment.
Sometimes there is just not much for me to do except to just monitor the markets looking for opportunity to develop. This is not to say I don't have some long term investment strategies currently engaged, as I do, it is that that I don't have any ballast positions or any special investment positions engaged at this time.
In closing, I am heavy in cash, light in income and neutral in equity.
Old_Skeet
Model may instruct back to cash allocation on Feb 1 as determined by variable #2 risk profile
https://stockmarketmap.wordpress.com/2015/11/14/market-map-model-tactical-asset-allocation-using-low-expense-index-etfs-2015/
Looking for entry into Biotech and then switch for Energy in Feb
https://docs.google.com/spreadsheets/d/1zlgOYdATSzC7YrUE9yE_uY03sHBRTcLUVyKusqqv2tI/edit?usp=sharing
Still allocated to Small Cap value as of Nov 2015.
Model may indicate cash position May 1 2016, as again determined by variable #2
https://stockmarketmap.wordpress.com/2015/11/03/model-with-sell-in-may-component-allocated-to-small-cap-value/
Always reassuring to have "foreknowledge" of model's objective allocation decision heuristic guiding the process vs. "subjective uncertainty".
Just wondering what your asset allocaton might be? How much (percent) in cash, bonds and stocks are you holding? I been selling more than I have been buying for the past two years ... raising my allocation to cash by about five percent each year. Thinking of late, perhaps I should have done ten percent per year and that would have put me about a third, rather than a quarter, in cash.
After the close on January 4, 2016 I will be 100% cash and will remain so for the foreseeable future. Unlike many knowledgeable posters on MFO my actions are very "unscientific" and I do not advocate this move to anyone else. Briefly stated, some of my reasoning is as follows:
1. I believe we are already in the early stages of a bear market although the major indices do not reflect this officially as yet. However, they look as if they spent most of 2016 in a broad "rolling top" pattern and the downside will accelerate. Many stocks are under their 200-dma and many more are already well off of their YTD highs - 20% or greater. This is being masked by a "Nifty Fifty" phenomenon similar to the late 1970's in which a handful of very large-cap stocks (AMZN, NFLX, FB, GOOG, MSFT, V, etc.) did extraordinarily well, giving the major indices a false read if taken by themselves.
2. No sector did well in 2015 after July 1st, i.e., nowhere to hide.
3. Rising interest rate environment, albeit slowly. However, the mindset has changed.
4. Law of Averages: we are entering the seventh year of a bull market with barely a 10%
correction in that time span. This is one of the 2 or 3 longest bull markets in the past
100 years. We are certainly due for a larger correction.
5. I think as the 2016 Presidential campaign narrows down to two candidates and it
intensifies it will have a corrosive effect (yes, I know, a Presidential year is supposed
to have positive returns historically). Voters will increasingly realize that the major
candidates do not have their concerns or interests in view and offer no solutions to
the major problems they face. They are beholden to business interests and Wall St.
6. Risk:Reward ratio does not feel right to me. I think there is little upside left and I do
not see any catalysts for it. Conversely, the downside - once it begins - is considerable. I
am not hanging around for a 5% equity return in view of the above - it is the equity
equivalent of reaching for yield in bonds (see "Kinder Morgan").
7. Insiders are heavy sellers, not buyers, in most stocks.
Clearly, everyone on MFO can poke holes in my reasoning but "You Pays Your Money,
You Takes Your Pick". I have a gut feeling that a much better entry point for equities will arise sometime in the next 6 to 18 months and cash preservation for this potential opportunity is my major concern.
Bonds? Too much risk for too little return. Take a look at M* Fund Category Returns for taxable bond funds. All of them were either flat (at best) or lost money. There may be some opportunities in Municipal bond funds or selected Muni CEFs (with low or no leverage) but I need to research this further.
Simply put, I'm out. GLTA.
Couldn't agree with you more (rolling tops). Yup! Lower highs, lower lows, not out yet. But selling into rallys as I can, as Jimmy says, "It's time to ring the register." I agree there is no reward, only risk. If the market taught you nothing in 2015, cash is king.
God bless
the Pudd
You have found the proverbial fly in the ointment and I certainly have entertained similar thoughts in this regard - namely, EVERYONE is bearish or predicting paltry returns for 2016. Since it is the job of Mr. Market to frustrate the maximum number of investors, nothing would do so more than a rip snorting stock year in 2016 with 20% to 25% return on the S&P 500 index.
That said, I just don't see it. As much of a self-aggrandizing clown as Jim Cramer is, he DOES have an excellent feel for the market and market action and he has been pointing out the discrepancy between the major indices and the bear market action in many stocks under the surface for the past 3-4 months. Additionally, I found last week disconcerting, the proverbial maraschino cherry on the sundae of doom. The traditional Santa Claus rally should have taken the indices higher last week into Monday/Tuesday of next week, i.e., the final week of December has one of the highest percentages of being positive. An old Wall Street bromide is:
" If Santa Claus should fail to call, bears may come to Broad & Wall".
Last week's poor action simply reinforced my decision ( made 3-4 months ago) to bail out at year's end or first few days in 2016 and not hang around for a few percentage points of gain. Put another way: the low-hanging fruit has been picked over.
I also own FMIJX. I think it's a very good fund. Have not added to it for a while due to dollar strength. Small caps.....I will wait 'til the end of the interest rate rise to add. I feel there will be time. The 3% cash JMO I would want more than that just in case. Curious.....what is your age? Is this a 401? Have you seen a bear? Are you a Cowboys fan? ..... Sorry, I get carried away sometimes. lol
God bless
the Pudd
If I were buying small now, HSCSX is one I'd be into.....looks good.
God bless
the Pudd
You're the man! You got the plan! The best part is....I like the land!!
God bless
the Pudd
Thanks for providing more detail on your take on the markets and your positioning. I too, believe stocks (S&P 500 Index) are expensive selling on as reported earnings at a P/E Ratio of 23. This is not to say they can't continue to do this but it sure does limit the upside potential from my perspective. I am going to hold off on doing much of anything until I see how January starts and perhaps finishes. As folklore has it ... As goes January ... so goes the year. If anything, I most likely will continue my current path and build cash through the year taking most all fund distributions in cash. This will raise my allocation in cash by about 1.25% per quarter so just in doing this I could be better than thirty plus percent in cash come this time next year. If I do some trimming that would raise my allocation in cash even more.
Notice that I deliberately avoided saying anything about P/E, valuation, etc. and that did not enter into my thinking at all. There are probably ten different ways of assessing valuation with widely discordant conclusions and the only time stock valuation is helpful is when it is at an obvious extreme, e.g., the super-low valuations toward the end of the 1973/1974 bear market or the dot.com extremes in late 1999/early 2000. At current levels, stock market valuation does not tell me anything. And, stocks can move in a given direction for a considerable period of time despite valuations, i.e., the stock market can remain irrational longer than you can remain solvent.
I am totally flexible and will watch the first month or two from the sidelines in 100% cash. If earnings are solid for equities and the market moves higher I will cautiously take a constructive position in equities via several ETFs. Right here, right now - I am out. The latter half of 2015 did not feel right to me.
Thanks for your clarification on my P/E comment. I took your comment under Item 6 ... risk reward, with upside being limited with greater downside being considerable ... to mean, without directly saying, that stocks were expensive. My bag.
I wan't very clear.
What I meant to say was: if 2016 is a positive year I believe the returns will be muted, in the 5% to 8% range. However, if 2016 is confirmation of a bear market which began in the latter half of 2015, the S&P 500 may lose between 20% to 35%. That is what I meant by "asymmetric risk:reward ratio", i.e, one up, four or five down. I do not anticipate either corporate earnings or bullish market spirits resulting in stellar returns in 2016 and if past is prologue (2000-2002 and 2007-early 2009) the next bear market will wipe out 35% to 50% of the S&P 500 levels, especially after it has/had gained over 200% from the low of 666 in March 2009.