Quick update. I noted that I was trying to buy additional shares of BIAWX yesterday but didn't because (1) $50 transaction fee and (2) four-hour hold time to talk with TD Ameritrade. Got through this morning, after a 40 minute hold. Two notes. First, they have a callback queue but disabled it because so many people were leaving stacks of callback requests that the system couldn't keep them straight. Second, they were very agreeable about waiving the transaction fee.
That purchase complements yesterday's tiny buys in each of my other TD funds: FPACX, MACSX, MAINX, RPHYX, GPROX.
No idea of where "the bottom" is (Leuthold estimates the market is 4% overvalued though bears do blow through "fair value"), but I figured my managers are good and could use the money. In an vaguely parallel vein, I also made contributions to my local food bank (their shelves are getting bare, too), One Tree Planted and a local small business initiative to provide coffee for first responders and medical personnel. That's 'cause Tom Hanks told me to be a helper!
Question: You couldn't perform this transaction online?
I'm at TD because they bought Scottrade, which I used because they had a convenient local office (and wasn't Schwab).
BIAWX has a transaction fee at TD, which the online execution would have triggered. I decided to call and request a waiver because (a) they should be anxious to be really helpful about now and (b) their soon-to-be robot overlords at Schwab don't charge the TF.
Through the market volatility the past couple weeks we have been adding to our positions in PRWCX and AKREX.
Current Market Direction:
Or, here's one news account that makes me think the answer to your question is no.
For sure corporations won't be buying back their shares this year with cheap borrowed money to jack up the price for executive compensation packages.
Currently, the Dow sits at 19,185 .
Remains to be seen if the Dow finishes the day still below 2016 level. Always possible they’ll shut this market down early.
The fair value note released this week looked at price/cash flow, price to book, dividend yield and three flavors of P/E. The implied drop to reach the median level maintained over the past 70 years ranged from -1 to -22%, depending on the metric.
Bear markets end up with valuations somewhere around the bottom quartile of the range. So ROE-based P/E is normal at 18.3 and low at 15.1. At the beginning of this week, the market's ROE-based P/E was 18.35 which might translate to "not wildly overvalued but way back the trough in a bear."
For what that's worth, David
What else can be way back the trough? Is this a common phrase in some part of the country?
No-one could have forecasted this catastrophe. No, not even me.
It's sanctimonious people like you who destroy this discussion forum. Your sarcastic comments cause people to leave for good, which is just what I am doing now. I'll be joining dtconroe on Morningstar for some civilized discussion.
Eventually, this forum will collapse as you all drop dead one by one because there will be no new members to take your places.
@Simon: Perhaps not. But those of us who have been around awhile and paid attention were well aware that it was just a matter of time until something came along to cause this. And you'll please note the lack of commentary regarding "surprise".
Good riddance to your know-it-all arrogance. No, you won't be missed. Not at all.
I'd like to see you stick around, but if someone points out statements you made that were so misleading at best, just say,
Simply typo. Or braino. "way from the trough in a bear."
The key is that bear markets tend to blow past fair value on the downside. The trough, or low point, of the market tends to be when stocks are selling at a substantial discount to their fair value. so, I was just trying to say we are near fair value but nowhere near the substantial discount that Leuthold uses in their metrics.
Hope that helps, David
Been a while since we really oversold to the underside though. Late 70's, or early 80's are what real capitulation looks like to me.
Given the Fed support since the dot.com bust, I don't think we really know what fair value is.
Your mileage may vary, of course.
I told you 6 months ago we were not in a bear market by any metric or measure. But none of you listened and your kneejerk reaction was to sell quality assets for no reason. Some supposedly experienced investors here were in complete denial and expressed shock at my comments that this ongoing bull will last until the 2030s.
Meanwhile my mutual fund retirement portfolio is up over 65% since January 1st. That's definitely a bull market....isn't it?
You old-timers really need to be more humble, consider the opinions of others, and learn from your mistakes.
Wouldn't it be a wonderful world if we were all humble, listened to others, and learned from our mistakes?
Now. Where do you think the market would be if The Fed had not injected trillions of dollars into it?
What you call a bull market looks like a speed freak to me. Now is the time to think about selling.
I had re-balanced the IRA last December - January so that I was close to 60-40 stocks/bonds, not counting cash. I'm back to 70-30 on the Biden rally and purchases made in March. And I think I'll let it ride. I still have a little nubbin of cash if there is another serious downdraft.
Bernard Baruch is supposed to have said that he made all his money selling too soon. Disciplined selling is one sure way to have cash on hand for those buying opportunities.
I sort of regret selling NASDX to put into really boring stuff. But that's the sort of calculus to make with retirement funds if you're going to need them sooner than later.
Check out this link for top 20 fund performance.
Have a nice day, Derf
As for myself ytd I'm at 0-1 %. With Aug. statement coming up , that % should move up.
Stay Safe, Derf