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2022 YTD Damage

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  • #Volatility rose sharply across the board today.
    SP500 $VIX 34.02 +22.59%
    Nasdaq-100 $VXN 40.36 +18.81%
    Bond $MOVE 139.21 +21.87%
    Oil $OVX 47.56% +10.81%
    But SP500 $SKEW was moderate at 124.14 +2.06%
    #Cryptos crashed.
    #Markets
  • edited June 2022
    fwiw saying I predict either a relief rebound or perhaps a 'neutral' day tomorrow -- followed by a volatility explosion on Wed as folks act on their post-Fed positioning plans into the latter part of the week. (Other central banks set to make rate decisions later this week, too.)

    Of course, that's just my opinion....
  • edited June 2022
    @rforno - Sounds logical. I’m thinking a half point rate hike. But language designed to ease the market stresses. Potentially a rebound Wednesday - if only short lived.

    It feels more like “investing” now. Things got too damn easy for a few years.:)

    Sorry for those in crypto. Afraid a lot of inexperienced people got suckered in by the lure of easy money. And their losses may greatly affect the economy going forward.

    Side note: Amazon got slammed. PRWCX now down 15.35% YTD.
  • edited June 2022
    I agree with this article. The first one was the best sign of a 'top' in crypto, in my view.

    The Clues You Missed: 5 Super-Obvious Signs We Were in a Financial Bubble
    https://nymag.com/intelligencer/2022/06/crypto-crash-5-obvious-market-top-signals-everyone-missed.html
  • There seems a leak or many guesses in the media about 75-bps hike. Also, this Friday is HUGE options expiry day - triple/quadruple witching.
  • rforno said:

    I agree with this article. The first one was the best sign of a 'top' in crypto, in my view.

    Yep - Lots of good stuff there.:)

  • edited June 2022

    There seems a leak or many guesses in the media about 75-bps hike. Also, this Friday is HUGE options expiry day - triple/quadruple witching.

    Double your pleasure … Double your fun …

  • There seems a leak or many guesses in the media about 75-bps hike. Also, this Friday is HUGE options expiry day - triple/quadruple witching.

    Good or bad? More spam to hit the fan that day?
  • edited June 2022
    Quarterly options expiry day has huge volumes. Unless there is some special news on that day, the trend of the week may just be magnified on Friday. So, Monday was BAD (somebody called yesterday the Crypto-Monday and we will see if that sticks), today seems calm (so far, although the crypto crash continues). Tomorrow is the FOMC Statement and Powell's news conference, so unclear how that will go. The CME FedWatch (based on fed fund futures market, not on "expert" opinions/surveys) is indicating these hikes now for the 5 FOMC meeting remaining in 2022: 75 (tomorrow)-75-50-50-25, reaching 3.50-3.75% by mid-December. So, Friday could be wild.
  • edited June 2022
    hank said:

    @rforno - Sounds logical. I’m thinking a half point rate hike. But language designed to ease the market stresses. Potentially a rebound Wednesday - if only short lived.

    It feels more like “investing” now. Things got too damn easy for a few years.:)

    Sorry for those in crypto. Afraid a lot of inexperienced people got suckered in by the lure of easy money. And their losses may greatly affect the economy going forward.

    Side note: Amazon got slammed. PRWCX now down 15.35% YTD.

    Not too bad considering its Fidelity and Vanguard peers are down a good bit more:

    TRAIX (I class of PRWCX) (14.95%)

    FBALX (19.09%)
    FPURX (17.36%)
    VWENX (17.55%)

    and outperforming S&P 500 substantially

  • edited June 2022
    Davep said:

    Not too bad considering its Fidelity and Vanguard peers are down a good bit more:

    TRAIX (I class of PRWCX) (14.95%)

    FBALX (19.09%)
    FPURX (17.36%)
    VWENX (17.55%)

    and outperforming S&P 500 substantially

    DODBX is down 10.56% YTD (lags farther out). I’ve got $$ in both.

    There’s a lot of ways to slice & dice it. As I recall PRWCX lost 28% in all of 2008, so it’s already down more than 50% of that loss in 5.5 months. Arguably, things were much worse in 2008. There’s some swagger with Giroux. So I like to nit-pick his management a bit. D&C employs more of a team approach. Giroux did predict in the Barron’s year-end “round-table” that the 10-year wouldn’t finish the year above 2.5%. Made quite a point of it. Ahh … We’ll see on that one. And griping about Amazon’s management hardly seems becoming of someone with all his supposed talent. Man-up. You went overboard / overweight on one of your worst picks! More humble managers would say as much.

  • hank said:

    Davep said:

    Not too bad considering its Fidelity and Vanguard peers are down a good bit more:l

    TRAIX (I class of PRWCX) (14.95%)

    FBALX (19.09%)
    FPURX (17.36%)
    VWENX (17.55%)

    and outperforming S&P 500 substantially

    DODBX is down 10.56% YTD (lags farther out). I’ve got $$ in both.

    There’s a lot of ways to slice & dice it. As I recall PRWCX lost 28% in all of 2008, so it’s already down more than 50% of that loss in 5.5 months. Arguably, things were much worse in 2008. There’s some swagger with Giroux. So I like to nit-pick his management a bit. D&C employs more of a team approach. Giroux did predict in the Barron’s year-end “round-table” that the 10-year wouldn’t finish the year above 2.5%. Made quite a point of it. Ahh … We’ll see on that one. And griping about Amazon’s management hardly seems becoming of someone with all his supposed talent. Man-up. You went overboard / overweight on one of your worst picks! More humble managers would say as much.

    Yes, DODBX is outperforming ytd, but over 3 and 5 years. TRAIX has considerably outperformed, especially over the last 5 years, per Morningstar.:



    DODBX 3yr. 7.99%. 5 yr. 7.01%
    TRAIX. 3yr. 8.80% 5 yr. 9.66%

  • Another possibility is BRUFX (Bruce fund). Like DODBX its stock holdings are large value, while PRWCX/TRAIX is large growth. But while DODBX has a 49% turnover, Bruce is only 4%. So in a non-tax-deferred account your after tax return is higher with BRUFX than with DODBX (9.54% vs 9.08% average over last 3 years and 7.62% vs. 6.97% average over 5 yrs. ), but 1 and 10 yrs DODBX did better.) I think that TRAIX and BRUFX complement each other. You need to buy Bruce directly from them, but it is easier to hold as it is considerably less volatile (3 yr beta of 0.95 vs 1.34 for DODBX and 1.04 for the T. Rowe Price offerings.). Bruce's site is www.thebrucefund.com
  • :). Funny you should mention that. I hold both PRWCX and (my wife's T-IRA) is in BRUFX. It's a very stinky year. But we are riding it out. YTD I'm down -18.2%. That does include just 3 single stocks, which are not a great big piece of the portfolio yet.

    RIDING THE STORM OUT:
  • A good rally from mid-June lows, whatever it is called - Bear-rally or new up-move. It has now reached the target area that many had for this bounce. Very strong day today. Strange that people are cheering CPI of +8.5% (President erroneously said no inflation when he meant no change in inflation). Where to now?

    Major Indexes since 1/3/22 https://stockcharts.com/h-perf/ui?s=$SPX&compare=$COMPQ,$INDU,$TRAN,IWM&id=p07001467085

    SPX/SP500 TA https://stockcharts.com/h-sc/ui?s=$SPX&p=D&b=5&g=0&id=p54837283928
  • Today was a 92% up-volume day.
    Others:
    90% up-volume days: May 13, Jul 19, Aug 10
    90% down-volume days: May 5, May 9, Jun 9, Jun 13, Jun 16
    These so-called A/D thrust days have significance.
    https://twitter.com/WalterDeemer/status/1557462958745190401
  • Yes, from a low point at -18%. our stuff is now down by -10%. That's -10% down from an ALL-TIME HIGH at the start of the year. And there have been changes in the portfolio. In one case, I dumped what had become a very big pile of smelly doggy poopies: ENIC. It was difficult to swallow THAT loss. But I learned a lesson, and so I did not wait so long to dump RGR after the Earnings miss just recently reported. After the numbers were published, the stock has been taking a beating. And the political climate makes RGR a member of the un-loved.

    PSTL is my new holding, bought with proceeds from the RGR sale. It was down today, but finished up from the price where I bought it. Nice. I plan on holding it for the dividends. The Post Office pays its bills.

    WHERE TO, FROM HERE? Maybe Tech will shine again, after the new legislation? With Fall and Winter coming, I do hope my midstream stock, ET, will do well. (Remember the war?) The economy is based upon Consumerism. That's not a good thing, ethically and morally. But the economy has no conscience, nor do the markets. I believe the Consumer will continue to over-spend and live day by day with credit card debt, just getting by. Wages are higher = more money will get spent. That's 66-70% of the Economy, right there.
  • edited August 2022

    Today was a 92% up-volume day.
    Others:
    90% up-volume days: May 13, Jul 19, Aug 10
    90% down-volume days: May 5, May 9, Jun 9, Jun 13, Jun 16
    These so-called A/D thrust days have significance.
    https://twitter.com/WalterDeemer/status/1557462958745190401

    I much prefer Marty Zweig’s double 9 to 1 up volume indicator within three months albeit a bit similar to Deemer’s and Lowry Research. Zweig divides up volume by down volume. Today was an impressive and rare 12 to 1. But his indicator already went on a buy on July 19 signaling the end of the bear. His indicator has kicked in at every bear market bottom with the only failure I believe in 2008. I have talked about this ad nauseam but no one ever listens. At bear market bottoms there are always 1001 reasons not to be bullish. Usually his indicator kicks in much closer to the actual bottom than this time around.

    Of course Zweig was also known as much as anyone about how not to fight the Fed as well as follow the trend, This is one of the rare times I can recall his two mantras are in direct conflict with his double 9 to 1 indicator kicking in amid an ever tightening Fed. Then again, it kicked in late 2018/early2019 amid a Fed that had been tightening and that signal was spot on.

    Edit: We had an 8.5 to one up day on July 1 and that was close enough to a 9 to 1 to convince many of those who religiously follow Zweig’s indicator,



  • Junkster said:

    Today was a 92% up-volume day.
    Others:
    90% up-volume days: May 13, Jul 19, Aug 10
    90% down-volume days: May 5, May 9, Jun 9, Jun 13, Jun 16
    These so-called A/D thrust days have significance.
    https://twitter.com/WalterDeemer/status/1557462958745190401

    I much prefer Marty Zweig’s double 9 to 1 up volume indicator within three months albeit a bit similar to Deemer’s and Lowry Research. Zweig divides up volume by down volume. Today was an impressive and rare 12 to 1. But his indicator already went on a buy on July 19 signaling the end of the bear. His indicator has kicked in at every bear market bottom with the only failure I believe in 2008. I have talked about this ad nauseam but no one ever listens. At bear market bottoms there are always 1001 reasons not to be bullish. Usually his indicator kicks in much closer to the actual bottom than this time around.

    Of course Zweig was also known as much as anyone about how not to fight the Fed as well as follow the trend, This is one of the rare times I can recall his two mantras are in direct conflict with his double 9 to 1 indicator kicking in amid an ever tightening Fed. Then again, it kicked in late 2018/early2019 amid a Fed that had been tightening and that signal was spot on.

    Edit: We had an 8.5 to one up day on July 1 and that was close enough to a 9 to 1 to convince many of those who religiously follow Zweig’s indicator,



    Your summarization and conclusions are encouraging. Those technical signals are, frankly, beyond me..... Even so, I certainly do pay attention to Zweig! And what YOU have shared is not just chopped liver, either. Thank you!

  • @Junkster : Thanks for the comments, & it's always nice to hear from you.
  • edited August 2022
    Thank you junkster for your wonderful insights

    2008 09 market crash very violent and did not match normal downwards /similar to previous historical crashes....




    Another question
    How do you predict market top or overbought levels

    Thankyou
  • Howard Marks - Which Way Now?
    He suggests that rather than in/out or buy/sell, make portfolio adjustments according to own risk level.
    https://www.oaktreecapital.com/insights/insight-video/market-commentary/insights-live-which-way-now
  • edited August 2022

    Howard Marks - Which Way Now?
    He suggests that rather than in/out or buy/sell, make portfolio adjustments according to own risk level.
    https://www.oaktreecapital.com/insights/insight-video/market-commentary/insights-live-which-way-now

    Marks suggests investors center on a neutral risk setting (think of a speedometer) suitable for their age, goals, tolerance, etc. He also recommends varying that a bit with one’s assessment of market valuation / dynamics. Therein lies the difficulty.

    Since around the first of the year I’ve tried using a “sliding scale” of sorts - but only with about half the portfolio. The other 50-55% is quite static. Essentially, I try to raise or lower the allocation to fixed income. Raising the fixed component reduces the equity component. Been trimming risk lately. “Neutral” for fixed income is 25%. Was down to only 17-18% a month ago. Has since risen to 21% - less aggressive than earlier, but still substantially overweighted towards risk. Keep in mind that there is also a 50+% (moderate) allocation which remains static other than minor rebalancing.

    There are many ways to skin a cat. If others have some sort of “speedometer” (Marks’ term) I’d enjoy hearing how they implement it. From some of the posts a month or two back some here were ramping up their cash and conservative investments based on “Fed-Speak” and their own macro assessment. In hindsight, that might have had them leaning the wrong way. Points to the difficulty of putting Marks into practice, Lately, mining and some natural resources (not oil) have recovered from earlier year losses. (And the dollar has begun to weaken). Yesterday I trimmed a bit off real assets and bumped up cash.

    Amazingly - PRSIX, a 40/60 fund I watch closely, remains deep underwater at near a double-digit loss YTD despite the market rebound. Individual investors have a nimbleness and ability to react to changing conditions that a large fund does not possess. Than again, TRP never ceases to amaze.
  • edited August 2022
    "Speedometer." Ya... Early in the year, the talking heads advised against bonds. I took from bonds to add to stocks at the highs for the year in TRAMX and PRNEX and PRISX. I'm still underwater, though TRAMX is nearly back to the zero-line by now.

    My sole bond fund is TRP Junk: TUHYX. Still down YTD by -10+%. I've added a bit to my TUHYX pile, buying de-valued, unloved shares. (Cost basis!)

    I'm in retirement, but can afford to invest for the heirs, so the move to overweight stocks doesn't make me itch so very much. Method? Steer clear of bonds, as instructed. But I did not go to ZERO in bonds. Don't put all your eggs in one basket, eh? I'm at 21% in bonds today. Another ingredient in my "method" is to stay overweight in PRWCX. It was down by -12%, now down by -5%. I added to it a couple of times in the past few months. If I'm fortunate, it might turn positive by year's end. We'll see. The expected Recession is technically here, after 2 Quarters of negative growth. But in practical terms, this does not feel like a Recession, yet. I still think things will get worse before we climb out of the present circumstances. Method? Cut losses before they get to be utterly unpalatable, re: my single stock positions. I can't make the Market love the stuff I own. I can sell, and then re-deploy. ...And all of this does not violate my sense of risk-tolerance.
  • What is the significance of a new high for the S&P 500's cumulative A/D line?
    Historically, has this proven to be a reliable indicator of future performance?
  • edited August 2022
    @Observant1, the high correlation between the market and A/D line is seen on the chart. But there can be short-term divergences (nonconforming). The A/D thrust days were mentioned earlier - another sign of cash on the sidelines burning hole in investors' pockets. All this means that the market participation is broadening, the rally failure is less likely at this critical juncture, and farther we get from the mid-June lows, less likely it is that may be broken (may be low testing only, if that). Just my 2 cents.
  • edited August 2022
    Over the past six weeks it has been one after another breadth, volume and assorted momentum indicators kick in on the buy side saying the bear is dead. Today yet another one from Seth Gordon on Twitter. 90% of the [email protected] stocks are trading above their 50 day moving average. Since 2003 has occurred 14 times with a positivity rate of 94% and an average 12 month [email protected] return of 18%
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