Discussion ***Official*** 2022 Stock Market Thread

[FelixDeCat]

$290 today, a $20 fall in two days.

Another two days, another $15 drop, new 52 week low @ $275.

.....come on dead cat bounce!!

 

[biostud]

Before new year my investments were +50%, now +3% :/

 

[FelixDeCat]

Before new year my investments were +50%, now +3% :/

Better 3% than negative. I saw the handwriting on the wall and took my haircut during the first big pull backs in February. Normally I hide out in high yield (junk) bonds earning 6%, or med term treasuries getting .75% - but with rates going up, those funds get killed. So in February I put it all in GOIXX Money Market.

The dividend seems to be going up "rapidly" (I use the term loosely) since February when I got in:



The yield is up from .01 to .70%.

Yes, you can argue that 8.5% inflation is killing that yield - but the alternative is huge short term negative returns on stocks and bonds.

Over time stocks and bonds will go back up as rates stabilize so there will be a time to get back in..near the end of the rate hike cycle.

 

[jpiniero]

Rate odds have suddenly gone to Triple for tomorrow.

 

[biostud]

Better 3% than negative. I saw the handwriting on the wall and took my haircut during the first big pull backs in February. Normally I hide out in high yield (junk) bonds earning 6%, or med term treasuries getting .75% - but with rates going up, those funds get killed. So in February I put it all in GOIXX Money Market.

The dividend seems to be going up "rapidly" (I use the term loosely) since February when I got in:

View attachment 63065

The yield is up from .01 to .70%.

Yes, you can argue that 8.5% inflation is killing that yield - but the alternative is huge short term negative returns on stocks and bonds.

Over time stocks and bonds will go back up as rates stabilize so there will be a time to get back in..near the end of the rate hike cycle.

I'm not really into trading so these are long term index investments, so the idea is simply to buy and hold on an let the dividends auto re-invest, and then at some point add the dividends to my private economy.

 

[FelixDeCat]

I'm not really into trading so these are long term index investments, so the idea is simply to buy and hold on an let the dividends auto re-invest, and then at some point add the dividends to my private economy.

I believe thats called "averaging in". its what most people do.

 

[AdamK47]

Hit my buy limits Friday and Monday after a three week lull. Lets see if I can hit again today.

 

[jpiniero]

Bankrate claims the national average 30 year fixed mortgage is 5.88%. Some places are doing 6+%. Maybe 7 is not too far off?

Might be an opportunity with Real Estate at some point.

 

[njdevilsfan87]

People joke about housing supply actually being shorted because of this. But the scenario presenting itself is similar to:

• California home owners never let go of their homes (locked into a very slowly increasing 1% tax rate based on 1980s home values)
• People never let go of rent controlled apartments, which increases prices on remaining non-controlled inventories

Now moving into 6-7% territory, rates are double what many homeowners over the past decade have. That means moving to the house next door would double the monthly payment. And that's before the 50-100% price appreciation (which factors into a new base tax rate) we've seen since the pandemic began. Add that in and a $5K/mo payment turns into a $10-$12K/mo payment... just for moving next door!

TLDR; even existing homeowners may not be able to afford to move, unless they downsize/downgrade or move a much lower cost area.

 

[brianmanahan]

TLDR; even existing homeowners may not be able to afford to move, unless they downsize/downgrade or move a much lower cost area.

yep i've kinda come to the same conclusion

house supply will be suffering for a decade or more because people will probably only sell their house for 1) a big job upgrade, 2) when they retire, or 3) when they money for medical problems or have to go into end-of-life care

if i even buy a house before i'm 50, it'll probably end up being some small-town shanty

 

[JS80]

Is there a broker that allows you to create your own portfolio model with % allocation, and then you just click a few buttons and it allocates some dollar amount and buys it all automatically (versus going in and buying one stock at a time)? And then allows you to auto-invest every period to dollar cost average?

For example:

Set portfolio XYZ
Stock A: 15%
Stock B: 20%
Stock C: 35%
Stock D: 30%

Buy $10,000 worth of XYZ, buys $1.5k of Stock A, $2k of Stock B, etc. with one click / trade
Buy $1,000 worth of XYZ a month, automatically buys $150 of Stock A, $200 of Stock B, etc. every month

 

[brianmanahan]

Is there a broker that allows you to create your own portfolio model with % allocation, and then you just click a few buttons and it allocates some dollar amount and buys it all automatically (versus going in and buying one stock at a time)? And then allows you to auto-invest every period to dollar cost average?

i thought M1 has something like that but i have not looked into it, just heard people talk about it

i think they call it a "pie"

 

[snoopy7548]

 

[jpiniero]

Current odds for a triple hike is now 99%. Should be fun tomorrow.

 

[FelixDeCat]

Is there a broker that allows you to create your own portfolio model with % allocation, and then you just click a few buttons and it allocates some dollar amount and buys it all automatically (versus going in and buying one stock at a time)? And then allows you to auto-invest every period to dollar cost average?

For example:

Set portfolio XYZ
Stock A: 15%
Stock B: 20%
Stock C: 35%
Stock D: 30%

Buy $10,000 worth of XYZ, buys $1.5k of Stock A, $2k of Stock B, etc. with one click / trade
Buy $1,000 worth of XYZ a month, automatically buys $150 of Stock A, $200 of Stock B, etc. every month

Seems like a neat idea. This is the closest thing I can think of:

"Robo investing"

Google Search

 

[FelixDeCat]

Bankrate claims the national average 30 year fixed mortgage is 5.88%. Some places are doing 6+%. Maybe 7 is not too far off?

Might be an opportunity with Real Estate at some point.

I remember when 10% was the norm for home mortgages back in the 1990s. Then 7-8% was the norm in the 2000s. Then 5-6% in the 2010s. Finally we wound up with 2-4% in the 2020s.

 

[FelixDeCat]

People joke about housing supply actually being shorted because of this. But the scenario presenting itself is similar to:

• California home owners never let go of their homes (locked into a very slowly increasing 1% tax rate based on 1980s home values)
• People never let go of rent controlled apartments, which increases prices on remaining non-controlled inventories

Now moving into 6-7% territory, rates are double what many homeowners over the past decade have. That means moving to the house next door would double the monthly payment. And that's before the 50-100% price appreciation (which factors into a new base tax rate) we've seen since the pandemic began. Add that in and a $5K/mo payment turns into a $10-$12K/mo payment... just for moving next door!

TLDR; even existing homeowners may not be able to afford to move, unless they downsize/downgrade or move a much lower cost area.

Persistently low mortgage rates only helped create the housing inflation we see today. Below average incomes simply cannot afford to buy homes today on an individual basis. You have to be married, make above average income or buy with other people.

You have to compete with corporations now to buy homes. They are contributing to the problem of homelessness in America.

 

[FelixDeCat]

yep i've kinda come to the same conclusion

house supply will be suffering for a decade or more because people will probably only sell their house for 1) a big job upgrade, 2) when they retire, or 3) when they money for medical problems or have to go into end-of-life care

if i even buy a house before i'm 50, it'll probably end up being some small-town shanty

Its unfortunate but there are signs everywhere that America is looking more and more like a 3rd world nation.

 

[JTsyo]

Buy $1,000 worth of XYZ a month, automatically buys $150 of Stock A, $200 of Stock B, etc. every month

This part should be doable with automatic investing but instead of XYZ you would have to set it up for each stock. For example Vanguard.

Basket trading from Fidelity might fit your bill but I'm not familiar with it.

 

[dullard]

Is there a broker that allows you to create your own portfolio model with % allocation, and then you just click a few buttons and it allocates some dollar amount and buys it all automatically (versus going in and buying one stock at a time)? And then allows you to auto-invest every period to dollar cost average?

That is basically how every 401K, SIMPLE-IRA, HSA, and 529 account that I have ever held is handled. One purchase gets split up into the percentages that you previously set. These are the types of accounts where dollar cost averaging is usually the best route. For example, you get paid regularly throughout the year, so your 401k gets contributions regularly throughout the year and it is natural thus to use dollar cost averaging with preset percentages. No thought needed, just set it, forget it, and retire comfortably (assuming you don't muck with it or massively underfund it).

When you come to taxable accounts, there are many reasons not to use dollar cost averaging. Often in taxable accounts, you don't have extra money in regular increments. You might get a windfall: inherit a pile of cash, have an insurance payout, win a court battle, sell something of value (like a business or stock or a house), etc. In those situations you have one large lump sum to invest and you have it now. Since investments generally go up over time, waiting to dollar cost average your lump sum means you are losing those returns for months/years. In most situations, it is best to get it invested as soon as is feasible. So while you might have a situation where you earn so much money that you have enough left over each month to dollar cost average the remainder, that is not the common situation in taxable accounts. Thus, most brokers don't have that set up or it is clumsy (see JTsyo's post for all the steps needed).

I am in that situation where my income is more than my expenses and I do have extra money each month for a taxable account. What I do with it is like dollar cost averaging but with a twist. I have preset goals for each stock (15% A, 20% B, etc). And I do invest regularly. But, I don't invest in every stock with each investment. I invest in the stocks that are under my goal percent. That means short-term I am always buying low (or at least relatively low compared to the other stocks) and never buying high.

For example, if in the last month stock A went down and stock B went up, then this month I buy stock A only (buying low) and not stock B (which would be buying high). Long term that is about the same as investing 15% in A and 20% in B. But, short-term I guarantee that I know what to buy and always buy the stock in my basket that is currently low priced (or at least relatively low compared to the other stocks). This gets me the advantages of immediate returns that you get with dollar cost averaging. It also means that I always know what to buy, no thought needed as it was previously decided.

 

[jpiniero]

Triple hike it is.

 

[jpiniero]

QQQ under 275. Still a ways to go before getting to pre-pandemic levels.

 

[Mai72]

I have $130k on standby. Just waiting...

I think stocks are going to go down much further. This is just the beginning folks.

 

[FelixDeCat]

Be careful. It's treacherous for longs and shorts right now.

 

[FelixDeCat]

Also, don't fight the Fed.