Join our investing community

Today's market

Discussion in 'Shares' started by Alan, 20th Jul, 2006.

  1. Alan

    Alan Well-Known Member

    Joined:
    15th Aug, 2005
    Posts:
    603
    Location:
    Sydney
    Sydney Futures pointing to an 87 point rise today, following 212 DOW rise overnight.

    I always like it when I hear the second shoe of 'volatility' hit the ground. :D
     
  2. MrDarcy

    MrDarcy Well-Known Member

    Joined:
    13th Sep, 2005
    Posts:
    283
    Location:
    Sydney
    Yes, it sure is a bootiful sound :D
     
  3. Tropo

    Tropo Well-Known Member

    Joined:
    17th Aug, 2005
    Posts:
    3,394
    Location:
    NSW
    Time will tell how tough the ground is...:p
    :cool:
     
  4. -T-

    -T- Well-Known Member

    Joined:
    2nd Apr, 2006
    Posts:
    194
    one step forward, two steps back :(
     
  5. -T-

    -T- Well-Known Member

    Joined:
    2nd Apr, 2006
    Posts:
    194
    ok, that was very pessimistic of me :)

    What are you guys thinking for the next six months? I'm trying to determine two things:
    1) Am I really long-term the stocks I'm holding at the moment?
    2) If not, will I benefit getting out soon and coming back in around Oct?

    I was thinking about writing options to reduce losses, but with this volatility, I think there will be all sorts of headaches with that. I was even thinking of buying 6-month or so puts against the stocks and then writing options, but there are all sorts of issues there too.

    I think I'll see how today goes, how the DJIA goes overnight and depending on volatility and direction, implement some sort of option plan. If the XJO goes nuts today against the DJIA, it may be a good time to write some calls. Just thinking aloud, but I guess I need to decide if it's more likely to coninue upward or downward. I'm thinking downward atm, so writing calls (maybe with protection) is probably a good option. :confused:
     
  6. Tropo

    Tropo Well-Known Member

    Joined:
    17th Aug, 2005
    Posts:
    3,394
    Location:
    NSW
    T,

    "What are you guys thinking for the next six months?".

    Rule 46 = In the world of money, which is a world shaped by human behavior, nobody has the foggiest notion of what will happen in the future. Mark that word...NOBODY !!.
    Thus the successful trader does not base moves on what supposedly will happen but react instead to what does happen.


    "I was thinking about writing options to reduce losses, but with this volatility, I think there will be all sorts of headaches with that. I was even thinking of buying 6-month or so puts against the stocks and then writing options, but there are all sorts of issues there too.
    I think I'll see how today goes, how the DJIA goes overnight and depending on volatility and direction, implement some sort of option plan. If the XJO goes nuts today against the DJIA, it may be a good time to write some calls. Just thinking aloud, but I guess I need to decide if it's more likely to coninue upward or downward. I'm thinking downward atm, so writing calls (maybe with protection) is probably a good option "


    RULE 9 = Successful traders ISOLATE themselves from the opinions of others.
    :cool:
     
  7. -T-

    -T- Well-Known Member

    Joined:
    2nd Apr, 2006
    Posts:
    194
    Rule 1324324 = There's no point of having a forum if there is no discussion, if no one voices opinions and no one is willing to use those opinions to make more informed decisions. :p

    Gee how completely boring; a forum where no one says anything except trying to prove others wrong. Sounds like a similar forum that most of us are a part of. :rolleyes:
     
  8. Mark Laszczuk

    Mark Laszczuk Well-Known Member

    Joined:
    16th Aug, 2005
    Posts:
    793
    Location:
    Brisbane
    -T-,

    Just because you didn't get the answers you wanted, doesn't mean you can have a go at Tropo (well, you can if you want, but don't be surprised when no one is willing to help you out in the future because of your attitude). What he's posted there is absolutely correct. Now, he's a successful trader who makes a living trading. You however, it seems are not.

    I'd suggest you might want to take on board what he's telling you and use that to your advantage. Most people spend a lot of time, money and effort learning what you've just been given for free. I suggest you either take it in your stride or find another forum if this one is not to your liking.

    Mark
     
  9. -T-

    -T- Well-Known Member

    Joined:
    2nd Apr, 2006
    Posts:
    194
    Mark

    With all due respect, your reply doesn't surprise me. I'll be honest and say that I do think this forum has become about justifying one's comments and less about discussion (especially in the shares/MFs section).

    I asked a simple question, Tropo decided to try to prove me wrong by making ridiculous comments and you (as usual) have followed the crowd and decided to forego thinking for yourself.

    Everything is based on opinion; books, articles, market wraps, discussions, collaboration, etc. Without opinion where would we be? All I was trying to do was initiate discussion! But I think it's futile justifying my retort further.

    As for making comments about my position, once again I think you've brought Somersoft to InvestEd. It's a shame really.

    -T-
     
  10. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,619
    Location:
    Sydney, Australia
    For what it's worth, I actually agree with -T- here ... we set this site up as an education resource. Even experienced investors can still learn from the opinions and thoughts of others.

    Hiding behind a set of "rules" doesn't really help someone learn how to become a better investor ... especially when those rules are for traders.

    I am in no position to question Tropo's authority on trading - I don't know Tropo, and I wouldn't know if someone was a good trader or not anyway.

    But investing isn't trading, and learning about trading is not just a set of rules - it is understanding as well.

    I am not criticising Tropo here - just putting another point of view, that I feel there is plenty of room for discussion about everything, including where we think the market is going, and why.

    It is only by putting our opinion out there and then being able to look back and think about why we were wrong (or why we were right), that we can really start to learn.
     
  11. Nigel Ward

    Nigel Ward Team InvestEd

    Joined:
    10th Jun, 2005
    Posts:
    1,172
    Good questions. On 1) I can't answer that. I guess you need to go back to the reasons you bought the relevant stocks and decide whether those reasons remain valid given your view on where the market and those stocks are heading.

    2) October is historically an interesting month for share markets :eek: (the others being Jan - Sept and Nov - Dec - just kidding and with apologies to Mark Twain! :D )

    I guess one thing that seems to be lurching towards certainty is higher interest rates. Particularly if the NZ inflation bug is caught by Australia (altho surely the plunging prices on plasma screens must help :rolleyes: ). Theory says higher interest rates = higher costs for business = lower profits.

    Will that evenuate? Don't know, but that is something that may influence your medium term plans.

    Conflict in Israel/Mid East/Oil prices/China or "Chindia" story and demand for our resources/gold as a safe refuge??? may all be things that influence you.

    Just some food for thought.

    Cheers
    N.
     
  12. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,619
    Location:
    Sydney, Australia
    Actually - let me change my previous post a bit ... looking back, -T- was asking questions about trading ... so I'll re-write my post ...

    For what it's worth, I actually agree with -T- here ... we set this site up as an education resource. Even experienced investors (and traders) can still learn from the opinions and thoughts of others.

    I'm not an expert on trading, but surely learning about trading is not just a set of rules - it is understanding as well.

    I am not criticising Tropo here - just putting another point of view, that I feel there is plenty of room for discussion about everything, including where we think the market is going, and why.

    It is only by putting our opinion out there and then being able to look back and think about why we were wrong (or why we were right), that we can really start to learn.

    Once you have mastered an understanding of trading, then I think those rules will probably help you become better ... but you have to get to the understanding part first - the fundamentals ... and more discussion will help there I feel.
     
  13. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,619
    Location:
    Sydney, Australia
    I'm not a trader - you won't get an intelligent response from me about trading - so I won't even try.

    I agree with Nigel - I think interest rates rises are almost a foregone conclusion ... the only question is when, and how many.

    Rising oil prices and low unemployment (and hence increasing wages pressure) are both likely to lead to higher inflation.

    I personally don't see the market performing 20%+ this year like it has the last few years - I'm going to go out on a limb and suggest we'll do less than 15%, perhaps even less than 10%. The only thing propping the market up will be continued strong performance by the resource sector - but I think rising oil prices will start to drag down the growth there too.

    I think conflict in the middle east will worsen, and this will have a negative impact on world markets as well.

    Essentially - I think we're in for a very bumpy ride, with resources pushing the market up, while oil prices and geopolitical insecurity will be pulling it down. It'll swing like crazy.

    My investment suggestion ? Invest in fund managers who specialise in trading volatile markets :D :D :D :D

    (note that I am not an economics or sharemarket expert - these are personal thoughts only, for the purposes of discussion - no warranty is implied :rolleyes: )
     
  14. Tropo

    Tropo Well-Known Member

    Joined:
    17th Aug, 2005
    Posts:
    3,394
    Location:
    NSW
    -T-,
    I do not have intention to proof anybody wrong, because I am not right all the time.
    My ridiculous answer (as you said), it is my opinion only ....
    Nobody knows what will happen in the market 6 months from now.
    You may ask 10 different people where market may be some time in the future and you will get 10 different answers.
    Would it be of any help ? So, what would you do in this case ?

    Sim,
    It's nothing wrong with education if right questions are ask. I am not sure if predictions have anything to do with education (correct me if I am wrong).
    Above rules are NOT only for traders !!! They are for investors also. How we all can be successful investors/traders without rules and understanding what are we going to achieve?

    Investing has a lot of common with trading so you must understand what you are doing and why. The difference is a time span (it's not easy to put the line where trading ends and investing begins).
    Maybe it's nothing wrong with predictions as long as you understand that you are trying to predict something which is unpredictable !!
    :cool:
     
  15. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,619
    Location:
    Sydney, Australia
    I don't think you are wrong - predictions in themselves don't really have anything to do with education. However, where education comes into it is developing an understanding of what drives the market - being able to identify the forces at work that have an impact on the market, and then being able to look back and see if that really did happen, or if there were other factors that you need to think about for the future.

    If predictions were of no value, then the entire field of economics would be thrown out as glorified historians.

    It's one thing to be predicting an interest rate rise of 0.50% on the 15th of August 2006, and another thing entirely to be predicting that the environmental pressure on inflation means that some interest rate rises are likely, and having an understanding of what pressure that may in turn put on the various investment markets you have exposure to.

    I guess what I'm saying is that micro-predictions are usually less than valuable (because the exact details are usually unpredictable as you mentioned), however macro-predictions (eg market cycles and broad trends), can help us identify strategies for our investing.

    For example, I believe that interest rates are going to increase for a while yet, therefore I don't believe that we've seen the bottom of the real estate market (in Sydney), and hence, I am not actively buying real estate just yet.

    At the same time, I don't think I would make a (hypothetical) prediction along the lines of "I think the market has bottomed, and therefore I'm going to buy real estate now" ... it would be more like "there is evidence that prices have picked up again, and I think the economic conditions are such that this could be sustainable, so I think it is time to start seriously looking at real estate now". That's basically like what you've said - acting on what HAS happened, not what MIGHT happen ... so I guess in my usual round-about way, I'm agreeing with you Tropo :D
     
  16. perky

    perky Well-Known Member

    Joined:
    15th Aug, 2005
    Posts:
    300
    Location:
    Sydney
    Interesting opinions there !!!

    Let me take out my crystal ball - next 3 months very volatile (good for you-know-who's fund) , as fears about OIL, interest rates etc change on a weekly basis in the US (and so here). October usual 10% or more downturn, Nov a little up and a nice December.
    So what am I going to do - maybe take some (hopefull :) ) profits over the next 2.5 months at some point - get out of everything (all of my managed funds, shares in late September). Get back in November some time.
    Test CFD's in Oct (do some down trades), then do some up trades in November or December.

    But who knows !!!!!!!!!!!!!!