The bears den

[coolhead]

Holeefk, us 10year yield woomed down to 1.86%....

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[revhappy]

Thanks for the info.. I will stick with British stocks ADR which has no WHT.. All of them are on sales now

Do you see any mispriced British stocks, due to cheap pound and mostly export oriented? I mean those that have been hit by Brexit worries but their earnings won't be impacted?

 

[churnmaster]

It is tough to be a macro trader nowadays. The markets are not behaving in the manner as the macro environment is dictating due to flush liquidity considerations... everyone is searching for yield and the next higher yielding asset gets bought regardless of its riskiness... and that's why we have a situation where there are junk bonds trading at negative yields. I only hope that this bubble does not burst and that central banks can unwind their QE programs in time and slowly deflate the bubble. Otherwise, all hell would break loose.

Yeah, you are right. For me, these days its all about small positional trades and mostly intra day / swing trade (1-2 days). Only currency exposure being SGD and USD. No multi currency asset like IWDA, where you have too many moving parts. Most of the risky bets with leveraged products, but with overall portfolio leverage less than 2. 80-90% capital earns 2-3% returns and 10-20% in leveraged products, with the target being low double digit returns on the overall capital.

Coming to QE programs, they have done gross injustice to small savers who are forced to invest in risky assets just to earn a positive return. And if the bubble bursts at a later date, it will cause so much hardship in their lives.

 

[homer123]

Doing research..with the pending BREXIT UK stock has more room to fall but it is also good opportunity to accumulate dividend UK stock with mainly international exposure

Do you see any mispriced British stocks, due to cheap pound and mostly export oriented? I mean those that have been hit by Brexit worries but their earnings won't be impacted?

 

[churnmaster]

Europe, Japan and Hong Kong are at mouth watering valuations, US is still expensive. So what is going to happen? Will US fall or the rest of the world go up. So far, it seems investors are selling RoW more than US, which doesn't make sense.

Mouth watering valuations How do you numerically define that ?

Coming to divergence between US and ROW markets, that's how it is with financial markets. Big investors chase the winners and shun the losers. Small retail investors do well when they piggyback on these moves. Remember, flow begets flow, whether its inflows or outflows. And based on that, I would think the divergence would increase over time.

Personally, I'm not comfortable being long at the current levels and thus small net short in the SG market.

 

[churnmaster]

Yes seriously.

https://www.bloomberg.com/news/arti...tart-taking-hold-in-europe-s-junk-bond-market

Highlight from that article -

High yield borrowers with bonds denominated in euros trading with a negative yield include:
Ardagh Packaging Finance plc /Ardagh Holdings USA Inc.
Altice Luxembourg SA
Altice France SA
Axalta Coating Systems LLC
Constellium NV
Arena Luxembourg Finance Sarl
EC Finance Plc
Nexi Capital SpA
Nokia Corp.
LSF10 Wolverine Investments SCA
Smurfit Kappa Acquisitions ULC
OI European Group BV
Becton Dickinson Euro Finance Sarl
WMG Acquisition Corp.

Imagine a company that is not managed well being paid money when they issue a bond... how would they deploy the monies raised? If they were not efficient prior, they would be less so in an environment with negative yields. The efficient capital allocation mechanism has truly broken down and inefficient companies are kept afloat...

Duke, we need to get some of these investors to fund us to scale up over trading.

We can atleast ensure that their capital is protected while working on a profit sharing basis.

 

[revhappy]

Mouth watering valuations How do you numerically define that ?

Coming to divergence between US and ROW markets, that's how it is with financial markets. Big investors chase the winners and shun the losers. Small retail investors do well when they piggyback on these moves. Remember, flow begets flow, whether its inflows or outflows. And based on that, I would think the divergence would increase over time.

Personally, I'm not comfortable being long at the current levels and thus small net short in the SG market.

Tides change and the slow growth of international markets will eventually pull down US. This always happens. If you are holding for the long term you are better off holding low PE international markets. While they may stay low for some more time, enjoy the dividend yield, we will eventually have a 2017 like year when international will beat US markets.

 

[Lasogette]

Holeefk, us 10year yield woomed down to 1.86%....

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Market pricing in rate cuts or investors bunker in for a crash ?

 

[BBCWatcher]

Tides change and the slow growth of international markets will eventually pull down US.

Before you assert that "international markets" are in "slow growth," would you care to check some actual data first? Hint: The data aren't showing that, not that I've found anyway. Go look at global GDP data, as a notable example.

 

[coolhead]

Market pricing in rate cuts or investors bunker in for a crash ?

According to online sources, the bond market is betting that fed has not done enough to sustain economic expansion and the trade war provide further support to bond market claims. In essence, the bond market is betting that there are further rate cuts down the road, contrary to fed's assertion that the latest rate cut was an insurance policy.


I don't understand the link though.

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[revhappy]

Before you assert that "international markets" are in "slow growth," would you care to check some actual data first? Hint: The data aren't showing that, not that I've found anyway. Go look at global GDP data, as a notable example.

I do check actual data. Look at global PMIs, Korea, Germany etc are in contraction.
https://in.reuters.com/article/us-g...h-asia-europe-stimulus-expected-idINKCN1UR39T

 

[limster]

I'm am buying present and future earnings when I buy shares. For each dollar I pay, how many cents earning I am buying will affect the potential dividend I can receive.

I've resumed normal buying activity and hope to be able to average down next week. Not touching warchest, but spending my free cash flow.

Thereafter, USA can announce progress in talks and suspend/postpone the tariff implementation deadline... but not before I finish buying for the month pls.

 

[revhappy]

 

[Lasogette]

Any idea how to get these low hanging fruits? Need to b able to read jap?

 

[limster]

Any idea how to get these low hanging fruits? Need to b able to read jap?

Yes,true.
similarly, in order to invest in China market, you need to be able to read Chinese and for German market, you need to be able to read German

thats why I'm only vested in China market and haven't bought any DAX shares yet.

 

[revhappy]

Yes,true.
similarly, in order to invest in China market, you need to be able to read Chinese and for German market, you need to be able to read German

thats why I'm only vested in China market and haven't bought any DAX shares yet.

Since I don't do stock picking, I would just buy a fund or ETF. I look at Japan as a very defensive bet. It may not outperform other markets, but it will beat fixed income returns. More like 10-20% returns by end of 2020 as a base case scenario.

 

[coolhead]

S&p futures suddenly woomed down 0.7%. in other news, gold back up 1450, hope it stays that way.

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[DukeCS33]

S&p futures suddenly woomed down 0.7%. in other news, gold back up 1450, hope it stays that way.

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I expect Trump to start tweeting again. Personally, I do not think we would have a trade resolution. So its now up to the Fed to cut rates aggressively to save the equity markets... The bond market is indicating a more aggressive rate cut path. Prior, we always hear that the market needs to respect the Fed. Under Powell, it appears that the Fed may well be led by the Markets.

 

[Mecisteus]

S&p futures suddenly woomed down 0.7%. in other news, gold back up 1450, hope it stays that way.

S&P500 is 2,932 now.

That is about 3% lower than the peak.

No hurry to buy again.

 

[coolhead]

S&P500 is 2,932 now.

That is about 3% lower than the peak.

No hurry to buy again.

I was hoping it won't go down so early so I can trade uvxy. Looks like it won't be easy gains on shorting...

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