Deep Singh

Hello.

With all this market turmoil I thought it might be useful to have one thread where we can discuss any/all of the major indices on a daily basis. In this way those who are interested know where to look, and those that aren't don't get fustrated by having half the forum being taken over by such threads.

I'm also hoping that perhaps by pooling our opinions we maybe able to identify the bottom and hence buying oppos in equities. I'm really talking about whole indices or sectors, not individual stock picking

Even though such discussions will by their nature include other areas of the economy ie property prices, commodities etc the main thrust should be the movements of the share indices.

FlightMan

FTSE at 3500 by the end of the year.

Property prices down 18% by the end of the year.

Deep Singh

Thanks for the first response on the thread! It would be nice though to have some reasoning as to why you think the FTSE will hit 3500 by year end

john banks

Some of the best days for gains have historically been after the biggest losses, although as these losses mount there will need to be lots of good days! I can feel no bottom for banks with all the derivative time bombs just starting to be revealed, but good companies/sectors that (so far) have been earning well are getting over-sold I feel, maybe to cover other losses? I hope for a recovery through industrials and commodities at some point, hopefully before our property market bottoms. Whilst "emerging markets" are getting hammered now, I wonder if their recovery will be part of the inevitable transfer of wealth from the West?

lozgti

I really cannot believe Bank Share prices.I really think something is going on that we just don't know about.

RBS now about 80 pence from £6.00 last October.

All these cash injections seem to be into a bottomless pit.

Suppose people thought NR was worth a punt when they were about a quid.Which reminds me....are those share holders going to get anything?

Deep Singh

Would it be useful to do a historical analyses? ie in previous bear markets the major indices must have dropped by a certain amount over a certain period of time, giving us some kind of average.
Obviously things are not the same everytime but it might give some sort of indication as to what sort of drops we should expect over what sort of time span.

John, you are obviously thinking about certain sectors/shares that will be the first to rise. I have two problems with this

1) Individual stock picks are a no go for me as too high risk

2) Investing in sectors usually means managed funds (as opposed to simple trackers)I find they are too expensive. Unless there are ETFs that cover these?

JTaylor

Good idea, Deep. I'll watch the thread with interest and will contribute if I have anything of value to add. This is highly unlikely.

lozgti

Deep.Don't think this stock market/economic thing is that difficult to work out really.Seems to follow perfect cycles

FTSE 100 Chart, Graph - MoneyWeek (obviously get the graph for All years.Apart from looking like Maddonas bra,it seems a pretty symmetrical thing

And Gordon Brown has not stopped that,much as he foolishly said he has.(must be regretting that statement!)

Butkus

I don't know anything about investing as I'm a trader, but I would say this is a trader's market only personally.

You need more than just "this is a good place to buy, so I'll buy here". You need a plan, with stops and targets. You also need money management.

paulr

Is there anywhere to get a longer term graph of share prices, than since 1996 ?

Deep Singh

Butkus, I'm not sure I agree or maybe we misunderstand each other? I'm not talking about day trading. I do not know enough nor have the time for this even in a benign market let alone in this climate.

What I'm saying is that given this huge ongoing correction there will be a once in a 'lifetime' oppo for us to buy assets at 'cheap' prices. I'm looking at international indices, commodities and perhaps sectors (as JB said in solid companies that make things that people want).

These can be bought as easy to manage trackers and ETFs and held for the medium term ie for the next bull market.

Butkus

OK, I got it. I'm a daytrader so we're thinking about different things. Funnily enough for all that people warned me about trading when I first started, I actually think investing is the riskier past time! People blindly hold shares with no regard to the future. They have no plan. And I think you have to have a plan whether you hold for 10 minutes or 10 years.

paulr

You make it sound so easy, if it was we'd all be rich.

Butkus

Another thing I have read in a few places is that no one alive today has ever really known a truly bad bear market. We're so used to things going back up because that is what we're always told, but they really don't HAVE to go back up.

Deep Singh

I do take your point and your opinion is invaluable given your background/expertise. I'm not talking about blindly holding shares, in my above post I specifically mentioned not stock picking single shares.

What I'm saying is investing in a whole index at the right time to benefit from the next bull run, obviously one would want an exit strategy, but not a daily one.

Or investing in sectors in a cyclical manner to again take advantage of the next cycles.

I do take on board your comments on having targets though

Butkus

Thanks for the 'big up', but I am just a postman who daytrades the US market in the afternoon!

You can still apply trading ideas to long term holds. For example, I think you should always have a stop whatever the timeframe. And then maybe with the targets you could scale out of your position in portions, moving your stop up as it moves (hopefully!) in your favour.

Deep Singh

Yes, that is a possibility. I suppose the Japanese property market is/was an example of that. But repeated across the whole world? A very scary concept!

john banks

I first started equity investing soon after I had some spare cash, but my timing was atrocious as I started as the dotcom bubble was bursting. I'd read some convincing work that stated that there was no four year period in the last century when the market ended lower than it started if you take the whole index. Well, guess what, it did as soon as I started investing and has done a fair bit since! Knowing what I know now, I would have been better off had I never invested in equities at all!

I read "Black Swan" on holiday and it was very interesting. Makes me more scared when you read how a lot of financial modelling is underestimating the frequency of outlying events that can produce disaster.

I would still like to identify recovery sectors where I can buy the index.

I used to buy index tracking funds with low expenses through Fidelity fund supermarkets. However, you have to put your order in before you know the price and the expenses can be high. So now I tend to use ETFs, through which you can buy a variety of trackers with low expenses and no stamp duty. I admit though I perhaps stupidly bought more ETFs without looking more closely at the counterparty risk. After AIG collapsed the other week, ETF SLVR was closed for trading for about a week as it was underwritten by AIG. I suppose index tracker ETFs may have the same problem if they are supported by insurance companies or derivatives.

Some want real share certificates rather than broker nominee accounts for the same reason.

jonc

It will hit rock bottom from October 23 apparently according to this guy
Is it the end of the financial world? - MSN Video

Deep Singh

JonC, can't seem to open that video.

FTSE 100 Share Price Chart | ^FTSE | | Yahoo! Finance UK=

If you look at this graph, the ftse was low 3000s in about 2003. If we are now meant to be in the biggest financial recession in living memory then surely the ftse must drop below that 'recent' dip? Therefore the time to buy might be about the 3000 mark?

Deep Singh

FTSE down 7% today!

I still think circa 3200 will offer the buying opportunity

alloy

Looking at the key support and resistence levels, taking into consideration the sentiment within the markets and the whole global economic state of play we will test the 3500 level again for sure before the year is out. Lot of sentiment in the markets that the bottom is finding itself which is why volatility is so prominent. My analysts beleive this volatility is the signal of things finding their bottom so for conventional investors they find some form of comfort in that respect, but for certain things on a short term basis will be of exceptional volatility, which is the catalyst for my strategies and ability to generate gains for my clients

alloy

On a side note today was the first day in over 8 weeks i have gone long on a proposition in the markets, but i still do strongly beleive being short is the best way to profit from this market. Relief rallies are short lived off the back of good news flow, and usually followed by either an equal or indeed savage demise shortly after. Alot of issues circulating have already been heavily taken into consideration and priced into the markets.

Deep Singh

Alloy, thanks for your comments, could you remind me what you do again please?

Even though alot of bad news has been priced in, things can only get worse from here can't they?(I'm talking whole indices/sectors here don't forget as that is how I am going to invest)

Earnings will continue to decrease over the next 12 months in almost all sectors as house prices continue to fall and unemployment rises. Share price rises tend to pre empt an improvement in the wider economy, but with the wider economy still on the way down the stock market must have further to fall yet?

TelBoy

Gone long in what vehicle? Dow futures?

stevem2k

2900 is the likely technical 'bottom' btw.

TelBoy

And where's it going to go from 2,900?? Not up very far would be my humble prediction. Nationalised bank account for 5%? Yes please.

alloy

I'm the senior trader on the CFD desk for a boutique in the city dealing with HNWI, professional and elligible counterparty clients.

I beleive things will get worse, which is why i'm still very much short of the market, probably up till the December break. I only trade single equities on the 100 and some of the larger 250, so i don't play with indices, thats hero stuff because there are so many more variables to take into consideration and if a heavily weighted stock moves against your anticipation it can not only ruin your day but your year.

I've just closed out now for the day, with the satisfaction of profit off my first long in a fair few months. I presume next week i'll be shorting the mid morning surges, but because all my positions are typically intraday it's very difficult to say for certain what sort of issues i'll be looking at until the market has opened and the direction is in conjunction with our anticipation.

Deep Singh

Tel/Steve, what I meant was that circa 3000 would be where the ftse may start to look like it offers opportunity. If the markets were still obviously bearish then obviously the position would need to be reviewed.

Alloy, for an amateur, non day trader like myself, with a 5 year outlook, does my strategy seem flawed? ie buying whole indices in cheap(fees) tracker funds when things look somewhere near the bottom?
I'm basing this on all the blurb that equities out perform all other asset classes over the longer term. If I'm getting in somewhere near the bottom (though I appreciate my timing will be far from perfect) then over 5 years I should see good capital growth.

Thanks. Btw, was it you who ordered the GTR? If so when is it due?

TelBoy

alloy, do you trade p/a and pay a commission?