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Topic: Misfits Thread

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Cincydawg

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Re: 2020 Offseason Stream of Unconciousness
« Reply #672 on: March 10, 2020, 09:54:42 AM »
I have known some "active traders" who would brag about the killing they were making and then a year or so later went silent on the topic and didn't want to talk about it.

We had a guy at work who was flipping houses and making a bundle, he said, circa 1999.

I figure if that many folks could time markets, no one could do it.  The high level money managers who do it for a living don't seem to be very good at it.

iahawk15

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Re: 2020 Offseason Stream of Unconciousness
« Reply #673 on: March 10, 2020, 10:01:37 AM »
I have known some "active traders" who would brag about the killing they were making and then a year or so later went silent on the topic and didn't want to talk about it.
Sounds like greedy people who didn't know how to manage their money.

I've known some good-to-damn-good poker players over the years. The ones that still play never walked into a game w/100% of their bankroll.

Cincydawg

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Re: 2020 Offseason Stream of Unconciousness
« Reply #674 on: March 10, 2020, 10:06:12 AM »
Why do mutual funds in general underperform the broader markets (or related sector ETFs)?

Obviously, not every trading day with a large drop is necessarily followed with a large pop the next morning.


iahawk15

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Re: 2020 Offseason Stream of Unconciousness
« Reply #675 on: March 10, 2020, 10:10:48 AM »

Why do mutual funds in general underperform the broader markets (or related sector ETFs)?

Obviously, not every trading day with a large drop is necessarily followed with a large pop the next morning.


I don't study mutual funds because I don't invest in them.

Passive investors and "good" active traders (seems like I have to continually qualify that) are using the same basic strategy; they trade with the trend. The only difference is the time frame.

Cincydawg

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Re: 2020 Offseason Stream of Unconciousness
« Reply #676 on: March 10, 2020, 10:18:02 AM »
https://www.marketwatch.com/story/more-evidence-that-passive-fund-management-beats-active-2019-09-12

It's generally known that active funds overall underperform passive funds over a decade time frame.  Thus, professional money managers broadly don't beat the market.

Maybe this just means a lot of MF managers are not very good and a few are.

The Morningstar Active/Passive Barometer is a semiannual report that measures the performance of U.S. active funds against passive peers in their respective Morningstar categories. The report showed that active funds outperformed passive funds in several categories during 2017, but the June report said this trend changed: "Just 36% of active managers categorized in one of the nine segments of the U.S. Morningstar Style Box both survived and outperformed their average passive peer over the 12 months through June 2018. In 2017, 43% of active managers achieved this feat."

847badgerfan

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Re: 2020 Offseason Stream of Unconciousness
« Reply #677 on: March 10, 2020, 10:33:06 AM »
That's fine. I've been lightly following the stock market thread in the other forum, but chose not to get involved. MCWTerps speaks a lot of truth there.

What it comes down to is two philosophies. Passive investors and active traders. Neither one is the "right" way to do it. There's money to be made for people who have the time, ability, and desire to learn how the markets move. For others, the long game works best.

I certainly haven't been making a zillion bucks, but I am making money. Winning traders work in probabilities, not absolutes. My strategy is aim small, miss small.
It depends what you believe in. I don't believe in anything that doesn't involve the long play. My work and play schedules are too busy to even think about anything else. If I come across an opportunity, I'll make a call to my guy.

(I admittedly did this morning on a couple of stocks I trust, in healthcare. I value the companies so I think I got a good deal, regardless of what happens over the next month or two. I'm holding.)
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betarhoalphadelta

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Re: 2020 Offseason Stream of Unconciousness
« Reply #678 on: March 10, 2020, 10:40:40 AM »
So, my company just reported that we had an employee test positive for COVID-19.  He was here in Austin, but left to go home to India on 2/28.  He stopped off in NYC on 2/29 and flew through Dubai at some point, and then reported to work in India for a couple of days before feeling ill, going to the doc, getting tested for COVID19, and coming up positive.  While here in the Austin area, he worked and interacted with a handful of his team members, at the same campus where I office.

I work from home primarily and rarely go into the office, it's highly unlikely I would have come into contact with him, or anyone else he came into contact with.

But the real point here, is that my company has decided to move to work-from-home for ALL employees that can, thru 3/24.  Some teams, primarily hardware engineers, won't be able to do that.  The equipment they're designing/testing is all in labs that are on our campuses.  But the rest of us in operational or finance or support roles, can, and must, work from home.
We're seeing a lot of the same, although I believe at this time we haven't had any employee [even worldwide] test positive. We instituted travel bans for international, restricted company meetings over a certain size, and moved certain meetings which would normally require people to fly in to one site to be remote. I might have a meeting coming up the first week of April in Colorado, and it remains to be seen whether that will be changed to be remote instead--I know my wife doesn't want me to go. 

Like you, I work from home primarily now (went from about 30-40% work from home to 90% once we got the puppy). For my role that's normal; it's a field role and most of my peers work from home as they don't live near an office. I just happen to be near a major office so I have a desk there. But just this past week they've been making sure that people in other roles have been validating all of their work-from-home capability (connectivity, VPN, etc) in case they get the order to start. 

Personally I think some of the panic is a bit overblown. But that said, we're currently at 730 cases tested positive in the US and 26 deaths. That's 3.6%, and given that probably 500+ of those positive tests have occurred in the last 96 hours, I would expect the death rate just amongst those 730 patients to climb as some of those 730 won't recover. Granted, I'm sure there are some unreported cases where [younger, healthier] people are either having mild symptoms and not getting checked out, or might even be entirely asymptomatic. As @847badgerfan says, that 3.6% rate is only based upon known positive tested patients, and clearly doesn't include everyone at this point. But it's still higher than we'd like to see. 

And of course, people stockpiling their bunkers are buying Costco, Target, Walmart etc out of toilet paper, water, cleaning supplies, etc. It's madness.

Cincydawg

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Re: 2020 Offseason Stream of Unconciousness
« Reply #679 on: March 10, 2020, 10:40:44 AM »
I bought some XLE this morning, same kind of thinking.  I appreciate that energy can go lower from here of course, but I'd guess it'll be OK in five years.

I saw Ohio State has cancelled classes for this entire month.  It's impossible for me to know whether this is an over reaction or being prudent and sensible.

iahawk15

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Re: 2020 Offseason Stream of Unconciousness
« Reply #680 on: March 10, 2020, 10:42:09 AM »
It depends what you believe in. I don't believe in anything that doesn't involve the long play. My work and play schedules are too busy to even think about anything else. If I come across an opportunity, I'll make a call to my guy.

(I admittedly did this morning on a couple of stocks I trust, in healthcare. I value the companies so I think I got a good deal, regardless of what happens over the next month or two. I'm holding.)
I think you completely agreed with my second paragraph. When I get annoyed, is one style of investor acts like the other style is wrong. It appears active investors are speaking out of arrogance toward passive investors, and passive investors are speaking out of ignorance to what active trading is.

Cincydawg

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Re: 2020 Offseason Stream of Unconciousness
« Reply #681 on: March 10, 2020, 10:42:51 AM »
Incidentally, we went to Costco three times in the past 5 days here and they have ample supplies, here, of everything.  I had ordered some photo books and also eyeglasses so we were in and out several times.  It was crowded, but it pretty much always is.  I don't think Atlanta is experiencing outages (yet).  Kroger also had plenty of whatever.


Cincydawg

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Re: 2020 Offseason Stream of Unconciousness
« Reply #682 on: March 10, 2020, 10:44:59 AM »
https://www.npr.org/2020/03/09/813750481/more-than-20-colleges-cancel-in-person-classes-in-response-to-coronavirus

More than 40 U.S. colleges have canceled in-person classes because of the coronavirus as of Tuesday morning. The colleges enroll a total of more than 600,000 students and include Columbia University, Princeton University, Rice University, Stanford University, Hofstra University and the University of Southern California, plus the University of Washington and a clutch of community colleges in Washington state.

betarhoalphadelta

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Re: 2020 Offseason Stream of Unconciousness
« Reply #683 on: March 10, 2020, 10:45:26 AM »
Why do mutual funds in general underperform the broader markets (or related sector ETFs)?

Obviously, not every trading day with a large drop is necessarily followed with a large pop the next morning.
My understanding is that a lot of this is fees. A typical index fund carries an expense ratio of ~0.2%. A typical mutual fund is closer to 2%. So in order to be net positive for the investor, the mutual fund not only has to outperform the index fund, it has to significantly outperform the index fund.

847badgerfan

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Re: 2020 Offseason Stream of Unconciousness
« Reply #684 on: March 10, 2020, 11:01:41 AM »
I think you completely agreed with my second paragraph. When I get annoyed, is one style of investor acts like the other style is wrong. It appears active investors are speaking out of arrogance toward passive investors, and passive investors are speaking out of ignorance to what active trading is.
Yep, no doubt. What has worked for me is not for everyone. I don't pretend that to be the case. But, investors like me (or seemed like me) are also panicking this week and hurting the markets.

One thing I do know for sure is that no matter your style, the markets are not for the timid.
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Cincydawg

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Re: 2020 Offseason Stream of Unconciousness
« Reply #685 on: March 10, 2020, 11:22:52 AM »
I think investing can be for the timid, if it's investing and not trading.

 

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