So you call yourself a Investment Professional

I’ve been catching up on here. Looks like a lot of you guys are going to cash, because you guys are scared. WTF. And you call yourself some kind of Investment Professional? This is the best time many us have EVER seen… If you are 25 and sitting in front on a 401(k) that you will not be touching for 40+ years, how can you go to cash NOW! The time was 12 months ago if you are looking at making tactical allocations. Sure, equities are not looking cheap on a relative valuations vs bonds/pfds. So why go to cash? Can’t invest in IG / HY bonds? I know, I know, company default have/are going to rise, probably to the highest in the last 20 years, on % basis, but don’t put everything in a company, diversify, across asset classes and sectors. If you choose to go equity route, you’ll be buying from Grandma who just realized, being 72 and sitting on 90% allocation to bank and utility stocks for their dividends probably wasn’t the best idea. Or maybe even some HF that’s getting redeemed and forced to sell into any rally. Or some CA resident who put $20K down on a $1.3MM house, just lost their job and must liquidate their tech company holdings to make the mortgage. Store these in your 401(k) and in 10 years you will love them: TGT, CSCO, PFE, DAR, BAC, GE, RHT.

Hey genius, since when can I buy individual stocks in my 401(k)???

ymc Wrote: ------------------------------------------------------- > Hey genius, since when can I buy individual stocks > in my 401(k)??? i can… also in rollover IRA.

I’m still an amateur but I’m getting fully invested… DAMN it hurts! I’m not buying any of the names you mention.

ConvertArb Wrote: ------------------------------------------------------- > I’ve been catching up on here. Looks like a lot > of you guys are going to cash, because you guys > are scared. WTF. And you call yourself some kind > of Investment Professional? > > This is the best time many us have EVER seen… If > you are 25 and sitting in front on a 401(k) that > you will not be touching for 40+ years, how can > you go to cash NOW! The time was 12 months ago if > you are looking at making tactical allocations. > Sure, equities are not looking cheap on a relative > valuations vs bonds/pfds. So why go to cash? > Can’t invest in IG / HY bonds? I know, I know, > company default have/are going to rise, probably > to the highest in the last 20 years, on % basis, > but don’t put everything in a company, diversify, > across asset classes and sectors. > > If you choose to go equity route, you’ll be buying > from Grandma who just realized, being 72 and > sitting on 90% allocation to bank and utility > stocks for their dividends probably wasn’t the > best idea. Or maybe even some HF that’s getting > redeemed and forced to sell into any rally. Or > some CA resident who put $20K down on a $1.3MM > house, just lost their job and must liquidate > their tech company holdings to make the mortgage. > > > Store these in your 401(k) and in 10 years you > will love them: > > TGT, CSCO, PFE, DAR, BAC, GE, RHT. preservation of capital is a fundamental to good investing, the reality is we don’t actually know how much further this market can go down.

I am definitely not pros. I do not even work for finance company. But I have studied market long and hard. I have been in close to 100% cash almost a year. I made a big move today. 40% in stocks right now. I think we will have nice bounce soon and probably sell off again next year.

The market can ALWAYS go down. Just because it went down last month doesn’t mean it will go down this month, too. We know that the market has gone down a lot already. It’s reassuring to know if you buy now you are guaranteed to not be buying at the peak. That’s a GUARANTEE! We also know that good returns in the market tend to follow bad returns. For examply, with EFA, if you purchased it anytime after a -20% year, the following 4 years would average 18%. If you purchased it after a 11% (or less) year (that would be an average return), the following 4 year returns would average only 9%. Buy after a good year = bad returns. Buy after a bad year = good returns. It’s always a good time to buy when there is irrational fear because the sellers aren’t thinking straight. There are lots of sellers who are, at best, selling because they don’t understand (they’re selling something they could never understand anyway!). At worst, you know hedge funds and dumbass leveraged CEOs are selling, not for the usual reasons.

hope you weren’t trying any ‘convertarb’ - regulatory risk would have bitten your nads off for 25 yr horizon even a monkey can tell you ‘buy 100% equity when vix is high’ the real challenge is for funds invested for next 2-3 years. very very hazy - you pretty much need to trade actively (good luck) to have a shot at decent returns.

rohufish Wrote: ------------------------------------------------------- > hope you weren’t trying any ‘convertarb’ - > regulatory risk would have bitten your nads off > > for 25 yr horizon even a monkey can tell you ‘buy > 100% equity when vix is high’ > > the real challenge is for funds invested for next > 2-3 years. very very hazy - you pretty much need > to trade actively (good luck) to have a shot at > decent returns. ha. " trying any" ‘convertarb’…“trying” i’m your monkey. you got a 2-3 year horizon… go to cash now, no wait go to cash 5 years ago… you should never have been in the markets, not corporate bonds, and definately not equities… are you serious? 2-3 year horizon? what are you 65? you better be 70% liquid. unless you are planning on leaving an investment for your kids/grandkids/great grand kids. NEVER should have been in equities. Sorry Themla, your utility stock ain’t secure.

ConvertArb Wrote: ------------------------------------------------------- > I’ve been catching up on here. Looks like a lot > of you guys are going to cash, because you guys > are scared. WTF. And you call yourself some kind > of Investment Professional? > > what you talking about, dodohead. Im here pitching stocks everyday and talking the book. keep the ideas flowing, arby boy.

Are you basically talking about CBs that are priced at discount with a short duration (2 years or less if called) and expected returns of 20-25% without leverage as long as the company is still financially sound and the bonds go to par? Would be interested to know how you tap that action - are you basically talking the cbs of the tickers you listed or do you really mean the stock? How does that work? Also, I hear the best opps are in Asia. Why shouldnt I just invest in a long only Asian cb fund (im offshore) Cheers

I think it makes more sense to invest in Asian (excl JP) stocks than US/EU stocks. They have more upside. It is possible that US/EU stocks can have a lost decade like JP.

ConvertArb Wrote: ------------------------------------------------------- > I’ve been catching up on here. Looks like a lot > of you guys are going to cash, because you guys > are scared. WTF. And you call yourself some kind > of Investment Professional? > > This is the best time many us have EVER seen… If > you are 25 and sitting in front on a 401(k) that > you will not be touching for 40+ years, how can > you go to cash NOW! The time was 12 months ago if > you are looking at making tactical allocations. > Sure, equities are not looking cheap on a relative > valuations vs bonds/pfds. So why go to cash? > Can’t invest in IG / HY bonds? I know, I know, > company default have/are going to rise, probably > to the highest in the last 20 years, on % basis, > but don’t put everything in a company, diversify, > across asset classes and sectors. > > If you choose to go equity route, you’ll be buying > from Grandma who just realized, being 72 and > sitting on 90% allocation to bank and utility > stocks for their dividends probably wasn’t the > best idea. Or maybe even some HF that’s getting > redeemed and forced to sell into any rally. Or > some CA resident who put $20K down on a $1.3MM > house, just lost their job and must liquidate > their tech company holdings to make the mortgage. > > > Store these in your 401(k) and in 10 years you > will love them: > > TGT, CSCO, PFE, DAR, BAC, GE, RHT. I’ve liked your posts lately - where did you go ( a few years off in Fiji or something)?

virginCFAhooker Wrote: ------------------------------------------------------- > I’m still an amateur but I’m getting fully > invested… DAMN it hurts! > > I’m not buying any of the names you mention. i’ve read your posts virgin. you have good ideas, i really like your NLY. I also like their historic commentary from their website. Look, I am not buying at the bottom, it does hurt when you’ve had a cash allocation and you start buying and watch it drop sometimes 10% within 2 days… Get past the fact that you will have paper losses in the interim. Succumb to the fact you are not buying at the bottom. I threw out a couple names that I am buyer. Will all of them survive? I hope so, but putting my chips on the table. All the other players are on tilt, throwing out their stocks b/c they are not performing, analysts out there lower expectations, guess what, nobody gives a flip about earning next year, it’s all about survival and postwar. Which stocks will have an excellent opportunity come back once the economy gets back on track? The economy has been strong without MBS/Subprime/CDO for several decades. So what if people have to actually put 20% down for a house or automobile. This is a cleansing process. US consumer will begin to actually be net savers? The markets (credit/equity) will rally before the rev’s of companies have hit bottom, that I know.