[MrBlackhill]

I'd like to get more copper, but not sure

I've been enjoying the ride with ERO. Bought in 2020 and I'm currently at +90%. Pretty volatile ride, but it's been going up.

KL gold

I also have KL which I bought in 2020 and I added more recently. I'm waiting patiently.

 

[MrBlackhill]

I'm getting flashbacks of 2017. Sell your bonds! Buy short term bonds! Preferred shares is the new fixed income! (lol, ridiculous).
In retrospective, buying and holding aggregate bond funds was the right move in 2017. I don't know how it will turn out this time, but I don't think you can go wrong by sticking to ZAG, XBB or VAB. And I believe that's true even if this year and the next are negative. I'm crazy, right?

Maybe, but how far in the negative must the rates go before a majority of people start agreeing? Do you think people in Switzerland are buying bonds? I'm no expert, it's just an open question.

 

[MrBlackhill]

@MrBlackhill too ... "actively" navigating markets and using facile logic to reposition oneself does not work. It's a losing strategy in the long term and studies have shown this.

Studies are not advice, they are a piece of information. This piece of information tells us about the risk and the distribution of that risk in the specific context of that study (population, methodology, hypotheses, etc).

If you are given a test that 95% fail but you are also given the choice to skip it and get the average score, you're the kind of person who would choose to skip it and you'd be happy with the average. I'm the kind of person who would be excited to take my chances.

When you're passionate about a subject, you don't want to be passive about it.

I never regret taking risks because that's how you learn the most and that's how you live the best experiences and adventures.

Yeah, these kinds of moods appear every once in a while. It's just human nature I suppose.

People who make all these prognostications, like the guys on CNBC and in the media, might get some of these calls right once in a while. For the short term anyway. The problem really is that they cannot successfully time their way through markets over the long term. We've seen the long term results of hedge funds and active, tactical fund... they suck.

Trying to time markets, asset classes, interest rates, is not a good strategy in the long term, assuming you have a 10+ year horizon.

Deciding on a strategy you like the best. And then stick with it. If you don't like 60/40 and think we now live in a world where you must be 80% stocks 20% preferreds, fine, then decide on that and stick with that, no matter what.

I'm wondering if there's a Swiss Money Forum with an equivalent of @james4beach telling people to keep buying Swiss bonds for the past decade.

Look at this :

iShares Swiss Domestic Government Bond 7-15 ETF (CH) | CSBGC0

The Fund seeks to track the performance of an index composed of Swiss government bonds.

www.ishares.com

Switzerland Government Bond 10Y - 2022 Data - 1994-2021 Historical - 2023 Forecast

The yield on the Swiss 10-year government bond was over 1% in early June, the highest since March of 2014 as investors ramped up bets that the SNB could tighten monetary policy this year following higher than expected CPI data. Annual inflation in Switzerland rose to 2.9% in May, well above...

tradingeconomics.com

Buy bonds for the uncorrelated asset class and the low volatility, but certainly not for the income or the performance.

I don't need the income, I don't care about volatility but I do care about performance, so my choice is clear and easy. No bonds.

 

[MrBlackhill]

@james4beach People are free to tell their opinion, what's wrong with those articles that you hate so much?

Life would be so boring if we couldn't share our opinions. Life would also be much harder if we couldn't have access to the opinion of other people.

Giving an opinion is not disinformation.

 

[MrBlackhill]

@Jimmy, @MrBlackhill and @james4beach, I think all opinions help people reading this forum, no matter which opinion you hold.

Is it better to hold index ETFs or individual stocks? Depends who you ask. I’ve done both, and wouldn’t have learned a new way without reading differing opinions.

I don’t know what will happen in the future, and neither does anyone else.

The way @james4beach invests is not eccentric in my view. I’m diversified among asset classes, I once was all equities and learned it doesn’t suit my personality after 2008. I suspect others will come to the same realization in the future. (Not saying this will be Jimmy or MrBlackhill).

I'm all good with this and I agree. I'm all good with passive investments. Most people should learn DIY passive investing. But I'm an active investor simply because I enjoy it.

What irritates me is when someone who uses a different strategy criticize the tools used by people using another strategy.

I mean, for instance, I don't like sports cars and I don't shop for sports cars. So why would I criticize the articles and magazines that people read about sports cars? All I say is that I don't spend my money on sports cars and I'm done, I don't have any added value in discussions about sports cars review magazines.

Or... I like guitar music. Most people will just listen to guitar music (passive), while I want to buy a guitar and learn to play the guitar (active) even if I'm a bad musician and it takes me years, even if I never do better than the average guitar player. But why would someone who prefers to listen to guitar music come and criticize the tools that I use and the content that I read to learn to play the guitar by myself?

 

[MrBlackhill]

Now, I find I’m too busy (young kids, long commute to work) to be active so I’m passive investing now.

Yes, that's true.

I know I won't have time to try to find hidden gems throughout the next years. I'll still want to keep investing all in equities and stock picking but I'll take less risk (less research and less due diligence required). As long as I'm having fun. I'll slowly adapt my style to the context.

Finding the right balance between all my interests and passions has always been my most frustrating life quest.

Did I read somewhere you have a child on the way soon? Congratulation

The baby has arrived last Wednesday, on July 7th. Thanks!

We're currently pretty busy with all the back and forth at the hospital and some other issues, but otherwise everybody is healthy.

 

[MrBlackhill]

So now 2-3% moves are a trend? Seriously?

I agree. All the indices are up compared to a month ago and now we're panicking on a 2% downward move in 2 days?

I'm not seeing a trend, but I am certainly expecting a correction at some point. I'm actually relieved to see the markets going slightly down. I've been expecting S&P 500 below 4,000 and I keep believing NASDAQ over 14,000 is totally unsustainable. It should be in the low 13,000.

I'm actually hoping the market to go down because I should have some decent money to buy stocks in early fall.

First time my 16-month-old newbie playground portfolio is below the 50% XIRR. (EDIT: And it's already back above 50% XIRR)

 

[MrBlackhill]

What if it enters a bear market, and keeps going down for years? Always a possibility. One never knows.

I'd be thrilled. The more it drops, the more I'll buy.

 

[MrBlackhill]

Damn I was hoping for a nice correction...

Yeah, that was short lived. People are stressing about usual volatility once after only 2 days down...

 

[MrBlackhill]

View attachment 21913

Shopify is in its own league. Totally crazy.

 

[MrBlackhill]

What can possibly go wrong, right guys?
View attachment 21914

Just recall that's an exponential function so it's normal that when you look at it over 50 years it seems like it's climbing vertically.

You should watch it in log scale. In log scale, a straight line is to be expected.

Below, you can clearly see in the log scale that the dot com bubble started in 1995 when it broke its line to follow a new line trending up faster. We're not there yet with the S&P 500 in 2021 but the 2020 crash added some noise because we're moving up a bit faster but it may not last.

 

[MrBlackhill]

So you reckon it’s completely normal and sustainable? Because it scares me, vertical growth.
View attachment 21916

You're not in log scale. Look at the bigger picture. It was a flash crash with a flash recovery, but set aside the crash, the upward trend has been accelerating just a tiny bit, which calls for a small correction, but not a crash.

 

[MrBlackhill]

It is in a dangerous zone, but it may drop -20%, which is a big correction, but not catastrophic.

This is a 7.3% CAGR trend line in log scale (price valuation return).

 

[MrBlackhill]

If I look at the bigger picture the 2008 crush and maybe even 2000 were completely unjustified. They happened never the less.

They were justified by bubbles.

 

[MrBlackhill]

Not if you look at log scale. Maybe for 2000 dot com. But definitely not for 2008 crush.

The 2008 was specific to the real estate, so it's seen on another graph. The rate of increase of the line on a log scale from 1990 to 2008 kept accelerating instead of staying linear. I drew 3 identical green lines. Why do you think Michael Burry started to short the housing market in 2005... The acceleration was clear (plus all the analysis about the subprime market, because obviously it wasn't all that clear at that time, it's now clear in hindsight).

 

[MrBlackhill]

Other than the valuation issue and the potential bubble, aren't we just scared due to recency bias?

Many experienced investors have seen two of the worst crashes ever. The Dot Com and the Financial Crisis. Then otherwise there's only the Oil Embargo which was comparable. And then obviously there's the Great Depression which happened during World Wars.

Over the past century, two of the three worst crashes ever (other than the Great Depression) occurred during the same decade. Starting to invest in 2000 was definitely not a fun game.

Look at this graph. What stands out? The Great Depression and the 2000+2008 crashes.

 

[MrBlackhill]

That's just the US. Historically speaking there have been severe bear markets in many countries.

Japan for example. But also many bad years in France, Italy and several other European countries.

We're talking about the ATH of the US and Canadian market in this thread, not?

Where do most Canadians put their money? In US and Canadian stocks.

Canada is correlated with US.

World stock correlation table and analysis

World stock market correlation table, matrix and cloud for selected group of securities. Includes correlation matrix for indexes from major exchanges

www.macroaxis.com

And anyways what were the worst crashes of the Global ex-US aggregate? 2000 & 2008

 

[MrBlackhill]

Bets are open. Will BTC & ETH reach new ATH?

 

[MrBlackhill]

No bets? Make a bet before the new ATH is reached, haha.

Have a nice FOMO.

 

[MrBlackhill]

Seems like the Yield Curve Model has always been a good recession predictor.

And it's saying we're now in the safe zone after this flash recession. Doesn't mean we won't have a correction though. I believe a correction would be healthy.

One thing to note though is that there was a recession after each peak in the recession probability curve and we've just had that peak in 2019 and maybe the flash recession in 2020 wasn't enough. Look at 2008, the recession came a bit late after the peak.

You can also calculate a recession probability, which has worked out pretty well so far.

Yield Curve Indicates Stock Market is Fairly Valued

Based on the yield curve, the New York Federal Reserve currently predicts the odds of the US being in a recession in 12 months to be ~6%.

www.currentmarketvaluation.com

There are other valuation models on this website, but you'll note that only the Yield Curve Model has been the best predictor of recessions.

Data Driven US Stock Market Valuation and Analysis

Our evaluation of simple, fundamental valuation indicators suggests that the market is currently Overvalued.

www.currentmarketvaluation.com