This will end when the next tightening cycle begins. Monetary stimulus and low interest rates = high liquidity which will eventually drive inflation. Once inflation starts peeking above 3% or so, which is really not that much given how much monetary and fiscal stimulus is out there, that will be the beginning of "The Conversation".Crazy market.
How can the absolute beginner that I am make over +70% XIRR in 10 months (over +50% P&L)... I was NOT expecting this. My whole portfolio could crash -35% tomorrow and I would not lose any of the money I invested in 2020...
Market crashes and recoveries are the best because... the market gets bailout...
Shopify is the original bubble stock of this bull run. It rose to bubble status even before Tesla. It was worth more than Tesla in various periods of 2019.Wow! This also implies that SHOP was, in fact, one of the bubble stocks. To drop like this, it means it was in those portfolios which built up mania stocks.
Or maybe it's a buying opportunity! Many of these have not even yet hit their 200 day moving averages. Maybe this is the buying opportunity of a lifetime... what do you think @MrBlackhill is this just the pause before these double in value again?
It's a valid question. I saw stocks that I liked going down 50-75% from March til June last year. Really, a lot of them stayed down until early November 2020, when Pfizer announced their COVID vaccine was 95%+ effective. I was scrounging up a lot of spare cash and even punched my LOC to buy shares in the 6+ month sale. So cash plus leverage. Down 75% means you can get 300% if it just returns to where it was.
Fear of crashes aside, a P/E of 11-13 is average to above average. They often trade around 10, which historically also means you get excellent returns just about whenever you buy, because you nearly always have a chance to get in at that 10% shareholder yield, with 5-6% annual growth, giving you long term 13-15% returns, at least over the last 30-40 years. If the P/E drops below 8, they are typically a screaming buy and offer outsized returns above 15%/year. And the P/E could drop below 6 like in March-June 2020 and that is the last time I was buying. The banks are considered cyclical and just do not get to those P/E of 15 or higher multiples because they can record big losses in recessions.Are they? Most CAD banks are at current P/E's of 11-13. Is that expensive?