Black Monday

[dabsman]

speaking of good places to hide in the bear this yr so far we have had energy ( which may have peaked ) and US dollar.
also utilities have been good in the US they are flat for the yr

In NZ only as an investor if you had positioned your portfolio defensively at the start of the yr your doing alright so far

US dollar cash
cnu
vct
spk

you would be up 16 odd % + against market down nearly as much

add in ift and the gentailers and you will have weathered the storm so far.
of course easy to look back in hindsight but just goes to show what you could have done.

I decided I'd do it differently and I ran at the bear and punched it in the nose. It then ripped me apart and ate me mostly whole. Arent tactics interesting...

[allfromacell]

you would be up 16 odd % + against market down nearly as much

Don't forget you'd have to pay 33% tax on your profits offsetting this 'gain'.

I know there are a lot of traders here and paying tax is the cost of doing your business but it's important to remember that NZ has incredibly favorable tax laws for buy and hold investing.

Edited the above because my math was hopelessly off

[Baa_Baa]

Don't forget you'd have to pay 33% tax on your profits offsetting this 'gain'.

I know there are a lot of traders here and paying tax is the cost of doing your business but it's important to remember that NZ has incredibly favorable tax laws for buy and hold investing. It's a great example you've posted because even if you did everything perfectly you'd still only be in the same spot as holding after taking into account our tax laws.

Don't forget to deduct the trading fees as well.

[Peitro]

The copper foil hat brigade will be out in force soon.

Well I hope they will, a few more capping ceremonies might bump the market beyond 4200...

[Biscuit]

Don't forget you'd have to pay 33% tax on your profits offsetting this 'gain'.

I know there are a lot of traders here and paying tax is the cost of doing your business but it's important to remember that NZ has incredibly favorable tax laws for buy and hold investing. It's a great example you've posted because even if you did everything perfectly you'd still only be in the same spot as holding after taking into account our tax laws.

It's been a pretty crap year so far for us "buy and hold" guys - I'm down about 10% from late last year, but dividends are all holding up well. Have a little bit of unneeded cash on hand but seems too early to put that on the table yet. Seems like sentiment has changed for the better currently. Think I'll wait to see where the current rally pulls back to.

[daveypnz]

Don't forget you'd have to pay 33% tax on your profits offsetting this 'gain'.

I know there are a lot of traders here and paying tax is the cost of doing your business but it's important to remember that NZ has incredibly favorable tax laws for buy and hold investing. It's a great example you've posted because even if you did everything perfectly you'd still only be in the same spot as holding after taking into account our tax laws.

What am I missing here? Surely paying 33% (or 39%) tax on a 16% net gain is still far better than being down 16% and paying no tax?

[dobby41]

What am I missing here? Surely paying 33% (or 39%) tax on a 16% net gain is still far better than being down 16% and paying no tax?

You'd think so wouldn't you?
Some people get a bit confused with percentages and forget that the tax is a % of a % as you say.

[allfromacell]

What am I missing here? Surely paying 33% (or 39%) tax on a 16% net gain is still far better than being down 16% and paying no tax?

My mistake, sorry

[Bobdn]

The S&P500 is having it's best month since November 2020.

So holders of USF.NZX will be happy. USF is down just 8 per cent now YTD.

USV is down just 1 per cent YTD. I love USV - such wonderful diversification. I love all my ETFs equally.

USV does have 7.5 per cent in energy. I see Exxon just made $18b USD this quarter and Chevron did well too. $18b is a lot of money, no question.

Well done Exxon and Chevron. Big hugs from me.

[Hoop]

The copper foil hat brigade will be out in force soon.

Well I hope they will, a few more capping ceremonies might bump the market beyond 4200...

Hmmm..I'm getting a luke warm fuzzy feeling in my copper coated antennas as copper price rose and broke though a weak resistance...As normally copper is leading and Equities lag behind, this dual bounce higher would be strange if a true reversal in play..In saying the word "strange" it could be said that the last 3 or so years "strange" has been a new "normal"...

A few other things to consider while a Bear Market cycle is operating:

1..It's too early yet to confirm a Copper bottom. This short term bounce could turn out to be sentiment noise.

2..A semi-reliable fact is the share market bottoms out 2/3rds through a recession. The tricky part is to guess how long the recession is going to be This fact works on the assumption that the share market is forward looking. Remember:.. Sharemarket Cycle v Economic cycle correlation is not great.

3..Bear Market Cycles have a declining PE Ratio trend. However the PE Ratio trend reversal back upwards could start in the later stage in a Bear Market Cycle during the peak of investor doom and gloom. During a Bear Market Cycle Investor sentiment alternates from brief happy relief moments to that of longer moments of pessimism and disappointment. Therefore the PE ratio trend has an overall declining trend as investors generally want more reward in exchange to their greater perceived market risk (risk v reward)..

4..Investor behavour is not consistent, it oscillates in waves. This fools some investors to jump in boots and all into a sucker rally. To trade "successfully" in these rallies some investors use Elliott Wave Theory.

5..An economic recession is not always present in a Equity Bear Market Cycle, as the declining PE Ratio trend is mainly due to investment sentiment and/or trading behaviour (mentioned in 3)...however in recessionary times businesses experience lower earnings figures which compounds the declining PE Ratio trend problem.