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View Poll Results: when will this current Bear market end

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  • in 3 months +

    19 16.24%
  • six months +

    44 37.61%
  • 12 months+

    27 23.08%
  • 18 months +

    19 16.24%
  • 2 years +

    5 4.27%
  • Even longer

    3 2.56%
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  1. #11
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    Quote Originally Posted by Beagle View Post
    Great post mate. Patience...often the hardest investment skill to master.
    To true Beagle and bob Patience eh but the fishing season is over now and I'm bored ,hey not like I'm advocating gambling on the king salmon debacle but got to be evaluating every possibility and keeping fluid .
    But I am tempted with Genesis !!! who is to say it is not to go lower

  2. #12
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    It's a balancing act, Dividend stock holders are addicted to their dividends but in inflationary times the dividend stocks face more competition from bonds and risk reductions in the dividends due to less per capita disposable income,all with inflation pushing everything up. This is what we pay our management for-out performance.
    Definitely pays to have some dry powder.
    Last edited by clearasmud; 14-05-2022 at 10:00 PM.

  3. #13
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    Quote Originally Posted by clearasmud View Post
    It's a balancing act, Dividend stock holders are addicted to their dividends but in inflationary times the dividend stocks face more competition from bonds and risk reductions in the dividends due to less per capita disposable income,all with inflation pushing everything up. This is what we pay our management for-out performance.
    Definitely pays to have some dry powder.
    Oh hell yeah and to be getting rid of the dead wood & damp looking powder .
    I like to balance both the dividend stocks with the growth and combine a bit of both .
    What would your dry powder be used for at the moment is anything within range any bears
    Last edited by ralph; 14-05-2022 at 10:28 PM.

  4. #14
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    Quote Originally Posted by ralph View Post
    To true Beagle and bob Patience eh but the fishing season is over now and I'm bored ,hey not like I'm advocating gambling on the king salmon debacle but got to be evaluating every possibility and keeping fluid .
    But I am tempted with Genesis !!! who is to say it is not to go lower
    I am grumpy with myself. Thought Genesis was very good buying at $2.80 and acted on that recently, several times.
    Once bitten twice shy !! $2.50 and I would be compelled to back up the truck though.
    Ecclesiastes 11:2: “Divide your portion to seven, or even to eight, for you do not know what misfortune may occur on the earth.
    Ben Graham - In the short run the market is a voting machine but in the long run the market is a weighing machine

  5. #15
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    Kept away fron Genesis lately only because the fundies need to stay squeeky green.
    However if it's cheap enough...
    I'm annoyed I lightened on Heartland at 2.12 but I do feel that confidence in the banks could dissapate soon on increased bad debt fears.
    Last edited by clearasmud; 14-05-2022 at 10:41 PM.

  6. #16
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    Quote Originally Posted by Beagle View Post
    I am grumpy with myself. Thought Genesis was very good buying at $2.80 and acted on that recently, several times.
    Once bitten twice shy !! $2.50 and I would be compelled to back up the truck though.
    Been bitten by that one a few times in the past

    ASX to me probably looks best way to find good prospectives for insulation
    or to better outperform against the Bear's ravages

    A smart astute operator should be able to decipher a shortlist of good prospectives
    to potentially more than beat the adverse prevailing tides

    NZX listings will likely mostly roll with the punches flowing in from the Bear's strikes
    with a few stand-outs from the carnage

    In these sort of times, Capital preservation & enhancement can be better
    than chasing the dividend only to see SP slide along the downhill ride

    Many will have seen gains out of the Covid upswing forward from Apr 20, but the
    next stage of the journey potentially may wipe out those gains (if you let it)
    or perhaps a good portion of them. All the RB & Govt stimulus in between has in effect
    hit the fiat Kiwi with possibly over 50% Loss in real value in 2-3 years - by way of
    unrecorded real inflation.

    There may always be opportunity to look in at NZX Co's again later when the Bear is seen
    retreating back into hibernation
    Last edited by nztx; 15-05-2022 at 12:26 AM.

  7. #17
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    I think you are right about the ASX nztx I only have a couple of listings over there & they are both doing good at the mo .
    There is a lot of grumpy buggers out there Beagle, playing with the bears me Included, Risky business that Bear baiting .
    The great kiwi bear could be out for quite a while this time just as you say nztx roll with the punches looking to counterpunch when the opportunity is there.
    I think the next budget will probably make things even worse as the government try to appease James Shaw & all the other fringe parties that keep them in power, to the detriment of business & Industry .
    Definitely put my head on the block and say the building industry will start winding down in the next six months if not sooner as is its cyclical nature .

  8. #18
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    Ahh just sit on your hands with your paper loss holdings and buy more cheapies if you have the dosh, give the Bear a hug and a nice wee pat, go big or go home or go big whilst at home.

  9. #19
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    Exactly Couta. I've been nibbling on anything in my portfolio whose share price drops below my average cost. They're mostly divvy stocks that I don't intend selling (unless they no longer meet my hold criteria) so now's a great time to accumulate and to decrease the average cost per share. This approach has served me well over the years. The Bear will eventually hibernate.

  10. #20
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    I'm not buying anything at the moment - and don't have plans to over the next few months, but am watching all the inflation & interest rate movements with interest.

    I posted this graph earlier this year as shows how ridiculously low interest rates were in America relative to the inflation, and give a picture of where they could climb to and what that would mean for their asset prices. American markets drive a lot of sentiment on a day to day basis.

    Re the NZX, our rising interest rates could impact equities in two ways and each at different times. The 10 year treasury yield shot up to 3.86% (but is having a little relief rally and there is a lot of chat may have overshot in the short term), which in theory increases company WACCs and drives down their net present value. That impact is more or less immediate as interest rates rise and we've seen it happen in front of our eyes the last 6 months.

    The second is what interest rates do to the economy and how long that takes. A lot of borrowings are fixed whether that by households or businesses. Mortgage holders probably fix for ~2 years, businesses for longer at 3-5 years on average but with some unhedged. There are still lucky households with ~3% mortgage rates, but those will be reset sometime this year. And as fixed lending gradually turns over, that sucks money out of households who eventually go on to spend less, and raises costs for businesses at the same time. Then you have wages which take time to respond to inflation as wage reviews are usually only once a year and collective agreements negotiated even more sporadically. Eventually corporate costs are rising steeply at the same time demand starts falling and we getting increasing unemployment which creates even less demand.

    Eventually dividends get cut and investment sentiment is often at its worst during a recession even if that means interest rates are expected to reduce again.

    And that's when I prefer to invest the bulk of my dough - near the bottom of the cycle - when sentiment is awful and the outlook is weak. But then interest rates eventually drop and we get to enjoy the whole spike up again.

    Could take some time for us to get there. There are a lot of households who still have savings built up the two years, so things could be more resilient than you'd expect at first glance.

    In the interim I am just plodding my surplus cash into a variety of interest bearing products with different tenures. So I can have some dough available as no one really knows what will happen, and also I think deposits haven't budged enough.

    I've avoided the temptation to put more into more 'defensible' equities like generators, REITS and banks. The dividend premium for generators & REITS over bonds is currently at an all time low which can only resolve itself two ways. And many retail investors and instos are just waking up to interest products being viable products again so could be a flight to those away from generators & reits.

    Banks might get a little rally they are in the "cost plus" business, so as their funding costs rise they pass it on and earn proportionately more income. But eventually bad debts sink in as the unemployment rises, a recession starts, interest rate expectations drop and bank stops drop. And once that happens I'll step in to buy. But the short term risk is they need to jack up their deposit rates more than they are able to pass on. Plus house sales were on fire the last few years and the outlook for house sales is pretty weak. So I'm not tempted by them in the short term. Plus commodity prices are super high which is great as an existing shareholder, but eventually they will drop too which could impact lending volumes. I'll just wait for things to bottom out more.

    At the moment it looks like we might be headed for a recession at some point. That's okay not the end of the world, we go through them and we always will. It doesn't feel as scary as the GFC or April 2020. But who knows maybe bitcoins drop kills some hedge fund which hurts some regional bank and starts some mini crisis. Or putin uses a nuke. Its easy to see the global financial system catching an unexpected stray bullet.

    Which is why when I do start deploying capital I'll probably break it up into chunks. If I want to buy more heartland or summerset or contact or whatever, say $100 for each stock, i'll watch the TA signals, but also do it in say 25 tranches instead of 100 over varying time periods. Inefficient. I don't have to pick the bottom but I want to de risk it by not deploying it right at the same time in case their is a shock. and as long as I do that on the bottom half of the cycle, I'm content.

    And my own investor 'mental health' is a lot better seeing some of my investments fall as they are now knowing when I bought them.
    Last edited by Muse; 15-05-2022 at 09:32 AM.

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