Are you holding cash or making investment into progressing sector in 2016?

Nobody can time their exits perfectly.........but reading and following a variety of stocks help a lot

(16-05-2016, 05:07 PM)BlueKelah Wrote: @Temperament : I am probably one of the few hoping for Black Swan to happen. That's when the loaded elephant gun will go to work. If you are buying individual stocks of companies you have been following for a while and know what is going on with management and the industry/sector and what assets are backing the stocks you are buying, there wont be any trepidation at all as prices sink. True value investors thrive on down markets. 

Easy to say, easy to do as well, just so long you have a plan and have had enough experience investing in stocks and gone through crash markets like during AFC and GFC.

Most people who derive their prosperity based on certainty (and depends on it) don't wish for black swans. An example, would be a person with a heavy mortgage, one with young kids. There should be more people than Mr BlueKelah think there is, that want Black Swans to happen. The funny thing is, our definition of "black swan" and "hoping for it to happen" most probably involves an extreme low probability event that is far away from us. How about a Japanese earthquake when you were in Fukushima yourself when it happened? How about getting stage4 cancer yourself? How about a Singaporean economic crisis that gets unemployment to 15%? How about Zika spreading in Singapore and you have a pregnant wife?

Our understanding of Black Swans need to go beyond what we read from Nassim Taleb and thinking on the 2nd level of our own implications.

(16-05-2016, 10:21 PM)weijian Wrote:

(16-05-2016, 05:07 PM)BlueKelah Wrote: @Temperament : I am probably one of the few hoping for Black Swan to happen. That's when the loaded elephant gun will go to work. If you are buying individual stocks of companies you have been following for a while and know what is going on with management and the industry/sector and what assets are backing the stocks you are buying, there wont be any trepidation at all as prices sink. True value investors thrive on down markets. 

Easy to say, easy to do as well, just so long you have a plan and have had enough experience investing in stocks and gone through crash markets like during AFC and GFC.

Most people who derive their prosperity based on certainty (and depends on it) don't wish for black swans. An example, would be a person with a heavy mortgage, one with young kids. There should be more people than Mr BlueKelah think there is, that want Black Swans to happen. The funny thing is, our definition of "black swan" and "hoping for it to happen" most probably involves an extreme low probability event that is far away from us. How about a Japanese earthquake when you were in Fukushima yourself when it happened? How about getting stage4 cancer yourself? How about a Singaporean economic crisis that gets unemployment to 15%? How about Zika spreading in Singapore and you have a pregnant wife?

Our understanding of Black Swans need to go beyond what we read from Nassim Taleb and thinking on the 2nd level of our own implications.

Exactly my sentiment.
No matter how much you think you know, there is no 100% of a sure thing in life.
And you can only know what is reported to date.
Again what you know UTD report may not be 100 % the truth or accurate.
Again the discrepancy in the report maybe "genuine" mistake.
You know who like to speak in this way.
So it's my genuine mistake, to think there is no 100% sure thing buying Blue Chips in a Black Swan market.
On the other hand, most people are just too happy buying in a Bull Market.
Again this may be a genuine mistake for some of them.


LIFE IS SO UNPREDITABLE.
YET THE SUN WILL SURELY RISE IN THE EAST AND SET IN THE WEST.
LULLING US TO THINK LIFE IS PREDICTABLE SOMETIMES.
SO IS WHEN WE ARE IN THE MARKET?

(16-05-2016, 10:21 PM)weijian Wrote: Most people who derive their prosperity based on certainty (and depends on it) don't wish for black swans. An example, would be a person with a heavy mortgage, one with young kids. There should be more people than Mr BlueKelah think there is, that want Black Swans to happen. The funny thing is, our definition of "black swan" and "hoping for it to happen" most probably involves an extreme low probability event that is far away from us. How about a Japanese earthquake when you were in Fukushima yourself when it happened? How about getting stage4 cancer yourself? How about a Singaporean economic crisis that gets unemployment to 15%? How about Zika spreading in Singapore and you have a pregnant wife?

Our understanding of Black Swans need to go beyond what we read from Nassim Taleb and thinking on the 2nd level of our own implications.

Thanks weijian.. woke up my dead brain. Resonates with me. I am one that subscribes to certainty.. at least as much as possible.

Black Swans do happen. But I wouldn't wait around for them.

(17-05-2016, 09:52 AM)Porkbelly Wrote:

(16-05-2016, 10:21 PM)weijian Wrote: Most people who derive their prosperity based on certainty (and depends on it) don't wish for black swans. An example, would be a person with a heavy mortgage, one with young kids. There should be more people than Mr BlueKelah think there is, that want Black Swans to happen. The funny thing is, our definition of "black swan" and "hoping for it to happen" most probably involves an extreme low probability event that is far away from us. How about a Japanese earthquake when you were in Fukushima yourself when it happened? How about getting stage4 cancer yourself? How about a Singaporean economic crisis that gets unemployment to 15%? How about Zika spreading in Singapore and you have a pregnant wife?

Our understanding of Black Swans need to go beyond what we read from Nassim Taleb and thinking on the 2nd level of our own implications.

Thanks weijian.. woke up my dead brain. Resonates with me. I am one that subscribes to certainty.. at least as much as possible.

Black Swans do happen. But I wouldn't wait around for them.

I'm glad I made a difference to you this morning.  here is actually nothing wrong with subscribing to certainty. I mean, don't we all want to know what time lunch is served or if we are an employee, when is pay coming in? But as in all matters of life, success is counterintuitive and most probably, one needs to subscribe to uncertainty to get there.

I take small little steps to build up my robustness/survivability to my own black swans, so that I will be ready to take advantage of the opportunities presented by other folks' black swans.

(17-05-2016, 12:26 PM)weijian Wrote: .... I will be ready to take advantage of the opportunities presented by other folks' black swans.

Your comments are a joy to read! and here, is evidence of a value investor!
Totally agree that Black Swans are events that affect individual portfolios.

(16-05-2016, 07:19 PM)shadow_walker Wrote: The idea is to long an inverse index etf, which means you are shorting the index.

The key risk is indeed the compounding risk due to the inverse nature.

Assuming both the index and etf are at 100:
1) The index goes down by 25% to 75 - The inverse etf will gain 25% at 125
2) The index goes up by 33% to 100- The inverse etf will lose 33% from 125 to 83.3

As the index goes down by 25% and up 33% to remain at 100, the inverse etf's value has dropped from 100 to 83.3.

Each time the index goes up and down, the inverse etf holder will suffer. Same goes for leveraged etf.

Volatile time makes it worse while they only gain if the underlying movement is single direction.

Both inverse and leverage etfs are destined to lose money over time, they are only meant for short term trading purpose.

Ok, but specifically how does the inverse ETF work?
Does it borrow shares and short them? utilise CFDs? or some form of futures?

I ask this because a few years back i shorted natural gas futures using an ETF.
Nat gas tanked, but the ETF was a losing proposition because of contango.
Gas prices dropped but the ETF bought futures and kept rolling over the futures every month, I assume aside from the contango, the transactional fees also killed the unit holders.

So it's not just enough to know so broadly how the ETF supposedly should react, but need to understand the specifics of how it's done.



https://thumbtackinvestor.wordpress.com/

(17-05-2016, 02:49 PM)TTTI Wrote: Ok, but specifically how does the inverse ETF work?
Does it borrow shares and short them? utilise CFDs? or some form of futures?

I ask this because a few years back i shorted natural gas futures using an ETF.
Nat gas tanked, but the ETF was a losing proposition because of contango.
Gas prices dropped but the ETF bought futures and kept rolling over the futures every month, I assume aside from the contango, the transactional fees also killed the unit holders.

So it's not just enough to know so broadly how the ETF supposedly should react, but need to understand the specifics of how it's done.

https://thumbtackinvestor.wordpress.com/

I reckon, the answer has been provided by Behappyalways in his post

http://www.valuebuddies.com/thread-7509-...#pid129510

Talking about swans.........how about bullish Swans like canada fire , nigeria oil disruptions?

Certainly now, these are helping the oil prices in a bullish way no??

There is a great difference between black swan and opportunities. Historically opportunities alway there following a black swan event, but black swan did not always come before an opportunity. If one can have opportunities without seeing black swan, isn't it wonderful? After all a black swan may be powerful enough to wash away all opportunities one had during a life time.

So, sometime dollars and cents are not really that important, especially when sunrise no longer be seen on the east but on the west instead.