The Next Big Crash - Are You Prepared?

A question to the more experienced investors here.

Under a correction, will it be better off selling away shares that dropped the least, and use the money to buy shares that drop the most, or vice versa? Which is considered as a "Contrarian" approach?

Thanks.

(13-06-2013, 09:07 AM)NTL Wrote: A question to the more experienced investors here.

Under a correction, will it be better off selling away shares that dropped the least, and use the money to buy shares that drop the most, or vice versa? Which is considered as a "Contrarian" approach?

Thanks.

Under a correction you should have a cash stash to be buying up shares other people are dumping. that is as contrarian as you can get.

You should have a watchlist as well as a buy-in range and amount to buy in.

You should not be balancing or mucking around with your portfolio holdings because of a correction. Also most of the time, the shares that drop the most (highest beta) will also rise the most later...

Trying to rebalance has some risk as well as extra brokerage fees, not so advisable. If you believe the fundamentals of your holdings are sound then should not worry so much. However u may wanna get rid of counters that are highly geared and have not dropped too much.

(12-06-2013, 10:48 AM)Bibi Wrote:

(12-06-2013, 09:28 AM)BlueKelah Wrote: Correction almost certain on the STI
Hopefully becomes a crash...

Who else rubbing hands and looking to start some accumulation?

Dont think there is a crash as there doesnt seem to have any panic selling. Vol is not high. There is no indiscriminate selling of pennies as well.

Has the PANIC set in yet today? hahahahaha...
STI 3000 go go go ....

(13-06-2013, 10:05 AM)BlueKelah Wrote:

(12-06-2013, 10:48 AM)Bibi Wrote:

(12-06-2013, 09:28 AM)BlueKelah Wrote: Correction almost certain on the STI
Hopefully becomes a crash...

Who else rubbing hands and looking to start some accumulation?

Dont think there is a crash as there doesnt seem to have any panic selling. Vol is not high. There is no indiscriminate selling of pennies as well.

Has the PANIC set in yet today? hahahahaha...
STI 3000 go go go ....

Ohhh i luv todays drop. Drop of >50pts have not happen for many months liao. Some panic selling on big cap today but pennies still holding quite well. I still cant see anything i like to buy yet.

Sti down 2% liao, bear bear out in full force, sti down over 10% from its year high of 3450 level already

I think other wise. Can only buy those that drop least as it show its strength for long term. For those that drop a lot, can only buy to make from re-bounce. These re-bounced stocks must be sold immediately.

(13-06-2013, 09:07 AM)NTL Wrote: A question to the more experienced investors here.

Under a correction, will it be better off selling away shares that dropped the least, and use the money to buy shares that drop the most, or vice versa? Which is considered as a "Contrarian" approach?

Thanks.

(13-06-2013, 10:24 AM)shareinvestor1 Wrote: I think other wise. Can only buy those that drop least as it show its strength for long term. For those that drop a lot, can only buy to make from re-bounce. These re-bounced stocks must be sold immediately.

(13-06-2013, 09:07 AM)NTL Wrote: A question to the more experienced investors here.

Under a correction, will it be better off selling away shares that dropped the least, and use the money to buy shares that drop the most, or vice versa? Which is considered as a "Contrarian" approach?

Thanks.

Keep in mind we are a value investing community here

So back to basics, whatever you calculated is the more undervalued share you can pick up. Of course given the correction in the markets, you may have to re-evaluate things like NAV especially if it is affected much by stock value.

(12-06-2013, 06:36 PM)felixleong Wrote: lol, I still remember some brokerage houses were running ads to encourage margin clients to do yield plays
borrow at 3.5% and buy reits and defensive stocks for higher yield
those naked swimmers I think now all drowning already

This is a small example of a local carry trade that needs to be unwound. But it is probably just a very small tip of the iceberg of massive "carry trades" of various stripes and colours globally, manifested by the ultra low interest rate environment of the past few years. That needs to be unwound. Trouble is if everybody heads or tries to head for the exit at the same time once they perceive it's time to go...

Ben has a press conference at the end of the FOMC meetings on 19 June. An opportunity for him to shape perceptions then. Will he or can he?

(13-06-2013, 09:05 AM)paullow Wrote:

(12-06-2013, 08:31 PM)Temperament Wrote:

(12-06-2013, 09:12 AM)paullow Wrote: let it get worse. as wat khoo teck puat favourite phase...when no one wants it, thats the time to buy a few million.

i have stuck to this line of thpught with immense wealth created.

It's only true when you know and quite sure nobody wants it now only. What things or products? How can we be sure of the future?

Hi temperament, this kind of things cannot openly disclose, otherwise if pple also notice how to buy so cheaply? Like wat i mentioned, do tons of homework first. Tell no one abt it, not even ur wife or mother.when u have amassed till ur heart desire, tell the world by all means.

Ha! Ha!
Understooded! Understooded! (pardon my poor English).
Just a warning for myself not to put all the eggs in one basket. Unless actually i am the business owner or one of the insiders.
I always dream how nice if i can put all the eggs in one basket and no need to take risks anymore.
Fat hopes! dream on.