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Post by Fearchar on Oct 7, 2023 19:35:21 GMT
The US Gov't $1.7T annual deficient and the FEDs QT plans is basically why I'm not excited about long term debt. The following chart (lifted from Ted Oakley's presentation October Oakley ) is why I'm not excited about diversified equity either: It's wonderful that some people on this board managed to profit from this years rally in the S&P. However, the longer term prospects for the S&P do not appear to be very encouraging. So, for the near term, short term Gov't debt or something very close to that will probably be best. Of course, it's possible that I'm wrong. That is maybe there is no real reason why the S&P should continue to correlate with 30 year treasuries as it has over the past 43 years. So, maybe both will return to the longer term trend but with the current offset remaining in place. Or maybe they will continue with the offset, but at a substantially slower growth rate than in the past. I really don't know for certain. Kudo's to anybody that can articulate a wiser strategy than short term bonds.
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Post by FD1000 on Oct 8, 2023 3:50:00 GMT
Fearchar , Several thoughts in no particular order. 1) Stocks performance in the next 1-3-6 months doesn't have a high correlation to deficit, valuation and many other indicators I mentioned for years. 2) The Fed always had an influence on markets ST, every word and nuance is measured carefully and why it's one of the indicators I follow and I have only several. 3) The 2 most common categories recommended by most experts are US LC (VOO, VTI) and for bondholders is BND=US tot bond index. 4) Other bond categories should be left for good bond managers. 5) Buying CD/Treasuries/MM or LT bonds depends on goals, risk tolerance, style, and age. There are the B&H ones and all the way to daily traders. 6) Does a 30 year old should behave as 70 years old? Does a 70-year-old with a 2 million portfolio should behave as 70 year old with only a $200K portfolio? The more money you have...or better, the more number of years your portfolio can support your annual expense, the more options you have. The older you are, and I mean 80+ years old, the more risk you can take vs someone at age 65. I have articulated what I have done since 2000. No need to repeat it in details. 1) Since 11/2022 my binary choice of be in or out=very high risk say IN=99+% invested. 2) In the last several weeks there are only 3 bond funds I like. 3) Suppose I was someone who wants 60/40 and must use only one fund, my choice of 13+ years = PRWCX. 4) I never liked high volatility stuff because I can't figured out how to get a better risk/reward performance and why I never invested in TLT and investing 2-3-5% doesn't have a substantial influence on performance. PRWCX is a great example of what I like. PIMIX used to be another until 2018.
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Post by Fearchar on Oct 8, 2023 15:45:45 GMT
FD1000, Thanks FD; Yes I agree the near term 1-3-6 months is typically difficult to predict. Over short time periods, technicals are usually more of a factor, which can reverse course quickly. I have a tendency to look out longer term. Of course short term trade opportunities may arise at any time. From day trades out to tactical trades of more than a month. The timing of these are impossible to predict until the actually present themselves. While I do review the past, the future will never match any particular historic period. Difference may be small or large, but there are always differences. However, long term the market is a weighing machine as Buffett points out. Earnings, interest rates, inflation and relative valuations do eventually become factors. Not that I wish to enter a debate, but it's apparent to me that our elected officials tend to be more focused on political posturing rather than economic solutions to the problems facing our states and nation. The FED on the other hand does do a better job, although even they are far from perfect.
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crln
Ensign
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Post by crln on Oct 8, 2023 16:21:49 GMT
FD1000, Thank you for your comments; I truly appreciate your perspective.
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Post by FD1000 on Oct 8, 2023 17:37:34 GMT
Fearchar , The only problem with LT (years) vs ST (weeks to 1-2 years) is the fact that the ST can make a big difference. I also look for special funds with much better risk/reward. Example 1: many investors hold higher-rated bonds. YTD most lost money, bank loans (EIFAX,FAFRX) made 10+% ( schrts.co/pXyPMMQf). 10+% more in bond land is huge. EIFAX+FAFRX actually made a lot more than PIMIX+RCTIX for YTD + 3 years ( schrts.co/drJcnNYu) Example 2: QQQ or growth made a lot more than VALUE YTD...and it's going on most years since 2010. "Earnings, interest rates, inflation and relative valuations do eventually become factors." Markets can be irrational a lot longer than the above. We have seen it before. Think about how much someone lost investing in VALUE vs Growth since 2010. Many gurus predictions failed based on that, think Arnott, GMO, Prof Shiller PE10=CAPE. Another observation: markets change a lot faster and why ST visions/trades are important. Many think ST=days to weeks. I think more in several weeks to months.
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Post by anitya on Oct 10, 2023 16:40:40 GMT
uncleharley , US Rates are down big in the 1 yr out of the curve and down across the curve. UK rates are slightly higher. Most other advanced economies’ rate curves today are mixed to unchanged. Makes me think market participants are calling short term peak in rates in the US - granted the US rates today include 4 days activity as yesterday the bond market was closed. XLU is not showing enough momentum commensurate with negative movements in rates. It was the worst performing sector yesterday and second worst today, albeit positive both days. XLE is the worst performing sector today and oil is down too (Gas is up slightly) but XLU is not benefiting from any of that. I am thinking of taking profits in XLU and rolling into something that traditionally has more beta. I think utilities are too complex now for investors interest. Any thoughts? I think oldskeet thought of value or dividend value may beat XLU.
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Post by uncleharley on Oct 10, 2023 17:08:41 GMT
uncleharley , US Rates are down big in the 1 yr out of the curve and down across the curve. UK rates are slightly higher. Most other advanced economies’ rate curves today are mixed to unchanged. Makes me think market participants are calling short term peak in rates in the US - granted the US rates today include 4 days activity as yesterday the bond market was closed. XLU is not showing enough momentum commensurate with negative movements in rates. It was the worst performing sector yesterday and second worst today, albeit positive both days. XLE is the worst performing sector today and oil is down too (Gas is up slightly) but XLU is not benefiting from any of that. I am thinking of taking profits in XLU and rolling into something that traditionally has more beta. I think utilities are too complex now for investors interest. Any thoughts? I think oldskeet thought of value or dividend value may beat XLU. I wrote a more detailed post and have no idea where it went. So, just let me say that I am long term bullish on domestic investments and short term giddy over todays flight to safety. We will probably have a correction when the flight to safety wears down, but right now I am enjoying the ride. Fwiw, I bought TQQQ yesterday.
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Post by anitya on Oct 10, 2023 18:44:30 GMT
uncleharley , US Rates are down big in the 1 yr out of the curve and down across the curve. UK rates are slightly higher. Most other advanced economies’ rate curves today are mixed to unchanged. Makes me think market participants are calling short term peak in rates in the US - granted the US rates today include 4 days activity as yesterday the bond market was closed. XLU is not showing enough momentum commensurate with negative movements in rates. It was the worst performing sector yesterday and second worst today, albeit positive both days. XLE is the worst performing sector today and oil is down too (Gas is up slightly) but XLU is not benefiting from any of that. I am thinking of taking profits in XLU and rolling into something that traditionally has more beta. I think utilities are too complex now for investors interest. Any thoughts? I think oldskeet thought of value or dividend value may beat XLU. I wrote a more detailed post and have no idea where it went. So, just let me say that I am long term bullish on domestic investments and short term giddy over todays flight to safety. We will probably have a correction when the flight to safety wears down, but right now I am enjoying the ride. Fwiw, I bought TQQQ yesterday. I know you are expressing your flight to safety view by buying QQQ than small / mid caps. If time permits, please elaborate on the text I bolded cause today high beta (e..g, SPHB) is outshining the safety of QQQ. I do like QQQ, my largest equity position, for their strong balance sheets and cash hordes earning lots of interest income. P.S.: Since I posted earlier today, XLU did turn around and is now one of the better performing sectors. Staying with XLU / UTF UTG for now.
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Post by uncleharley on Oct 10, 2023 20:46:09 GMT
I wrote a more detailed post and have no idea where it went. So, just let me say that I am long term bullish on domestic investments and short term giddy over todays flight to safety. We will probably have a correction when the flight to safety wears down, but right now I am enjoying the ride. Fwiw, I bought TQQQ yesterday. I know you are expressing your flight to safety view by buying QQQ than small / mid caps. If time permits, please elaborate on the text I bolded cause today high beta (e..g, SPHB) is outshining the safety of QQQ. I do like QQQ, my largest equity position, for their strong balance sheets and cash hordes earning lots of interest income. P.S.: Since I posted earlier today, XLU did turn around and is now one of the better performing sectors. Staying with XLU / UTF UTG for now. This mornings giddiness ended when the S&P closed that open gap from 9/21. Once the gap was filled, further price advances stalled. My current thought is that emotion of a Flight to Safety was not enough to overcome the fear of higher rates for longer. The open tomorrow may tell a different story. My long term dividend payers are working very well. My TQQQ was up yesterday and today. The S&P does not indicate a clear trend in any direction for the short term. When you look at the weekly chart the S&P has been trending up for a yr now.
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Post by FD1000 on Oct 11, 2023 9:25:02 GMT
Since 11/2022 my binary option says that market risk = "normal" which means I'm in at 99+%. Lately, VIX went down and my T/A signaled a buy for SPY.
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Post by anitya on Oct 11, 2023 17:48:32 GMT
richardsok, uncleharley, I know China equities are radioactive but do you see them forming a good base to turn up shortly? Pick the China ETF you like. (I know that in investing being early is the same as being wrong and so tying to figure out how and when other investors react to the potential than focus on the potential itself.)
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Post by richardsok on Oct 11, 2023 18:59:00 GMT
richardsok , uncleharley , I know China equities are radioactive but do you see them forming a good base to turn up shortly? Pick the China ETF you like. (I know that in investing being early is the same as being wrong and so tying to figure out how and when other investors react to the potential than focus on the potential itself.) The only China asset I follow is ASHR, which is right at its two year low. Personally, I'm not interested; it's just another fund for which my ignorance is total. Still, if you want to spec at these deep levels, no one will accuse you of buying near the top.
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Post by uncleharley on Oct 11, 2023 19:01:26 GMT
Based on the daily and weekly charts for FXI, the China I shares ETF, I would not buy it with my former Mother-in-Laws money. It may very well be building a base, but I see no indication of an imminent breakout from that base, either up or down.
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Post by richardsok on Oct 16, 2023 16:14:14 GMT
QQQY : interesting but risky new fund out there, selling ZERO DTE puts. www.youtube.com/watch?v=TD2dOHzgBFAMEMO: PDI chart keeps hemorrhaging money, longer than I could have imagined possible. How long does this continue?
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Post by chang on Oct 16, 2023 16:17:41 GMT
PDI chart keeps hemorrhaging money, longer than I could have imagined possible. How long does this continue? Until it trades at a big, fat discount.
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Post by anitya on Oct 16, 2023 16:51:48 GMT
Obviously, PIMCO knows what is best for their business, which is amassing AUM. So, I am trying to figure out why they are converting NRGX to a mostly fixed income fund (in a month), as if they do not have enough fixed income CEFs. Do they think we are pretty much at the bottom for credit or is this going to be another one of their ill timed CEF launches lately? Interestingly, based on the narrowing of NRGX discount, it seems investors think the timing is good. P.S.: I have been out of fixed income CEFs for 2+ years but continue to be tempted to get back in but as chang said discounts have not expanded enough for me to bite. MUNI CEFs are at very good discounts! Any favorite MUNI CEFs?
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Post by archer on Oct 16, 2023 17:04:16 GMT
anitya, I too have been wondering about Pimco's apparent disregard for increasing AUM. PIMIX/PONDX suffered from too large to move, and thus lost it's edge. They also merged funds into PDI, increasing it's AUM. I really wonder what their thinking is on this.
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Post by richardsok on Oct 16, 2023 17:07:26 GMT
PDI chart keeps hemorrhaging money, longer than I could have imagined possible. How long does this continue? Until it trades at a big, fat discount. But the premium is shrinking only because the price is plunging faster than the NAV -- which is also steadily eroding. That 45% leverage must be brutally costly to maintain. Where's the catalyst?
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Post by chang on Oct 16, 2023 18:48:51 GMT
P.S.: I have been out of fixed income CEFs for 2+ years but continue to be tempted to get back in but as chang said discounts have not expanded enough for me to bite. MUNI CEFs are at very good discounts! Any favorite MUNI CEFs? You might be right - PML has a 1-Year Z-Stat of -2.68. But I think they have further to go downward. Look at the charts, and at the historical discount/premium charts. I used to consider PMF/PML/PMX best in class. I owned some others in the past too - Nuveen, DWS, Blackrock, Pioneer. They all made money off the Whitney bottom. I wouldn't mind if someone started a "Muni CEF Watch" thread, so I could see specific news and poster opinions and actions. This is one product which I will buy when the time is right.
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Post by richardsok on Oct 16, 2023 20:53:52 GMT
You have to be careful with muni CEFs. Leverages can be heavy and many of them are paying out a LOT of ROC, including PML, PMN and PMX. So ugly chart trends are probably not an anomaly.
IIM and IQI are earning about 90% of distys.
NAD appears fully covered.
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Post by archer on Oct 17, 2023 3:24:09 GMT
Any ideas why PDI had such a massive drop today, and such high volume?
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Post by chang on Oct 17, 2023 6:17:13 GMT
You have to be careful with muni CEFs. Leverages can be heavy and many of them are paying out a LOT of ROC, including PML, PMN and PMX. So ugly chart trends are probably not an anomaly. I expect you mean PMF (not PMN), but it's a very good point. CEFs require continual monitoring and health checks.
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Post by FD1000 on Oct 17, 2023 7:55:24 GMT
Any ideas why PDI had such a massive drop today, and such high volume? Could be the rate rise because leverage costs more. Maybe holders just gave up, after all, it gets more difficult to hold something for years and claim that "I hold it for the income" 😭🤑
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Post by anitya on Oct 17, 2023 11:32:55 GMT
You have to be careful with muni CEFs. Leverages can be heavy and many of them are paying out a LOT of ROC, including PML, PMN and PMX. So ugly chart trends are probably not an anomaly. I expect you mean PMF (not PMN), but it's a very good point. CEFs require continual monitoring and health checks. May be move / copy the above to the new MUNI CEF thread.
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Post by liftlock on Oct 17, 2023 20:53:51 GMT
Obviously, PIMCO knows what is best for their business, which is amassing AUM. So, I am trying to figure out why they are converting NRGX to a mostly fixed income fund (in a month), as if they do not have enough fixed income CEFs. Do they think we are pretty much at the bottom for credit or is this going to be another one of their ill timed CEF launches lately? Interestingly, based on the narrowing of NRGX discount, it seems investors think the timing is good. I have wondered the same thing about NRGX. The press release states: "PIMCO expects that the changes will reduce the Fund’s focus on investments linked to the energy sector in favor of a primarily income-oriented objective and broader, multi-sector credit mandate, which PIMCO believes has the potential to strengthen secondary market demand for the Fund’s common shares." This sounds like an appeal to the ESG crowd. Or possibly PIMCO believes that the discounts will narrow and take on the premium / discount characteristics of the other PIMCO muti-sector income funds. Interestingly, those discounts appear to be widening. The NRGX discount hasn't narrowed very much in spite of the run up in Market Price and NAV. The discount was at 14.9% as the last report 10/16/2023. Daniel J. Ivascyn owns a boat load of shares in NRGX and is being added to the replacement fund's management team. I suspect he is driving this change.
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Post by archer on Oct 17, 2023 22:23:02 GMT
Today the S&P stopped just short of its overhead 50DMA which crossed the 100 yesterday. SPY actually touched the 50 and then retreated. For the past month aggressive sectors XLK and XLC have been leading, indicating a positive outlook, or at least not a negative one. We could be at a point where the market makes a break out or resumes a downtrend. Of course that's always the case, but sometimes more than others.
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Post by uncleharley on Oct 17, 2023 22:59:50 GMT
Today the S&P stopped just short of its overhead 50DMA which crossed the 100 yesterday. SPY actually touched the 50 and then retreated. For the past month aggressive sectors XLK and XLC have been leading, indicating a positive outlook, or at least not a negative one. We could be at a point where the market makes a break out or resumes a downtrend. Of course that's always the case, but sometimes more than others. I would like to see a more assertive break in the charts for stocks. Something like we are seeing in the precious metals and their miners.
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Post by oldskeet on Oct 18, 2023 0:29:16 GMT
Hi archer. Thanks for posting your thinking about where the 500 Index is heading. For me, I am thinking the near term outlook is upward as long as earning continue to surprise to the upside. Also, know some headwinds can become pretty strong as we move through October and into November. We still do not have a Speaker of the House and a government shutdown is looming ... Then there is the Middle East unrest ... Then there is the FOMC with their inflation fighting campaign ... Then there is the Ukraine invasion by Russia ... And, I could continue ... But, I think you get the headwinds concept.
For me, I have pretty much put my equity ballast money in play and since I have averaged into it I am upside down as I write. Should earnings continue to surprise to the upside and the stock markets continues to do better than anticipated via corporate earning beat I should go positive soon.
Anyway, I plan to stick with the seasonal strategy as it has offered positive results more times than not.
With current money market funds I am sure some investors will be content to sit there. After all, I have about 20% of my portfolio parked there. And, 3% in my equity ballast position.
And, so it goes.
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Post by anitya on Oct 18, 2023 3:05:46 GMT
liftlock , I do not think it is an appeal to the ESG crowd - the fund launched near the peak of ESG AUM hysteria. It is an attempt to move it to a premium or at the least get rid of the discount, as stated in the purpose of conversion "PIMCO believes has the potential to strengthen secondary market demand for the Fund’s common shares." Time will tell how well they will achieve that goal. NRGX for majority of its life until June of this year used to trade at nearly a 20% discount and I remember the discount narrowing to nearly 10% after the conversion announcement. I am happy to share via PM why I think the discount narrowed prior to the announcement and why it expanded a bit more since but I am penclling in for it to go back to 10% as a resting place. My crystal ball is not as clear below 10%. I owned NRGX from Covid lows until the price got to about $15+. I sold it in 2022 and obviously missed the big run up in the last few months. I do not follow its price-NAV closely like I used to when I owned it. (I have owned all their multi-sector FI CEFs at some point or the other. If I add up all the periods of ownership, I owned PDI the longest and PDO & PAXS the least amount of time. I am not a prolific CEF investor / trader.)
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Post by yogibearbull on Oct 18, 2023 11:52:35 GMT
Pimco is a bond house. It shut its small excursions into equity years ago (it was a brief chapter in the career of Neel Kashkari, now the MN Fed Prez). NRGX looked like an odd exception and now that too is gone. NRGX SEC filing also showed ticker change from NRGX to PDX, but PDX isn't valid anywhere yet. www.sec.gov/Archives/edgar/data/1756908/000119312523240524/d518266d8k.htm
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