Where to invest cash in this market

Quite rightly too.

Long-Term Capital Management had some people involved who were awarded a Nobel Prize for mathematics. Everyone was smiling. Then Oops.

Even Sir Isaac Newton, one of the brightest of the ages, got it right once then got it very, very wrong indeed.

If those of that caliber had failures there is no chance an average so-so like me has any hope. I plod on doing what I do.

Others may have a different opinion of their ability. If it it works for them well done. Hope it continues that way.

 

Market up over 1.5%. Looks like @Big Al has decided to pile in

Cheers
Oracle

 

@Big Al makes me nervous holding all that cash! What if he waits months, then goes in just before the correction he thought would happen, which hadn't happened, happened!

 

Hence the Big in his name.

 

Be nice.

It's bloody difficult knowing you should do or can do something but not sure when. Most of us have had the feeling of concern of placing money in a volatile item like the share market whether the hard earned capital will drop.

But then ya ain't nice. I'd hoped to get through the day without knowing nuffen about the market and what do I see? Someone posting about the movement in the share market. This is a property forum. Stop it.

 

I'm projecting my issues on to him. I should hold fire. Main thing is he's confident in his decision and that way regardless the outcome he knows he followed his plan. In 10 years the decision will be but a speed bump in the rear view mirror.

 

We have 100 years of data at best, slightly longer than the average human life time. I'd argue that that is a minuscule sample in the context of human existence. Recently reading some stuff on America in the 20's and 30's (story of Anheuser-Busch).....it was an incredibly different world and that is less than 100 years ago. From Prohibition to the Trump Era in a lifetime.. I give less and less credibility to extrapolations based on recent past (100 years) and come back to thinking about the characteristics of asset classes and risk tolerance, with the knowledge that risk entails more than volatility and your financial success will by a large part be determined by a great strategic game (geopolitics and the power of force) over which you have no control. Of course it will all make sense and fit into a understandable narrative looking back 100 years from now.

TLDR ; Nobody knows nothin!

 

I'll have a stab then.

Im heading for Perth Mint and get me some o them shiny gold bar thingys. Got a fair bit tied up in an upcoming gold stock, RED 5 LTD.

Does anyone trust the govt deposit guarantee considering that video we saw earlier?

@willair yeah GFC saw us actually make money and grab some cheap $$ for property. Now we've sold off all property and focussing on PPOR renos etc its the cash leftover Im looking for a home. I keep looking at properties! LOL.
Should stayed in.

 

Lol. Not yet.

Don’t worry it’s something I think about all the time. I would be very annoyed if that happened.
Thing for me though is at the moment equities as a total of all investments still only sits at 15-20%. Approx 50% is in unlisted property trusts. Though I really want to bring equities to that 50% mark. The cash pile I have built up is now also in the Vicinity of 15% of total. So if I went all in with equities I would almost double my equities holding. That’s my plan but want to try and avoid doubling it right before a 50% market drop. Imagine that double your holding only for the market to bring it back down to where you started.

 

Your money so your call. Fair enough too.

Wicked thought. When you are absolutely sure the market will drop 50% or whatever the day after you put money in to it don't do it the day before. Do it the day after.

 

Ok. Just so I have this right. I’ll work out when the market is going to drop then wait till the day after and put it all in.

Done. Now when I work out which day that’s going to be did you want me to give you all a heads up? Or I should wait till I’m in then tell you so you guys can pile in and send prices back up.

To be honest with you this is all a first for me. In my short equities investing career I haven’t played the timing thing yet. This will be the first and am only tinkering with some sort of timing attempt because I would like to increase the holding significantly. After this next big buy it will be monthly buy ins.

Not enjoying the head doing of trying to pick the right time.

 

Apologies @Big Al. My post was harsh.

Just when I read what you have to say it gives me the impression you are in a mass of indecision. Are you certain you wish to invest in the share market at all? It isn't obligatory if it causes a person extreme worry. For those who do experience this then it may be better to stay away from it, invest elsewhere according to their temperament but accept responsibility for whatever outcome results.

 

Not at all mate. I’m enjoying the banter. Good fun as well as educational.
I wouldn’t say it’s causing me serious worry. I mean I am a worrier by nature. So I need something to stress about. Always over analysing everything. I’m sure a few on here can relate to that.

I don’t think anyone discussing this topic is expecting anyone to have the magic answer to when the market is doing what next. I think it’s more about understanding the mindset of others when it comes to investing in such volatile times.
That’s what I’m learning the most from here. The behavioural and emotional aspect of our decisions when investing.

Appreciate everyone’s input into this topic and the many other great discussions on this forum.

 

Any chance you could link the page please.

 

Have you read the Sequence of Returns thread on here? From the start, it's really good if I remember correctly. Helped me come to terms with decisions and go forth!

 

In my mind noone has that answer so I immediately ignore anyone saying they can market time. Attempting to time the market before the fact doesn't work, as everything that worked in backtesting falls apart. The famous CAPE ratio? Hasn't worked in decades. The big guns like Cliff Asness - his AQR podcasts and whitepapers are fantastic - even fail. He was calling for lower returns to happen in 2012. Another trendy stock person Meb Faber was arguing against the US stock market in 2013.

The only people who might be able to pull it off won't be sharing their info, I'm thinking the renaissance technologies of the world. That's even if they can do it. Investing in the share market for me requires completely ignoring any thoughts of both timing and individual stock picking, you can let rebalancing do the buy low sell high timing for you. DCA lump sums in over a long period if you have a good safe alternative (eg mortgage offset) to reduce the risks of a major drawdown just after lump summing. Then if the market drops you win because you're investing when its cheaper, but if it keeps going up you still win because you've made money.

Trying to market time will only do your head in unless you're one of the lucky few who get a long drawn out correction at just the right time AND deploy capital into it. How many people missed the 1987 and 2018 flash crashes waiting for just the right time?

If you must market time maybe do it with extra cash or small, long-duration leverage. If the market drops 20+% maybe draw down home equity or sell a IP/sports car to invest. Definitely not advice.

 

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Barny, i just can't find the one that every time i read it as it didn't come out of any corporate finance tex book nor became reality on ones barometer ..

 

Had a bit of a read of that fascinating history and it's interesting to see there were quite a few people saying be careful, don't rush, but NOW will be a great buying opportunity.

 

Once you put aside the tribalism ,there were some very smart minds that posted during that period in Australian investing history ,some who played a significant and historic role in bringing and were in the room when CBA started to be listed on the ASX and reflects on the time in more black and white terms,btw I was not one of them

..Bill.L. Mark. and several other's who no longer post from an investor and financial perspective during the depths of the GFC really had a mask for what was going on inside the inside and could spy an opportunity even before the opportunity was still around the blind corner,i learnt so much of those people..imho..