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explo

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explo last won the day on February 29

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About explo

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    Europe

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  • Portfolio %
    Currencies 38%, Stocks 36%, Hedgies 16%, Bonds 10%

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  1. I can imagine that the mistake stings a bit, but for the year you have a massive outperformance by moving to the vastly superior asset class (cash) at the right time.
  2. I agree it looks like a bad flush. My strategy (allocating long-term strong companies) should hopefully work well for a likely "strong getting stronger" scenario.
  3. Good luck. It looks like a dead cat bounce could be forming and that more than half of its potential has been exhausted by now. Multiple year growth projection revisions are starting to come in from heavy institutions (governments and their major agencies) and the come with dire short-term scenarios. It looks like it will take a couple of years before we are back on track. Back on track meaning to be where we would be at that time had this outbreak not occurred. The recovery to get back on that track will start however start quite quickly, we are talking quarters not years. Then the questions is if/when the market buys this scenario and if it focuses its asset pricing on earnings 2023- or 2020-2022. I'm still waiting for more fills so a double bottom or just slightly deeper final bottom would suit my tactics at this time. A much deeper bottom would force me to heavy leverage management trading again (opportunistically trimming and maybe topping up my around 130 assets). Much of the beta has been eliminated from my funds basket so I should not be pulled down as deep I was during the initial crash and my beta should be in more liquid assets for better ability to do more optimal handling of asset price changes. Right now I'm at just slightly positive return since the start of 2018.
  4. Interesting. Very active allocation.
  5. 16 of 44 filled now.
  6. Great timing of what looks like a bounce building.
  7. Yes. The market goes through its phases (denial in equities when bonds already saw concern for example). The fear phase before was due to not seeing that this is a bell curve and we will see the light at the end of the tunnel quite quickly. First on the infection rate and then on the economy. To know that the infection rate slowing measures do not need to be applied during the whole bell curve build up in order to flatten the curve will be a big relief. As more people have been infected the virus will naturally be slowed by increased difficulty to find new uninfected (non-immune) host chains. One immune person can break a whole chain of infections that would otherwise happen. When enough persons are immune (60%+ it becomes very difficult for the virus to spread among the non-infected). So if the infection rate bell curve is formed over months, rightly timed restrictions of the right kind might only be needed for a couple of weeks for the curve to reach ideal shape, since we don't want a too slow infection rate either. We want a balanced infection rate so that the health care system doesn't collapse and so that we reach herd immunity quickly so that the general population no longer risk passing on the virus to a big share of the risk group (which probably should remain isolated longer than the rest). Then a second wave of fear will likely arise regarding the uncertainty about how much damages was inflicted, but for now the market is relieved that the damage will not go on for an extended period. How deep the bottom test goes and when happens is difficult to say sometimes it double dips and sometimes it is another large leg down.
  8. I included the 4 previous filled for 7 of 41 filled last week. Three more filled this morning. Update: It was actually 5 previously filled. Another one filled in late trading. 12 of 42 now.
  9. explo

    Beyond Solar

    I think many think that the measures taken will reduce the spread like in China. It won't. The majority of the population in the majority of the countries will get infected. The measures intend only to slow the infection rate so that all don't get infected the same month. Flattening the infection curve reduce the peak and make it occur later. This has double effect - it reduces the healthcare capacity requirement and buys time to expand the healthcare capacity. What China did is likely more problematic as the virus is almost impossible to stop, so they will likely get new outbreaks. After the virus has run its course a majority will have been infected which gives herd immunity preventing the virus from being able to cause large problems in the future. Hopefully. The question is how much we must restrict the economy to flatten the infection curve and how quickly the economy rebounds after restrictions are lifted. Turning off part of the economy is something quite new in this globalized economy, so we don't know very much about it.
  10. explo

    Beyond Solar

    If you refer to the intra-day hit of 666 for the S&P 500 on March 6, 2009 that would a very bad scenario that would only be topped by the 86% drop from September 16, 1929 to June 1, 1932, which was a complete breakdown of the equities chart. A more reasonable, still very bad but not complete breakdown, scenario would be a drop to the October 11, 2007 high of 1576 before the 58% crash that followed. This would be a crash with equal magnitude to 2008 and a 13 year setback, but far from the 1929 crash. By its swiftness it looks more like the 36% decline in 1987 from the August 25 high to the October 20 low. That would mean that we could hit 2170 next week based on the February 19 high. To me it would seem reasonable to have a last wash out there before stabilisation and rebound. The big question is whether get a big second drop after that to have a scenario like above. For fortunate investors that got out early (like you) it is more easy to wait things out to not risk getting in before the bottom. Those down already need to be on the ride back up to not get a blow to long-term return (being out on the big up days and being in on the big down days does that wipes long-term return). Personally I don't know. The virus is running its course quite rapidly, so out of the humanitarian and economics hits it looks like it might be biased towards the former. That the Q2 economy will contract double digits would be expected by now. That there will be many bankruptcies and spiking unemployment is expected and packages to reduce this will be released on the world. The big question is whether the machinery can spin up much more quickly again next year than it did after the financial crisis. When the markets will do its big price mark ups and how large discount we will see before that is the impossible question to answer. When the dust settles the strong (business and people) will remain with all the stimulus to share. Don't forget that liabilities reduction will happen too. When we look at this in retrospect the outcome will as always be obvious and the appropriate actions clear. For now uncertainty rules.
  11. The bids are at different levels for different stocks. So far only 3 out of 37 filled. If we go lower bids in new stocks at even lower levels will be triggered. Each bid is quite small. So it is loser nibbling action with the funds raised from previous gainers trimming. This will be balanced by further larger trimming of a few other big gainer stocks in case the portfolio is getting too stretched. The portfolio simply requires frequent rebalancing now. This is one of those few times in a decade when the trading action requirement goes through the roof with all the daily big moves in individual names, industries, sectors and market as a whole. My strategy is otherwise quite free from action. Freezing like "deer in headlights" to inaction or heated action in panic is usually inferior to cold calculated risk management and opportunity seeking in these times, but not necessarily. For rebalancing action to work well the 99 stocks I've picked must be of good quality, i.e. be the ones that come back stronger on the other side. If the bottom is way lower then it would be better to go all cash and then all in at the bottom, but I have a "time in market" strategy, i.e. it is difficult to be out only on the way the down to the bottom without being it on the way up from it too, so I'm trying to manage the decent to the bottom optimally from a risk management (prices risk becoming lower) and opportunity utilization (prices are much lower already) perspective. This is sort of a test of rebalancing vs market timing strategy. It is probably not the best medicine for good sleep though. Go all out and not going all in too soon is definitely the less risky option, but can be less rewarding. I don't try to speculate (bottom picking), but if I should guess I don't think we are near the bottom, but maybe near a significant bounce as the rate of change of "the new normal" slows a bit. PS. I understand that we come from very different goals, mine long-term growth and yours capital preservation, so its only natural that our strategies and tactics are different and they should be.
  12. 3 out the 37 new bids filled, 34 to go..
  13. Five in total filled. OKE two times (the lowest at $12.50 which is up a lot now). I've put in further limit buy orders now. For 37 stocks in total. I don't expect many to fill today since it look like we will have an up day, but likely there will be more days will brutal downward volatility which will be good days to cheaply top up share count.
  14. explo

    Beyond Solar

    Interesting discussion SCSolar. So there are a lot of "curve flattening" and "steepening" decisions going on by policy makers in many countries now. The main focus is to flatten the "death rate" curve by flattening "infection rate" in the risk group in parallell with steepening the "health care capacity expansion rate" curve. If the "infection rate" doesn't peak too much higher and earlier than the capacity then the "death rate" can be significantly flattened to a "non-unnecessary deaths" level and the "public uproar" curve gets flattened with it. One big problem is that flattening the "infection rate" in the risk group requires restrictions to freedom of economy contributing non-risk groups which steepens the "recession curve" as some industries grinds to a halt by the restrictions, which also steepens the "public uproar" curve (both from direct freedom as well as indirect freedom, by reduced financial security, impact). To counter that recession flattening measures using targeted fiscal stimulus packages are announced on a daily basis and monetary policy makers are firing all (blank) demand boosting bullet as well as venturing into different targeted measures (buying junk bonds etc.) to help bridge liquidity stress to avoid unnecessary insolvency of normally strong businesses. So the elderly death rate and the normally vibrant small businesses "death rate" needs to be balanced perfectly by policy makers to have their own interest - the "public uproar" curve - flattened optimally. How the policy makers manages to use its currently virtually free money (inflation bill will come later but some inflation is welcome) to laser target the "recession flattening" measures is still uncertain as well as the virus and public behaviour is uncertain. Specific industries might be bailed out. In non-democracies the "public uproar" curve is less of a problem as the public is more used to restrictions and to plan rather than market economy. In the short-term the financial markets are trying to price the uncertainty about the effect the fallout will have on future earnings. If it thinks it will be a short pain it will be much better than if it thinks damage will linger for years as it did from the financial crisis of 2008. That judgement is very much up to sentiment. At least policy makers seem to take the difficult task of balancing the different curves optimally quite seriously, so it is more up to their competence than willingness. So pricing of financial assets now is reflecting the confidence the public (or investor community) have in policy makers ability to avoid lasting effects on the economy.
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