Please tell me specific names to buy and at what price or stop the panic porn.
OK
I think there will probably be money to be made buying GOOGL at current levels, $2266.
And of course probably also some short term pain since it’s so hard to say where the current bottom might be.
Murphy’s law of stock prediction suggests we aren’t near it yet, unless I believe Murphy’s law of stock prediction and wait for lower prices.
Jim
Jim a question, I’ll try to word it well but I may not do such a good job. You may or may not be interested in answering it too but I’ll give it a go.
Berkshire’s stock price in downturns…overall falls less than the indexes but…
My feeling from the past (note I wrote feeling) is that Berkshire’s stock price initially does a good job of falling far less than Mr. Market. But at some point in significant downturns it seems to me that Berkshire’s stock price falls in unison with the market.
Is this anywhere close to accurate?
“I tend to keep buying on the way down.
The lower the price for something, the smaller the downside is (not that there really is one with BRK) and the higher the upside is.”
That is the way I am wired as well although rarely hit it at the bottom. Nibbled some Bs @$316 and imagine WEB is also repurchasing in this range. Glad you like GOOGL too- I added @$2300-2500 recently.
Curious if anyone else is playing the ATVI/MSFT merger arb play like WEB? I bought some ATVI today @$77 (19% upside if the deal goes thru at $95 next year). Thanks
My feeling from the past (note I wrote feeling) is that Berkshire’s stock price initially does a good job of falling far less than Mr. Market. But at some point in significant downturns it seems to me that Berkshire’s stock price falls in unison with the market.
Is this anywhere close to accurate?
That has been my observation.
Though the pattern might not repeat, you never know.
You might even speculate a possibility of three phases:
(1) Normal falling market, short term index correlation as usual, Berkshire falls about as much as everything else.
e.g., summer 2008.
(2) Value starts to look good, Berkshire’s share price starts to firm up as value buyers appear, stops falling as much as the index.
e.g., first three weeks of October 2008.
(3) --maybe-- Bear market proceeds to next step: a dire financial situation or panic.
Many forced sellers, some people sell whatever they can sell rather than whatever they want to sell.
This can cause a sudden spike lower. But probably not lasting very long.
e.g., Oct 28 2008, or Feb 17-20 2009.
This might be a good time to leave a “stinker bid” open, to buy at an unreasonably low price.
Jim
Curious if anyone else is playing the ATVI/MSFT merger arb play like WEB? I bought some ATVI today @$77 (19% upside if the deal goes thru at $95 next year). Thanks
I bought some last week at $77.78.
tecmo
…
Ships or shoes or sealing wax, cabbages or bonds
Doesn’t scan.
Perhaps “brassicas or bonds”? Technically correct, scans better
https://en.wikipedia.org/wiki/Brassica
-sutton
helpful
needs to get back to transplanting the broccoli
Perhaps “brassicas or bonds”? Technically correct, scans better
Very nice.
No doubt you can appreciate that, geek that I am, I stopped and thought about it, but couldn’t immediately think of anything better.
Ships or shoes or sealing wax, cabbages or convertibles?
Ships or shoes or sealing wax, cabbages or collateral?
Yours is better.
(Convertible bonds, of course. Not soft tops)
Jim
This might be a good time to leave a “stinker bid” open, to buy at an unreasonably low price.
Downturns like this seem like a really good time to have some aggressively low bids out. If you get a fill, you got a bargain, if you don’t, no harm no foul. I added some on Friday, maybe I get a fill maybe a I don’t. It’s a low stress way of taking advantage of Mr. Market having a terrible hangover.
How low should the stinker bid be? 20% under current quote? 30%?
How low should the stinker bid be? 20% under current quote? 30%?
Well, GOOGL is -17% down from when I bought it in January.
So, maybe down 20%?
How low should the stinker bid be? 20% under current quote? 30%?
Just above where you think some panic selling might reach.
For Berkshire, a price below peak-to-date book per share is sometimes a reachable target.
The lowest intraday trades in Nov 2008, Jan 2009, Feb 2009, Mar 2009, Sep 2011, Mar 2020, Apr 2020, May 2020 were all below peak-to-date book-per-share.
Maybe a bit higher because someone else might get that rare tick rather than you. 1.05 maybe?
It has traded below 1.00 X peak book at some point in 8 of the last 180 calendar months.
It has traded below 1.05 X peak book at some point in 12 of the last 180 calendar months.
It has traded below 1.10 X peak book at some point in 16 of the last 180 calendar months.
Those month counts don’t vary as much as you might think.
So, the main issue isn’t how aggressive you are with your limit, but how long you’re willing to wait for a panicky moment.
When the panic hits, most of the limits get hit.
Not so patient?
It has traded below 1.15 X peak book at some point in 29 of the last 180 calendar months.
It has traded below 1.20 X peak book at some point in 44 of the last 180 calendar months.
Jim