Hey guys wondering if anyone added to any of their holdings today with the swift market sell off or if you guys are holding and waiting to see if we continue selling off more. Then buy lower?
I know we can’t market time but I know you all have much more experience then I do.
The news is talking about a recession coming with the inverted yield and I have almost all my net worth in the stock market right now. So naturally Im worried some
Thanks!
I know this is probably OT, but since a lot of people are concerned, I decided to run a little data
analysis.
I took a list of Saul’s hyper growth stocks (and a few similar software stocks) and went back 3
years (some of the stocks have shorter history than 3 years). There has been no “recession” over
the past 3 years, but quite a few episodes of large market swings. So the analysis may not exactly
address the OP’s question, but may provide some color nonetheless.
First, average performance of our hyper growth stocks following major market rallies (defined by QQQ
returns):
next day next week #data next day next week #data
If 1d_ret_QQQ > If 5d_ret_QQQ >
2.0% 0.72% 2.83% 165 2.0% 0.27% 1.93% 998
2.5% 1.01% 1.20% 102 3.0% 0.00% 1.86% 480
3.0% 0.57% 1.42% 53 5.0% -0.69% 3.63% 79
4.0% 4.68% 2.66% 18 7.0% -1.55% 5.16% 33
In plain English, while our stocks on average continue to go up after big market rallies, there are
(on average) some pullback if the market rally is really big, but the pullback seems to be short
lived. After one week, our stocks on average actually go up even more after the temporary pullback.
Second, the results that many are interested in, which is average performance of these stocks
following major market selloffs:
next day next week #data next day next week #data
If 1d_ret_QQQ < If 5d_ret_QQQ <
2.0% 0.91% 3.74% 267 2.0% 0.59% 3.25% 671
2.5% 1.16% 5.91% 146 3.0% 1.23% 3.68% 406
3.0% 1.41% 6.87% 104 5.0% 1.97% 6.86% 156
4.0% 1.44% 11.69% 24 7.0% 1.64% 8.13% 63
Very encouragingly (and not surprisingly to many on this board), after major market selloffs, our
stocks go up on average always go up, the next day or the next week. It seems that the bigger the
selloff, the stronger our stocks tend to go up.
Now, past performance is no prediction of the future, so take these results with a grain of salt and
use your own judgement whether this time things are different.
(Note: the stocks I included in this little study are TWLO, ZS, AYX, OKTA, TTD, TEAM, MDB, ESTC,
PLAN)
(re-send --- once again I struggled with the formatting. Sorry)
I know this is probably OT, but since a lot of people are concerned, I decided to run a little data
analysis.
I took a list of Saul's hyper growth stocks (and a few similar software stocks) and went back 3
years (some of the stocks have shorter history than 3 years). There has been no "recession" over
the past 3 years, but quite a few episodes of large market swings. So the analysis may not exactly
address the OP's question, but may provide some color nonetheless.
First, average performance of our hyper growth stocks following major market rallies (defined by QQQ
returns):
next day next week #data next day next week #data
If 1d_ret_QQQ > If 5d_ret_QQQ >
2.0% 0.72% 2.83% 165 2.0% 0.27% 1.93% 998
2.5% 1.01% 1.20% 102 3.0% 0.00% 1.86% 480
3.0% 0.57% 1.42% 53 5.0% -0.69% 3.63% 79
4.0% 4.68% 2.66% 18 7.0% -1.55% 5.16% 33
In plain English, while our stocks on average continue to go up after big market rallies, there are
(on average) some pullback if the market rally is really big, but the pullback seems to be short
lived. After one week, our stocks on average actually go up even more after the temporary pullback.
Second, the results that many are interested in, which is average performance of these stocks
following major market selloffs:
next day next week #data next day next week #data
If 1d_ret_QQQ < If 5d_ret_QQQ <
2.0% 0.91% 3.74% 267 2.0% 0.59% 3.25% 671
2.5% 1.16% 5.91% 146 3.0% 1.23% 3.68% 406
3.0% 1.41% 6.87% 104 5.0% 1.97% 6.86% 156
4.0% 1.44% 11.69% 24 7.0% 1.64% 8.13% 63
Very encouragingly (and not surprisingly to many on this board), after major market selloffs, our
stocks on average always go up, either the next day or the next week. It seems that the bigger the
selloff, the stronger our stocks tend to go up in the following day(s).
Now, past performance is no prediction of the future, so take these results with a grain of salt and
use your own judgement whether this time things are different.
(Note: the stocks I included in this little study are TWLO, ZS, AYX, OKTA, TTD, TEAM, MDB, ESTC,
PLAN)
bashuzi,
Very helpful work.
Just a thought. Might your sample be a little biased towards the stocks that have come through the storms successfully?
As i understand it, others that are now out of favor once were counted among the hyper growth stocks such as ZUO, NTNX, CLDR, PSTG, PVTL, TLND, NEWR, etc. In that analysis, including any of these stocks that were in play 3 years ago might make sense.
Maybe months from now, a stock or two from among our current favorites will falter.
Use < pre > and < /pre> (no spaces) around the tables and not with the text and we might actually be able to read this.
addedupon,
Thanks for the excellent suggestion. Since I have not been part of the board for long, the former
favorite names you listed are very helpful.
So, in addition to the 9 current favorites (those that have come through): TWLO, ZS, AYX,
OKTA, TTD, TEAM, MDB, ESTC, PLAN, I added 3 out of favor names: NTNX, NEWR, CLDR. I figure 3:1
ratio of successful versus busted names seem reasonable.
Anyway, the numbers change somewhat to being less impressive, but overall conclusions are pretty
much the same.
Here are the new tables.
First, average performance of these stocks following major market rallies:
next day next week #data next day next week #data
If 1d_ret_QQQ > If 5d_ret_QQQ >
2.0% 0.64% 2.10% 232 2.0% 0.21% 1.67% 1432
2.5% 0.71% 0.48% 140 3.0% -0.03% 1.68% 681
3.0% 0.23% 0.96% 72 5.0% -0.83% 3.34% 110
4.0% 4.13% 2.42% 24 7.0% -1.76% 4.91% 45
Second, average performance of these stocks following major market selloffs:
next day next week #data next day next week #data
If 1d_ret_QQQ < If 5d_ret_QQQ <
-2.0% 0.80% 2.91% 373 -2.0% 0.43% 2.51% 958
-2.5% 1.09% 4.95% 205 -3.0% 1.05% 2.89% 571
-3.0% 1.30% 5.85% 144 -5.0% 1.83% 5.94% 218
-4.0% 0.94% 10.09% 34 -7.0% 1.57% 7.58% 88
(Previous disclaimer still applies, obviously.)
While I anticipate/hope that there will be plenty of additional opportunities to purchase great companies on sale over the next several months; I did generate some cash today and sold iRobot and PagerDuty in order to add to my positions in Zscaler ($79.80), SMAR ($45.06) and TWLO ($123.82). It should be noted that the sale of iRobot and PagerDuty represented a big step for me in terms of trimming my portfolio of a couple of my languishing positions to reallocate my resources to what I hope will be more rewarding companies. I know I am not unique in the fact that I tend to hold onto losers far too long. A psychological barrier that as an investor I know I need to work harder to overcome. I need to become more comfortable in not only seeing the value in reallocating resources to stronger performing companies; but seeing these as positive moves in order to move forward and not failures looking backward.
First, if you end up selling off and buying lower, that is total luck. I wouldn’t make that “trading” part of your approach. The real questions you have to HONESTLY ask yourself is when do you need the money and do you have enough confidence in your investing that you know you can continue to generate great returns in the “next market cycle” even if the market drops (with your current stocks or new ones). If you honestly don’t need your money for 5 to 10 years (closer to 10) and you believe in your investment approach, stop worrying about day to day market fluctuations and news coverage and stay in the market. There are so many variables that I doubt even the holy “Inverted Yield Curve” is as predictive as the “professionals” say it is. If you might need the money in the next 5 to 10 years, I recommending staying out of the stock market with the money you need. The market can half your portfolio for a period of time in a blink of an eye if it just feels like it one day. (regardless of yield curves)
Jeff
I appreciate the feedback, I was a little confused at the way you graphed your chart but I do know our stocks have sold off in market sell offs then come back stronger. The main thing that’s different now I worry is the major news headlines are talking about a recession coming because of the inverted yield and the global economies are also in recession territory already. What I worry is that because most of our stocks are all loosing money, investors will start to look towards value stocks for a while, it’s never taken this long for our stocks to not rebound, this year at least while I’ve been invested. Twlo continues falling, mdb and Smar haven’t regained strength, ttd and roku both keep falling after earnings and I made a huge mistake and put option calls on these stocks expecting them to rebound. Basically just threw my money away on those. So I know this is getting somewhat off topic but we are talking about our core growth stock holdings. I did have enough money pulled out to both add if there are further dips and also the money I need in the next few months. There certainly has been far more recession talk then there has been since the last recession and everyone is saying the risk is greater then since 2008. I still believe in our companies and I don’t think the recession will hit until at least the election if not later. Obviously we can’t time the market though.
Anyways enough about me.
Thanks for your responses
I don’t think the recession will hit until at least the election if not later. Obviously we can’t time the market though.
Your stocks will be down a lot well before the recession hits even if you could identify the beginning of the recession with any precision.
You can find advice everywhere saying “we can’t beat the averages” indices so should buy the SPY . But plenty here have beat them… And I know this is heresy on Saul’s board but “we can’t time the market” may just mean most can’t time the market. But some can ,as long as they pick when to do it. (timing tops is the hardest of all, it’s highly error prone)) Though buy and hold may work just as well if you are skillful and patient.
Here are some other stocks that dropped off the list for many of us - NTNX, PSTG, SHOP, SNCR, VEEV, NVDA, ANET, SWKS, LGIH, TDOC. (Was ILMN in there, too?)
While he’s not always right, Saul has what I think is an exceptionally good sense of when to sell, and it’s made a big difference. (He has an especially good sense of when a stock is starting to smell bad; SNCR was one of the more blatant examples. 
If you put all the stocks mentioned in this thread into an index, I would be expect the performance to be a lot worse than his personal results.
It would be good to actually test that and see how much difference it made.
The very name of this thread (Market sell-off: buying opportunities) makes it clear that it is OFF-TOPIC… FOR THIS BOARD!
There are other boards that would welcome an interesting market-timing thread like this, but we are about discussing and analyzing INDIVDIUAL growth stocks. PLEASE BRING THIS THREAD TO A CLOSE NOW.
Thanks for your cooperation
Saul