Equities are on sale? Or do you mean, when and if you find them on sale?
"Equities are on sale? "
If you buy something, that something was on sale. The price may be high or low - but that
is the basis of “dollar cost averaging”. At any time you only have an estimate of the value
of any equity - even after earnings are known. What is then a “reasonable price” to pay for
that equity is a judgement every individual investor chooses.
Howie52
IMHO, the larger the capital position of an equity, the more difficult justifying paying too high
a price becomes. More people see earnings history and project earnings growth with more clear
definition of markets served. There is simply a greater clarity of just how high a mountain
the equity could potentially climb.
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<<Curious - what equities do you consider to be on sale?>>
Hawkwin: Pretty much most of them. S&P 500 hit correction territory which is usually a buy signal.
Since 1974, the S&P 500 has risen an average of more than 8% one month after a market correction bottom and more than 24% one year later.
1poorguy: What Hawkwin said.
Pretty much any company that is hitting (or exceeding) their numbers, but has had a sharp decline in stock price, is on sale. Some Saul stocks, some of my holdings (though not all!). I don’t want to start recommending stocks. But this correction has put many great companies on sale.
That’s interesting. I’m more in the camp that the US market has gotten ahead of itself and returns from here are likely to be less than we’ve been used to for a while. CAPE of 39, the second highest in history, gives me pause. But hey, that’s what makes markets.
Are you 100% stocks? Or maybe even a little more than 100% since you have a mortgage?
I’m still making money (part-time, self-employed). We have a goal of about 5 years expenses in cash/ibonds. Currently have more than that. No pension. SS is a ways off.
Being self-employed most of my career has probably made me more inclined to keep a lot of cash around.
Related, this just showed up in my podcast app:
Jeremy Grantham: The U.S. Market Is in a Super Bubble
https://the-long-view.simplecast.com/episodes/jeremy-grantha…
I haven’t listened yet, but I’m pretty sure I know what perma-bear Grantham is going to say.
He’ll be right one day.
That’s interesting. I’m more in the camp that the US market has gotten ahead of itself and returns from here are likely to be less than we’ve been used to for a while.
Keep in mind that the economy, as measured by corporate profits, grew MUCH FASTER than the market did last year. We don’t have to have 20% returns this year - a simple return to historical averages with corporate profits growing half as fast this year would be reasonable and would likely put a big dent in CAPE (especially since CAPE is backward looking vs forward looking).
https://www.cnbc.com/2022/01/13/profits-for-sp-500-companies…
That’s interesting. I’m more in the camp that the US market has gotten ahead of itself and returns from here are likely to be less than we’ve been used to for a while.
Yes, pretty much 100% stocks. Some cash, the house. But the rest stocks (or mutual funds in retirement accounts).
I don’t think I can know if “it’s ahead of itself”. I look at earnings and growth. If those are improving over time, but the stock is being beaten down, I regard that as “on sale”. Could it later have a better sale? Sure. I won’t even try to guess a bottom. Mostly I look at the numbers, the business performance.
For example, DDOG. Got that from Saul’s board. They announce tomorrow. If you look at their history, they consistently beat expectations. They’re firing on all cylinders (barring some unanticipated event in the announcement tomorrow). As long as that continues to be the pattern, I’m happy to own them. And if they are dipping, and I have cash available, I’ll pick up more “on sale”.
I do have a few speculative stocks, like QS. They potentially could be very disruptive, but from a numbers standpoint they are NOT on sale.
Others like COST are juggernauts, and any negative deviation from the trend (sans newsworthy development) I regard as a “sale”.
The “market” may or may not be “ahead of itself”, but a good company is a good company.
1poorguy
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Yes, pretty much 100% stocks. Some cash, the house. But the rest stocks (or mutual funds in retirement accounts).
I don’t think I can know if “it’s ahead of itself”. I look at earnings and growth. If those are improving over time, but the stock is being beaten down, I regard that as “on sale”. Could it later have a better sale? Sure. I won’t even try to guess a bottom. Mostly I look at the numbers, the business performance.
For example, DDOG. Got that from Saul’s board. They announce tomorrow. If you look at their history, they consistently beat expectations. They’re firing on all cylinders (barring some unanticipated event in the announcement tomorrow). As long as that continues to be the pattern, I’m happy to own them. And if they are dipping, and I have cash available, I’ll pick up more “on sale”.
We’re about 85% stocks, but not those kinds of stocks 
I see DDOG is up nicely in pre-market. I also see it does not have what I would call “earnings”.
“GAAP net loss per diluted share was $(0.07)”
Huge growth. Not my area of expertise, or my cup of tea.
It’s in the too-hard pile.
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