Poll: Reason for the ouch

I thought that at the year-end, people bought popular stocks that have gone up, and sold the losers. That makes their 13-F look good, without affecting total returns (unless something happens in the last few trading days of the year.)
But what is happening now is the opposite. Losers for the year are going up (I should know, I own them :-)) and winners are going down. Is it -

  • Short covering for losers and profit taking for winners?
  • Loss of faith in (at least some) winners?
  • A true rotation into value stocks from growth stocks as suggested upthread (rotation = trend, longer than a week, at least a few months)?

I don’t believe macro reasons like tensions with North Korea are applicable this time. I can’t prove that, but if the pundits in the news are so smart, why can’t they predict the macro effects in advance? They explain the daily advance/decline with perfect 20/20 hindsight.
People predicted the (as it turned out, temporary) panic caused by Brexit. Today people seem calm about world news, overall.

  • Short covering for losers and profit taking for winners
  • Loss of faith in (at least some) winners
  • A true rotation into value stocks from growth stocks
  • Other (please specify)

0 voters

“Other”

Locking in outsized profits so their quarter looks great.

Cheers!
Murph
II and PP Home Fool

6 Likes

minor, but last year after Trump got elected there was also a rotation from tech growth stocks to value oriented cyclical names; all the tech names resumed upward momentum

I think a real rotation is a 10% move, not a dinky 1 or 2% one or two day nasdaq rotation - therefore, only worth considering if you want to do so - otherwise, my other guess is this:

some people selling and buying
and other people buying and selling

that pretty much covers it…

Locking in outsized profits so their quarter looks great.

“Other”

Murph’s got half of it right. The other half is yesterday the chances of tax overhaul looked bad. Today it looked good. Tonight it looks bad again.

Tomorrow will not be a great day.

Big bucks move the markets and big buck hate taxes. (I’m not fond of them either but I do expect to pay my share. But for the mega-rich, that’s foolish. Let the peons pay.)

Dan

2 Likes

The key here is that this appears to be selling based on nothing but stocks which are currently winning which means WE (individual investors) are in the position to profit from the situation. This is our advantage.

Peace,
Dana
added to SQ, PYPL
adding to NVDA today

Other - more active traders moving into larger cash positions over the holidays season as it traditionally slows down. Also funds locking in profits to show good year over year results.