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Started By
Message
Where is the Top of the Bubble?
Posted on 12/27/13 at 9:56 am
Posted on 12/27/13 at 9:56 am
"Bubble" may not be the right word, but you can see what I'm talking about with the link. What side of the fence are you on? Do we come down significantly as in the past? Or is the market priced as it should be and we continue upward/even for some time?
S&P Chart
nb4UPandDOWN
S&P Chart
nb4UPandDOWN
4
Posted on 12/27/13 at 9:58 am to ell_13
I'll be able to tell you where the top is right after it is reached.
Posted on 12/27/13 at 10:06 am to ell_13
I love technicals but I'll even tell you timing is a myth. However, a good sign is when retail investors are flowing into equities while institutional investors are staying put or pulling out.
The markets are a greater fools game, are equities overprice? I absolutely think so, but do they have room to go up more? As long as there is a greater fool to buy them from you at a higher price.
The markets are a greater fools game, are equities overprice? I absolutely think so, but do they have room to go up more? As long as there is a greater fool to buy them from you at a higher price.
This post was edited on 12/27/13 at 10:07 am
Posted on 12/27/13 at 10:07 am to LSURussian
So you think there is one?
What could trigger the drop and investors taking gains and waiting for a lower price point driving it even lower? Tapering won't do it. Most of the down Euro countries seemed to have bounced off their lows. No major world conflicts currently in the way. Student Loan defaults? China economy falls?
(Bored-at-work-on-Friday-thread)
What could trigger the drop and investors taking gains and waiting for a lower price point driving it even lower? Tapering won't do it. Most of the down Euro countries seemed to have bounced off their lows. No major world conflicts currently in the way. Student Loan defaults? China economy falls?
(Bored-at-work-on-Friday-thread)
Posted on 12/27/13 at 10:09 am to BennyAndTheInkJets
quote:
However, a good sign is when retail investors are flowing into equities while institutional investors are staying put or pulling out.
How would one go about finding out this kind of info?
Posted on 12/27/13 at 10:09 am to ell_13
quote:
Tapering won't do it. Most of the down Euro countries seemed to have bounced off their lows. No major world conflicts currently in the way. Student Loan defaults? China economy falls?
Always remember that no matter what, markets are based on supply and demand. All other things are just marginal factors that could affect those two primary factors. When people on CNBC have some explanation as to why markets went up or down for the day, 70% of the time its really bullshite. They are paid to come up with easily digestible explanations that may or may not have anything to do with what's happening.
Posted on 12/27/13 at 10:17 am to OnTheBrink
That's very difficult to distinguish between retail versus institutional.
ICI is free and gives mutual fund flow information
Lipper will also give you some of the same information.
EPFR is the best aggregate flow website that will dis-aggregate retail versus institutional, but it's pay based as are most of the flow databases.
If you have a Bloomberg terminal there are some good indicators for retail v institutional for short-term rates and a little bit of equities. However, EPFR is still the best overall retail versus institutional flow data website you can get. There are better sites for asset class specific data than EPFR (Money Market Intelligence for short-term funds, etc.), but there isn't a better aggregate site.
ICI is free and gives mutual fund flow information
Lipper will also give you some of the same information.
EPFR is the best aggregate flow website that will dis-aggregate retail versus institutional, but it's pay based as are most of the flow databases.
If you have a Bloomberg terminal there are some good indicators for retail v institutional for short-term rates and a little bit of equities. However, EPFR is still the best overall retail versus institutional flow data website you can get. There are better sites for asset class specific data than EPFR (Money Market Intelligence for short-term funds, etc.), but there isn't a better aggregate site.
Posted on 12/27/13 at 10:17 am to BennyAndTheInkJets
quote:Sure. The two bubbles you see happened because of supply and demand.
Always remember that no matter what, markets are based on supply and demand
First one:
High demand for internet sites (rise) -> oversupply (fall)
Second:
High demand for housing (rise) -> oversupply (fall)
That's putting it very simply, and there were multiple factors thrown in between. 9/11, financial/loan collapse, etc.
Posted on 12/27/13 at 10:19 am to BennyAndTheInkJets
quote:Benny, how about you just tell us when you start to sell.
but there isn't a better aggregate site.
Posted on 12/27/13 at 10:21 am to ell_13
quote:
Benny, how about you just tell us when you start to sell.
+1
Benny always gives great insights for the novices!
Posted on 12/27/13 at 10:25 am to ell_13
My 401k is set with a 10 year time horizon so I don't really reallocate that much. My personal account only trades ETFs because that's the only thing I can personally trade without pre-clearance. The problem with ETFs is the amount of decay you experience from holding over time so my time horizon is usually a couple days to a week, so I trade those on techincals. Obviously can't talk firm positioning.
The supply/demand post was also meant as a cover for me. I thought equities were a little overpriced to begin the year, +27% later I think they're ridiculously overpriced so I'm no muse by any means.
The supply/demand post was also meant as a cover for me. I thought equities were a little overpriced to begin the year, +27% later I think they're ridiculously overpriced so I'm no muse by any means.
This post was edited on 12/27/13 at 10:26 am
Posted on 12/27/13 at 10:45 am to BennyAndTheInkJets
My worry is that everyone know that equities are overpriced. No one denies this because it's exactly what the fed/gov intended to do with their rates. They wanted to force investors into that market. Well, now it's priced higher than it ever has been.
And when people start to see the downturn (however it gets started)? They'll take their profits and hold out for the cheapest price. Well, everyone can't do this; equities would collapse and we'd have another huge crash. So what happens? Can the fed release rates to decent levels again?
And when people start to see the downturn (however it gets started)? They'll take their profits and hold out for the cheapest price. Well, everyone can't do this; equities would collapse and we'd have another huge crash. So what happens? Can the fed release rates to decent levels again?
This post was edited on 12/27/13 at 10:46 am
Posted on 12/27/13 at 10:49 am to LSURussian
quote:
I'll be able to tell you where the top is right after it is reached.
Good one.
I like S&P 2000 to 2100 and Dow 18500 to 19000. Just wild guesses on my part.
Posted on 12/27/13 at 11:03 am to ell_13
quote:
Where is the Top of the Bubble?
If I knew, I sure as hell wouldn't tell you and I'd be a billionaire.
Posted on 12/27/13 at 11:12 am to barry
quote:
If I knew, I sure as hell wouldn't tell you
Posted on 12/27/13 at 12:40 pm to LSURussian
quote:
I'll be able to tell you where the top is right after it is reached.
This! But if y'all get a little insight before hand, PLEEEEEEEEEEEZZZZZZZZZZ let me know!!!!
As the market goes up, I have been accumulating more and more cash. We are due for a correction, but you never know. I'm about 75 stock/ 25cash at the moment.
Posted on 12/27/13 at 1:43 pm to ell_13
The market is overpriced on an absolute basis but not a relative basis. I still think we are in a sweet spot with the 10-year at 3% and low inflation.
My $0.02.
My $0.02.
Posted on 12/27/13 at 2:12 pm to ell_13
Psychologically S&P 2000 to 2100 is where it should turn down.
However, any major event can trigger the avalanche when we are in uncharted territory, index wise, like we are today.
However, any major event can trigger the avalanche when we are in uncharted territory, index wise, like we are today.
This post was edited on 12/27/13 at 2:13 pm
Posted on 12/27/13 at 2:56 pm to ell_13
quote:
So what happens? Can the fed release rates to decent levels again?
This is a question on everyone's mind that nobody has the answers for. Not even the Fed.
quote:
The market is overpriced on an absolute basis but not a relative basis. I still think we are in a sweet spot with the 10-year at 3% and low inflation.
Relative to what is the question. All asset classes are artificially high, just look at Sharpe ratios over the past 10 and 5-years across everything, it's pretty striking. During May - June, there wasn't a rotation into equities, there was a rotation into cash. HY has had some of their best performances ever in recent years due to historically tight spreads and historically low interest rates holding down default rates, and that asset class has seen pretty substantial inflows. How will it react when the 10-year is back at 3.5%? It's a worry that almost everyone has, where do you go? Equities may be the answer but I'm not very convinced by any means.
This post was edited on 12/27/13 at 3:00 pm
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