Simba

If you bought the S&P 500, basically pre covid high (i.e. Feb 2020) and held till today, your annual return w/ dividend, is 7.5-8%? (using round figures, assuming minimal taxes). That assumes round trip from peak mania to today. Gold is up a similar portion, while long-term bonds seem to be down. IMO 8% historical return is in-line with historical, and I'll take that compounded over the next 50 years, easy.

Anyone have a view of Canadian Real Estate? Long-term still a good buy?

IMO it will take a while to adopt at the corporate level, and in the near term, a lot of low level tasks IMO will be automated.

The market current trades at ~17.5x (5.7% earnings yield). Not bad. In a world where 10YT yields 3.5%, is a 5.7% earnings yield a decent purchase ?

Yup good ole Bill Ackman ... good ole the world is falling.

Nice find.

There is a lot of talk about recession.. believe this will result in a bit of volatility for the foreseeable future. Suggest to make use of this volatility - i.e. trader's market. I also think inflation is going to be overblown in the long-run, and like all bear markets, this one shall end.. eventually.

Yes to all your points. Takes a heck of a lot of time + effort (almost a full-time job in of itself to be honest). Riding a trend is fun, just hop on the F*** off, before the station peaks (i.e. when you have 10M Redditors all-in on meme stocks, that's your sign to head for the exits).

wait your telling me I shouldn't pay up for tech companies valued on TAM on a revenue basis, and on 2048 Adj. Earnings before all expenses, when the 10Y is at 4%

Feel like sayin' it “There's always a bull market somewhere."

It's tough to do... as driven by so few companies (Apple 11%+ weight, Microsoft ~12% weight)

I like this view. My own take to add (all anecdotal) 1. Stocks are emotionally hardest to own after a bear market (as we had in 2022) 2. Stocks usually perform the best after large sell offs 3. Market rallies tend to be swift (as we have already seen YTD, with S&P 500 up 8% in a short 31 days to start the year). I don't really follow inflation, but was never in the camp this was going to kill stocks, and I generally believe that corporations pass on prices to consumers, and in fact benefit earnings, so owning stocks is an inflation protector (and historically stocks returned above inflation anyways).

Stocks have been absolutely pummeled for 2022, so wouldn't be surprised to see the worst performers bounce back in 2023.

IMO the best outcome is a long played out bottom - which is exactly what's happening. We've been in a downtrend for almost 10 months now. The GFC was ~1.5 years in downtrend, while the dot-com bubble was ~2.0 years Hard to think this lasts more than dot-com bubble (IMO), unless some unknown macro factors throws a wrench into the mix.

I love markets like this. IMO fear + uncertainty + large price declines -> create the room for investment opportunities. I'm not excited buying equities when crowds are euphoric. I'm excited by markets charactered by panic. Names are starting to be valued as they should be. This is a slow bottom grind (with slow change in investment psychology). Reminds me exactly like 2008 of how everyone was fatigued by new lows. Seeing 3000 price targets on the S&P excite me. I hope this does happen, because I'll be buying. For those in the accumulation phase, IMO lower prices are beneficial Rather be buying a market at fair value than overvalued

This is brutal.

Not really familiar with the deal, but maybe this help? It kind of reads that Elon owes $1B if he fails to perform his side of the deal, or if Twitter is willing/able and Elon cancels under a valid termination under certain specified circumstances I'm really far away from the details, so maybe others can chime in as well! " Upon valid termination of the merger agreement under certain specified circumstances, Parent will be required to pay, at the direction of Twitter, a termination fee of $1,000,000,000, the payment of which has been guaranteed pursuant and subject to the terms and conditions of the limited guaranty. Specifically, the termination fee will be payable by Parent to Twitter if the merger agreement is terminated by Twitter: • as a result of a breach or failure by Parent, Acquisition Sub or Mr. Musk to perform any of its respective representations, warranties, covenants or other agreements in the merger agreement (subject to a 30-day cure period), which breach or failure would give rise to the failure of relevant conditions to effect the closing of the merger; or • because Parent and Acquisition Sub failed to consummate the merger as required pursuant to, and in the circumstances specified in, and subject to the terms of, the merger agreement while Twitter stood ready, willing and able to consummate the merger and the other transactions contemplated by the merger agreement." PREM14A (sec.gov)

I think the market doesn't look cheap if the "E" starts to cater, or the one-time COVID-gains are not sustainable and will be challenged going forward. All that being said, the market is climbing a wall of worry next 1-3 years. No one is really talking about this, but take a name like PayPal, their revenue was OK, but operating income / free cash flow got completely crushed. Huge re-rating (stock popped on earnings which made no sense). I'm assuming there are other names like this which Consensus Earnings need to be adjusted down. Even if rates go up to 5%, I still think equities are a good place to be long-term (but multiple would get crushed). Historically inflation has been 2% and if you have a long-term view, I think it's safe to assume inflation will eventually mean revert back. To be honest, for anyone in the accumulation phase, they should be happy that stock prices are low. It just means they can accumulate more at a fair price. If inflation is contained in the next 5 years (which it most likely be), and FANG continues to deliver, I'm sure the market will be fine. This shall too pass. That being said, the market is 18.7x for trailing 2021 EPS (5.3% earnings yield), and much cheaper on a forward looking basis. Meh. Not bad.

This is my thought process - but I'm not really expecting a V shape recovery as we've been so fortunate to have in the past. IMO there's probably a ton of value in TECH land, if you can really spot out the compounders / winners, and not 1-trick COVID ponies (basically avoid whatever Cathie Wood owns)

Yup. Although I do think some of the tech names are good businesses (e.g. MSFT), so they remain high for good reason, but like NFLX, generals can be shot fairly quickly, if they start reporting weakening comps and margin deteriorates. I also don't think we've seen capitulation. I'm thinking maybe another -10 or -15% to go. Hoping for a -30% down year (one can hope, can't I?) Deployed cash today, first time in a long time.

I'm starting to buy on the way down. Prices are getting to the attractive category with some positive IRR expectation (Versus absurdity of stocks jumping 100-300% on bull$hit numbers). I find the market is very quick to react to earnings (versus 12-18 months ago, where everything gapped up 30% on air) I'm of the opinion, even if rates headed up hypothetically to 6-8% in a bear case / hyper inflation scenario, stocks would likely still perform great. Own good operators, and the share price shall take care of itself. If the market valuation truly mean reverses, then you end up in a pre-2013, post dot-com world, of fair multiples with decent IRRs. United States still a great country to invest IMHO. A lot of noise, and if your a long-term investor (5-10+ year horizon), opportunity fortunes the brave (for stocks that is)

If you can buy bonds outright and own to maturity, I agree locking in coupon / return is quite decent That being said, I wouldn't own anything with very long term duration.

Interesting anectode. It seems like overall market sentiment has indeed shifted from the glory days of 2020 WSB peak

My "FinTwit" sentiment was extremely negative last week - was clear there was pure fear in the markets (and naturally a bottom ensured). That being said inflation and interest rates are 2 big unknowns, and it does seem like a stock-picker's market this year. If you choose tech your wrecked, if you choose value, your doing great. And if inflation stays high, what impact does this have under the hood? How much longer does the value regime hold? Berkshire Hathaway outperforming the market - remember last year how ARKK bros were making fun of Warren Buffet How cycles change, how sentiment changes. Amazing. Can't make this shit up.

Interesting take and agree completely. What's your take on managing temperament through trading?