My purchases are always long term. While I was happy I got to add to my positions at a relative discount compared to the prices they had been, I know in another 5 years it won't matter. I just get a kick out of picking up stocks on a down day versus it going down the day after I purchase. The later happens more than the former so I celebrate all little victories. Woot! :D

Great post Trey! Because that's the message that is "correct". It DOES feel better to get a bit of a deal... and investing is VERY emotional. You need "confirmation" that what you're doing is right - not wrong. I get that it's not about the few bucks saved... Longer term - you're absolutely right - it won't matter one bit.

What I am also trying to convey though --- is that it doesn't always work this way -- or snap quite so dramatically. It's wonderful when it does... but get your heads wrapped around that we WILL -- WITH CERTAINTY -- make these buys one day, and then just bleed for a long time. What I've always tried to get everyone to get ready for is when your buys/investments/markets DON'T work the way we've become quite used to. This is why I say to use this period to learn -- to remember the basics - like reminding yourself with the charts that HISTORICALLY we're more about lower on the left and higher on the right... and to remember the euphoria you feel when the market is with you... and that it WILL be like that again - and that you're still earning money on your money with the dividends etc.

Time is totally relevant! I like to look at my stocks more like living in my house... It doesn't have much value while I'm living there other than to keep me dry and warm (the dividends). The value only becomes important when I want to sell it.

Anyone buying oil stocks?

I would but they are in my Roth and it's maxed out for the year already. It's not going to turn around quickly. It may get uglier yet, too. Greg had some thoughts on oil stocks on the previous page.

Here John --- "Somebody" is buying oil.... LOL


http://www.reuters.com/article/2015/...0QY0L120150829

An interesting view on the "market" in SHANGHAI...... That market was up 100% between last November and last month (JULY)... and everyone is freaking out because it's now DOWN 36%. If you were an investor last October or November or December (you know - as it was rising). You're still way ahead.

This IS what happens when a market runs too far - too quickly. Up 100% in a few months is not normal in anything - anywhere. The fact that some air is coming out is a total "well duh".

You can't compare the US markets with that kind of a run. Our market is based - key word here - based - on EARNINGS. All the lumps and bumps along the way are reactionary moves more based on emotion vs fact. Look at YOUR holdings and make sure their earnings are sound and their revenues are going the right way. That's why you want to own the very best companies.

Here's some other food for thought this morning.


If I had not invested in a business in 1975.... or ever since then - bought stocks - and made apartment building investments - and bought commercial buildings... because I thought at the time that they were too high -- or the world was coming to an end - or that interest rates were going one way or the other... or that my house was going down...

We've had wars - I've seen 15% interest rates - I've seen the collapse of the Savings and Loan industry... the collapse of the stock market TWICE (1999 and 2007) - the collapse of the mortgage industry... a slew of Presidents I didn't like... 9/11... Lived thru the cold war - and seen Russia and China go from being imminent threats to being trading partners.

At any time along the way I could have used all of that for INACTION or reasons to be frozen in my tracks... all nothing but excuses for not investing in anything. 25+ years later all of that seems pretty important... and yet here I am living off all those early investments. Maybe you'll see my point? Ignore all of that short term BS... and keep plugging along saving and investing for your future. It matters little that your last investment is down 20%... Where will it be 15 or 20 years from now? My bet is WAY UP.

Market could go down way more.

The Chicago Cubs no hitter could spell doom for the market.
Following Milt Pappas' September 1972 'no hitter', The Dow dropped over 40%
Carlos Zambrano's 'no hitter' in 2008 came during the Lehman bankruptcy weekend and was followed by a 30% plunge in the S&P in the next three weeks, as well as a 6000-point-plus total collapse in the Dow.

So, when we saw Jake Arrieta's 'no hitter' this weekend, we can only imagine what doom it implies for US stocks.

And if that is not worrying enough, the last time The Cubs won the National League Pennant was in 1945, two cities were destroyed by atom bombs.

LOL just joking around.

Another fun fact. In the Back to the Future movie when Marty goes to 2015 the Cubs won the World series.

That is funny stuff right there

The Transition from Growth P/E to the Value P/E
 

I have nearly all of my individual stocks in large-cap dividend companies with 'low' PE ratios: 10 to 25.

But I'm only 31 and have a long investment career ahead of me. So the devil on one shoulder wants me to be bold, and re-balance into 5-10% into these high-flyer tech companies with marginal profits and a ton of growth already priced in.

However, I just can't seem to convince myself that my money is worth it. Sure, NFLX, AMZN, FB, TSLA are pioneers. But according to their profit/loss sheets, their future potential is already priced in. At some point, won't the value of a company need to be reflected in the share price?

Ben Graham says to be wary of these types of stocks because it is very rare to buy a stock at a XXX PE level, then expect to make money as it descends to a 20x-ish PE level. I am trying to find historical examples of companies that have successfully done this, but am stumped. Thoughts/examples?

:EmoteClueless: