Trying to buy ORB bonds via Selftrade with no luck
Decided to be brave (likely foolish) and top up a few of my small ORB holdings but can't get a quote out of Selftrade. I own 2,000 ICG3 5% 2023. Tried to buy another 2,000 at the offer price of 70p (so just a £1,400 trade) and no online quote available and when I routed it to the dealers seems nobody would sell at that price. Tried a few others with similar results. I also own some REITs and am having similar problems e.g. trying to buy 5,000 Empiric Student Property at the LSE offer price of 60p doesn't seem possible. Oh well, may be for the best . . . .
Comments
Markets top out when last buyer has brought in, and markets bottom out when last seller has sold out
So looks like we might be finally out of sellers here, don't be afraid to pay bit more to buy, it's still a great bargain
Universities lockdown would be a mistake as i explained here - https://fii.vanillacommunity.com/discussion/comment/4879/#Comment_4879
You don't buy too soon, everybody buys bit early or bit late because nobody can pick the exact bottom, the bottoms are finalised only in the retrospect
It's unnerving to see stocks down 33%, but you have to recognise stocks as a piece of future human potential which is now available at bargain prices, with the potential of 50% rally in short order as we saw in Q2 2009
The problem with Browne's Permanent Portfolio is that there is lot of inertia in there, you have to adjust % based on the existing paradigm, you have to maintain enough cash or cash equivalent so that you can ride out a rough decade in stocks, long govvies are anywhere from 0 to 2% yield, that's really tiny compared to 7% earnings yield in stocks, while gold yields negative and is completely unproductive, don't get me wrong, gold is everything to everyone, it's perfect for speculation, just like the useless bitcoin
so if you have a lot of gold and govvies, you are going to miss out on all the upside from holding stocks instead, which is what buffett avoids diligently, in the past decade, stocks were the only game in the town, all of the rest, cash, gold and govvies were left in the dust
You have to balance out the planned performance with the adaptive performance, the pain u feel is the emotional and financial pressure which decreases your adaptive performance, instead focus on play, purpose and potential -
This is the reason you have to balance out the planned performance with the adaptive performance, like Tyson would say - everybody has a plan until they get punched in the face
When it comes to investments, people lose more money on losing positions than they make on winning positions - Imagine a wager. You have two choices. Choice A, we flip a coin. Heads, you win $1,000, and tails, you win nothing. Choice B, we flip a coin, but heads or tails, you win $450. Which would you choose? Over many flips, say 100, choice A makes sense. If you get heads half the time, you'd make $50,000. The more heads you get, the more you make. With B, the most you can make is $45,000. Human psychology suggests most people choose B, because the guarantee is perfectly acceptable. Let's flip the wager and run it as a loss. Choice A, heads you owe $1,000, and tails, you owe $0. Choice B, you owe $450 regardless of heads or tails. Again, psychology suggests the majority of people pick A every time. People avoid risk when it comes to a potential profit but accept risk to avoid a guaranteed loss. We take more pain from loss than pleasure from gain.
This is why they say it's so hard to cut your losses and run your profits, which is central to having an outperformance on your investments.
Most people wouldn't be able to navigate personal investments because of lack of understanding or application of the above ideas, it's no different in other fields like medicine, i would depend on health specialists to help on the health strategy, just going to google and figuring out yourself is a recipe for disaster at some point in the future.
Most people don't have your personal experience of the the various ups and downs since the mid 90s. They also don't have time for a lot of investment reading. So their plan ends up being a flawed one, that has too much inertia, which then kills their adaptive performance
Pls stop buying excessive toilet paper and long life food, the production of these haven't gone up in the last month, so if you buy too much of those, it means when i run out, i have to go queue at 5am outside some large Tesco to buy some toilet paper, because i, definitely am not going to add to the panic by hoarding, So when you reduce your emotional and financial pressure by hoarding, you are increasing mine by leaving less on the aisle. We shouldn't be having zero sum performance, we should instead be working with each other to increase both our performance and potential.
Long Govvies at 0-2% yield, pale in comparison to Stocks with 7% earnings yield. I can also see the recency bias in the view that bonds did well the last decade. What puzzles me here is why the massive outperformance of stocks is not being considered here instead. Yes, S&P500 now had 33% drawdown, but this was the same case in 1987 with 36% drawdown and the secular bull continued to run for another 13 years producing a massive 607% returns over that period.
10Y Gilt Yields topped out in Feb 2010 at 4.27% and yes the general consensus since then has been that there is limited upside in bonds. But just because the consensus was wrong before doesn't mean that Gilts at 0.55% yields are still likely to be better choice than US Stocks with 7% earning yield over the coming decade.
Index Linked have done even better because they had really low inflation expectations to begin with and with the secular GBP declines, this clearly hasn't been the case - https://tradingeconomics.com/united-kingdom/inflation-cpi
Inflation Linked Gilts performance is quite correlated with Regular Gilts due to underlying driver of real growth expectations overwhelming any movements in the inflation expectations. Stocks are much better for cases of higher future inflation expectations. This is because growth and inflation are usually correlated apart from Stagflation. And thus higher gilt yields would cancel out any uptick from higher inflation expectations, thus Inflation Linked Gilts are going to easily lag stocks in growing inflationary environment.
Property is another obsession in UK i haven't got my head around. You take on a lot of debt/mortgage, put on unnecessary emotional and financial pressure on yourself and then wonder why your adaptive performance have gone down. Instead you can easily rent, keep your balance sheet free to take on some other new ideas, maintain your flexibility to break your inertia and thus increase your adaptive performance