Posted on 01/06/2022 10:27:42 AM PST by BenLurkin
The hedge fund community dumped tech stocks in the four sessions between Dec. 30 and Tuesday as interest rates spiked. The four-session tech unloading marked the biggest sale in dollar terms in more than 10 years, reaching a record since Goldman Sachs’ prime brokerage started tracking the data.
Tech stocks are seen as sensitive to rising yields because increased debt costs can hinder their growth and can make their future cash flows appear less valuable. The tech-heavy Nasdaq Composite has sold off more than 3% this week, underperforming the S&P 500, which dipped 1% during the same period.
(Excerpt) Read more at cnbc.com ...
They’ve been killing my portfolio. It is a bloodbath. It is across the board.
Buying up homes and land instead?
It is about time for an interest increase, cool this market down. It needs to fall 10K. I think the savings interest rate will go up too.
It can’t be across the board - I’m up substantially for the week.
Of course, for many months my stocks did nothing.
They’ll take it down a bit and then get back in at a lower price which will cause it to go up again - usually even more than it did before.
The market is a self correcting machine.
When prices get low all of a sudden the bargain hunters will come out of the woodwork and start buying hands over fist and drive the prices up. When prices are high people get cautious and take profits.
If you look at long term graphs of any indices all these “corrections” are just blips in an upward moving curve. If you’re a long term investor I wouldn’t worry about them.
Just human nature. The market is mostly about human psychology.
If you are buying and selling stocks based on theoretical predictions about how interest rates affect market multiples, you are a trader not an investor.
When I invest in a company, I first try to understand their underlying story; what is it about this company that gives them an edge or makes them a potential game-changer. If the story is compelling, I invest. As long as the story remains intact, I add to my position until I “get my price”.
If the price goes down and the story is still valid, I dollar cost average to lower my basis. The hardest part is finding a compelling story and not getting emotional when the “smart” crowd all turns against this or that sector. Patience and vigilance are the key to “getting your price”, not following the herd.
“Buying up homes and land instead?”
That would not be a smart move with prices of homes at ridiculous levels and with interest rates going up. Look for home prices to go down as interest rates increase.
NASDAQ is always described as the tech heavy NASDAQ. I don’t think I have ever heard a news broadcast mentioning NASDAQ without saying tech heavy first. “ the Dow is down 150 while the tech heavy NASDAQ is down 14. “ It’s almost like tech heavy NASDAQ is its name.
honestly, it’s about time. There’s a new interview with Jeffrey Gundlach on Yahoo Finance in which he discusses the 2022 outlook. He mentioned that the S&P500, without the FAANG companies included, would have about a 0% return over the last two-year period.
“It can’t be across the board - I’m up substantially for the week.”
I’m in some new spacs. CLOV, UWMC, SFT, VRM, LOTZ.
Let’s put it this way. LOTZ is selling at 1.15 it’s book value - in essence they value it with zero business prospects. It has beat earnings and revenue the last 2 quarters. It has $200 million in cash. They’ve gone from 8 hubs to 22 this year. And Q4 earning report will be another beat. That is an unbelievable amount of hedge fund hate.
APPL is just barely down from 52 week high so doesn’t seem to be hurting them. Waiting for a good opportunity to go back into tech myself.
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