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Stockmarket tragedy

Discussion in 'The Pub' started by BruiserMadden, Jan 22, 2008.

  1. well ladies and gentleman, after yesterdays ~3% loss on the ASX, today a massive 7.8% drop was recorded on the all ords. I'm surprised there aren't more threads about this, doesn't anyone else invest money in stocks?

    This puts us down about 23% from the November highs, which is a MASSIVE drop. Investors are hurting, I'm hurting, mum and dad investors must be feeling it.

    The US stockmarket has 2 days of pent up sell orders to release tonight, so expect more meltdown pain tomorrow. If anyone's thinking of investing, in the next few weeks i think we will see a strong rebound and some awesome buying opportunities.

  2. Mate, the big players have been slowley selling stocks for the last 6 months and moving into gold and cash.

    This down turn was easily forseeable.
  3. i don't think this is a big suprise at all
    the big players have been selling for a long time- the investors have been trying to quell fears but have failed..

    i am ashamed to say that i am slightly delighted- the aussie dollar dropping is a blessing for those who invest foreign curriences here!
  4. It's certainly an "exciting" time on the markets.

    It seems that the fear of the US going into recession and the reality of big players making big decisions based on book value (as opposed to intrinsic value) seems to be hitting home.

    The hidden story for non institutional investors is that the reduction in book value is producing margin calls left right and centre (i.e., folks who negatively geared share investments have fallen below the minimum LVR), which means people are having to sell stocks to rebalance or get liquidity... which puts more downward pressure... so this little spiral is not over yet.

    For those that are able, upping your super a few hundred a month might pay big dividends down the track. :-k
  5. "wealth washing away"

    "$xxx,xxx,xxx.xx lost"


    Sounds awfully final.

    Can someone please correct me if I'm wrong here but:

    -Once bought, you own shares.
    -Their value is dynamic.
    -If you sell them for a higher price than what you bought them for, you've made a profit.
    -If you sell them below what you paid for them, you have made a loss.
    -It makes financial sense to simply hang on to them while their value is low in times of market downturn, and wait for them to return to their higher value before selling.
    -You're only really "screwed overnight" if the company you've invested in goes under and is liquidated.

    Is this not the case?
  6. I love clarity!
  7. Yep, you are correct. You only loose the money if you sell now (and if you bought in the last year). However, as robsalvv mentioned, a lot of people have been borrowing money to buy shares and are now having to sell them to cover the loan conditions (a margin call).

    IMO shares are a long term investment. Sure, you can buy and sell them day by day but in the long run they go up. I just wish I had a substantial amount of spare cash to take advantage of the situation...
  8. Oh, and you can also make money when the shares are going down by 'shorting' (which isn't legal but nutters get around it by 'borrowing shares')...
  9. I just hope this reduces the available liquidity so that houses become more affordable... did anyone see today's report that Australian major cities are the LEAST affordable places to buy a home in the world (compared to average incomes in those cities)?
  10. yes, commiserations to those that had to sell today.

    Gotta say though, this is a massive buying opportunity if you're a patient long term investor - fundamentally our economy is strong and the sell off is largely overdone...I'll be loading up on oversold solid shares as soon as the bounces comes...which could be as early as tomorrow afternoon...
  11. What actually happens is that the market moves INTO these investments. It happened the last time the market went down (.com crash) and will happen now.
  12. Why do I believe you? I think I'm getting pessimistic :roll: Can the market be any more into these investments than it is ... don't tell me, I don't want to know...
  13. Well I lost 7.5K on when I sold my RAMS shares, could have lost it all the way it is going, I also have 2K in previous years losses.

    On my BHP, Macquarie Bank and Connect East shares I am down by 6k but am not worried as these are quality companies unlike RAMS.

    I am looking at making back my 9.5K loss so have been following the market for an entry point but have held off and will hold off tommorrow given Dow Jones Futures Index is down, but there are a lot of massively cheap shares going but they will go down lower at least for another day.
  14. Who the fcuk sells when a market drops? That's just DUMB.

    Regards, Andrew.
  15. Margin calls mate.
  16. I sold out prior to this drop to retrieve some money which I was going to use to buy other shares which had more upside. So far I have held off buying as the lower the stock goes the higher my gain when the market corrects itself, just trying to pick the bottom of the market to make my move.
  17. Look on the bright side Hotcam.

    As an ex-Pom, I can assure you that you really wouldn't want to live where the affordable houses are in the UK.
  18. Looks like there's a rally... that's the stock market for you.
  19. #19 Ktulu, Jan 23, 2008
    Last edited by a moderator: Jul 13, 2015
  20. As someone who's only exposure to the stock market is my superannuation, I feel that dips like this are great every now and again to wipe the smug smiles off the faces of the 'money for nothing' crowd who think that they are the next Rene Rivkin simply because they've only ever invested in a booming market.