Strong Eagle wrote:Gents (and Ladies, if you are out there)... I've been talking to a few people re investments and have heard many opinions, some completely 180 to others. Since I value the opinions of many on here, I toss out the following questions.
a) One fellow says that we are certain to have a major correction (aka 2008) in the stock market no later than July or maybe third quarter. Another person says, yes, there will be a correction but only 5 to 10 percent, and the market will be back past that by first quarter next year. Yet another says that so long as quantitative easing is in place, cheap money will keep stocks propped up. Which izzit in your esteemed opinions?
Did he say why he thinks that? Otherwise his opinion is worth no more than just that. I am reminded of an eloquent writer on the Fool/Property Markets forum, who had a fixation of the
property market being doomed. He was clearly of a mature age, and highly eloquent, and he continued as a possessed doomsayer on a daily basis for years, and years: Whilst the market continued (and still continues) steadily rising. He went very quiet one day, and was never heard of again. This same fellow chased Marconi (dot.com) stock down from c200p all the way to 5p, doubling-up all the way down...
My philosophy (per the similar/prev discussion in Janaury) is that no one knows what will happen, not you, or me, or the 'experts'. So the way through this is to have a strategy where what happens short/medium term simply doesn't matter..
http://forum.singaporeexpats.com/ftopic92941.html
You never followed-up on the above. Maybe you've set your mind on needing to be more 'risk-on'? Be careful, is my advice.
I prefer picking my own pretty intuitive bullet-proof portfolio, and saving on the fees that funds charge.
Strong Eagle wrote:c) Yet another suggested an "alternative investments" portfolio... a mutual fund like collection of commodities, real estate, precious metals, M&A arbitrage, listed private equity, managed futures, and covered calls. Whereas the traditional "financial advisor" recommends allocations only in stocks, bonds, and cash, the other guy recommends a significant percentage of assets to be invested in alternative investments via an ETF or mutual funds. Thoughts on this?
What are the competing rationales and strategies here? A whole bunch of that list would seem speculative (commodities, metals, M+A Arb, futures, options, covered calls etc etc). It is very high risk, even if you're an expert in all of those fields. If were you, 'Art of war', pick to fight your battles, on territory with which you are most familiar: Or prepare to fight with a handicap.
Strong Eagle wrote:d) The bonds that I hold right now (in a fund) are barely hovering at zero return. Seems like no matter which way the market moves, this fund isn't going to get any better... what's your view of bonds in these interesting times, taking into account quantitative easing, potential for another market crash, etc?
Many thanks.
Bond funds (IMHO) are for when you hit retirement, want to largely de-leverage risk, and instead have a steady and sure indexed income, and draw-down facility instead. Better yet, hold the bonds directly, rather than via some fee paying managed unit.
It's hard to say more without knowing your personal circumstances. If you have just a little time and inclination, it is not difficult to avoid stupid fund fees, and, beat the returns you'd get from a fund. But just one thought, since you're still in employment and young and fit enough to be gambolling around the back-roads of Indochina on a trail-bike, I have an impression that you might suit a more 'risk-on' strategy. Nothing mad at all, but perhaps something similar (as previously linked) to what I have, diversified blue-chip stocks + property.
