“Be greedy when others are fearful.” Is the mantra of Warren Buffet, and I’ve been trying to take advantage of stocks that I think might be undervalued during the turmoil in the market this year. Unfortunately, it’s been pretty tough, and I’ve grabbed a few falling knives: GE and YLO.UN are two that stick in my mind (aside from the banks, that is). Both were hit pretty hard this week to find new lows today. While I have plenty of each, I do still have my last bit of “dry powder” to double-down or dollar cost average into one. I liked each of them at the point where I bought them (GE at $32.50 and YLO.UN at $11.50), and don’t really see the potential return from either one being all that different today… nonetheless, I find it’s hard to feel brave and invest in much right now. I’m still rolling my dividends\/new money into the index funds, though unfortunately that happened at the beginning of this week rather than today. But other than that I find it very easy to second guess myself and very difficult to be greedy while others are fearful.<\/p>\n
I think it’s because I’m getting a different “vibe” from the market right now than I was from the sell-off in January\/February when I did much of my buying. It could be because I’m in PEI and not watching the news, but there doesn’t seem to be blood in the streets or the stench of fear in the air. Bear Sterns isn’t going under, there isn’t a panic that banking as we know it might be ended forever, which almost makes me wonder if the sell-off is for “real” reasons in the fundamentals or outlook rather than an emotional over-reaction. That of course makes me afraid of potential value-traps — especially since my previous “values” haven’t done so well in the last few months, which can really eat away at one’s confidence. <\/p>\n
However, as the interest rates drop, having some cash sitting in my high interest savings account looks like a poorer and poorer idea. While I do like having it there as an emergency fund and\/or car payment fund (which might be needed in <2 years, so shouldn’t really be in the stock market), the dividend yields of some companies looks very appealing to get paid to wait for a recovery in banks, or GE, or YLO…<\/p>\n
For now, I think I will continue to be patient and sit on my dry powder, and see if the market makes a new low beyond what was seen in March, and maybe buy then.<\/p>\n","protected":false},"excerpt":{"rendered":"
“Be greedy when others are fearful.” Is the mantra of Warren Buffet, and I’ve been trying to take advantage of stocks that I think might be undervalued during the turmoil in the market this year. Unfortunately, it’s been pretty tough, and I’ve grabbed a few falling knives: GE and YLO.UN are two that stick in […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16],"tags":[],"_links":{"self":[{"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/posts\/515"}],"collection":[{"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=515"}],"version-history":[{"count":0,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/posts\/515\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.holypotato.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=515"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=515"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=515"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}