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Thread: So which stocks will be positively affected after Covid-19 ?

  1. #16
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    FYI:Schwab has closed their physical locations. So you have to call or do it all online.
    I believe the math of individual trading has changed now that big outfits, like Schwab, offer no fee stock trades.
    There is not really any cost to do day trading with no commissions to pay. I sold over 9,000$ worth of stock several months ago before all this started. Total fees were 17 cents. Not exactly sure why it cost so much?
    I have sold most of my stocks and ETF's so sitting on the sidelines waiting. It gives me a weird perspective. I want the market to go up so I get back in a see my stocks go up but... I feel good when it goes down because that means I did the right thing by cashing out.
    Bil lD
    Last edited by Bill Dufour; 04-01-2020 at 5:23 PM.

  2. #17
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    Quote Originally Posted by Aaron Rosenthal View Post
    Julian, I’m not exactly sure of your credentials in the financial advisory area, but there are many very smart investors here (and I’m not including myself) who pick individual stocks/bonds etc. who regularly beat the overall averages, without the “benefit” of mutual fund managers and highly commissioned sales persons.
    Aaron, yes I'm sure there are many savvy stock investors here who are quite successful picking winner stocks and bonds. But I think in terms of the average everyday investors who would not have the time or interest to adequately analyze the financials of 10-12 companies each week, hoping to pick a portfolio of winners. I'm afraid the average investor buys stock on the recommendation of Marketwatch, Jim Cramer, etc. with no personal research into the companies he is buying. This is akin to picking your winners off the tip sheet at the racetrack. Instead of having an investment strategy it more like gambling. Certainly folks can successfully use different investing strategies. There are many investors who have been successful with the mutual fund strategy that I have suggested. Perhaps you have heard of Jack Bogle, founder of Vanguard, second largest investment company in the US. True to Vanguard investing, I have never used a "highly" commissioned sales person and only invest in low cost index funds. I have no financial credentials to give advice, my thoughts are given freely and in the spirit of sharing my investing experiences with this community. I have been investing for over 40 years and spent early years chasing the hot stocks and the hot mutual funds. Sometimes successful but many times taking a bath. My wife and I have never been high income earners but I'm very satisfied with the nice portfolio we have accumulated over years by investing a proper asset allocation in stock and bond mutual funds. My days of chasing the hot stocks are over. I learned early I was not smart enough, nor had the time to pick and follow them. My challenge was not so much when to buy a company's beaten down stock but at what point do you sell. I sleep much better not making constant buy and sell decisions.

    Addeum: My thoughts are only shared in the view of long term investing, 5 years or more. If you are a day trader, short term less than a year investor, God bless you, that is a totally different ballgame more akin to the racetrack strategy. My best wishes for your success.
    Last edited by julian abram; 04-02-2020 at 6:33 PM.

  3. #18
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    There are some incredible bargains to be had right now, if you can stomach the uncertainty. Boeing, and all airlines. Coca-cola is another. Microsoft. All oil producers. These are all industries / companies that will come back after the dust settles. Does anyone actually thing air travel is a thing of the past? Who's going to build the planes?

    For my 401K/retirement accounts, I do as Julian suggests and invest in low cost Vanguard index funds. I also invest in stocks a bit with a cash account that is separate from my nest egg money. I do not chase stocks though, and focus of solid companies that make good product that I personally have faith in, and I buy long too. But for this once in a lifetime event, there are true opportunities to be had - but only if you have the cash, and it won't kill you to loose it all.

  4. #19
    Quote Originally Posted by Michael Drew View Post
    There are some incredible bargains to be had right now, if you can stomach the uncertainty. Boeing, and all airlines. Coca-cola is another. Microsoft. All oil producers. These are all industries / companies that will come back after the dust settles. Does anyone actually thing air travel is a thing of the past? Who's going to build the planes?
    I think the concern with some companies, especially the airlines, is what would happen to the stockholders if they ultimately end up going through bankruptcy. This is what happened to GM in 2009, and yes, the Federal Government took an equity stake, but only in the reorganized GM. Anyone who bought GM on the dip in 2008 thinking we will always need cars ultimately lost everything. There's a case that something similar could happen with the airlines, and it's very possible with Boeing too. Then again maybe it won't happen.

    Yes, for companies that are strong enough to survive no matter what, like Microsoft, Apple, and others with bulletproof balance sheets, bankruptcy is much more remote possibility.

    At least the broad index funds spread the money across the entire fund class, so there is diversification risk. But buyer beware that even the bargains have risk.
    Edwin

  5. #20
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    I have no problem with folks using 5-10% of their portofilo playing with individual stocks. Heck, with the proper mind set it is fun and entertaining as long as you are not playing with rent and grocery money. There are some tremdous bargins out there right now in several sectors. Yeah, it's tempting even for me as a strict mutual fund investor. I think the challenge in picking is knowing how long this economy will be shut down. No body knows. Some of these companies that are soild and great bargins in a 3 month shut down but will be bankrupt if it turns into a 6-9 month shutdown. If you play the game you just have to roll dice because we cannot print enough money to save them all.
    I've always had mixed feelings about the government stepping into the private sector saving companies. I remember years ago when we saved Harley Davidson and then Chrylser. Was that really necessary? More recently we saved GM. Now Boeing and perhaps some airlines. Althought I do think we have a national security interest with Boeing & airlines remaining solvent.
    I'm beginning to question the security of many bond funds that I have considered "safe" over the years. Many of these funds hold 40-50% corporate bonds with many of the holdings rated BBB. If this economy shutdown continues for more the 2-3 months, many corporate bond holdings will be downgraded to junk ratings.
    There is a lot of upside opportunity in this market but along with it comes a lot of landmines as well. Be safe.
    Last edited by julian abram; 04-05-2020 at 2:58 PM.

  6. #21
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    Quote Originally Posted by dennis thompson View Post
    So does anyone think there will be some stocks positively affected by Covid-19?
    Two come to mind:
    -Zoom- which is a teleconferencing application currently used by many
    -Teladoc-which is a medical application used to examine and talk to patients remotely
    Both are pretty popular right now but will they continue to be popular after Covid-19?
    I know, I know, stick with index funds/ETFs, but this is much more interesting, if not more profitable.
    Thoughts/suggestions?
    So when I started this thread I mentioned that two stocks I thought would do well were Zoom, it's down 15% and Teladoc, it's down 3%. So clearly if you want to make money in the market all you have to do is sell my recommendations short☺
    Dennis

  7. #22
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    Dennis, Zoom was zooming...and then there were the concerns about security in certain scenarios. Folks and organizations whose needs require greater security for their meetings are now migrating to other platforms now that the rush to "do something" has calmed down. It's not surprising to me at all and it's likely this would have happened anyway as companies found that their actual needs were better served by other specific products that are more tailored but maybe required more lead time to get involved with. I bet some of the companies and government agencies that were dragging their feet on full adoption of the solutions I was selling prior to retirement were kicking themselves recently. They were taking their time because they felt their people wouldn't or couldn't adapt to the virtual environment. Clearly they were wrong!

    I don't know much about Teledoc. I do know that the medical practice I work with is using FaceTime for consultation for any patient that has Apple ecosystem. It costs them nothing to do so other than having a few practice-owned devices available. My PA said that certain aspects of HIPAA had to be relaxed for regular medical practices to use video for patient consultation. The limitation for Telemedicine is at the far endpoint...what does the client have available for both the physical endpoint and for connectivity. Much of the US does not have the Internet infrastructure to actually support even simple video...
    --

    The most expensive tool is the one you buy "cheaply" and often...

  8. #23
    Quote Originally Posted by Jim Becker View Post

    I don't know much about Teledoc. I do know that the medical practice I work with is using FaceTime for consultation for any patient that has Apple ecosystem. It costs them nothing to do so other than having a few practice-owned devices available. My PA said that certain aspects of HIPAA had to be relaxed for regular medical practices to use video for patient consultation. The limitation for Telemedicine is at the far endpoint...what does the client have available for both the physical endpoint and for connectivity. Much of the US does not have the Internet infrastructure to actually support even simple video...
    Hi Jim,
    Teledoc isn't a communication platform like FaceTime or Zoom that would be vended to providers like your doctor. Teledoc is the service provider, with a national footprint. Mostly doctors and extenders (PA and FNP) I think. I think it's a fairly extensive subcontracted network of providers they have assembled. The void they're trying to fill is the need in the middle of the night, weekend, when you're doc is not available or you can't get an appointment. Some of the large insurers use them as a network provider and even push patients toward them by reducing copays because the cost to the plan is usually less. There are pros and cons. If a person prefers the small town high touch experience of the doc or office they've always known, maybe telemedicine is not a fit, but for those folks looking to solve a routine problem, like needing a scrip for a sinus infection or something like that.

    As to the connectivity limitations, I couldn't say if that's a limiter. Not sure if the video occurs through their app, like WhatsApp can do. If they haven't figured that out, then I'd say Teledoc has problems. I would hope they've also solved HIPAA compliance. I've never used them as a patient, but I notice they've gotten some prime time mention at the WH press conferences where telemedicine has been brought up.

  9. #24
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    They may still benefit here, Edwin, since Insurance carriers are quickly becoming more flexible about using Telemedicine, which historically has a higher cost than "regular" providers. Patients, however, will have to be comfortable with using a different provider if they use, say...Teledoc...rather than their normal PCP. It's not just about technology...it's about relationships. If I have a choice between my PA, Dan, using FaceTime or phone or using Teledoc...I'm going to pick Dan every time because he knows me and more importantly, I know him.
    --

    The most expensive tool is the one you buy "cheaply" and often...

  10. #25
    Quote Originally Posted by Jim Becker View Post
    They may still benefit here, Edwin, since Insurance carriers are quickly becoming more flexible about using Telemedicine, which historically has a higher cost than "regular" providers. Patients, however, will have to be comfortable with using a different provider if they use, say...Teledoc...rather than their normal PCP. It's not just about technology...it's about relationships. If I have a choice between my PA, Dan, using FaceTime or phone or using Teledoc...I'm going to pick Dan every time because he knows me and more importantly, I know him.
    I don't blame you one bit Jim, I'd probably pick Dan too.
    On a broader market basis though, what I think we'll start seeing is Telemedicine being a lower cost alternative because the docs don't have the office overhead. Most of their infrastructure is virtual. So they contract with the insurance company at a lower rate than Dan can. And then the insurance company will start "gently" influencing us over to Teledoc by designing the plan in such a way that our co-pays are lower or zero with Teledoc, or the coverage doesn't require meeting a deductible for full coverage.

    It's not a total substitution because there will always be times when we need to be seen physically by a doc, and there are times when the problem is more complicated than can be resolved remotely, but the theory is that a high % of needs can be met this way. I think there are also advantages to telemedicine for the elderly and disabled to not have to physically travel for care, not to mention inclement weather. And then there's the 24/7 access.
    It's like everything, there are advantages and disadvantages both ways, but I think we'll be seeing more and more telemedicine in the future.
    That is until machine learning and AI replace both Dan and Telemedicine!

  11. #26
    I picked Silver because the ETFs are more accessible than gold (SLV for example) and the silver to gold ratio is out of historical norm hugely in favor of a silver increase.

    Precious metals are no brainer in a real crisis because they have ability to resist both inflation and deflation (the two hobgoblins of disaster economies). What is going on right now is so interesting because the US seems like the 3rd economy hit with this and we may be the first open market to recover. Later this summer its entirely possible that the US economy will fly up while the rest of the world gets hit hard (or is near the apogee of thier curves). The Chinese economy is recovering first, of course, but China is mind-field for outside investment because of the government there. I would not be surprised to see the US go from the worst to the best markets in a few weeks time.

    If you are OK investing global I have some love for Japanese stocks right now. The Japanese just masked up and continued business as usual.

    I know that investing in precious metals seems very old-school to some of you. But I submit that this last week I:

    1. Went to town only once for supplies and groceries.
    2. Planted a garden.
    3. Cooked a lot of my grandmother's depression era recipes.

    So I may be turning into my grandparents after all. They DID survive the great depression and somehow raise families while doing it.

  12. #27
    Quote Originally Posted by Devon Prescott View Post
    I picked Silver because the ETFs are more accessible than gold (SLV for example) and the silver to gold ratio is out of historical norm hugely in favor of a silver increase.

    Precious metals are no brainer in a real crisis because they have ability to resist both inflation and deflation (the two hobgoblins of disaster economies).
    Quick question for you - I get why precious metals would be good to hold in a period of inflation, but how do you figure precious metals will resist deflation?

    After all, in a deflationary environment, dollars are becoming more valuable in real terms (opposite of inflation), and since precious metals are denominated in dollars, usually they would be suffering a value decline relatively speaking. I would think bonds would be the better asset class to hold in a deflation because the dollars you receive in coupon payments are increasing in value hence yield should decline to reflect this. At the moment we're seeing historic yield decline.

  13. #28
    I don't have a quick answer.

    Deflation in a laboratory would hurt gold and silver where there is an infinite supply of money. In the real world, at least in my investing lifetime periods of deflation have been accompanied by shortage of 'available money' - sometimes in a big way. In this environment metals (gold more so than silver) seem to hold value well - its not going to set the world on fire but it has proved to do well for me. In the great recession (when everything seemed to be down like now) gold dipped but rallied well ahead of the general market. This was not a great performance overall in a recession. Silver was being manipulated that whole time (we now know) by a few odd characters some of whom have come under legal penalty for crimes.

    However, in a disaster of global proportions (like today) I will bet on the precious metals any time. They have intrinsic value as a physical item (more than I can say for some of the stock certificates I have paid good money for). In Disaster Deflation the value of a metal that can be held will likely offset deflationary trends - a fund with an "association" to the metal is an easy way to trade without taking pallets of bars into your warehouse. This is my hypothesis and I hope it never gets tested.

    I define the difference between a Disaster and Recession as follows: In a Rescission people wonder if they will have a job next month, in a Disaster people wonder if they will eat tomorrow. Silver and Gold should go down in a recession but not down as much and they should come up faster at the end. Its a place to hide money in a world where bonds have proven to be less than ideal. In big growth markets you can't beat dividend producing stocks. This summer I plan to exit metal and buy those on they way up.

    Two barometers that I have used for years on silver are:
    A. The spot price of a metal vs the on-the-street price. More than a few dollars difference and you need to pay attention. At $15.30 USD Silver today I can't buy a coin for $20. I don't think I could buy a quantity for $23, in fact. This tells me something fishy is going on with silver. That spot price is junk in my book (I'm not saying fraud, but in Oklahoma the REAL value of horse is what you can sell it for today). I think the spot price will creep up to the street price or vise versa.
    B. The ratio of Silver to Gold. Governments used to set this ratio (15:1 or thereabouts) now the market decides. 50:1 is what I think of a mean. At 5:1 I would look at the price of Gold to buy it. At 100:1 I would look at the price of Silver to buy it. I think this ratio is over 112:1 right now.

    I think a lot of poorly written trading algorithms dumped a lot of silver at $11 last month because they were never coded for a full-on Depression (what coder was alive in the 1920s?). So a lot of people now want to buy that back - silver is a great hedge against inflation and with the US government printing money and giving it to everyone inflation is likely to occur in a big way in the days ahead. I see the high street price plus the pandemic as good indicators that silver has real value. Add in all the mines getting shut down right now due to outbreak and logistic challenges.

    I think silver is up over %10 since I suggested it and I am assuming that it has another %10 to go.

  14. #29
    Quote Originally Posted by Edwin Santos View Post
    I would think bonds would be the better asset class to hold in a deflation because the dollars you receive in coupon payments are increasing in value hence yield should decline to reflect this. At the moment we're seeing historic yield decline.
    Bonds are EXACTLY what I was taught to use in deflation - you are spot on. But I simply don't (or almost never do) use them. I got my eyebrows burned on bonds many years ago and I diverged from the conservative investing cannon afterward. I find the liquidity of cash too temping and the metals ETFs let me get in and out quickly (not multiple times a day, but weekly).
    Last edited by Devon Prescott; 04-07-2020 at 1:52 PM. Reason: two oos om too

  15. #30
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    I was on another website devoted to investing and much the same discussion was taking place: buy this, sell that, wait until the crisis is over, invest now there are bargains out there, use puts, use calls, all very confusing until it was all nicely summarized, until the crisis is over : " nobody knows nothin" and I include myself in the "nobody"
    Dennis

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