Market Panic Selling Overdone - "Buy And Take No Prisoners"
The dividend discount value of the DJII is very close to its historic high. Earlier today it hit a record high when the 30 Year T bond rate fell to 2.75%
In the past this has proven to be the best time to buy.
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Tony Hayes CFA
Ashton Consultancy ...
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I will certainly let you know when I become a bull again, although about as many people will disagree as when I was bearish.
Are you bullish yet?
Regards
Tony
There is little fear in the market and not a single catalyst yet. Buying now is still buying on the way down. Wait until the correction is done.
Irrational fear has been in the equity market since Lehman. This accounts for the DJII PRICE remaining below its dividend discount VALUE since then. If there were no fear then the price would be in line with its value.
Unlike equities there is no fear in the bond market. If bonds are correctly priced then the DJII has a long way to move up to match its value of 30,000 and higher to 39,000 if the dividend payout ratio were to return to its historic level of 42%
I am aware of the risks if trying to catch a falling knife. However, the dividend discount value of the DJII is so high both on an historical basis and relative to price that it is worth the risk.
As there was no meaningful catalyst that sent the market down and with the 30 Year T bond rate hitting 2.75% on Wednesday while the price of the market was under 16,000 and falling I could not resist the opportunity of yelling "BUY" with value rocketing upward.
Tell me when you decide buy