7 ms·

Dow plunges 900 points, Nasdaq suffers worst month since 2008

56 points by mgh2 5y ago

causality0 5y ago
I don't see why anyone is shocked. The Western world is at financial war, the bill from ten trillion dollars in stimulus spending is coming due, and 2022 is the median year at which the baby boomers retire.
- BuyMyBitcoins 5y ago
  For the past few years I had this feeling of unease that this wild market was finally going to end in a correction and yet it just kept bouncing back. I have no clue what to believe anymore but I still have the feeling something bad will come.
  - refurb 5y ago
    The US equities market has been on a non-stop tear (Covid dip excluded) since 2008. It’s up 300%. If you’ve been in the whole time the returns have been some of the best since the 1990’s.
  - chii 5y ago
    > I still have the feeling something bad will come. This feeling is what i'd call the risk of investing. And it never goes away in any period, because if it did go away, then the stock market would be under-valued and would be bought up to the price such that this feeling would return.
  - ricardobayes 5y ago
    A bird flu case found in a US prison might be more than just a bad feeling. Although, statistically it's very unlikely to have two pandemics in such short period of time.
rufus_foreman 5y ago
https://ei.marketwatch.com/Multimedia/2017/03/23/Photos/NS/MW-FI823_DowCor_20170323160402_NS.png?uuid=dc21ed9a-1003-11e7-9078-001cc448aede https://ei.marketwatch.com/Multimedia/2017/03/23/Photos/NS/M...
- engineer_22 5y ago
  Can you provide some context or analysis of this figure?
  - rufus_foreman 5y ago
    Context: this is a logarithmic chart of the Dow Jones Industrial Average, which is a (poorly designed) stock market index over 120 years, along with indicators of major events that had happened during that period. Many of those events being terrible and horrifying events that affected stock market returns. "Pearl Harbor - Attacked by Japanese" or "Terrorist Attack on World Trade Center & Pentagon", that can't be good for stocks, right? Analysis: If you're a long term investor, don't pay attention to headlines like "Dow plunges 900 points" unless you (like me) enjoy doom porn. If you are a young person contributing money on a regular basis to investments in equities, you can just ignore this stuff.
    - netfortius 5y ago
      There is and always will be this qualifying "if you are a young person" criteria for "don't pay attention". Unfortunately there are some who fall into the "down" period right during retirement, which may lead to disastrous consequences. Also unfortunately, the US (at least), whose retirement strategy is based on market investments (IRAs, 401Ks, etc.), combined with the high risk of health issues having the potential to have a large financial impact, and no other means for support of specific categories, has no mechanisms for adjustments / no social safety net. Moral: if [still] in the US, make sure you stay young for ever ;-)
      - viraptor 5y ago
        The recommended way to deal with that (by financial advisors I talked to / read) is that you start with the "risk/aggressive" slider all the way to the right and then move it back as you get closer to the retirement age. In practice that means that on the extreme end I'm 80-90% in shares, but 5 years to retirement I may be 50% in cash / bonds / something else stable. (I don't know if you can do the same in the US, but I would expect something similar exists)
slaw 5y ago
Nasdaq-100 is 27.51% over one year ago.
- nightski 5y ago
  That doesn’t seem to be the case. According to the source below it’s down 7%. What am i missing. [1] https://www.cnbc.com/quotes/.NDX?qsearchterm=nasdaq https://www.cnbc.com/quotes/.NDX?qsearchterm=nasdaq
  - woozymans 5y ago
    you’re not missing anything. slaw has called this one wrong
  - deleted 5y ago
    [deleted]
- DougMellon 5y ago
  I believe you are looking at the one year average annual return [0] which is 27.51% [1]. The Nasdaq-100 is down 22.10% YTD [3]. [0] https://www.investopedia.com/terms/a/aar.asp https://www.investopedia.com/terms/a/aar.asp [1] https://www.nasdaq.com/market-activity/total-returns https://www.nasdaq.com/market-activity/total-returns [3] https://www.slickcharts.com/nasdaq100/returns https://www.slickcharts.com/nasdaq100/returns
  - Thorrez 5y ago
    How are these numbers calculated? It doesn't make sense to me. There are apparently 2 different indices NDX: NASDAQ 100 Index 2021-04-27 13960 2021-04-28 13902 2021-04-29 13970 2022-04-28 13456 2022-04-29 12854 https://finance.yahoo.com/quote/%5ENDX/chart https://finance.yahoo.com/quote/%5ENDX/chart XNDX: NASDAQ-100 Total Return 2021-04-27 16360 2021-04-28 16291 2021-04-29 16372 2022-04-28 15880 (matches your [1]) 2022-04-29 15170 https://www.barchart.com/stocks/quotes/$XNDX/interactive-chart https://www.barchart.com/stocks/quotes/$XNDX/interactive-cha... I can't figure out what the difference is between them. QQQ is a fund that tracks one of them, but I don't know which. It apparently all 3 match very closely: https://seekingalpha.com/symbol/XNDX/charting?compare=XNDX,QQQ,NDX&interval=1Y https://seekingalpha.com/symbol/XNDX/charting?compare=XNDX,Q... QQQ's "1-Year Daily Total Return" is -6.78% and its "1-Year" "Trailing Returns" "Monthly Total Returns" is 9.54%. How come those numbers are so different? Shouldn't they be essentially the same? These other sites say QQQ's "1 Year Return" is -2.78%. https://www.bloomberg.com/quote/QQQ:US https://www.bloomberg.com/quote/QQQ:US https://etfdb.com/etf/QQQ/#performance https://etfdb.com/etf/QQQ/#performance I don't understand any of these numbers. How can this stuff be so contradictory?
pkrumins 5y ago
dt3ft 5y ago
Stay the course.
- d4rkp4ttern 5y ago
  HODL
dangerwill 5y ago
I know this is how it goes but I truly had the best possible timing of starting investing (outside of 401ks) for the first time ...
- chii 5y ago
  it's much better for the markets to be down when you start, than when you end your investing journey.
- sph 5y ago
  Looking for the best time to start investing sets you up for failure, time in the market is more important than when you enter the market. And buying when markets are low is how you make profit.
- Tyresian 5y ago
  Over at Bogelheads they always like to post articles like this (time in the market is better than timing the market) which should make you feel better. https://www.personalfinanceclub.com/how-to-perfectly-time-the-market/ https://www.personalfinanceclub.com/how-to-perfectly-time-th...
  - ricardobayes 5y ago
    That's generally true, however the yields generally come from short-term rallies that don't correct themselves. So if someone misses such an event it can be a really long time to recover from it. I think I could possibly show you a 20 year period in the past 100 years of US stock market without significant gains.
d4rkp4ttern 5y ago
I can’t figure out why headlines still scream about the NUMBER of points the Dow (or other index) has plunged, when the percentage drop is more relevant. A plunge of 900 pts when the Dow is at 32K is not as bad as the same plunge when Dow is at 10K. Oh wait, I just realized why they do this — something called clickbait.

56 points by mgh2 5y ago

I don't see why anyone is shocked. The Western world is at financial war, the bill from ten trillion dollars in stimulus spending is coming due, and 2022 is the median year at which the baby boomers retire.

BuyMyBitcoins 5y ago
For the past few years I had this feeling of unease that this wild market was finally going to end in a correction and yet it just kept bouncing back. I have no clue what to believe anymore but I still have the feeling something bad will come.
- refurb 5y ago
  The US equities market has been on a non-stop tear (Covid dip excluded) since 2008. It’s up 300%. If you’ve been in the whole time the returns have been some of the best since the 1990’s.
- chii 5y ago
  > I still have the feeling something bad will come. This feeling is what i'd call the risk of investing. And it never goes away in any period, because if it did go away, then the stock market would be under-valued and would be bought up to the price such that this feeling would return.
- ricardobayes 5y ago
  A bird flu case found in a US prison might be more than just a bad feeling. Although, statistically it's very unlikely to have two pandemics in such short period of time.

rufus_foreman 5y ago

https://ei.marketwatch.com/Multimedia/2017/03/23/Photos/NS/MW-FI823_DowCor_20170323160402_NS.png?uuid=dc21ed9a-1003-11e7-9078-001cc448aede https://ei.marketwatch.com/Multimedia/2017/03/23/Photos/NS/M...

engineer_22 5y ago
Can you provide some context or analysis of this figure?
- rufus_foreman 5y ago
  Context: this is a logarithmic chart of the Dow Jones Industrial Average, which is a (poorly designed) stock market index over 120 years, along with indicators of major events that had happened during that period. Many of those events being terrible and horrifying events that affected stock market returns. "Pearl Harbor - Attacked by Japanese" or "Terrorist Attack on World Trade Center & Pentagon", that can't be good for stocks, right? Analysis: If you're a long term investor, don't pay attention to headlines like "Dow plunges 900 points" unless you (like me) enjoy doom porn. If you are a young person contributing money on a regular basis to investments in equities, you can just ignore this stuff.
  - netfortius 5y ago
    There is and always will be this qualifying "if you are a young person" criteria for "don't pay attention". Unfortunately there are some who fall into the "down" period right during retirement, which may lead to disastrous consequences. Also unfortunately, the US (at least), whose retirement strategy is based on market investments (IRAs, 401Ks, etc.), combined with the high risk of health issues having the potential to have a large financial impact, and no other means for support of specific categories, has no mechanisms for adjustments / no social safety net. Moral: if [still] in the US, make sure you stay young for ever ;-)
    - viraptor 5y ago
      The recommended way to deal with that (by financial advisors I talked to / read) is that you start with the "risk/aggressive" slider all the way to the right and then move it back as you get closer to the retirement age. In practice that means that on the extreme end I'm 80-90% in shares, but 5 years to retirement I may be 50% in cash / bonds / something else stable. (I don't know if you can do the same in the US, but I would expect something similar exists)

slaw 5y ago

Nasdaq-100 is 27.51% over one year ago.

nightski 5y ago
That doesn’t seem to be the case. According to the source below it’s down 7%. What am i missing. [1] https://www.cnbc.com/quotes/.NDX?qsearchterm=nasdaq https://www.cnbc.com/quotes/.NDX?qsearchterm=nasdaq
- woozymans 5y ago
  you’re not missing anything. slaw has called this one wrong
- deleted 5y ago
  [deleted]
DougMellon 5y ago
I believe you are looking at the one year average annual return [0] which is 27.51% [1]. The Nasdaq-100 is down 22.10% YTD [3]. [0] https://www.investopedia.com/terms/a/aar.asp https://www.investopedia.com/terms/a/aar.asp [1] https://www.nasdaq.com/market-activity/total-returns https://www.nasdaq.com/market-activity/total-returns [3] https://www.slickcharts.com/nasdaq100/returns https://www.slickcharts.com/nasdaq100/returns
- Thorrez 5y ago
  How are these numbers calculated? It doesn't make sense to me. There are apparently 2 different indices NDX: NASDAQ 100 Index 2021-04-27 13960 2021-04-28 13902 2021-04-29 13970 2022-04-28 13456 2022-04-29 12854 https://finance.yahoo.com/quote/%5ENDX/chart https://finance.yahoo.com/quote/%5ENDX/chart XNDX: NASDAQ-100 Total Return 2021-04-27 16360 2021-04-28 16291 2021-04-29 16372 2022-04-28 15880 (matches your [1]) 2022-04-29 15170 https://www.barchart.com/stocks/quotes/$XNDX/interactive-chart https://www.barchart.com/stocks/quotes/$XNDX/interactive-cha... I can't figure out what the difference is between them. QQQ is a fund that tracks one of them, but I don't know which. It apparently all 3 match very closely: https://seekingalpha.com/symbol/XNDX/charting?compare=XNDX,QQQ,NDX&interval=1Y https://seekingalpha.com/symbol/XNDX/charting?compare=XNDX,Q... QQQ's "1-Year Daily Total Return" is -6.78% and its "1-Year" "Trailing Returns" "Monthly Total Returns" is 9.54%. How come those numbers are so different? Shouldn't they be essentially the same? These other sites say QQQ's "1 Year Return" is -2.78%. https://www.bloomberg.com/quote/QQQ:US https://www.bloomberg.com/quote/QQQ:US https://etfdb.com/etf/QQQ/#performance https://etfdb.com/etf/QQQ/#performance I don't understand any of these numbers. How can this stuff be so contradictory?

pkrumins 5y ago

dt3ft 5y ago

Stay the course.

d4rkp4ttern 5y ago
HODL

dangerwill 5y ago

I know this is how it goes but I truly had the best possible timing of starting investing (outside of 401ks) for the first time ...

chii 5y ago
it's much better for the markets to be down when you start, than when you end your investing journey.
sph 5y ago
Looking for the best time to start investing sets you up for failure, time in the market is more important than when you enter the market. And buying when markets are low is how you make profit.
Tyresian 5y ago
Over at Bogelheads they always like to post articles like this (time in the market is better than timing the market) which should make you feel better. https://www.personalfinanceclub.com/how-to-perfectly-time-the-market/ https://www.personalfinanceclub.com/how-to-perfectly-time-th...
- ricardobayes 5y ago
  That's generally true, however the yields generally come from short-term rallies that don't correct themselves. So if someone misses such an event it can be a really long time to recover from it. I think I could possibly show you a 20 year period in the past 100 years of US stock market without significant gains.

d4rkp4ttern 5y ago

I can’t figure out why headlines still scream about the NUMBER of points the Dow (or other index) has plunged, when the percentage drop is more relevant. A plunge of 900 pts when the Dow is at 32K is not as bad as the same plunge when Dow is at 10K. Oh wait, I just realized why they do this — something called clickbait.