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No. of Recommendations: 3
Extreme fear on fear/greed index.

A bad start to this week could unlock some bargains.

Holding ESTC...only buying on real dip back into 60s.

TTD...love them, but trying to be disciplined and let it come back to me sub-250 further down this year.

Roku - sub 100, interesting.

PINS - how long before millenials on reddit realize people avoiding public places like stores/malls may shop more online. Bodes well for amzn/pins. Etsy may get a boost but it is still niche items mostly imo.

NVEE - more of how i viewed T back in july 2019...value play w upside.

Got to try not to spend all cash right away...lets see how week unfolds.

I want to try and get in front of any Fed cuts that may boost market.

Dreamer
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No. of Recommendations: 2
Bought some nvee and pins.
I think they both were down gor non-virus reasons and then compounded with macro virus news. Could fall further, but like upside from these levels.

Bought more estc as swing trade when it hit near $69.
Just no sane reason stock should fall after that ER.

I heard robinhood had outage...

Virus news not done, so i will play all these by ear. Likely sell the new estc chunk once it recoups todays losses, to get cash back up to 20%+.

Dreamer
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No. of Recommendations: 2
Lvgo results looked good.
On the buy soon list now.

Livongo Reports Fourth Quarter and Full Year Financial Results https://seekingalpha.com/pr/17796783?source=ansh $LVGO

EVA: $284.5 million, up 84% from $154.5 million in 2018.

Hmmmm.
So they entered 2019 w estimated value of agreements or EVA of $154m. Actual 2019 revenue exceeded that w $171m.

So if they start 2020 w $284m in EVA, final 2020 revenues should be more?

Dreamer
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No. of Recommendations: 1
Now have giant eatc allocation.
Then nvee pins and lvgo as 8%ish positions.

Not giving up on estc...just tired of missing gains on other opps while waiting and i am hopeful timing is good w these three. I dont see negative impact from virus ro their bus models.
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No. of Recommendations: 3
ok...last post for a while. At least during working hours.
But since I just posted on LVGO and it tanked, I wanted to update:

Sold my NVEE (temporarily exiting) to sell my 10% gains and buy the LVGO dip.

Tomorrow, or later in the week, will plan on re-entering NVEE.

I just stubbornly try not to sell lots that are down...strategy is to wait for the bounce-back, then sell if I don't want that large of an allocation.

As far as accounts go:
taxable: about 80% ESTC, 20% LVGO now, and my hope is that those both ride for 2020 at this point, to carry over tax consequences another year and/or to get to long-term tax rates (Jan 2021 for ESTC, and now March for LVGO)
401k: good chunk of ESTC, but also PINS and LVGO. Likely swapping out the LVGO soon with NVEE, and plan to pare down ESTC over time as it rises (that's the friggin theory anyway!!!) and into stocks I deem to have better share-price prospects at that point in time.

Dreamer
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No. of Recommendations: 0
LVGO looks like a great choice.. thanks for sharing.
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No. of Recommendations: 3
welp...that timing sure sucked.

buying opp...only way to look at it.
LVGO and ESTC both had great ERs...no clue why the beatdown (belated somewhat too).

I get overall market down, but during trade war the growth stocks flourished, and I expect this will eventually be case again if/as virus continues punching macro markets in face.

lower interest rates, largely software, and mammoth growth rates...seems ideal.

But what the heck do I know, apparently the only thing that makes sense is that ZM should be worth 30-35b mkt cap, because they do video conferencing. Huh?

I guess I am crazy and the rest of the world is sane. Let's see how that plays out over time.

Will try and play musical chairs as stocks rebound, and leveraging remaining cash, to quickly get port back up over next couple of days. Not going to panic sell when something is down though, when the long-term looks bright.

Dreamer
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No. of Recommendations: 2
Dreamer,

I think the company that I have the highest confidence in is Zoom.

I bought a large position in the 60’s. Multiple lots there. But $120 was stretching credibility and seemed like Corona bubble. Out now, will enter again. Maybe ER gives some reality to market?

Curious. I also very recently added some LVGO. Surprised by reaction to exceptional earnings. Buying more. Seems a good company.

And I can’t figure out with ESTC. ER was great! And S&M expense growing at 43% compared to revenue growth of 60% seems very efficient. R&D and G&A grew pretty fast. But that doesn’t bother me to reinvest in the product and build the company into a larger enterprise. Those expenses will slow and if S&M to sales growth continues that way, should lead to a very profitable company. ESTC is a large position for me.

Darth
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No. of Recommendations: 2
Hey Darth!
I think you nailed how I view Zoom.
Highest confidence they will execute and do well, as a company.
Less confidence about their stock.

The company and stock can truly be two different things, of course.
How I feel about TTD a bit. Still love the company, but after stock went from about $50 to $300 from roughly May 2018 to Feb 2020, can the stock continue to appreciate faster than the business? Should it?

I like LVGO, ESTC, and even PINS at these levels. Sure we could get a huge uptick in virus-news and stock market likely a roller coaster for a while, but not sure how/why this would be all that different from Trade War angst in which high-growth stocks were also safer than traditional value.

Also looking at ROKU if they dip further, and not ruling out getting back into TTD at a later date if the price hasn't gotten away from me too much.

But DDOG and ZM...I just don't see the 12-month stock upside from these levels, and I know I may miss out on some momentum-based spurts, but so be it.

Last 3 years, most of gains were made over 2-3 of the 12 months...so while it doesn't feel great right now to only be up a little when others may be up a lot, I am ok with letting the market come to me at some point in 2020 with these stocks. It feels just like Jan 2018, when everyone was on fire with ANET or SQ or something, and I had an oversized and underperforming allocation of TTD doing jack squat. 2018 wound up working out pretty good, despite Dec drop. So I am hopeful my faith and napkin math gets rewarded at some point in 2020, too.

Was up 60% in 2019, so not like things have been bad. It is all relative, of course.


Dreamer
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No. of Recommendations: 2
LVGO
Their lockup release (45 Million shares) is on 3/11. Current float is 33 M shares. total shares is 94.5M. So, seems reasonable to expect a bumpy ride till say 3/18.

ESTC
Seems like a step child to DDOG. Lot of commentary that is too hard to use and only good for DIY. If true and this limits TAM then maybe a reason for the low multiple. But you would not conclude that with current growth.
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No. of Recommendations: 3
Much of Elastic R&D has gone into developing the SaaS offering. And the majority of that has been on making Kibana a simplified visualization tool. Check out Kibana Lens. Drag and drop UI for data visualization.

https://www.elastic.co/what-is/kibana-lens

Self managed may be viewed as a somewhat more intensive solution due to resource management mostly. But deploying on SaaS eliminates this. So the resources are automatically handled by Elastic. And you could have hundreds (or more)employees dragging and dropping and visualizing all manner of data via Kibana. And for the vast majority all they would have to do is access Kibana. And then one click to change among the views.

So yeah creating Elastic to spit out the best Uber driver to dispatch to you may be an engineering challenge, spinning up an instance to BI some data sitting in a server would be relatively easy. As easy as any other in the field at least.
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No. of Recommendations: 4
"Lot of commentary that is too hard to use"

agreed...a lot of commentary. or basically someone said it on sauls board and now everyone repeats it. exactly how many use DDOG or ESTC on these mssg boards? Guessing about as many that have configured an Arista switch or have implemented an EPP solution.


The fastest-growing segment of Elastic? Oh yeah, the below.

https://www.elastic.co/cloud/
From an easy-to-use hosted and managed Elasticsearch experience to powerful, out-of-the-box search solutions, Elastic Cloud is your springboard for seamlessly putting Elastic to work for you.


Dreamer
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No. of Recommendations: 3
Bob and weave...bob and weave...jab jab hook!

Crikey...this market is something else this week.
Closed yesterday at ATH, thanks largely to LVGO run.

Back down in dumps today.
Sold out of LVGO to play the dips.

Saw this scenario play out a couple times in the past two years with big market dips...I can only be creative for so long until I am out of cash buying all the dips, and then just stuck waiting for the eventual turnaround. Luckily (I hope) I view some of these stocks as being at very good price points, such as ESTC and PINS and even NVEE. LVGO holders may take profits as markets stay south...I think that is what you are seeing with ZM today.

ROKU at $100.
TTD dipped to $250s (would have to go lower for me to reenter though)
TLRA took a big hit, but just because they are in CTV space doesn't mean you can predict they have same success as TTD moving forward.

Bought more ESTC...about $5b mkt cap, and 13 TTM P/S. Crazy, compared to peers. Their forward P/S is what, 8-9 now?

Dreamer
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No. of Recommendations: 1
Bought more ESTC...about $5b mkt cap, and 13 TTM P/S. Crazy, compared to peers. Their forward P/S is what, 8-9 now?

Current P/S is 13.9 and EV/S is 13.1.
You pick your growth rate.
I have it at 55% for one year giving a forward EV/S at 8.5.

A.J.
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No. of Recommendations: 2
what a weird week.
Up Monday, down Tuesday, Up Wed, flat/up Thurs, dick punch friday.

Twice this week I was at ATH for port, from a monthly close perspective. Still haven't bested my July 26th 2019 ATH.

Still up for the year, but back down to single digits...blah.
ESTC will be my savior or albatross this year, it seems. I have time.

You have to wonder how many body blows the economy can take. The coronavirus is literally like a virus to the economy/markets, after having endured an 18+ month Trade War...just when we seemed over the Trade War, this happens.

Luckily we have high-alcohol-based medicine in form of the earlier tax breaks plus accomodating Fed.
Hard to believe it was just late 2018 when Fed had been raising rates bc economy was just too good for low rates. On side note, I was in process of refinancing...so...ha...my procrastination on that front is paying off. (it is the small victories in life that keep our spirits buoyed)

This I had a client avoid shaking hands. The hand sanitizer is out of stock at all the stores, IT conferences being cancelled and switched to virtual left and right. Even had a client tell me his HR is instructing no visitors to their offices unless they put in writing they haven't visited restricted countries and they haven't been sick, prior to showing up onsite. The you know what is getting real out there, and I am in the (relatively) virus-free midwest.

Since virus lives on surfaces, aren't my packages and mail all suspect...if the main handler at the sorting facility has the virus, think of the implications for spread. So it is a matter of when, not if, we likely get infected I think, and if we can just hold off infection long enough to reduce strain on the healthcare systems (vs us all being sick at once) and if we can get some medicine/vaccines that either combat getting infected in the first place or greatly reduces seriousness of the symptoms once we have it. One bright spot, for those under a certain age at least, is that the fatality rate seems very low for kids thru middle-aged folks. Have to watch out for the eldery...checking in on my parents this weekend to see if they at least have a strategy/plan and where their awareness level is at.

I just don't see how virus impacts asset-light software, or streaming/online-focused businesses, but in fear-infused moments like today, all stocks get punched hard.

I will wait for the bounceback. Saw the fear/greed index at 5 for Extreme Fear. Normally a good entry point for stocks. We will see!

Dreamer
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No. of Recommendations: 1
I just don't see how virus impacts asset-light software, or streaming/online-focused businesses, but in fear-infused moments like today, all stocks get punched hard.

On this I agree.

I will wait for the bounceback. Saw the fear/greed index at 5 for Extreme Fear. Normally a good entry point for stocks. We will see!

On this, I disagree.

Isn’t this index relatively new? What the hell would it have been in ‘08? 1999? 1929?

If today is a 5, 2008 had to be -50.
I don’t believe the index even goes negative.

A.J.
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Isn’t this index relatively new? What the hell would it have been in ‘08? 1999? 1929?

If today is a 5, 2008 had to be -50.
I don’t believe the index even goes negative.

---

I don't believe it can go negative. I meant more the sentiment that the collective market is "in extreme fear" represents (normally, in hindsight) a good buying opp.

I think it may have gotten to "2" or something in Dec 2018, which was the worst drop since great recession.

The VIX was at 2nd highest level for most of today's session, based on viewing chart at maximum today...surpassed everything but 2008 era. https://finance.yahoo.com/quote/%5EVIX?p=^VIX

Is this the absolute bottom? No...of course could get worse. But just from an acquisition floor I am ok with ESTC at these levels.

I am almost out of levers to pull anyway...so let's see how next week plays out.
My crappy crystal balls says we hear/see a lot about economic stimulus and/or Fed further cutting to offset the virus impact fears a bit.

When Dec 24 2018 hit, I was about 30% off highs for the year at that point. Right now, I am a little under 8% off my highs, so just feel better-positioned at this point, given all the broader market carnage.

From a Dow and S&P standpoint, we just hit a 2-year time machine..back to Jan 2018 levels. Nasdaq faring a bit better. I am up 136% during that period at the moment. So, perspective is all relative I guess.

Dreamer
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No. of Recommendations: 2
If today is a 5, 2008 had to be -50.
I don’t believe the index even goes negative.


Interesting question.

https://money.cnn.com/investing/about-fear-greed-tool/index....

When the S&P 500 (SPX) plummeted to a three-year low on Sept. 17, 2008 - the height of the financial crisis -- the Fear and Greed index sank to 12. The index gained some ground to 28 before stocks finally bottomed out on March 9, 2009 and the latest bull market began.
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No. of Recommendations: 2
When the S&P 500 (SPX) plummeted to a three-year low on Sept. 17, 2008 - the height of the financial crisis -- the Fear and Greed index sank to 12. The index gained some ground to 28 before stocks finally bottomed out on March 9, 2009 and the latest bull market began.

Right? How, at the depths of the financial crisis, was the index higher than Friday? A strange index to say the least. Do we need an index to tell us investors were selling in droves?

I think not.

AJ
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No. of Recommendations: 2
Right? How, at the depths of the financial crisis, was the index higher than Friday? A strange index to say the least. Do we need an index to tell us investors were selling in droves?

I think not.

AJ
----

We barely had smart phones and trading apps or proliferant social media then. Perhaps it is explainable just that the instantaneous nature of todays information/fud distribution has never been equalled previously.

I also feel that it is the same reason for quicker rebounds.

Dreamer
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No. of Recommendations: 2
We barely had smart phones and trading apps or proliferant social media then. Perhaps it is explainable just that the instantaneous nature of todays information/fud distribution has never been equalled previously.

Maybe. Honestly, I don’t know how the index is measured. But one would think it would be based on the reality of how bad the market is. Saying today’s fear is greater than the fear during the economic crisis just doesn’t make any sense at all. I’m assuming the index doesn’t take into account the speed with which information is disseminated. I’m assuming it has to do with actual market information/conditions. How can one say today’s market is experiencing more fear than that of the crisis? I mean, that just makes zero sense and the index if it is a real index should reflect that which it obviously doesn’t.

That’s it. It isn’t worth much more thought as the distinction isn’t actionable.

A.J.
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No. of Recommendations: 2
Right? How, at the depths of the financial crisis, was the index higher than Friday? A strange index to say the least. Do we need an index to tell us investors were selling in droves?

I think not.

AJ


We barely had smart phones and trading apps or proliferant social media then. Perhaps it is explainable just that the instantaneous nature of todays information/fud distribution has never been equalled previously.

I also feel that it is the same reason for quicker rebounds.

Dreamer


---------------------------

I think it's because we have seen a Fed that has made it it's mission to inflate assets for the last 10+ years ever since the 2008 housing crisis. Other Central Banks have done the same. As a result, (1) we've built up a ton of leverage in the debt markets (not just in mortgages this time) in the corporate and government debt sides. (2) We've also witnessed a ton of mal-investment in the system over this last decade, just look no further than "unicorns" like WeWork and UBER.

The result is that the whole global economic system is now so fragile that even a minor shock like coronavirus can have a dramatic impact on the entire system.

-Cap
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No. of Recommendations: 12
Most of us remember Dec 24 2018.
Like a lot of folks, I really enjoy the holidays...my kids are so excited, and I am for them, and it is just all around good food/times that just add to the previous years that have built up such fond nostalgia.

So there I am, looking at the 30% or so drop from my peak in 2018, and on 12/24 of all days (we open more presents on xmas eve out of tradition). I remember taking a really deep breath, and telling myself that I needed to let it go, and just enjoy the day.

I feel same today. Such a huge drop, off a huge Friday drop.
I had some extra cash for a rainy day...deposited into trading account and bought more.

And now walking away and going to go play video games, watch Oak Island and Better Call Saul. Workout (weather getting nicer). Play with my kids. Double down on work (make more money, regardless of market).

(takes breath)

Dreamer
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No. of Recommendations: 1
Tough couple of tradings days but I took a few nibbles today on ESTC, AYX, and OKTA.

This too shall pass.

CNL
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No. of Recommendations: 1
Today was ugly for those of us in high growth stocks. My portfolio dropped a record in both percentage and absolute dollar amount since the previous record drop back in, oh, let me think...last Friday!

I just retired the beginning of this year, planned on living off my investment returns, so how’s that working out for me? I lost more today than I used to make in a year at my job, but honestly I’m not worried, and I’m so much happier!

Don’t feel bad for me, it’s not all bad news. I had to roll my 401(k) over into my rollover IRA recently and it happened to be when my old company stock was at an all time high, so I have a lot of cash available to invest currently (at least 5 years worth of my old salary). And I’ve been doing it! I gained about a 40% cash position when I did the rollover, and over the last couple weeks, invested that probably down to what would’ve been about a 30% cash position, but with the large drops in my equity holdings over that time, the cash position is still at 40%!

So even though the last couple weeks have been painful, I think I’m in a good position and will continue to invest my cash position as long as there are good companies to buy. Hopefully the cash position lasts longer than this downturn.
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Don’t feel bad for me

Oh, I don't! :) Lucky you.

What more could you want? I mean, when you want to invest a lot of cash in the markets, would your rather it be at record highs, or record lows?

I know which one I would pick.

Dan
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No. of Recommendations: 9
ok...took oppty since so many down hard, to diversify a bit, as I have lost confidence that the market will recognize ESTC as underpriced in the short-term. Still like ESTC long-term for 2020.

Swizzled some stuff, ended up at 22% cash.
About 49% ESTC (ouch, yes, I know. See how I feel in Dec 2020.)
PINS 9% (feels like an easy bounceback at these levels)
NVEE 5%
ROKU 8%
crappy mandatory mutual fund 3%

something like that.

Thought long and hard about TTD, and while I expect a bounceback from $220s eventual, the upside may be limited in 2020, which was reason I sold out in the first place. If/had it gotten down to sub-200s, that may have changed my tune.

I bought ROKU as it has a rabid following and is churning out good numbers in a CTV space that was already positioned to grow, and with folks staying in more often next couple of months, I could see artificial subscriber boosts as a result. HBOMax launches soon too. Then Peacock at some point, and eventually the new Disney+ shows start rolling out, etc etc...

Down single digits YTD, which truly blows. About 19% off my ATH.

Man oh man...in hindsight, OF COURSE I SHOULD HAVE GONE TO CASH EARLIER!!! I hit ATH with approaching coronavirus...what a dolt. Literally a week ago at ATH...wow. Can't play that game though...but would have been nice to drop all that cash in a market collapse.

Moving forward, I expect ups and downs...initiatives announced, Fed actions, offset by higher infection numbers as tests roll out. Thus the 22% cash.

Feels like Jan 2019...diversified a bit, let the market come back to me, and if/as things settle in coming months, and focus returns to fundamentals, I can rebalance opportunistically.

On side note: remember how growth stocks peaked July 26 2019, and then all of a sudden the Value stocks became cool again? Most of those (T, NOC, CACI, DIS) have retraced all those 2H-19 gains or more. Reset button for everyone!

Dreamer
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No. of Recommendations: 3
Man oh man...in hindsight, OF COURSE I SHOULD HAVE GONE TO CASH EARLIER!!! I hit ATH with approaching coronavirus...what a dolt. Literally a week ago at ATH...wow. Can't play that game though...but would have been nice to drop all that cash in a market collapse.

I was fortunate enough to move to 60% cash two weeks ago but what was a 30% portfolio gain (ATH)this year is 12% after close today. My wife's port is in a 401k so no swapping in and out without delays and red tape. She is 55% BRK.B. Maybe that helps on the upswing but for now she is down about 14%. Average that with my small gain and we are negative in the single digits as well.

I'm struggling with when to start buying. Not seeing it yet. Fed Action, payroll cuts, create opportunities for floating the market short term. I don't think the pain is over by any means.

I have had two limit orders filled over the last two weeks. AMZN at $1900. AYX at $120. I don't think they have seen there lows yet.... Maybe nibble with some MDB after ER as I believe it will be a longer term hold.

Good luck -

cliff
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No. of Recommendations: 14
Sold the roku...it had most downside potential from 2019 runup. Will sit on cash for a while.

Ugly out there.
And while i believe we snap back hard at some point, there is so much more news to come out, and since trump downplayed this like an idiot instead of ripping off the bandaid, the fud appears to have a longer runway.

Stop electing idiots that care only about themselves.

Not a political post...just common sense.

Dreamer
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No. of Recommendations: 9
Sold the roku...it had most downside potential from 2019 runup. Will sit on cash for a while.

Ugly out there.
And while i believe we snap back hard at some point, there is so much more news to come out, and since trump downplayed this like an idiot instead of ripping off the bandaid, the fud appears to have a longer runway.


I know it is tempting, but to buy now you would have to have the blind faith to believe that the Federal government and Federal reserve will pull out all the stops to save the economy a la 2008. What people don't get is this is no longer about a simple recession issue, it has become a full-blown credit crisis. Many businesses, including S&P 500-listed companies, are having to draw on their lines of credit to keep the lights on because they don't have any cash or working capital available. I'm talking Boeing, cruise lines, airlines, hotel chains, oil companies, etc.

Unfortunately, due to artificially low rates for so long, companies have been encouraged to lever up and borrow money to buyback stock or otherwise try to grow operations even faster to satisfy Wall St and their shareholders. There are no rainy day funds out there and this is causing a strain on the financial system.

There is serious risk of major corporate defaults out there folks depending on how long the virus' impact continues. I don't mean to be an alarmist, but this is a huge problem and either governments and global central banks step in to provide liquidity and backstop the system similar to 2008, or we risk (yet another) catastrophic financial crisis.

I do believe our government and the Fed will step up because they literally have no choice, but it is still too soon to try to front-run them. Congressional action will be needed and they just now seem to have agreed to forego their vacation next week to stay in DC and work. I would continue to wait until we have the certainty that the authorities will act and act aggressively enough.

-Cap
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No. of Recommendations: 0
they just now seem to have agreed to forego their vacation next week to stay in DC and work.

--

How heroic of them...

:)

as for credit/bankruptcies...maybe retail/discretionary/event-related businesses. But software?

I expect some companies are hurt bad...just now sure the stronger growing software companies will be as affected. Maybe growth slows for a Q or two. Will be a while (ala NVDA/crypto) before we see results play out, I suppose.
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TTD near 180
ROKU near 72
NVEE has been demolished...P/E under 8.
PINS at 12
ESTC at 46

crazy...not calling a bottom, but man.

On TTD, we have seen this movie play out before, but growth was also a bit higher back then. This is below Fall of 2019 collapse and lowest since early Feb 2019. To retrace to where I sold in Jan at $265, would be about a 40% gain.

ESTC is jaw-dropping though. Starting to wonder what the market knows or why it is so hated, considering the hot/rich IPO and eventual climb to $100 in July 2019.

It could double and not hit the 2019 high. 50% gain gets you back to $69, which was, like 1 week ago.

Thinking...

Dreamer
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No. of Recommendations: 3
ok...new (sort of) strategy of still trading around a core.

I don't trust market or some of my favorite stocks that had big runups in 2019 (AYX, TTD, ROKU etc) and which may still have downside if people start going to cash in droves.

I am part of the problem as I went to about 50% cash, after the small ESTC bump today.

My assumption is volatility continues for a while.

Negative FUD news cycles:
Testing numbers of infected will rise dramatically
Businesses laying off workers / horror stories hitting news

Positive news cycles:
Things "getting better" in previous hotspots, which allows a predictable pattern/end to US situation.
Vaccine progress
Cure/medicine progress

If the latter two happen on the Positive News front, the market will explode, so I am hesitant to be out of the market as a result. On the flip-side, I believe those Negatives will continue, so I want to have some dry powder.

Plan: buy on big down days, probably closer to 1-2pm, fighting urge to buy the dip in the morning, when it may get much worse. Then sell on any pops and reset cash. Rinse/repeat until I believe we have really passed the Barrier of Uncertainty and Doom (BUD). I don't know what the end of BUD looks like...I think it is one of those "you will know it when you see it".

My goal is to still get positive returns this year, and beat the market. I dug myself a hole, but can't look back now...only forward.

Dreamer
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No. of Recommendations: 1
Ok...a bit of breathing room today felt nice.

Now...I need a big market downturn tomorrow for a fresh new buying opp.

Rinse/repeat, and like rise like a phoenix from the ashes!

(cheesy enough for ya?)

Dreamer
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No. of Recommendations: 3
a bit of a radical move for me today:

Because I had TTD long-term gain taken in early Jan, I took oppty to sell in taxable account my current losses to help offset that future tax hit a bit.

Then I am treating taxable account as more of a safety net personally...want to be careful not to be too risky there. (job seems stable, but these are crazy times, etc...)

I also want to give up fighting valuation, and realized I could leverage a "basket" approach of ESTC + DDOG. Will play/trade them off each other, if one moves at the expense of the other.

So in:
Taxable - I went all BRK-B...could go lower, but great cash position, and well-poised to get thru this crisis and/or buy some distressed assets. Just looking at the 2008 recession playbook, BRK did quite well out of that.

In 401k - stayed in ESTC, but added smaller DDOG to hedge against it.

In smaller spouse account, went with QYLD, to play dividends + QQQ appreciation. It is basically a covered call play.

So some conservative (for me) moves today, but based on how much market has fallen, I consider them all growth prospects.

Will pare if/as gains add up, and see if any favorites are still overly beaten down. Something like NVEE, if they emerge financially intact, could be good upside in a Phase Two approach to this stock market recovery.

Others I note, but wouldn't buy now, are: DIS, NOC, JPM, T. Those could be value plays with upside, but there could be more pain based on their business models tied to discretionary spending. (not going to parks, not paying your cell bills or feeling that HBOMax is too expensive to add).

For high-growth, AYX, TTD, Roku and others are of interest, but with advertising (TTD, Roku) likely to get wallopped, I wonder if waiting for next ER would make more sense...but if prices decline further, then I may change my tune. AYX is a smart move for companies, but not necessarily a need-to-have if/as they look to cut costs due to economy.

The tricky part is that most will have ok/decent Q1's, as most business was in the funnel before things really went to crap in early/mid-March. So guidance will be key...Q2's may be really low in April but perhaps if things progress well, May/June start to normalize. Question is: are these future discombobulated ERs already baked into current prices or not?

good luck all!
Dreamer
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I know there are boards dedicated to Berkshire and I don't frequent them so I haven't done my DD.

What convinced you BRK.B was a good buy? I happened to drop BRK.B a couple weeks ago, it was a tiny way <1% position that was just a vanity thing for my wife's account so I could say we had some of that.

I dropped after one morning woke up and wondered if it was a safety net or how many insurance / reinsurance claims will they have to pay? Like for example do they back conference cancellation insurance? Travel insurance? Life Insurance? Those will all have large amount of claims, followed by potentially huge drop in future business though life insurance may pick up after this passes and rates will go up.

Also aren't they big on airlines, rail lines, and other transport? I think US is headed for recession/depression with less travel, less transport.

That said I don't know what will go up that they have against what will go down. Also short term, next bailout bill may splash some cash in the direction of their companies so could be a boost. So could go either way.

I think I got out around $190. Yeah they'll be around in 3, 5, 10 years. May buy back in sometime but would need to hear a good pitch or watch them turn into falling knife which sometimes I'm a sucker for.
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No. of Recommendations: 2
I am in about $162.

Insurance: Geico and others seems mostly auto/home so unclear how much exposure they have related to bus ops or life insurance, etc...

Rail: I asked on Berk board, and mungofitch (who seems to know BRK very well) feels they have never been cheaper on price-to-book, and that from Rail perspective it is mostly cargo (so probably less of an impact).

They are sitting on a ton of cash, and much like in 2008-2009, you can imagine them swooping in on cheap shares or other capital deals to their advantage. I know Heinz (and all food supply companies) are getting short-term resurgence from the stay-at-home/hoarding purchases going on.

Not a question of whether their businesses actually take a hit, but rather that they can absorb the hit a lot easier than most, and perhaps the drop is overdone a bit at this point.

I looked at BRK last summer when I (correctly) felt saas/growth/cloud was overheating but I (incorrectly) failed to buy into "value" companies that became all the rage last Fall. I remember BRK was near ATH, and now are well off of it.

Probably just a short-term play for me...one that let's me sleep a bit easier. I can switch out once I feel the post-Covid plan is materializing and if a growth stock has more upside in my mind at that point, I can thank BRK for their time and effort and cash it in and reinvest elsewhere.

That is the plan...might be a crappy plan. Time will tell.

Dreamer
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No. of Recommendations: 1
Hey who knows how its going to play out but from a 2018 fool article:


However, people not too familiar with Berkshire are often surprised to learn that GEICO is a relatively small part of Berkshire's insurance business. The majority of its insurance business is reinsurance, which essentially means insurance for other insurance companies. For example, in order to avoid excessive losses due to a natural disaster, a property-casualty insurer might purchase a reinsurance policy that covers losses above a certain amount.

Reinsurance is not only a long-tail business, but Berkshire specializes in jumbo reinsurance policies that let it assume long-tail losses of other insurers. Its leading position in this type of insurance has allowed its float to grow tremendously over the years, and also lets the company maximize the returns from investing this money.


https://www.fool.com/investing/2018/03/08/why-warren-buffett...

So I think I recall reading this before and that was the cold sweat dream about the other insurers sticking Berkshire with their losses.

I think some good stock are underpriced now/recently (whould have gotten some ROKU, TDOC before the bounce). Maybe Berkshire is in the same oversold range but for me its in the 'too complicated' pile, not because it can't be figured out but more that I don't have time.
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No. of Recommendations: 4
Hi Dreamer.

I'm no BRK expert, and I really haven't paid much attention to what the Fool writes about them. As much as I respect Buffett and Munger, Value Line shows me what their top equity holdings are. If they were a mutual fund instead of Berkshire Hathaway, I would run for the hills. Therefore I don't invest in them and don't pay attention. I still feel as if I owe you a favor for pounding the table on The Trade Desk until I heard clearly. I hope you're very clear on what you own when you buy BRK. BRK may appear to be something that you want. But is the reality of what it is well-aligned with the thing you're seeking? Only you can know, but it may take some study to distinguish reality from perception.


Fool on!
Thanks, and best wishes,
TMFDatabaseBob (no positions in companies mentioned and VERY little overlap with BRK's top-ten holdings)
Maintenance Coverage Fool
See what a "Coverage Fool" does here: http://www.fool.com/community/community-team.aspx
See my holdings here: http://my.fool.com/profile/TMFDatabasebob/info.aspx
Peace on Earth

Please note: I am not a member of any newsletter team. My opinions are my own and do not necessarily reflect those of the TMF advisers. I am a Maintenance Coverage Fool (see the above link for details). I am not an investment professional, merely an investor.
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No. of Recommendations: 2
Rail perspective it is mostly cargo (so probably less of an impact)

If we are assuming there is going to be a recession, then Rail is going to be impacted.

much like in 2008-2009, you can imagine them swooping in on cheap shares or other capital deals to their advantage

Actually Buffett didn't make any significant purchase in 2008 crash. He got some preferred investments, sweet heart deals, but other than that he didn't make any meaningful purchase in that crash. He bought Apple almost 8 years after the crash.

The industrial's, utilities also will be impacted by recession. I am not convinced that we will make a V recovery.

The cash gives lots of optionality and needs to be seen what WEB does with it. Normal time valuations doesn't mean a think.

Situation is pretty fluid. You have no idea when this thing is going to be over. There are noises made on republican side to lift the lockdown and open up. We need to see how NYC does before we can understand how this thing can play out. Luckily the governor seems to be very level headed and stepping up big time. Today his press conference about doubling the bed capacity and converting two convention centers into make shift hospitals with 1000 bed is impressive. So far, he is able to make more progress than Federal government. Let us hope he succeeds and we bend the curve.

I am making small bets on buying calls, or such. I am holding on to my cash.
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No. of Recommendations: 1
The primary thing that has made me sleep better lately is 'cash' --FDIC insured as much as I can. I used to be like 2-3% cash, now maybe 50% in the funds I manage. Disclousure is I do have a lot in mutual funds, etc... Cannot get spouse to agree to do changes in the assets managed by our company 401ks or a couple IRAs with a financial planner.

The world is coming around to a completely new paradigm. In 2 weeks we went from a 2-week suspension of school to out for rest of year. Monday they announced 4 weeks of meetings for planning on Olympics, then only took 1 day to decide they are Olympics delayed a year now. I am not sure even if students will return to school next fall.

We need months to get virus under control and then South Korea type program if we want to resume regular life. Long term we get treatments, vaccines, and herd immunity. But short term looks ugly to me.
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Our potus has a ton of sway in how things go.
You could see the trend changing just 24 hours ago "the cure can't be worse than disease" manta.

Basically, if we have self-quarantined enough, and continue to practice social distancing as much as possible, AND testing/ventilators/masks and all other medically-needed items have sufficiently ramped, then he sees a path to a modified return to work.

I actually don't disagree, in the sense that a full collapse of economy won't just cost people money....there will be mass suicides, huge spike in depression and drug use, homelessness. I remember the pain many peers felt around 2008-2009, which I was fortunate (lucky) to avoid.

We move very fast in today's age...as fast as the news cycles, it seems.

My crappy crystal ball says we have some sort of new thing in about 6-7 days when the "15 days to stop the spread" officially ends. Either we have:

1. a short extension of another 5 days or something
2. a Phase Two to "Make America Work Again" in some sort of modified lifting of work restrictions on restaurants/travel.
3. some made-up thing I haven't imagined yet.
4. another 15 days or 30 days added (I really don't see Trump going for this)

Another trend to be on the lookout for is patriotic seniors (like Lt Gov of TX) coming out of woodwork to declare that they are willing to risk their health for the future health of the country/economy for their children and grandchildren. "Hey...no one asked us seniors if we wanted to bankrupt the whole country for our benefit" kind of a thing.

Final prediction, because Orange just has a charmed sort of life: the drugs he has been touting do a good enough job to mitigate symptoms and speed recovery, that the Covid19 does start to mimic the actual flu a bit, in terms of lower fatality rate...making it that much easier to put #2 into motion, and ensuring an onslaught of "I was right" from Trump all the way thru his reelection.

Not saying we don't have turbulence, but I think yesterday was a bottom signal, more or less.

Dreamer
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I think short term bottom was made on 3/18. I am using that as my stop loss, now.
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annnnnnd sold the BRK and DDOG to lock in today's gains.

I call it 50/50 that this is a "buy the rumor, sell the news" type situation, as we should get word of Congress passing something soon.

The board would like to thank BRK and DDOG for their contributions in our MDPGA (Make Dreamer Port Great Again) initiative. Hats, pins, and other highly-collectible merchandise available in the official Dreamer Corp store.

Why did I sell?
Moves like this are extreme...not much changed between yesterday and today, so the market is just drunk/high to move BRK up or down more than 5-6% in a day, and I closed out on an 8% move.

Will reassess with the news cycles today, and see what/when I feel like moving into the next thing.

Let's see if some of these moves fade today. If we can see the end of this crisis in sight, having a cost basis of $59 for ESTC may turn out ok after all, and maybe NVEE makes it back into the port if it hasn't run too hard by the time I feel it is "safe" to get into smaller caps like that.

About 45% cash.

Dreamer, MDPGA
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sold half my ESTC...now 70% cash.
Not a reflection on long-term view...this is just locking in today's outsized gains in nontaxable account, and will look to buy lower in a day or two. Rinse/repeat.

I think Trump's push for ending lockdown will clash with Dems/news agencies...market will whipsaw I think.

Anyway...great day, which I needed.
Will look to build off of it!


Dreamer, President/CEO of MDPGA
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i am selling a bit too
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took a small toe dip in RADA.

the company just came out and reiterated their 2020 forecast, stating no virus impact.

https://seekingalpha.com/news/3553667-rada-reaffirms-expecta...

They had forecast 45%+ type rev growth for this coming year, and from what I can tell the analysts were setting price targets of $7-8 pre-Covid. It was as low as low-$2 on 3/18, and now about $3.26 per share.

They apparently have been in R&D mode for a while, defense-related company, that does radar for drones.

Be prepared to lose all your money or double it, with this stock.

Dreamer
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No. of Recommendations: 2
took a toe dip back in NVEE...they announced another contract win today, and stressed how their business is typically tied to "critical" infrastructure, so getting a pass during covid crisis a bit, is how I interpret that.

Anyway, keeping it small, along with RADA. Toe dips.

About 65% cash, and today feels like a do-nothing day, as I only really see catalysts for market to go down after the big runup yesterday. And, honestly, way too busy with the real job. So let's see if there are positions to take at end of day or in AH.

I had a work project get pushed out by larger client yesterday...many companies seem focused on working thru hiccups tied to remote workforce and other projects put on pause while they assess financial damage to budgets, etc... Blah. On flipside, on call today for another client that wants to get out of managed/hosted relationship where they feel they are being hosed - so an oppty to sell a client something because they are spending money in one area, or with a different partner, to save money elsewhere - I think this is what we will see an uptick in for a bit: where can I be more efficient, reduce costs, but also clients will still need to extend support on critical infrastructure or will still move forward on projects they consider mission critical (security/compliance, expiring licenses, maybe they are about to get a huge increase in support costs on older gear and it makes sense to get newer gear that can do more with less capex investment. etc etc

Dreamer
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didn't do squat today.
unless there is an actual drug/cure type announcement, I expect more pain.

Either way, I would like at least one more down day before I jump back in.

My favorites to pile into, if they retrace lows near/around the 3/18 or 3/23 lows: ESTC, AYX, NVEE, TTD

Simply because I know and understand them, so easier to hold long-term if my timing sucks.

Others that might just be trades: HAL, RCL, BA, QDEL, LVGO, etc...

I am still a bit under for the year, but banked a good chunk of this week's rebound and sitting on my hands for now.

infections growing 32% day/day today to 99k.
Deaths growing 39% day/day today to 1500.
The curve has not slowed yet, as those percentages are in line with averages since 3/16.

Get a spreadsheet out and look at it yourself. If the rates hold around 30% and 35% respectively, we should wake up Monday to 200k infections and 3500 deaths. Infections may increase faster if we have more testing out there, so as AJ has stated elsewhere, deaths are the more important stat to track.

If the trend holds, that is 10k deaths on April 3rd.
I am not hoping for bad news...I am just not banking on sunshine and rainbows from this point forward.

Dreamer
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I actually sold ZM and a bunch of CRWD today for nice gains. I'm waiting and watching the indices and names of interest along with COVID stats as you do. I'm in the camp that markets retrace prior to springing forward. Talking head from Blackrock (CIO Global Fixed Income) today remarked that we were at the bottom but could go lower. I think I could make those kind of remarks for far less pay :)

I know that it is difficult to time the market, but I like the idea of beaucoup cash at the ready...I also have to prepare to tap the port in a couple of years...

5
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We talk about cases and deaths, but I appreciate that our local health authority also reports statistics on hospitalizations and #s in ICUs. I find those additional numbers helpful in gaining a deeper picture of the human and healthcare toll of the virus.

I'm not banking on near-term sunshine either but I see a gradually lightening outlook with all the stories of businesses overcoming the multitude of medical shortages and the breadth of effort being applied around the world to create and trial vaccines or drugs to speed recoveries.

And I also think that in 3 months even if we haven't figured out the vaccine or recovery medicines, we'll have figured out ways to minimize transmission risks - at least enough to return to a new normal that includes outings, gatherings and safe travels.

Thanks to all for the insights and ideas,

Pollyanna
(AKA Doug)
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No. of Recommendations: 1
To add to Doug’s point, in 3 months, there may be a much larger stock of ventilators and more info on chloroquine effectiveness. Of course, you can’t increase medical staff to a great degree. People take a long time to make :). However, if hospitals are better equipped to handle sick folk, life could begin to return to normal again.

The biggest issue today is that we can’t overwhelm hospitals or else the death rate will increase drastically. With more medical equipment and supplies in 3 months, we will hopefully be better prepared to deal with influxes until and if we develop a vaccine. From what I’ve read, if a vaccine is developed, we shouldn’t have the need to redesign it every year and hopefully its effectiveness will be higher than that of flu vaccines. Those vaccines need to be reworked every year to deal with the ever changing flu virus. Coronaviruses apparently don’t have the capability to mutate as quickly as the flu do to their “construction.”

New York should begin getting data on chloroquine effectiveness in the coming week or two.

A.J.
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No. of Recommendations: 9
A.J,

A friend in life sciences had sent me a graph displaying results from the initial NYC study. I just don't have a mechanism to post the visual but here's my attempt to translate the results:

There were three groups of 19 patients (57 total) in the study.
1. 19 Control patients
2. 19 Received hydroxychloroquine
3. 19 Received hydroxychloroquine and azithromycin

All had tested PCR-positive with nasopharyngeal samples.

After 6 days:
1. 90% of the control group still tested positive
2. 50% of the hydroxychloroquine group tested positive
3. At day 5 NONE of the hydroxy and azithromycin group tested positive

Apparently there are trials now in multiple cities.

Doug
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No. of Recommendations: 5
While that is good sign, it still suggests we have to get sick first, and be out of commission 4-5 days, possibly in the hospital in order to receive the meds in the first place.

I think the market is in for some pain this week, or at least a rational market would be...Trump now talking about quarantining NY and a couple other states...an obvious nod to fact they aren't under control.

The death rate is still over 30% day/day, bringing us close to 2000 total today.
This is a doubling about every 2 to 2-1/2 days. Meaning on Monday afternoon we should be talking about 3500-4000 U.S. deaths, behind Italy and Spain only at that point. If that rate holds, we will be over 10,000 deaths Thursday evening or Friday morning...if Italy has slowed, the U.S. may lead in covid deaths at this time next weekend.

That would still be about a 1/3rd of the annual deaths from auto accidents or the normal flu...and we just accept those facts as reality in society: 60-70k people each year die from flu or auto accidents in U.S., both which would be classified as unexpected on a personal level should it happen to someone close to us, even if we intellectually understand it as a whole for society.

I think this is where Trump's head is: "hey...this thing is bad, but we don't tell US automakers to stop making cars bc they kill 30k people every year."

Other factors: those that recover should be immune...why not jump back into normal work/society at that point, although 100k recovered workers is still a drop in the bucket when you shut down all of society. So Trump will want some sort of modified back-to-work action, is my guess, that puts the blame and responsibility on individual states, and Fed will just issue "recommended guidelines" of seniors should stay isolated and social distancing in general should be the norm, but if you have no symptoms and want to go to office or factory or whatever, go ahead, as long as your state allows it.

Wrap all this conjecture and craziness into my crystal ball, smear it in wet clay, and throw it at a wall from a moving vehicle, and the result is about as useful as any prediction I can deduce.

So the only certainty I sense is that a sense of uncertainty will rear back up this week a bit, and expect we see some pressure on the market. If not, then I may be stuck sitting on my hands a lot longer than I imagined, because I am not chasing valuations in this environment.

Nothing would surprise me on what the next ERs look like...they will be very mixed bags, I imagine, and I think the smartest thing any of them could do, is to abandon forecasts. Buffett thinks they are dumb, Saul ignores them...and it removes "miss" and "beat" from the equation and turns the focus on to "is the company executing now and/or do they see issues with executing again in the future?"

I am imposing a restriction on sugar today...got out of hand the past week. Normally a somewhat paleo-diet follower, all bets are off as my comfort food takes the edge off the news/stress.

Dreamer <--- getting a bit doughy
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No. of Recommendations: 13
Trump now talking about quarantining NY and a couple other states.

You are getting so many mis-statements from the administration, you cannot understand or plan for what they are truly going to do.

Within hours, Trump argued, that 30~40K ventilators NY is asking is unnecessary, they don't need that, and we need to open the country by Easter to let us quarantine 3 states. This is nuts. These are difficult times, but it is compounded by the administration.

I reject auto accidents/ flu death comparisons. Auto death is well defined risk, you have certain percentage of people going to get into accidents, and some is going to be fatal. For flu, yes some people are going to die, but we have medicine to treat for most folks.

Corona is highly contagious and we don't have a cure. What China, South Korea and Germany experienced is not what we are experiencing. I will wait for the March 18th bottom to test and bounce off, before making any additional purchase. I have added a 3% position, and it is up 7.5% I might reduce it to 1% on Monday. The goal is hold on to cash, and close some positions to raise cash.
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