Currently 5225.

Okay, so it's overbought at the moment and due a pullback, but this current run has a lot of life left in it as the US markets consolidate.

Stocks or property? Stocks are advancing, property is falling. Watch the lemmings jump ship.

Maybe some brainiacs don't realise the FTSE is strong on the promise of coming rate drops & the impact of more cash in the system etc.

Question for you, I don't know the answer so I'm not testing you.

Is it not the case the the footsie 100 has a disproportionate number of Banks, oil companies and the sort of organisations that have been making mega bucks due to debt growth and commodity shortages, not just oil.

If so, does it really signal a good economic situation just because its high. After all, if there was an oil crises it might go up but the economy could collapse. I've said before that financial wealth may be disconnected from standard of living.

If Sterling stays weak, Ftse may stay strong, since a number of the
component companies have dollar income

But I doubt that, and expect a turn soon

Deano, Ive profited from B2L and now having largely sold - up I believe sentiment alone will drive the Stock Market hard fuelled by lots of property investors looking for a new home and new investors drawn by the magnate of a steadily increasing FTSE.

Its that simple.

To over - complicate is a waste of time. Sure all kinds of things could cause a SM fall, but its pointless trying to predict. In the end you have to take a risk. For me right now the risk feels about right and I use monthly purchased Unit Trusts to spread my risks.

Its just like setting up in business. There are always more reasons not to do it, but in the end you just go for it.

DB your wasted, you should set up as an IFA....

I have been considering the recent rise in the FTSE from a the perspective of how it links with the housing market.

Take the stock market boom of the 1980s. This ended in 1987 dramatically, at which point the housing market suddenly took off and expanded into a bubble. This peaked several years later and then slid.

In the mid-1990s as the recession came to an end, the stock market took off again, more than doubling in 6 years. House prices did nothing special.

In 2000 the stock market peaked and then began falling. The stock exchange was no longer the place to have your money. Money began to move into property and the housing market took off again.

2005, the housing market is passed its peak and everyone knows it. Those with money to invest are again looking for returns and the stock market is providing them. Sentiment will shift and the transfer of funds from property to shares will continue.

I think that when the US property boom dies out in maybe a year, US investors will start piling into shares as a alternative which should in turn drive up the FTSE.

Exactly what I think people.

And you know what? Dickhead here put £7k in between 1998 and 2003 - I'm now £500 up.

Long may it continue, I was livid when I lost all that money and finally I'm starting to get some of it back.

Here is a poser for you:-

What is the likely effect of the FTSE in the event we don't get the games?

forget the dynamics.
im making decent chunks of free money.

my original outlays are banked.

Probably no effect as France are the favourites. If we won it would help a few construction stocks - that's about all.

Investing in the Stock Market, in particular the Footsie would suggest that you are of the opinion that UK companies are going to be making a lot of money in the near future. Given that many over the past few years have struggled to keep themselves in the black on what do you base your prediction of good times ahead for british businesses?.

In my opinion if the economy is screwed, and there is a tightning of lending to business as is currently the case, and we have inflation running higher each month then how could business be looking forward to prosperous times.

Footsie over 5200 I think it hit that in 1998 ?.

Laurejon, I'm not FTSE bull, but just to let you know, the FTSE has a disproportionate number of international companies for a national index, BP for example makes only 10% of it's earnings in the UK, this means that it is perfectly feasible for the FTSE to be doing very well whilst the UK economy falls to bits.

How many times do I have to say this. The FTSE250 (101 to 351st biggest companies) are less affected by international events yet it is currently at a record high of 7400. It used to be the same as the FTSE100.

To answer Lauerejon's point a huge amount of the stock markets performance is down to SENTIMENT and maybe investors shifting money from property.

BOT some Oct.puts this morning,
as a partial hedge for my portfolio

If the economy is heading south, and interest rates are set to rise then a simple savings account would be a good home for the cash.

In the last recession my Grandparents made an absolute killing on their savings with the high interest rates available to term deposits and then made another by investing in BTL property as we came out of the recession.

I think the trick it to keep your capital relatively liquid as you never know when you might need to use it. I would love to be able to do the Gordon Geko from home, but given my first and last attempt involved lastminute.com and psion I think I have had my try.

Have to say I agree here. If the HPC gets into gear it is going to cause a recession. Things are bad already - building stocks down, banks talking about bad debts, oil is going to impact everyone's costs and profits as it can't all be passed on. So, okay FTSE enjoying a little bull run at the moment and, as someone else said here, it is driven by sentiment. So even though lots of the FTSE companies derive earnings abroad - if sentiment here turns really bad - FTSE will go back down.

Just watching Bloomberg - Italy - worst June retail figures for 12 years. Holland - economy in worst shape for ... (can't remember - a long time though). Isn't Europe our biggest trading partner. If their economies are all bug*erd, which they seem to be as they are massively inefficient, our trade with them will fall affecting internation earnings. Nice to be able to see into the future, I think selective investing in recession proof companies will pay off at the moment. The index surely will fall back.

Last time round - investing in companies that are in 'recession-proof' sectors of the economy definitely worked.

Previous bubbles have more to do with sentiment than green light fundamentals.

Also Im not all that exposed to simply the FTSE. I invested in sectors such as health and technology.

To the bears who advise me to read Steinbeck, I say this, read............................................................................
.......... The Mr Men

Firstly Mr Happy
Secondly Mr Miserable

"You must be Mr Silly then ! "

Better than Mr Chicken.

You will never find a risk free investment endeavour. There will always be clouds on any economic horizon.

Some bearish types think theyre going to wake up one morning and find there are no bad news stories in the press, no potential economic disaters, and that will at last give them confidence to invest big - time. Problem is, with any life opportunity a degree of risk will attach.

You could also go for the very long term strategy. I got zapped in the dotcom crash but i never sold and i have recovered quite a few losses (especially with FTSE250 shares). I am building up a sizable cash buffer so i hopefully shouldnt have to fall back on my equities an I plan to leave them there for 20 years when i would use them as retirement money.

These days unless you are a day-trader freak you should hold equities for 10 years minimum.

Worst thing i could have done was sell at a market low after everyone else sold. I managed to avoid doing that.

Eh? Hold them for ten years and then take a look and see if they did OK or not?

That's too passive for me - hope it works for you

Hey I am investing in index trackers and unit trusts so i am spreading my risk. Anyway i could always fund switch which anyone else could do.

equities...zzzz......gold bars...zzzz.....

this waiting for houses to level off is very boring. it livens it up a bit to whip out just 5k or so and ride the day trader rollercoasters. im doing ok......and i dont even know what im really doing...

having watched any real savings dissapear under HPI i think it rather play with it than lose it to some joe who happens to say his house is worth 3 times what it really is.


no thanks.

Same here, but I dont use those muppet devices - 'Investment Trusts' which can be highly geared and volatile. Unit Trusts are the way for me - youre closer to the underlying assets.

Like you I kept buying through the last SM downtime and now its proving a good stratergy.

All those people out there beavering away to make thier companies richer must be good to invest in.

To dictate any optimal time to hold an asset is bonkers. The optimum timing might be 10 minutes or 10 years plus depending on the asset and the circumstances.

The two biggest ways to lose money on shares:
1. Selling too quickly
2. Not selling quickly enough

How long you hold for depends if you are speculating/trading or really investing. The two are worlds apart.

The trader doesn't care about intrinsic value; he holds short term positions in the expectation of the that price will move in a certain position because it has been oversold/overbought. Trading is 90% guaranteed to lose you money. It is a minus-sum game. No only do you have to be right about which way price goes, but you have to be right enough to beat the spread and commission fees.

Investors buy shares in companies in the expectation that intrinsic value will rise in future years as the company earns more. He doesn't care about short term fluctutations in the shareprice so long as they are a fair reflection of the company's true worth. The investor cares more about a company's earnings and than its shareprice. Proper investors never lose money in the long run. Even if you had bought the FTSE at its peak in March 2000, with dividends reinvested and cost averaging (i.e. buying more of the market when it is cheaper), you would be healthily in profit by now.

Today's action:

I closed several of my long positions today and went short on the FTSE as a hedge on my remaning longs. Only £2/pp at this stage, but we've had 7 consecutive days of gains and are due a pullback now. Will add to my position when (and only when) my short is in profit.

Well if it works for you - good. However buggered if I will give any fund manager 5.25% of my capital as a going in present. The tossers take 2 years just to get you back to where you started. Might be okay on a 20 year horizon but the days are gone when you could buy a basket of FTSE shares (which is all most Unit Trusts do), sit back and watch it grow. Brave new world now - who knows if BT, British Airways, Sainsburys, Marks and Spencer will even be around in 10 years? These people have to invest in a number of shares and usually hold big positions they cannot get out of easily. If I am going to hold a supermarket I'll hold Tesco thanks. I won't put my money in a Unit Trust where they have to hold Tesco, Sainsbury and Morrisons. When things start going wrong they take ages to get out of a position.

What about lendlease they are bound to pick up work from the Olympics having already proved themselves in both London and Sydney.?.

What does that tell you? Never understood charts. It tells me the price went up today!

It could also be representative of how many children will die in Africa each hour as borrowed money is funelled into the East End of London to finance a two week 100 metre dash.

"What does that tell you?"

Nothing on its own. It's a piece of a puzzle.
But what I can tell you is that I have waited for weeks to see what would happen when FTSE touched 5200. When it gapped above that level, I decided to trade.

I bought Oct. Puts today to start hedging my portfolio

Bull markets climb a wall of worry:

worry about high oil price
worry about middle east/iran
worry about house price crash/high street slump.

I'm staying in the FTSE for a while longer chaps,the good thing about sterling weakening is the US$ conversion rate is much better,giving better earnings and increased divi's.....the lovely mix of capital growth and improving yield.

stick that in your BTL and smoke it!!!

what the BLT's don't yet realise is that UK domestic may get shot to bits,with lay offs galore,but the growth in the FTSE is mostly overseas....with any luck they'll figure this one out in a few years,and try to cash in the BTL portfolio's at just the wrong time,when the HPC is in full swing and the FTSE gets back to 6900+(unbelievable some of you may think but we all now the power of speculation don't we...so I'm not expecting much in the way of a pullback either!)

...and to any chartists,yes I know the index reads overbought at present(RSI above 70),but I'm still looking for year end 5500...with BP/Shell aand oil at $60bbl...that meand chunky profit and dividend hikes.

Looks very toppy. Dow has lost 90pts today, so it looks like the end for this particular little run. Let's see what happens to IRs tomorrow. Currently Long Dow/Short FTSE.

Anyone seen This lately?

Rate cuts? Dream on.

"Looks very toppy. Dow has lost 90pts today"

Too early to say it will work,
but I am very glad I bought some FTSE puts today.
I also bought some on HGX, the US Housing index

Chart HGX- daily

Trend on FTSE still looks OK,if it does come back down a bit then I'm not going to get too worried unless it breaks 5000ish.,if it bounces back off that I think it will be on it's way up again

is a pretty good graph....shows a lot of resistance at 5350,so will take some getting through,but i'm optimistic

ISLAND REVERSAL COMING?
(In place by tomorrow's opening perhaps)

Some of you may know what this means
(The market gaps up one day, trades above recent levels, and then gaps back down the next day)

Wall Street was down -101 today.
It looks like FTSE will gap down tomorrow on the opening.

That will give us an "Island reversal" and a nice look top formation.

(You can find the whole blow-by-blow & a bullseye forecast here!):
Thread:
http://www.housepricecrash.co.uk/forum/ind...showtopic=11863

Quick adition, just found this on the FT, the Ftse went nuts after 12 as you would expect after the announcement of the olympics...

http://news.ft.com/cms/s/ca82d6be-edef-11d...000e2511c8.html


“Not only is the thought of lower interest rates underpinning the UK market but so is sterling’s slide against the dollar,” said Mike Lenhoff of Brewin Dolphin Securities: “The market is now approaching an overbought condition and the amber light is beginning to flash. Its worth noting that the rise in the FTSE has been associated with low volumes (since April). It doesn’t take much in a thin market for momentum to acquire a life of its own.”



In other words, if they dont get a cut in IRs like they are all expecting (expectiation; such a wonderful thing ) Then the market could VERY quickly go Pete Tong.

Must admit I buy shares with a view to holding forever. Sometimes I sell when I think the share has been revalued too much, or to cut losses when I obviously got it wrong.

Actually, I sometimes find myself getting annoyed when shares I like get revalued. Irrational, but it's always nice (and quite rare) to find a share that can be bought regularly on good fundamentals, and oddly annoying when market discovers it too. (e.g. HAECO/ Karrie Int'l, lovely little HK based industrial companies that I've had to stop buying for long time now, because are now fairly or maybe over valued) Bought HAECO from 12.5 to 25, it is now 50HKD a share

Much prefer low or no geared investment trusts or just a ETF to mutual funds. BMV. Yes, the BMV may likely never be arbitraged away in an IT, but, again, assuring to know it is there. Plus the management costs tend to be lower, and the trading costs in/out far far lower than a UT.

I believe we are in for long period of OK returns (I reckon 6%) - in which case low costs and good dividends become very important

Oil at $61/barrel and the Saudis have announced that they can't service demand for oil makes it very difficult to decide which way the FTSE will go. Although there has got to be some serious profit taking soon...

with £/$ trading very poorly i don't expect a significant reversal here.

however markets are ignoring the eventual impact on MPC thinking of a weaker pound and thus the potential for higher rates. if the pound continues to fall it will be a major talking point at the August Inflation Report.

you can't have your cake and eat it. something has to give and i expect stocks will give later this month.

Unit Trusts are only a part of my investment portfolio.

I too was erked by the initial and on - going charges but in the end it was past performance that suckered me in.

Framlington Health Fund returned 50 x what was put in between 1981 and 1998, despite gloom and recessions. So £50.00 per month became £500000 after 17 years.

If I only get 3 x what I put in I will happy.

I think there is often a tendancy amongst people like us to over - complicate long term investment. A freinds Mum bought Disney & RBS shares in the 1960s and just sat on them. A couple of years back she cashed them in for a fortune. No thought, no graphs, no hand wringing, just a quick off the cuff decision.

Im with you.

There have always been 'walls of worry' that didnt stop previous SM bull runs.
The mid - East has been about to boil over since I was born, AIDs was about to ruin the markets in the 1980s, not to mention Northern Ireland, Miners Strikes, Falklands War, Iraq 1991, Israel, OPEC crisis, 3 day weeks (70s), high unemployment, KY2, etc etc. Despite all this, the SM has proved a good long - term investment and for those that sold near the end of each bull run the profits have been spectaculor.

Again, my Framlington Health Unit Trust returned 50 x money invested on a monthly basis from 1981 - 1998 (I wasnt investing then unfortunately).

Once Ive reached the 15 - 20 year mark I will look to transfer the Equity based Trusts into Trusts backed by cash / Gold, but I will only do this during a bull run.
£500 per month is within ISA & previously PEP, so its all Tax free and unlike my poxy personal pension I control this pot.

FTSE is down 80 at the moment, due to the "bang" at Liverpool Street Station?

Why not get a SIPPs? I have one so I make the decisions on what to invest in. Still in some nano-technology stocks at the moment. I'm either going to retire potless or very rich. Can't see any point in being in-between. All that means is you're still hard up but you have to pay all your Council Tax.

My Wife & I also invest modest amounts in Pensions. What I mean by I have no control, reflects the fact that upon retirment you HAVE to give an annuity provider 75% of YOUR dosh. What if the anuity goes bust? Also for the higher paying annuities you have to give up the capital, so of you die after 1 year your loved ones get zilch, no thanks. I want as much control over my and my families financial well - being.