FTSE To Finish June Above Pre-Brexit Levels....

[Deleted member 21794]

Liberals, they simply don't understand stock markets. And they really should, given stock markets are much like liberals. They're emotional and overreact.

We've been subjected to days of doom and gloom about Brexit from liberals. The end result? The FTSE (that's the major stock market index in Britain for you ignorant liberals) will finish June above pre-Brexit levels, completely wiping out the 3-point something Brexit losses.

Sorry Obama, sorry liberals, it looks like giving you globalist totalitarians the middle finger is going to work out just fine.

http://uk.reuters.com/article/uk-britain-stocks-idUKKCN0ZF21N

 

[marvin martian]

Crickets from the folks who, just four days ago, were predicting the end of the world. LOL

 

[Lukey]

Yep! The collectivists were wrong again.

Then you have propagandists like @Arkady trying to drag the currency value into the discussion since it's down, but typically Keynesians like him are touting a weaker currency in situations of slow economic growth as a boon to domestic production and sales (but then progressives tend to like having things both ways). Which is probably why their stocks are receiving bids.

 

[Deleted member 21794]

Yep! The collectivists were wrong again.

Then you have propagandists like @Arkady trying to drag the currency value into the discussion since it's down, but typically Keynesians like him are touting a weaker currency in situations of slow economic growth as a boon to domestic production and sales (but then progressives tend to like having things both ways). Which is probably why their stocks are receiving bids.

BAM! This is yet another area where Arkady demonstrates he knows nothing about free markets. Of course, he's a central planning statist, so how would he? He and other market illiterates are like the markets themselves: emotional, overreactive and sometimes hysterical. Equilibrium will return to the GBP in context of its comparison to other currencies. We've already seen it happen with the FTSE.

When the currency returns to where it belongs, Arkady will run into a character limit problem with his posts that will no doubt explain to us dummies how really he was right all along!

 

[Lukey]

BAM! This is yet another area where Arkady demonstrates he knows nothing about free markets. Of course, he's a central planning statist, so how would he? He and other market illiterates are like the markets themselves: emotional, overreactive and sometimes hysterical. Equilibrium will return to the GBP in context of its comparison to other currencies. We've already seen it happen with the FTSE.

When the currency returns to where it belongs, Arkady will run into a character limit problem with his posts that will no doubt explain to us dummies how really he was right all along!

He is so fixated on scoring minor technical victories (like that if you price both markets in dollars we end up slightly ahead even though the FTSE's nominal performance was better) that it completely escapes him that he is losing all the actual debates.

 

[Arkady]

Yep! The collectivists were wrong again.

Then you have propagandists like @Arkady trying to drag the currency value into the discussion since it's down

If you can't understand that the real value of a stock is dependent on the value of the currency in which the stock's price is expresses, you really need to stop and think. But, in the meantime, my offer remains on the table. If you want to put your money where your mouth is, I'm more than willing to take it from you.

 

[marvin martian]

If you can't understand that the real value of a stock is dependent on the value of the currency in which the stock's price is expresses, you really need to stop and think. But, in the meantime, my offer remains on the table. If you want to put your money where your mouth is, I'm more than willing to take it from you.

Good luck, Mitt! Let us know how it goes.

 

[Arkady]

BAM! This is yet another area where Arkady demonstrates he knows nothing about free markets. Of course, he's a central planning statist, so how would he? He and other market illiterates are like the markets themselves: emotional, overreactive and sometimes hysterical. Equilibrium will return to the GBP in context of its comparison to other currencies. We've already seen it happen with the FTSE.

When the currency returns to where it belongs, Arkady will run into a character limit problem with his posts that will no doubt explain to us dummies how really he was right all along!

If you'd like to take me up on the offer I gave Lukey, feel free to do so. The FTSE 100 has outperformed the S&P 500 in nominal terms. So, I'll trade you shares in a FTSE index ETF that were worth $100,000 at June 23 close, for shares in an S&P 500 index ETF that were worth $100,000 at June 23 close. Want to make a deal?

Anyway, on a side note, I don't think there's any particular reason the FTSE 100 needs to be down in real terms, short-term. The harms from Brexit are more long-term considerations, and stock markets in the short term are largely about speculation. So, if it were to end up rising in real terms, that wouldn't be terribly shocking. I'm just saying that, at this moment, British stocks, as a whole, have underperformed American ones, as a whole, in real terms, since the Brexit vote. People who don't realize that either haven't thought it through, or are so married to the idea that the Brexit vote is a good thing that they must deny reality.

 

[Arkady]

He is so fixated on scoring minor technical victories (like that if you price both markets in dollars we end up slightly ahead even though the FTSE's nominal performance was better) that it completely escapes him that he is losing all the actual debates.

As a reminder, it wasn't "slightly ahead." When I did the math, yesterday, the trade would have involved me giving you $90,827.07 of value for you giving me $99,017.56 of value. That would be over a 9% return on the investment, for me.... about what a person gets in an average year of investing.

 

[Lukey]

As a reminder, it wasn't "slightly ahead." When I did the math, yesterday, the trade would have involved me giving you $90,827.07 of value for you giving me $99,017.56 of value. That would be over a 9% return on the investment, for me.... about what a person gets in an average year of investing.

We found there is no significant difference in long-term risk-adjusted returns between
portfolios that use a currency-hedged international-equity strategy and portfolios that use an unhedged international-equity strategy. As such, long-term investors should focus on choosing well-run, low-cost international-equity funds for their portfolios and should be indifferent to whether or not the funds hedge their currency exposure.

https://corporate.morningstar.com/U...eign-Currenty-Movements-Equity-Portfolios.pdf

Yeah, and it's cherry picked bullshit!

 

[Arkady]

We found there is no significant difference in long-term risk-adjusted returns between
portfolios that use a currency-hedged international-equity strategy and portfolios that use an unhedged international-equity strategy. As such, long-term investors should focus on choosing well-run, low-cost international-equity funds for their portfolios and should be indifferent to whether or not the funds hedge their currency exposure.

https://corporate.morningstar.com/U...eign-Currenty-Movements-Equity-Portfolios.pdf

Yeah, and it's cherry picked bullshit!

That text is totally irrelevant to the issue we're discussing. Obviously there won't be a significant difference in long-term risk-adjusted returns between currency-hedged and non-currency-hedged portfolios.

Scenario A: Five dollar-based investors and five euro-based investors, each hedged against currency moves.

Scenario B: Five dollar-based investors and five euro-based investors, none hedged against currency moves.

If the dollar moves higher against the Euro, what does that do in each case?

Scenario A: The dollar-based investors get a gain, partially offset by the cost of hedging, while the euro-based investors get a loss, partially mitigated by the benefit of the hedging. The two net out.

Scenario B: The dollar-based investors get a gain, the euro-based investors get a loss. The two net out.

If you analyze investments generally, these things are going to net out, and there will be no benefit to hedging. Even at the individual investor level, if, long-term, you have currencies move against your interests about as often as for your interests, there's no benefit to hedging (other than to diminish the size of swings).

But none of that is relevant to the issue at hand. When looking at the performance of a particular asset or collection of assets in a given time, you can only meaningfully judge it if you account for the value of the currency in which it's expressed. FTSE 100 stocks did better in nominal terms than S&P 500 stocks, but significantly worse in real terms.

 

[Lukey]

That text is totally irrelevant to the issue we're discussing. Obviously there won't be a significant difference in long-term risk-adjusted returns between currency-hedged and non-currency-hedged portfolios.

Scenario A: Five dollar-based investors and five euro-based investors, each hedged against currency moves.

Scenario B: Five dollar-based investors and five euro-based investors, none hedged against currency moves.

If the dollar moves higher against the Euro, what does that do in each case?

Scenario A: The dollar-based investors get a gain, partially offset by the cost of hedging, while the euro-based investors get a loss, partially mitigated by the benefit of the hedging. The two net out.

Scenario B: The dollar-based investors get a gain, the euro-based investors get a loss. The two net out.

If you analyze investments generally, these things are going to net out, and there will be no benefit to hedging. Even at the individual investor level, if, long-term, you have currencies move against your interests about as often as for your interests, there's no benefit to hedging (other than to diminish the size of swings).

But none of that is relevant to the issue at hand. When looking at the performance of a particular asset or collection of assets in a given time, you can only meaningfully judge it if you account for the value of the currency in which it's expressed. FTSE 100 stocks did better in nominal terms than S&P 500 stocks, but significantly worse in real terms.

Which makes your point moot for all but short term global market traders (who probably did hedge their currency risk). And my point stands - the FTSE performed better than the S&P 500. Period. The GBP, on the other hand, performed worse than the USD. I didn't mention that - you did. For those invested long term in either market, the Brit made back his losses quicker than the Yank. Unless he sold his holdings and immediately converted the pounds into dollars. Which no one in their right mind is going to do. So you came up with a hypothetical situation that I wasn't talking about and, after redefining the discussion to something it wasn't, you won that argument (about the currency) which wasn't my argument. As Moody's research points out, no typical investor is going to do what you suggest, and, if they don't, in the long run, they will never feel the (temporary) currency "loss" you tried to use to redirect my argument.

 

[Deleted member 21794]

Which makes your point moot for all but short term global market traders (who probably did hedge their currency risk). And my point stands - the FTSE performed better than the S&P 500. Period. The GBP, on the other hand, performed worse than the USD. I didn't mention that - you did. For those invested long term in either market, the Brit made back his losses quicker than the Yank. Unless he sold his holdings and immediately converted the pounds into dollars. Which no one in their right mind is going to do. So you came up with a hypothetical situation that I wasn't talking about and, after redefining the discussion to something it wasn't, you won that argument (about the currency) which wasn't my argument. As Moody's research points out, no typical investor is going to do what you suggest, and, if they don't, in the long run, they will never feel the (temporary) currency "loss" you tried to use to redirect my argument.

Checkmate.

 

[Lukey]

Checkmate.

Indeed! He is the master or redefining your argument into something it isn't and then "refuting" that and then he thinks he won the debate. Yes, in a very narrow, hypothetical, tangentially related situation, a scenario that may but does not necessarily have to exist, he is right. In ALLLLL the rest of the real world applicable situations, it just has no applicability.

 

[marvin martian]

Checkmate.

And of course you know how @Arkady takes being checkmated:

 

[Arkady]

Which makes your point moot for all but short term global market traders

My point is clearly NOT moot in the context in which it came up: the question of whether the FTSE 100 outperformed the S&P 500 since Brexit. Regardless of whether you analyze the question in dollars, pounds, or some third currency, the answer is the same: the S&P 500 did better for investors. The only way to get around that is to state each in a different currency, so that you're really just measuring change in currency valuations (the same way I could claim that an investment in AstraZeneca UK shares greatly outperformed an investment in AstraZeneca ADRs, even though they're the exact same company with the same real return for investors.

Stick to buying hunks of shiny metal. Stock market investing is clearly something you don't understand.

 

[Arkady]

Checkmate.

You missed the checkmate when I made the move, way back at the beginning of this discussion. Ever since then, it's just been Lukey whimpering about how checkers is a much better game.

 

[georgephillip]

Liberals, they simply don't understand stock markets. And they really should, given stock markets are much like liberals. They're emotional and overreact.

We've been subjected to days of doom and gloom about Brexit from liberals. The end result? The FTSE (that's the major stock market index in Britain for you ignorant liberals) will finish June above pre-Brexit levels, completely wiping out the 3-point something Brexit losses.

Sorry Obama, sorry liberals, it looks like giving you globalist totalitarians the middle finger is going to work out just fine.

http://uk.reuters.com/article/uk-britain-stocks-idUKKCN0ZF21N

Maybe we should be looking at the Brexit results as a kind of stress test?
http://wallstreetonparade.com/2016/06/why-is-metlife-tanking-in-tandem-with-wall-street-banks/
"But the trading action of the giant U.S. insurer, MetLife, following the Brexit vote in the U.K. has tongues wagging on Wall Street.

"The question is why this company traded worse than even the biggest Wall Street banks in the immediate aftermath of the Brexit vote.

"In last Friday and Monday’s trading sessions, MetLife lost 17.3 percent of its market capitalization or $8.4 billion.

"Adding to the curiosity, this comes at a time when MetLife is fighting in court to avoid the government’s designation of it as a non-bank systemically important financial institution or SIFI.

"Insurers like MetLife are supposed to be the safest of the safe. They hold life insurance policies to protect families in the case of the death of the breadwinner and annuities to provide income to retirees that rely on those policies to buy food and pay bills in retirement. Insurers like MetLife are not supposed to go into a swan dive when a country on the opposite side of the Atlantic holds a voter referendum."

 

[Lukey]

My point is clearly NOT moot in the context in which it came up: the question of whether the FTSE 100 outperformed the S&P 500 since Brexit. Regardless of whether you analyze the question in dollars, pounds, or some third currency, the answer is the same: the S&P 500 did better for investors. The only way to get around that is to state each in a different currency, so that you're really just measuring change in currency valuations (the same way I could claim that an investment in AstraZeneca UK shares greatly outperformed an investment in AstraZeneca ADRs, even though they're the exact same company with the same real return for investors.

Stick to buying hunks of shiny metal. Stock market investing is clearly something you don't understand.

Yes, once you altered the context to include currency changes. Which, as Moody's research pointed out, for normal investors, is moot. And thanks, I will. My silver was up another 6.43% today alone! I think I understand stock market investing just fine. And by that I mean I know enough to stay the f*ck away from it:

http://www.zerohedge.com/news/2016-06-29/those-who-still-care-about-fundamentals-troubling-chart

 

[Lukey]

You missed the checkmate when I made the move, way back at the beginning of this discussion. Ever since then, it's just been Lukey whimpering about how checkers is a much better game.

You altered the context to something irrelevant to all the people in the real world, so perhaps in another dimension that qualifies as a "checkmate." But I think the Moody's report (you know, the real world) that showed you were introducing a meaningless parameter, tells us all we needed to know about your premise. You disqualified yourself.