Historic opportunity to buy stocks
Bill Miller, a legendary Billionaire investor on Wall Street, has a distinguished track record when it comes to spotting winning stock opportunities.
His Hedge Fund, Miller Value Partners, delivered a mammoth return of 120% in 2019.
He revealed that he achieved this enviable return by doing “nothing” i.e. sitting passively on his stock holdings.
Earlier, Miller had created a record for outperforming the S&P 500 for 15 years straight, from 1991 to 2005.
“I think this is an exceptional buying opportunity,” Miller said, unfazed while the Dow Jones plunged like a stone to hit the lower circuit.
“There have been four great buying opportunities in my adult lifetime.”
“The first was in 1973 and ’74, the second was in 1982, the third was in 1987 and the fourth was in 2008 and 2009. And this is the fifth one.”
Miller pointed out that these historic opportunities were mainly event-driven, like during the war in the Middle East and Vietnam.
“Those are the sorts of events that you see when markets are making historic lows, the news is just bleak all around,” he added.
Miller also opined that fears about the Coronavirus would reduce in the days to come as the economy limps back to normalcy.
“I think as time goes on, unless the news on the pandemic side gets radically worse, the fear would attenuate,” he stated.
“Just keeping that level of emotion and fear up requires a constant dose of new and really bad news,” he added.
“I’d definitely call it a panic in the markets,” investor Bill Miller said yesterday about the recent coronavirus-induced volatility, which he calls the 5th great buying opportunity of his adult lifetime. But he adds, “it takes a lot to maintain a panic.” https://t.co/dSUMkyyCfj pic.twitter.com/eu0lwt7mfx
— CNBC (@CNBC) March 19, 2020
“I think this is an exceptional buying opportunity” — fund manager Bill Miller on CNBC.
— Jay Yarow (@jyarow) March 18, 2020
There is merit in Bill Miller’s theory because already good news is trickling in that the Corona Virus is curable.
China, which is the epicenter of the crisis, has not reported any new cases.
Good news! The Chinese mainland has seen no homegrown infections of #COVID_19, a disease caused by a novel #coronavirus, for three straight days, as the latest data of the National Health Commission showed. pic.twitter.com/i7mh0lgj4M
— China Daily (@ChinaDaily) March 21, 2020
Govt Sources: 13 out of 15 #coronavirus positive cases of an Italian group (including 1 Indian guide) shifted from ITBP quarantine facility, Chhawla, New Delhi to different hospitals on 4 March for isolation, have been tested negative today after 16 days of medical care.
— ANI (@ANI) March 21, 2020
Good news: Delhi’s first #Coronavirus patient has recovered. He has been discharged.
— Zeba Warsi (@Zebaism) March 14, 2020
Good news: 22 people infected with COVID-19 have been cured and discharged… #Coronavirus
— Amit Malviya (@amitmalviya) March 20, 2020
— Rob Portman (@senrobportman) March 21, 2020
Korea finished developing the 10 minute Covid-19 diagnostic kit and is now ramping up production. They plan to export 300.000 test-kits per week – pic.twitter.com/DpJCph9RT7
— Florian Witulski (@vaitor) March 21, 2020
South Korea is showing #COVID19 can be beat with smart, aggressive public health. Their daily new cases declined again to 76. They’ve tested 268,000 people for virus since their epidemic began and implemented aggressive containment and mitigation, closing schools, venues quickly.
— Scott Gottlieb, MD (@ScottGottliebMD) March 15, 2020
It is obvious that once the trickle of good news turns into a steady flow, confidence will return to investors and they will again start flocking to Wall Street and Dalal Street to buy stocks.
This is a massive buying opportunity: Marc Lasry
Marc Lasry, also a well known investor on Wall Street, has also come out with all guns blazing in favour of a buy.
This is a “massive buying opportunity” he exclaimed, with a big smile on his face.
“The market is definitely going to be higher at the end of the year,” he said.
“You’re never going to be able to time this thing,” he added.
“If you know that you don’t have to sell next week, then I would absolutely be a buyer. Should you start coming into today? Absolutely.”
“Every time there’s a down move you should be buying,” he opined.
Marc Lasry should know what he is talking about because he made a fortune out of buying troubled assets that nobody wanted.
Buy shares in companies we cannot live without: Jim Cramer
Jim Cramer, the charismatic anchor of CNBC, is well known for his perceptive analysis of the state of the stock markets.
“We should buy quality recession-proof stocks because that’s what works when the economy’s on hiatus,” he advised.
The advice is very sensible because such stocks are resilient and will bounce back fast.
Defensive stocks can outperform the broader market during an economic downturn because there is constant demand for their products.
“Check out your medicine cabinet, check your refrigerator, look at your pantry,” he stated, implying that these products are the most important for our survival and the companies manufacturing them will obviously thrive.
The obvious companies that make products we cannot live without include ColPal (toothpaste), HUL (soaps, shampoo), Nestle (Milk, Maggie Noodles), Marico (hair oil) etc.
The best sign of a market bottom is panic selling: Larry Williams
Larry Williams is a veteran expert on technical analysis with over 60 years of experience.
He has provided a detailed commentary on why in his view the bull is about to roar back and put the bears to sleep.
He has opined that the best sign of a market bottom is “panic selling“, which we have seen over the past few weeks.
one of my favorite technicians, Larry Williams, the dean of the group, just went VERY bullish with a Major Buy signal.. Time of Extreme Panic.. The most reliable indicator he has. Ask any technician –he is the best
— Jim Cramer (@jimcramer) March 19, 2020
For the first time in years I am now not short any U.S. stocks. I covered my last three shorts today at 2:37 p.m EDT. The profits were just too great to not harvest, and the panic is palpable.
— Jeffrey Gundlach (@TruthGundlach) March 18, 2020
Larry Williams went "extreme bullish" yesterday. Jeff Gundlach covered ALL his shorts yesterday and went 100% long for the first time in years. This is an extreme inflection point…a rare opportunity for life-changing returns.
Come join us! (click my blue badge)
— Dr. Stoxx (@DrStoxx) March 20, 2020
Dip your toes, buy 1% every down day: Mark Cuban
Mark Cuban, the self-made Billionaire entrepreneur, revealed that he is “dipping his toes” into the market to take advantage of the savage volatility.
“I’ve been putting in 1% to 1.5% to work on every down day,” he stated.
He has done the sensible thing of buying the SPDR S&P 500 ETF Trust, the exchange-traded fund that tracks the S&P 500 index.
The ETF, which is also known as the ‘SPY‘, boasts of having the best companies (such as Microsoft, Apple, Amazon etc) in its portfolio.
|Top 10 Holdings of the SPY (23.91% of Total Assets)|
|Facebook Inc A||1.89%|
|Berkshire Hathaway Inc B||1.65%|
|Alphabet Inc A||1.64%|
|Alphabet Inc Class C||1.63%|
|JPMorgan Chase & Co||1.49%|
|Johnson & Johnson||1.44%|
|Visa Inc Class A||1.27%|
The Equivalent of the SPY ETF in India is the Nifty BEES and the Nifty Junior BEES.
Both are packed with the best winning stocks and will give us excellent diversification and low volatility.
These are bargains of a lifetime: Bill Ackman
Bill Ackman had created panic a few days ago when he projected a dooms day scenario (see Hell Is Coming, Tsunami Is Coming: Bill Ackman Sends Dire Warning That Many Businesses Will Go Bankrupt Due To Corona Virus).
However, he has also confidently predicted that we will win the war against the virus and the markets and the economy will soar.
“That is why we are buying stocks. These are bargains of a lifetime if we manage this crisis correctly,” he stated.
That is why we are buying stocks. These are bargains of a lifetime if we manage this crisis correctly.
— Bill Ackman (@BillAckman) March 18, 2020