Lessons Learned in 2020..
My friends JC Parets and Joe Fahmy hosted a year end round table to discuss
2020 was anything but normal. While the final market numbers ended with better than average gains (S&P 500 up 16.26%), the route to get to this result was not for the faint of heart. Who can forget just a few of the highlights..
The fastest sell-off in history and biggest crash since the Great Depression (we wiped out four years of gains in 30 days)
A generational buying opportunity
The lockdown - ‘Sell in May’ and go where exactly?
Negative Oil (try to explain that to your kid)
The rise, fall and return of Kodak (I’m still waiting for those lost prom pics), Robinhood traders and their new voice - Davey Day Trade Global , the resurgence of Bitcoin mania, record number of IPO’s and SPACs
Volatility - more 3% intraday moves in the S&P 500 than over the last 11 years combined
I could go on and on. I’m sure you have some of your favorite moments as well and I’d love to hear them in the comments below.
To end this volatile year I got together with some of my favorite traders on FinTwit to discuss this crazy 2020 market. While we touched on some of these topics, the premise of the discussion was simple… Tell us what you learned in 2020. None of us talked ahead of time, so we didn’t know what anyone was going to say. The similarity of our answers was uncanny - “Shut out the noise!”
Each person brought a new perspective with that same underlying message. This year alone saw headlines that led to warranted comparisons to every historical market since 1900. They included the 1918 Spanish Flu, 1929 Market Crash, Great Depression and recovery, ‘87 Crash, ‘99 Tech Bubble and IPO Boom, and now the Roaring 20’s. Trying to use logic and historical context to explain things was more challenging than ever.
I touched on the speed of the markets. This year news cycles lasted minutes, not days. By Wednesday you had already forgotten what headline caused the Monday sell-off. We weren’t here to make sense of it, but to discuss the process that let us survive, stay sane and thrive.
We even had a little fun picking some stocks for the first half of 2021. Hope you enjoy and most importantly - Happy New Year!
Good show! I've love to see more of these insightful shows. I'd say one my favorite moments of this year was making the decision of stepping into this parallel universe of trading where I was graced with the knowledge of how the market works, and also being humbled by the wisdom of how it doesn't work. I've come across several new personalities in this new universe. It helped to separate the knowledgeable personalities from the fantasy filled disillusioned personalities (You're not the latter). From my own experience of living, I've found that to gain knowledge you have to be objective most of the time and so I gauge and take what information is useful and ignore the tantrums of those I don't personally care for. People are who they are and it's not my job to be subjective to their own delusions. It never has been and I don't plan to change that. That's God's job, not mine. It's all elementary.
My deepest thanks to you and some of your comrades for sharing your knowledge, experience, and for your patience. We'll chat soon. Cheers to new beginnings!!! Happy new year Jay! The best to you and your family.