Okay... it is the most exciting time in markets in quite a while... we are in the midst of the one-two whammy of a global pandemic and an oil price war!
As of today, my main account is down -24.5% for the year compared to -23.0% for the S&P.
I started buying on 2/28 after the market was down about 8%-9%, but then between March 4 and March 23 it dropped to about -30% before recovering to where it is now. I also bought on 3/12, 3/18, and 3/27. I did buy some on March 23 as well, but not for my main account (bought for my dad and my smaller foreign stock account).
I still have my t-bills and some cash left, so if prices drop more I have more room to buy. I was a little lucky in that I had extra cash right before the drop because I sold quite a bit of stock because we were trying to buy a house. Now it looks like that won't happen for at least another year.
It doesn't really bother me to see the prices on my existing holdings drop, but it is almost physically painful to try to buy stuff that is dropping a lot on big down days. It just feels like I am taking my money and lighting it on fire.
So far my feeling is that the energy fallout is more interesting the broader economic fallout. I have bought two new names, both in the MLP space, because it felt like they was more technical pressure in this sector as there were certainly redemptions and forced selling but there are not a lot of natural holders of these securities anymore now that they are not popular with retail.
I bought a lot of Enterprise Products, one of the highest quality and lowest leverage names in this space. It had been around $28 before the crash and I had thought it was interesting there. I bought a lot at $22.20, then kept buying down to $11.51. My average cost now is $17.89.
I also bought Alliance Resources, an Illinois basin coal producer, which also operates with much more conservative leverage than most coal producers. This stock had already declined a lot due to hatred of coal and has really crashed now, I guess because natural gas is so cheap. I bought at $3.55 with around 30% dividend yield, this was trading around $20 less than a year ago. My hope is that a lot of other mines shut down and they can hang on for a while.
In addition, I have added to my holdings in Wells Fargo and Melcor, a Canadian real estate firm.
Who knows how this all plays out, but my guess would be that it turns out to not be very severe. New cases in Italy and NYC look like they are moderating. The reported death rate is very low, almost entirely for people who are very old or with multiple underlying conditions, and the reported death rate is vastly overstated by some unknown amount. I went back and read Ben Graham's memoirs and he doesn't even mention the 1918 Spanish Flu as a market event.
Certainly feels like a panic, but if I'm wrong and there is a major economic contraction then I am prepared to deal with that too.
